AUGUST 2010

About Us

Headquartered in Rio de Janeiro, Mello Martins is a multidisciplinary team formed by

attorneys coming from across Brazil s largest companies and best law firms.

Its expressive experience was acquired during decades of good services rendered to both

legal and business arena

Mello Martins assists a full range of different companies from all over the world in

structuring and executing large-projects for oil & gas, biofuel, mining, infrastructure,

environmental, equipment and services trade commerce, M&A operations, assets

commercialization, international and domestic project financing and capital markets.

Solutions provided by Mello Martins attorneys are custom tailored to fit the Client s

specific and unique needs based on a variety of practices such as litigation, taxation,

administrative and regulatory compliance, corporate governance and policies,

environment and sustainability, labor, arbitration and dispute resolution

Why Brazil?

TERRITORY:

8.5 MKm2

5th largest territory

4.600 Km from North to South

4.400 Km from East to West

The GDP Growth Is Jumping From 0.21%

in 2009 TO 5% to 6% in 2010 according to

local authorities;

The investment grade rating awarded by

moody’s in 2009 just after the 2008 global

financial crisis…

…confirmed the same rating released by

S&P and Fitch in 2008.

Brazil as the host of the FIFA World Cup in

2014, has already opened a bunch of new

opportunities…

…as well specifically Rio de Janeiro, due

to the election as the 2016 Olympic

Games host.

Where are the Opportunities?

ProductRank

(Producer)Rank

(Exporter)

Ethanol 1st 1st

Sugar 1st 1st

Coffee 1st 1st

Orange Juice 1st 1st

Soybean Products 2nd 1st

Beef 2nd 1st

Tobacco 2nd 1st

Chicken Products 3rd 1st

Pork Products 4th 4th

Infrastructure Overview

Toll Roads:

Investments: $18.5 billion through 2010 (PAC)

Main Projects: - SP Ring Road South Section;

-3rd phase of Federal Toll Road

Concessions Program;

-2nd phase of SP Concession Program.

Railroads:Investments:

US$ 4.4 billion through 2010 (PAC).

US$65.5 Billion for expansion and maintenance, according to

National Logistics Plan estimation up until 2023

Main Projects:

-North-South Railroad (Transnordestina);

-São Paulo – Rio de Janeiro high speed train;

-Rio De Janeiro Local subway project for 2014 soccer World Cup

Infrastructure Overview

Airports:

Investments: $1.7 billion through 2010 (PAC)

Main Projects:

-BID for International Airports Concessions (e.g., Rio de

Janeiro & Campinas);

-Expansion of Guarulhos airport

-Construction of a 3rd international airport in SP;

- BID FOR SP state OWNED airports

Airport is a critical issue for 2014 world cup and 2016 olympics. São Gonçalo Airport, in natal, now under construction, will be the largest one in Latin America when completed.

US $ 2.5 billion will be invested in different world cup host cities such as Brasilia, Rio de Janeiro and Sao Paulo for modernization ot their airports starting this year..

Energy - Generation

Since last year, private companies have started the construction and

commissioning of 14 new energy plants, being 12 Hydroelectric, 01 coal fired and

01 Nuclear powered.

With all those investments Brazil will reach a significant number around 10.602,28

MW of power delivered, being 7.000 MW by the end of 2010.

The deployment of more than 2.700 KM of power lines will increase the

integration of all Brazilian regions.

Energy - Renewable

The Brazilian government shall put 399 wind farm projects and 79 other

renewable energy projects up for bidding this year of 2010.

The projects, if approved and completed, would add 14,529 MW to the country's

electric grid, an amount just slightly greater than the generating capacity of Itaipu,

the world's largest hydroelectric power plant, which Brazil operates jointly with

Paraguay

The Brazilian Oil & Gas Sector

Over 60 oil companies with oil

exploration and appraisal areas in Brazil

Petrobras 2010-2014 investment: US$

224 Billion

819 oil blocks auctioned; Petrobras

plans to contract about 300 new vessels

(e.g. oil drilling and production platforms,

ships, platform support boats, and very

large crude oil carriers)

Challenge: Heavy emphasis on local

equipment content. Complex suppliers’

registration process with Petrobras

Pre-salt oil fields: Petrobras

plans to invest USD$ 111.4

billion from 2009 to 2020 to

produce 5.7 million bpd plus

1,815 million bpd from pre-salt

fields. This figure includes

Petrobras and its partners’ pre-

salt production.

