The report provides estimates of contingent oil and gas resources as of July 1, 2010 for certain properties located offshore Brazil. Contingent resources were estimated for the Iara and Franco areas using standard geological and engineering methods. For the Iara area, 2C and 3C contingent resources were estimated outside the BM-S-11 block. For the Franco area, 1C, 2C, and 3C contingent resources were estimated. The report includes tables summarizing the estimated gross contingent resources and potential development plans and economics for the resources.

1. DeGolyer and MacNaughton
5001 Spring Valley Road
Suite 800 East
Dallas, Texas 75244
This is a digital representation of a DeGolyer and MacNaughton report.
This file is intended to be a manifestation of certain data in the subject report and as such are
subject to the same conditions thereof. The information and data contained in this file may be
subject to misinterpretation; therefore, the signed and bound copy of this report should be
considered the only authoritative source of such information.

2. DeGolyer and MacNaughton
5001 Spr ing Valley Road
Suite 800 East
Dallas, Texas 75244
REPORT
as of
JULY 1, 2010
on the
CONTINGENT RESOURCES
of
CERTAIN PROPERTIES
located
OFFSHORE BRAZIL

3. DeGolyer and MacNaughton
TABLE of CONTENTS
Page
FOREWORD.............................................................................................................. 1
Scope of Investigation.............................................................................................. 1
Authority .................................................................................................................. 3
Source of Information .............................................................................................. 3
DEFINITION of CONTINGENT RESOURCES.................................................. 4
ESTIMATION of CONTINGENT RESOURCES................................................. 6
Iara Area .................................................................................................................. 8
Franco Area.............................................................................................................. 8
VALUATION of RESOURCES............................................................................. 10
SUMMARY and CONCLUSIONS ........................................................................ 12
TABLES
Table 1 – Summary of Gross Contingent Resources
Table 2 – Summary of Potential Present Worth
Table 3 – Gross Potential Quantities, Expenses, and Costs – 1C, Franco Area
Table 4 – Gross Potential Quantities, Expenses, and Costs – 2C, Iara Offblock
Area
Table 5 – Gross Potential Quantities, Expenses, and Costs – 2C, Franco Area
Table 6 – Gross Potential Quantities, Expenses, and Costs – 3C, Iara Offblock
Area
Table 7 – Gross Potential Quantities, Expenses, and Costs – 3C, Franco Area
Table 8 – Summary of Conceptual Development Plan Assumptions – 1C
Table 9 – Summary of Conceptual Development Plan Assumptions – 2C
Table 10 – Summary of Conceptual Development Plan Assumptions – 3C

4. DeGolyer and MacNaughton
5001 Spr ing Valley Road
Suite 800 East
Dallas, Texas 75244
REPORT
as of
JULY 1, 2010
on the
CONTINGENT RESOURCES
of
CERTAIN PROPERTIES
located
OFFSHORE BRAZIL
FOREWORD
Scope of Investigation This report presents estimates, as of
July 1, 2010, of the extent of the oil,
condensate, and natural gas contingent resources and estimates of the potential
value of the contingent resources of the petroleum interests evaluated herein. The
contingent resources evaluated in this report are located in the Santos Basin
offshore from Brazil. Petróleo Brasileiro S.A. (Petrobras) has represented that it may
acquire these resources as part of a process known as transfer of rights with
compensation, which is currently being undertaken between the Government of
Brazil and Petrobras.
Estimates of contingent resources have
been prepared according to the Petroleum Resources Management System (PRMS)
approved in March 2007 by the Society of Petroleum Engineers, the World
Petroleum Council, the American Association of Petroleum Geologists, and the
Society of Petroleum Evaluation Engineers. The contingent resources definitions are
discussed in detail in the Definition of Contingent Resources section of this report.
The contingent resources in this report
are expressed as gross contingent resources. Gross contingent resources are defined
as the total estimated petroleum that is potentially recoverable from known
accumulations after June 30, 2010.

