Petrobras, the Brazilian international energy company, yesterday announced an aggressive business plan of raising its five-year investment plan by an astounding 55 per cent from $112.4 billion announced a year ago for the 2008-2012 period to the now revised $174.4 billion for 2009-2013 period and investing $28.6 billion in the current year itself.

This represents an annual average of $34.9 billion, 90 per cent or $ 157.3 billion of which will be invested in Brazil and 10 per cent or $16.8 billion abroad.

This massive hike in investment comes at a time when oil companies around the world are cutting jobs and cutting costs since the price of crude fell 68 per cent from the dizzy heights of $147 a barrel from July 2008 and is currently trading at approximately $42 a barrel.

The oil major said, ''This business plan is based on the fundamental strategies of the strategic plan 2020. The plan has been revised and updated to take into account the changes in the international macroeconomic scenario and its impacts on oil and oil products market.''

Petrobas expects to generate $120 billion in cash from its operations, at an average price of crude at $47 a barrel. The rest will be funded by debt.

Despite the current financial crises, the figures were based on potential impact in the short-term on oil demand, since in the long term the supply of oil is expected to be even lower than the projected emand due to the depletion in the existing production fields.

Petrobras used the average Brent price assumption of $42 per barrel for its analysis of financiability, leverage targets and rates of return. The plan also contemplates the analysis of the world production growth, exchange rate, price assumptions, oil and oil products.

Petrobras said that in comparison with the business plan 2008-12, the most significant increase was in exploration and production, with a growth of 71 per cent in investments equivalent to $92 billion, or 53 per cent of the $174.4 billion for the 2009-13 period.

The Brazilian oil major plans to produce 2,680 thousand barrels of oil per day (bpd) in 2013, 3,340 thousand bpd in 2015 and 3,920 thousand bpd in 2020 and daily refining capacity in Brazil to 2.27 million barrels by 2013. Petrobras production of oil was approximately 2.4 million barrels a day last year.

The Tupi Pilot System will begin production in 2010, where three systems are scheduled to go into production in the pre-salt layer of the Santos Basin during the period 2009-2013 - Tupi 1 and Guará 1 in 2012 and Iara 1 in 2013.

The company has earmarked approximately $28 billion in developing the pre-salt offshore oil fields, which includes the Tupi field, discovered lately and estimated to have approximately 5 to 8 billion barrels.

The 2015 target in the 2008-12 business plan of 2,812 thousand bpd has been increased by 528 thousand bpd as a result of these additional production projects.

Announcing the business plan for 2009-2013, Petrobras CEO Jose Sergio Gabrielli told reporters at a press conference in Rio de Janeiro that the plan was "very robust and very important for the continuity of Petrobras' growth."

Brazil being a major producer of ethanol, which is derived from sugarcane, Petrobras plans to spend $2.4 billion to expand ethanol production.. "It is important to expand our presence in ethanol and biofuels," Gabrielli said.

Petrobras had originally planned to announce its business plan for 2009-2013 in September but due to the global financial uncertainty, the date was pushed back several times.

Petrobas said that the company's vision is to become one of the five largest integrated energy companies in the world has been maintained, based on the pillars of profitability, social and environmental responsibility, and integrated growth.