This excerpt taken from the PBR 6-K filed Aug 19, 2005.
ii) Thermoelectric Power Plants in which the energy produced belongs to PETROBRAS (market risk)
PETROBRAS leased the IBIRITERMO and TERMOBAHIA plants and took over their operations and maintenance (under O&M Agreements). At the end of the 20-year periods of the two agreements, the thermoelectric power plants will be transferred to PETROBRAS ownership. The price disbursed each month takes into account the remuneration of the capital invested by the shareholders.
In February 2005, the arbitral proceeding related to TERMORIO was concluded with payment of US$ 83 million to NRG and the consequent transfer of its shares to PETROBRAS. When holding all shares of TERMORIO, PETROBRAS will be exempt from paying for the provided capacity, irrespective of the electric power that may be generated by the plant.
The commitments assumed with third parties regarding the Três Lagoas, Canoas and Nova Piratininga power plants, basically O&M Agreements, have been substantially reduced and are being settled and recorded on the appropriate accrual basis.