5. 2
DeGolyer and MacNaughton
The potential values of the projected
contingent resources estimated herein are expressed in terms of potential present
worth. Potential present worth is defined as potential future net revenue discounted
at a specified arbitrary discount rate compounded monthly over the expected period
of realization. Potential future net revenue is that net revenue remaining after
deductions for royalties, costs, and taxes that might be derived from the sale of the
total estimated contingent resources recoverable after June 30, 2010. In this report,
potential present worth values were estimated using a 10 percent discount rate.
Values of potential present worth at 10 percent have been estimated
deterministically taking into account information related to field development plans
(actual or conceptual), contract terms, product pricing, and marketing plans as
provided by Petrobras.
The contingent resources estimated
herein are those volumes of petroleum that are potentially recoverable from known
accumulations but which are not currently considered to be commercially
recoverable. Because of the uncertainty of commerciality, the contingent resources
estimated herein cannot be classified as reserves. The contingent resources
estimates in this report are provided as a means of comparison to other contingent
resources and do not provide a means of direct comparison to reserves. The
contingent resources estimated in this report have an economic status of “Marginal”
and “Sub-Marginal.”
Contingent resources quantities should
not be confused with those quantities that are associated with reserves due to the
additional risks involved. The quantities that might actually be recovered should
they be developed may differ significantly from the estimates presented herein.
There is no certainty that it will be commercially viable to produce any portion of the
contingent resources evaluated herein.
At the request of Petrobras, a model was
prepared to estimate potential values that might be realized from the resources
estimated herein should these resources be successfully developed. A possibility
exists that the accumulations will not result in successful development, in which
case there could be no potential present worth.
Potential present worth estimates are
provided as a means of comparison to the potential present worth estimates of other
resources and do not provide a means of direct comparison to the present worth

6. 3
DeGolyer and MacNaughton
estimates attributable to reserves. These potential present worth estimates do not
take into consideration the uncertainties associated with market and political
conditions. The estimates are expressed in terms of potential present worth
discounted at 10 percent. All potential present worth estimates presented in this
report are expressed in United States dollars (U.S.$).
Estimates of oil and gas contingent
resources should be regarded only as estimates that may change as further
production history and additional information become available. Not only are such
contingent resources estimates based on that information which is currently
available, but such estimates are also subject to the uncertainties inherent in the
application of judgmental factors in interpreting such information.
Authority This report was authorized by
Mr. Jose Jorge de Moraes Junior,
Manager E&P, Petrobras.
Source of Information In the preparation of this report we have
relied, without independent verification,
upon information furnished by or on behalf of Petrobras with respect to the property
interests to be evaluated, subsurface data as they pertain to the target objectives
and prospects, and various other information and technical data that were accepted
as represented. This report was based on data available as of July 1, 2010.

7. 4
DeGolyer and MacNaughton
DEFINITION of CONTINGENT RESOURCES
Petroleum resources included in this
report are classified as contingent resources and have been prepared in accordance
with the PRMS approved in March 2007 by the Society of Petroleum Engineers, the
World Petroleum Council, the American Association of Petroleum Geologists, and
the Society of Petroleum Evaluation Engineers. Because of the lack of commerciality
or sufficient development drilling, the contingent resources estimated herein cannot
be classified as reserves. The petroleum resources are classified as follows:
Contingent Resources – Those quantities of petroleum estimated, as of
a given date, to be potentially recoverable from known accumulations
by application of development projects, but which are not currently
considered to be commercially recoverable due to one or more
contingencies.
Based on assumptions regarding future conditions and their impact on
ultimate economic viability, projects currently classified as Contingent
Resources may be broadly divided into three economic status groups:
Marginal Contingent Resources – Those quantities associated
with technically feasible projects that are either currently
economic or projected to be economic under reasonably
forecasted improvements in commercial conditions but are not
committed for development because of one or more
contingencies.
Sub-Marginal Contingent Resources – Those quantities
associated with discoveries for which analysis indicates that
technically feasible development projects would not be
economic and/or other contingencies would not be satisfied
under current or reasonably forecasted improvements in
commercial conditions. These projects nonetheless should be
retained in the inventory of discovered resources pending
unforeseen major changes in commercial conditions.
Undetermined Contingent Resources – Where evaluations are
incomplete such that it is premature to clearly define ultimate

