Petrobras (PBR)

Petrobras contracts two new-build Ultra-deepwater rigs

(Rio de Janeiro, September 20, 2006). – PETRÓLEO BRASILEIRO S/A - PETROBRAS, [Bovespa: PETR3/PETR4, NYSE: PBR/PBRA, Latibex: XPBR/XPBRA, BCBA: APBR/APBRA], a Brazilian international energy company, announces that has contracted two ultra deepwater rigs for its drilling operations in the Gulf of Mexico, through its wholly owned subsidiary Petrobras America Inc., based in Houston (TX).

The first contract was signed with Larsen Oil Company, with a 5 years term, for the semi-submersible PetroRig 1, capable of drilling 35,000 feet wells in 10,000 feet water depth. The second is a 6 years contract with Sevan Marine ASA for the SSP Sevan Driller that will be capable of drilling wells up to 40,000 feet deep, in water depth of up to 12,500 feet.

Currently both rigs are under construction and are expected to start operations in the Gulf of Mexico on the first quarter of 2009. The design of these rigs includes state of the art drilling technology to optimize drilling and completion operations in the Gulf of Mexico.

With these contracts, Petrobras consolidates its position as one of the leading players in the ultra deep waters of the Gulf of Mexico, benefiting from its deepwater expertise and technology developed offshore Brazil. These new rigs will provide Petrobras with sufficient offshore drilling capacity to ensure the objectives in the Company’s Business Plan are met.