Extrajudicial Mediation with Sete Brasil

03/01/2018

Rio de Janeiro, March 1, 2018 - Petróleo Brasileiro S.A. - Petrobras, in compliance with CVM Instruction no. 358/2002 and further to the press release disclosed on 9/21/2017, reports that its Board of Directors approved in a meeting held yesterday the key terms for a possible settlement, in the context of the extrajudicial mediation procedure in progress with Sete Brasil Participações S.A. – Under Judicial Recovery (“Sete Brasil”).

The main terms are the following: (i) maintenance of charter and operation contracts referring to 4 drilling rigs, with rescindment (termination) of signed contracts in relation to the other 24 drilling rigs; (ii) the contracts shall have effect of 10 years, with daily rate of US$ 299 thousand, including the chartering and operation of the units; (iii) the removal of Petrobras and its subsidiaries from the shareholding structure of the companies of Grupo Sete Brasil and FIP Sondas, so that it no longer holds any shares in this company, as well as the consequent dissolution of all other contracts that are not compatible with the terms of the agreement.

The signing of the agreement between Petrobras and Sete Brasil is conditional upon presentation, by Sete Brasil, of an international-class drilling rig operator with experience in deep waters, in accordance with the approval criteria of Petrobras. Said agreement is further conditioned to the success in the negotiation and approval, by the relevant bodies of both companies, of the final terms and conditions of the documents necessary to the implementation of the agreement.

The company restates that any and all information relating to the mediation procedure is confidential in relation to third parties.

Facts deemed relevant on this issue will be timely disclosed to the market.