8. 5
DeGolyer and MacNaughton
chance of commerciality, it is acceptable to note that project
economic status is “undetermined.”
The estimation of resources quantities for
an accumulation is subject to both technical and commercial uncertainties and, in
general, may be quoted as a range. The range of uncertainty reflects a reasonable
range of estimated potentially recoverable volumes. In all cases, the range of
uncertainty is dependent on the amount and quality of both technical and
commercial data that are available and may change as more data become available.
1C (Low), 2C (Best), and 3C (High) Estimates – Estimates of
petroleum resources in this report are expressed using the terms 1C
(low) estimate, 2C (best) estimate, and 3C (high) estimate to reflect
the range of uncertainty.

9. 6
DeGolyer and MacNaughton
ESTIMATION of CONTINGENT RESOURCES
Estimates of contingent resources were
prepared by the use of standard geological and engineering methods generally
accepted by the petroleum industry. The method or combination of methods used in
the analysis of each reservoir was tempered by experience with similar reservoirs,
stage of development, quality and completeness of basic data, and production
history.
The volumetric method was used to
estimate the original oil in place (OOIP) or original gas in place (OGIP). Structure
maps were prepared to delineate each reservoir, and isopach maps were constructed
to estimate reservoir volume. Electrical logs, radioactivity logs, core analyses, and
other available data were used to prepare these maps as well as to estimate
representative values for porosity and water saturation.
Estimates of ultimate recovery were
obtained after applying recovery factors to OOIP and OGIP. These recovery factors
were based on consideration of the type of energy inherent in the reservoirs,
analyses of the petroleum, the structural positions of the properties, and the
production histories.
In certain cases, when the previously
named methods could not be used, contingent resources were estimated by analogy
with similar wells or reservoirs for which more complete data were available.
Gas quantities estimated herein are
expressed as sales gas. Sales gas is defined as the gas remaining to be produced
after June 30, 2010, after field separation and delivered to a pipeline inlet after
deductions for fuel usage and flare and the removal of nonhydrocarbon components
to meet gas sales specifications. All gas quantities are expressed at a temperature
base of 60 degrees Fahrenheit (°F) and a pressure base of 14.7 pounds per square
inch absolute (psia).
The contingent oil resources estimated in
this report are expressed in terms of 42 United States gallons per barrel. Crude oil
and condensate resources are to be recovered by conventional field operations.

10. 7
DeGolyer and MacNaughton
Data available from wells drilled on the
evaluated properties, as of July 1, 2010, are included herein. Contingent oil and gas
resources have been estimated for each of the discoveries based on evaluation of the
in-place volumes and the potential recoverable volumes.
Petrophysical, geophysical, and geological
interpretations have been performed in estimating the net rock volume used in
estimating in-place volumes. Seismic amplitude data were used extensively to
estimate the distribution of sands for the discoveries. OOIP and OGIP were
estimated using the rock and fluid properties of each accumulation combined with
the geological interpretation of the net rock distribution.
Initial pressures and temperatures for the
reservoirs were based on wireline pressure data, drill-stem test data, and trends
that could be developed from that information to apply to fields where that type of
data was unavailable.
All oil, condensate, and gas quantities
estimated in these areas were classified as contingent resources, primarily because
of uncertain economic viability. The economic status of the contingent resources is
“Marginal” and “Sub-Marginal.” These classifications are appropriate because of the
uncertainty relating to commitment to develop, development costs, gas-sales
agreements, existence of production infrastructure, and timing.
Contingent resources quantities for the
reservoir intervals in each resources area were estimated using geological structure
maps constructed from seismic depth structure maps. All contingent resources
quantities evaluated in this report are located on unlicensed acreage. Contingent
resources quantities of each reservoir interval were estimated volumetrically. A
gross interval isopach map was drawn for each reservoir using the structure map
and petrophysical analysis. Net rock volumes were estimated by applying a net-to-
gross ratio (NGR) to rock volumes from the gross interval isopach map.
The Iara and Franco contingent resources
areas, located in the Santos Basin, were evaluated for this report.

