Petróleo Brasileiro S.A. - Petrobras (PBR) SDConflict minerals disclosure

Report on Payments

to Governments

for the fiscal year ended December 31, 2023

Glossary

Glossary of certain terms used in this Report on Payments to Governments (the “Report”). The following terms are defined as follows:

Basis for Preparation - Report on Payments to Governments for the fiscal year ended December 31, 2023

This Report provides a consolidated overview of the payments to governments made by Petrobras and its subsidiaries (hereinafter referred to as “Petrobras” or “Company”) for the fiscal year ended December 31, 2023 as required under the U.S. SEC Regulation “Disclosure of Payments by Resource Extraction Issuers”.

Definitions

Reporting entities

This Report includes payments to governments made by Petrobras and entities under its control in accordance with the IFRS. Payments made by entities which are not under the control of Petrobras are not included in this Report.

Activities

Payments made by Petrobras to governments arising from activities involving the exploration, extraction, processing, and export of oil, natural gas, or the acquisition of a license for any such activity are disclosed in this Report.

Government

Government includes any national government, as well as any department, agency, or instrumentality of a national government, or a company at least majority owned by the national government. It also includes subnational governments, such as states (in Brazil) and departments (in Bolivia).

Projects

Payments are reported at project level except those payments that are not attributable to a specific project are reported at entity level. Project is defined using the following factors: (i) type of resource being commercially developed, (ii) method of extraction, and (iii) major subnational political jurisdiction where the commercial development of the resource is taking place. All of Petrobras’ projects refer to the commercial development of oil and natural gas, in the Exploration & Production ("E&P") segment, using the well extraction method.

Segments

This Report includes payments made by Petrobras’ E&P segment.

E&P: This segment covers the activities of exploration, development and production of crude oil, NGL and natural gas in Brazil and abroad, for the primary purpose of supplying Petrobras’ domestic refineries. The E&P segment also operates through partnerships with other companies, including holding interests in non-Brazilian companies in this segment.

Royalties

Royalties are payments made for the right to extract oil and gas, calculated as a percentage of revenue, less deductions provided for in the respective regulations.

In Brazil, Royalties are established in concession contracts at a rate ranging from 5% to 15% of the gross revenue based on the reference prices for crude oil or natural gas established by the Brazilian National Agency for Petroleum, Natural Gas and Biofuels (“ANP”) in its regulatory acts. When establishing the royalties’ rates, ANP also considers the geological risks and expected productivity levels for each concession. Most of the Company’s crude oil production currently pays the maximum royalty rate.

Payments under this type also includes Special participations, which range from 0% to 40% of the net revenue from the production of fields presenting high production volumes or profitability, according to the criteria established in the applicable legislation. The calculation takes into account the gross revenue from each production field, based on the reference prices for crude oil or natural gas established by Decree No. 2,705/1998 and the ANP regulatory acts, deducted from the royalties paid, exploratory investments, operational expenditures, and applicable depreciation and taxes adjustments. In 2023, payments of this government share were made in 12 of our fields: Barracuda, Jubarte, Marlim Leste, Marlim Sul, Roncador and Tartaruga Verde (Campos basin - offshore); Berbigão, Sapinhoá, Sururu and Tupi (Santos basin - offshore); Leste do Urucu and Rio Urucu (Solimões basin - onshore).

Bonuses

Bonuses disclosed correspond to the signature bonus, amounts paid by the winning bidder upon signing an exploration and production contract, which can be predefined or offered, subject to the minimum values published in the bidding notices.

Fees

Fees are payments made for the retention or occupation of contracted areas for exploration and production of oil and natural gas, whose rate established by the ANP in the respective bidding notices, based on the size, location, and geological characteristics of the concession block.

It also includes payments for the acquisition and maintenance of an environmental license to operate in an area where extractive activities are carried out.

Production entitlements

These are the host government’s share of production under the production sharing regime adopted in Brazil for the exploration and production of oil, natural gas, and other fluid hydrocarbons in the Pre-Salt Polygon and/or strategic areas, and as established by Law 12,351/2010, particularly in articles 2(III), 15(III), 18, 29 (VII). The percentage of production to be shared with the Brazilian Federal Government is defined in production sharing contracts, in which the state-owned company PPSA represents the interests of the Brazilian Federal Government, as a non-operating partner who manages these contracts.

The production entitlements are presented at fair market value, which is calculated based on volume entitled to the Brazilian Federal Government, valued at the average Brent price for the year, as historical costs are not reasonably available or determinable by project.

Taxes

Payments of taxes in Brazil include taxes on the exports of crude oil from March 1 to June 28, 2023, when the Brazilian Federal Government established a temporary 9.2% rate on these exports.

The Company does not pay for taxes levied on corporate profits, corporate income, and production specifically when engaging in the commercial development of oil and natural gas. The Company’s payments for corporate income taxes are based on taxable profit at the legal entity level within a given jurisdiction, which includes income earned from business activities beyond those generated by resource extraction activities.

Dividends

The Company does not pay any dividends in lieu of production entitlements or royalties. These payments are made to the Brazilian Federal Government as a common or ordinary shareholder of Petrobras under the same terms as other shareholders. Thus, these payments are not under the scope of this Report.

Payments for infrastructure improvements

These are payments which relate to the construction of infrastructure (road, bridge, or rail) not substantially dedicated for the use of extractive activities and, therefore, are not accounted for as property, plant and equipment. For 2023, there was no payment made to governments relating to infrastructure improvements.

Community and social responsibility payments

These are payments required by law or contract comprising, in general, payments to support the social or economic well-being of communities where the expenditures are made.

Partnerships

When the Company makes a payment directly to a government arising from a partnership, whenever Petrobras is the operator, the full amount paid is disclosed even where Petrobras as the operator is proportionally reimbursed by its non-operating venture partners.

Currencies used to make the payments and Exchange rate

Payments in Brasil are made in Reais and payments in Bolivia are made in Bolivianos. All payments in this Report are reported in US Dollars, which have been translated based on the exchange rate as of December 31, 2023 (Brazilian Real/US Dollar 4.84 and Boliviano/US Dollar 6.82).

Project-level Disclosure

The table below sets forth the Company’s payments made to governments for the fiscal year ended December 31, 2023, by project and type of payment.

Government-level Disclosure

The table below sets forth the Company’s payments made to governments for the fiscal year ended December 31, 2023, by government and type of payment.

Payment details disclosure

The table below provides the details of payments made to governments for the fiscal year ended December 31, 2023.