China offers Brazil $10bn loan to develop offshore oil

China wants to lend Petrobras, Brazil’s state oil company, US$10 billion to develop deepwater oil fields off the coast of Rio de Janeiro, AP reported. Brazil’s top energy official, Edison Lobao, told to Folha de S. Paulo newspaper that the United Arab Emirates is also interested in financing field development, without specifying a price. Lobao said that Chinese officials contacted the Mines and Energy Ministry to propose the loan, but negotiations with China were conducted directly by Petrobras. Brazil’s offshore reserves could hold up to 80 billion barrels of oil. Brazil discovered 50 to 80 billion barrels of reserves last year and is preparing to intensify exploration, but has been hit by the global credit crunch. Petrobras’ shares were up 7.8% Monday in New York.