11. 8
DeGolyer and MacNaughton
Iara Area The Iara area is located offshore from
Brazil about 230 kilometers from Rio de
Janeiro. The area is within the BM-S-11 offshore block and the water depth over the
field is about 2,230 meters. The area was discovered in 2008 by the 1-RJS-656 well.
Drill-stem tests confirmed that the Cretaceous-age carbonate sediments were oil
bearing.
The productive reservoirs discovered in
the 1-RJS-656 well are interpreted to extend beyond the boundaries of the BM-S-11
block. Contingent resources quantities were estimated only for the areas outside the
limits of the BM-S-11 block (termed the Iara offblock area). These quantities were
classified as 2C and 3C contingent resources. No 1C contingent resources quantities
were estimated for the Iara offblock area in this report. Quantities classified as 1C
are associated only with reservoir areas near the Iara well and inside the boundaries
of the BM-S-11 block and are not included in this report. For the Iara area, the
development plan calls for leasing floating production, storage, and offloading
vessels (FPSOs) and the related subsea equipment. The 2C development plan for the
Iara offblock area considered the use of one FPSO with a processing capacity of
30 thousand barrels of oil per day (103BOPD). The 3C development plan for the Iara
offblock area considered four FPSOs (three with 100 103BOPD processing capacity
and one with 70 103BOPD processing capacity).
Franco Area The Franco area is located offshore from
Brazil about 45 kilometers north from the
Iara area. The discovery well, 2-ANP-1, was drilled in May 2010 by Agência
Nacional do Petróleo, Gás Natural e Biocombustíveis (ANP), Brazil’s national
hydrocarbons agency. Drill-stem testing confirmed that the Cretaceous-age
carbonate sediments were oil bearing. The offshore acreage associated with the well
is not leased to any company and is controlled by ANP. Water depth over the
discovery is about 1,900 meters. The 1C development plan for Franco considered one
FPSO with a 125 103BOPD processing capacity. The 2C and 3C plans considered
three and seven FPSOs, respectively, each with 150 103BOPD processing capacity.

12. 9
DeGolyer and MacNaughton
The estimated gross contingent resources,
as of July 1, 2010, evaluated herein are summarized as follows, expressed in
thousands of barrels (103bbl) and millions of cubic feet (106ft3):
Gross Contingent Resources
1C 2C 3C
Oil and Sales Oil and Sales Oil and Sales
Area Condensate Gas Condensate Gas Condensate Gas
Classification (103bbl) (106ft3) (103bbl) (106ft3) (103bbl) (106ft3)
Iara
Marginal 0 0 71,660 58,470 866,600 707,146
Submarginal 0 0 4,540 3,713 40,034 32,673
Franco
Marginal 334,960 341,659 1,576,210 1,607,736 4,721,560 4,815,999
Submarginal 16,010 16,331 56,090 57,217 123,390 125,858
Total 350,970 357,990 1,708,500 1,727,136 5,751,584 5,681,676
Notes:
1. Application of any risk factor to contingent resources quantities does not equate contingent resources
with reserves.
2. There is no certainty that it will be commercially viable to produce any portion of the resources
evaluated.
3. Contingent resources have an economic status of “Marginal” and “Sub-Marginal.”
4. No 1C contingent resources quantities were estimated for Iara in this report. Quantities classified as
1C are associated only with reservoir areas near the Iara well and inside the boundaries of the BM-S-
11 block and are not included in this report.

