(FILE) A man walks past the Petrobras bu...(FILE) A man walks past the Petrobras building in Rio de Janeiro, Brazil, January 4, 2011. Police made 27 arrests on November 14, 2014 in raids across Brazil in a widening investigation into allegations of a multi-billion-dollar kickback scheme at the state-owned oil giant Petrobras. Among those swooped on by 30 police teams that fanned out across the country was Renato Duque, the former Petrobras director of engineering and services, while several prominent construction companies have also now been dragged into the scandal that has touched the Brazilian president. Authorities, under pressure to get to the bottom of the escalating crisis at Petrobras, also froze assets worth 720 million reais ($277 million) belonging to 36 suspects and three unnamed companies. AFP PHOTO/VANDERLEI ALMEIDAVANDERLEI ALMEIDA/AFP/Getty Images
Sales are part of Petrobras’s plan to sell as much as $15bn in assets by the end of this year © AFP
Petrobras, the state-controlled oil company at the centre of Brazil’s vast corruption scandal, has sold more than $1.3bn in assets in Argentina and Chile as it struggles to emerge from one of the deepest crises in its history. 
The Rio de Janeiro-based company said late on Tuesday it had concluded the sale of a 67.2 per cent stake in its Argentine subsidiary to Argentina's Pampa Energia for $892m. 
It also sold all of its Chilean subsidiary to Southern Cross Group, an Argentina-based private equity firm, for $490m. 
The sales are part of Petrobras’s plan to sell as much as $15bn in assets by the end of this year, as concerns grow that the company may have to resort to some form of government bailout. 
With just over $100bn in net debt at the end of last year, Petrobras ranked as the world’s most indebted oil company, according to Bloomberg data. 
“In the most extreme circumstances, the government may be forced to provide a backstop for the company’s debt — allowing Petrobras to default would be a political catastrophe for any administration,” said Daniel Kerner at Eurasia, the risk consultancy. 
Petrobras’s finances have come under intense pressure since a kickbacks and briberyscandal emerged at the company in 2014, costing it at least R$6.2bn (US$1.7bn) in corruption-related losses and paralysing the oil industry just as Brazil sinks into a deep recession. 
Meanwhile, plummeting oil prices have forced Petrobras to book steep writedowns. It reported its biggest quarterly net loss of about $10bn in the fourth quarter last year after suffering impairments equivalent to more than a third of its market capitalisation, which stands at R$150bn.
Petrobras has also been forced to slash investments to preserve cash. In January the company said it planned to invest $98.4bn between 2015 and 2019, down 25 per cent from its original forecast of $130.3bn. 
While Tuesday’s announcements offer hope that Petrobras will be able to offload assets in spite of the global oil price slide, the sales to Argentine groups further underline the changing fortunes of Brazil and its neighbour. 
Only a few years ago, Brazil was viewed as the darling of the emerging markets while Argentina was shunned by global investors.
However, while Brazil has been mired in recession and scandal, Argentina has returned to international capital marketsunder the leadership of new president Mauricio Macri. 
Brazil’s vice-president, Michel Temer, who is set to replace President Dilma Rousseff after her likely removal from office this month amid an impeachment battle, is expected to try to bolster Petrobras’s financial position by raising domestic fuel prices and encouraging more divestment. 
However, those options may not be enough to significantly deleverage the company at this stage, said Mr Kerner.
“A sharp drop in domestic demand has limited the effect that favourable fuel pricing has had on Petrobras’s balance sheet, whereas low oil prices have made it more difficult for the company to shed assets,” he said.