Petrobras (PBR)

c) Parameters used for risk management and the results obtained with respect to the proposed objectives

The hedge known as a cross currency swap complies with CVM Resolution 566/08 which approved CPC 14 - Financial Instruments: Recognition, Valuation and Proof.

The Company decided to qualify its cash flow cross currency hedging transactions. In the contracting of hedge and during its effectiveness, it is expected that the cash flow hedge will be highly effective in the offsetting of the cash flows attributable to the risk of the hedge, during the period of its effectiveness. The changes in the fair value, in the measure of the effectiveness of the hedge transaction, tested quarterly, are posted in Other accumulated comprehensive income, until the cash flow of the item subject to hedge is realized.

BR Distribuidora is in a short position in exchange futures rates through NDFs on the Brazilian over-the-counter market. The hedge is contracted concomitantly with the definition of the cost of the exported products, thus fixing and guaranteeing the trading margin. The Company's policy is to contract hedge up to the maximum of 100% of the volume exported.

Between January 1 and September 30, 2009, operations were contracted in the amount of US$ 217,08 million. The volume of hedge executed for the exports occurring in that period represented 67,2 % of the total exported by the Company. The settlements of the operations that matured between January 1 and September 30, 2009 generated a positive result for the Company of R$ 27.450 million.

c) Parameters used for risk management and the results obtained with respect to the proposed objectives

The hedge known as a cross-country swap follows CVM Resolution 566/08 which approved CPC 14 - Financial Instruments: Recognition, valuation and proof.

Effectiveness tests are conducted quarterly in order to measure how much the changes in the fair value or the cash flow of the hedge items are being absorbed by the hedge mechanisms. The effectiveness calculation indicated that the cross currency swap significantly minimizes the variation in the cash flow of the bonds issued in Yens.

c) Parameters used for risk management and the results obtained with respect to the proposed objectives

The hedge called a cross currency swap complies with CVM Resolution 566/08 which approved CPC 14 - Financial Instruments: Recognition, valuation and proof.

Effectiveness tests are conducted quarterly in order to measure how much the changes in the fair value or the cash flow of the hedge items are being absorbed by the hedge mechanisms. The effectiveness calculation indicated that the cross currency swap significantly minimizes the variation in the cash flow of the bonds issued in Yens.

c) Parameters used for risk management and the results obtained with respect to the proposed objectives

The economic hedge operation known as a cross-country swap complies with SFAS 133 (Accounting for derivative instruments and hedging activities) issued by the Financial Accounting Standards Boards (FASB).

Effectiveness tests are conducted quarterly in order to measure how much the changes in the fair value or the cash flow of the hedge items are being absorbed by the economic hedge mechanisms. The effectiveness calculation indicated that the cross currency swap significantly minimizes the variation in the cash flow of the bonds issued in Yens.

The Company is in a short position for exchange rate futures through non-deliverable forwards - NDF on the Brazilian over-the-counter market. For the aviation segment, which represents 98,3% of the transactions contracted for the period, the term of exposure is 3 months on average and the hedge is contracted concomittantly with the definition of the cost of exported aviation kerosene, thus fixing and guaranteeing the trading margin. In the period in question, transactions in the amount of US$ 584.851 million were contracted.

The volume of hedge contracted for the legal effects of the year 2008 for the aviation segment represented 74,3% of the volume of exports that effectively occurred.

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