13. 10
DeGolyer and MacNaughton
VALUATION of RESOURCES
The estimates of potential present worth
of future net revenue discounted at 10 percent that could be realized for the
contingent resources estimated in this report are dependent on the successful
development of the accumulations evaluated herein. The estimated potential present
worth of the contingent resources evaluated in this report is to be used for
comparison and ranking of these contingent resources against other contingent
resources only. The estimated potential present worth for the contingent resources
cannot be compared directly to, equated with, or aggregated with the present worth
estimates that could be realized from reserves, nor are these potential present worth
estimates an assessment of the fair market value of the properties evaluated herein.
At the request of Petrobras, deterministic
methodologies were used to estimate potential present worth that could be realized
should the contingent resources estimated herein be developed.
Deterministic models incorporated
various economic factors and development practices based on the potential
contingent resources quantities estimated. The following were estimated
deterministically: operating expenses, capital costs, potential production,
depreciation, taxes, time value of money, field life, exploration well costs,
development timing, and abandonment costs, with consideration of other factors. At
the request of Petrobras, the following prices were used to estimate future net
revenue: U.S.$79.23 per barrel for Brent crude, not escalated, in 2010 U.S.$; and
U.S.$4.27 per thousand cubic feet for gas, not escalated, in 2010 U.S.$. The field
prices for oil were adjusted to account for crude quality and transportation.
The gross contingent resources quantities,
expressed in thousands of barrels (10 bbl) and millions of cubic feet (106ft3), are
3
summarized in Table 1. The estimated potential present worth, discounted at
10 percent, expressed in millions of U.S.$ (106 U.S.$), of the contingent resources
quantities attributable to the two license areas if the accumulations were
successfully developed, are summarized in Table 2. Table 3 shows the gross
potential quantities, operating expenses, and capital costs in detail for the 1C
contingent resources for the Franco area. Tables 4 and 5 show the gross potential
quantities, expenses, and costs in detail for each area for the 2C contingent
resources. Tables 6 and 7 show the gross potential quantities, expenses, and costs in
detail for each area for the 3C contingent resources. Tables 8 through 10 show the

14. 11
DeGolyer and MacNaughton
conceptual development plan assumptions used for the 1C, 2C, and 3C cases,
respectively. Future changes in the fiscal environment and/or the infrastructure of
the area can change these values significantly. There is no certainty that it will be
commercially viable to produce any portion of the contingent resources evaluated
herein.
The economic status of the contingent
resources estimated herein is “Marginal” and “Sub-Marginal.” These classifications
are appropriate because of the uncertainties relating to commitment to develop,
development costs, gas-sales agreements, existence of production infrastructure, and
timing. The “Sub-Marginal” contingent resources are related to those volumes that
have negative potential future net revenue.

15. 12
DeGolyer and MacNaughton
SUMMARY and CONCLUSIONS
Petrobras requested evaluations of certain
properties located in unlicensed areas of the Santos Basin offshore from Brazil. The
estimated gross contingent resources, as of July 1, 2010, are summarized as follows,
expressed in thousands of barrels (103bbl) and millions of cubic feet (106ft3):
Gross Contingent Resources
1C 2C 3C
Oil and Sales Oil and Sales Oil and Sales
Area Condensate Gas Condensate Gas Condensate Gas
Classification (103bbl) (106ft3) (103bbl) (106ft3) (103bbl) (106ft3)
Iara
Marginal 0 0 71,660 58,470 866,600 707,146
Submarginal 0 0 4,540 3,713 40,034 32,673
Franco
Marginal 334,960 341,659 1,576,210 1,607,736 4,721,560 4,815,999
Submarginal 16,010 16,331 56,090 57,217 123,390 125,858
Total 350,970 357,990 1,708,500 1,727,136 5,751,584 5,681,676
Notes:
1. Application of any risk factor to contingent resources quantities does not equate contingent resources
with reserves.
2. There is no certainty that it will be commercially viable to produce any portion of the resources
evaluated.
3. Contingent resources have an economic status of “Marginal” and “Sub-Marginal.”
4. No 1C contingent resources quantities were estimated for Iara in this report. Quantities classified as
1C are associated only with reservoir areas near the Iara well and inside the boundaries of the BM-S-
11 block and are not included in this report.
All gas quantities are expressed at a
temperature base of 60 °F and a pressure base of 14.7 psia.
For various reasons, including reservoir
uncertainty, lack of plans to develop the petroleum quantities in these areas, and
the uncertain economic viability of such developments, the contingent resources
estimated herein cannot be considered reserves. If the required commitment and
approval were in place to exploit the oil and gas reservoirs and the development
were economic, certain of these contingent resources could be reclassified as
reserves. The economic status of the contingent resources estimated herein is
“Marginal” and “Sub-Marginal.” These classifications are appropriate because of the
uncertainties relating to commitment to develop, development costs, gas-sales
agreements, existence of production infrastructure, and timing.