PETROBRAS bounces

back as #1PETROBRAS is the first company regarding market value at Brazil andentire Latin America (R$ 252,828 Billion).

With the recent governmental decision regarding the capitalization ofpre-salt at US$ 8,51, PETROBRAS stocks are expected to rise. After thestatement concerning the amount of the barrel, the stocks raised 1.12%.

The actual potential recoverable amount of Oil equals to all the PETROBRAS production for 57 years and the total of its proven reserves (10 – 16 Million BoE).

Pre Salt Phases

Data Acquisition

(2016)

1st PhaseDefinitive

Development(2013-2016)

2nd PhaseDefinitive

Development(2017-2030)

Small Scale

Production of long

term tests and

Tupi – exploratory

wells.

Large scale

production (>1

Million barrels/day

at 2017)

2 pilot wells

(Guará & Tupi), 8

FPSPs

Growth of

production

New Production

Unis

Primary Demand for Energy

PETROBRAS business plan 2010-14: US$ 224 billion

Targets 2010-2020

Production, Refining and Demand

Production, Refining and Demand

The exploratory activity in

the Solimoes Basin

With the new auctions for the

concessions of exploratory blocks in

Brazil still undefined and the

prospect of new discoveries focused

more and more on the pre-salt area,

this part of the frontier located in the

North Region, in the heart of the

Amazon jungle, is emerging as one

of the strongest bets in Brazil —

especially after the entry of the

newcomer HRT Oil & Gas, a

Brazilian oil company that will take

over the operation of 21 blocks in the

region. It intends to invest the

significant sum of US$ 140 million.

One of the largest onshore sedimentary

areas in Brazil, deep in the heart of

Amazonas, will take on a new pace

beginning at the end of the year.

With a proven potential

for high quality gas and

light oil, the production of

the Solimoes Basin

already totals an

accumulated 200

million barrels BOE

World Cup

With a budget estimated at one hundred (R$ 100) billion Reais, the 2014

World Cup ("Cup"), shall be the largest sports event ever held in the history of

the country, comparable only to the 2016 Olympic Games, an event which will

be hosted in the City of Rio de Janeiro and will have a budget of approximately

thirty-four billion Reais (R$ 34 billion).

Investments needed in all of the 12

selected cities (Rio de Janeiro, São Paulo,

Belo Horizonte, Porto Alegre, Curitiba,

Brasília, Fortaleza, Salvador, Recife, Natal,

Cuiabá and Manaus)

Conscious that Brazil needs to address

the current deficient infrastructure in some

parts of this huge country, the Brazilian

government has announced several

ambitious investment plans for the near

future

Urban Development

The seaport region, including the areas of

Saúde, Gamboa and Santo Cristo will be

further developed and in need of

investment for residential properties,

commercial buildings, restaurants,

theaters, museums, shopping centers and

more.

The Urban Development is linked to the

expected growth in tourism, which has a

deficit on hotel numbers. The projected

target is 11.000 new rooms, which

amounts to 20 to 25 new hotels across the

12 cities which will host the games.

Transportation

Airports

On 31 August 2009 the state airport management agency

Infraero unveiled a R$5.3 billion (approx. US$3 billion, £2

billion) investment plan to upgrade airports of ten of the

venue cities, increasing their capacity and comfort for the

hundreds of thousands of tourists expected for the Cup. A

significant amount (55.3%) of the money will be spent

overhauling the airports of São Paulo and Rio de Janeiro.

The investment figure covers works to be carried out up to

2014.

Railways/Subways

A new subway line is planned and the massive

upgrade of the stations and systems is planned.

Construction of a VLT (Light Rail Transit

vehicle)

Transportation

Seaports

The special secretary of ports announced that R$700

Million will be invested at the expansion of the

seaports at 7 cities. Rio de Janeiro seaport will be

one of the key expansions

This sector is expected to attract more than US$20

billion in investments for the next 5 years.

TAV

In September 2008, Brazil's Transport Ministry

announced the High-speed rail in Brazil, a project

for the World Cup connecting Campinas, São

Paulo and Rio de Janeiro. This would cost R$11

billion (approx. US$6.25 billion, £4.1 billion)

High Speed Train

Construction, operation and

maintenance of a High-Speed Train

system between Campinas/ São Paulo

and Rio de Janeiro, with stations in

Viracopos Airport, Guarulhos Airport,

Jundiaí, São José dos Campos, Volta

Redonda, and Galeão Airport;

Integration between the two largest

urban areas in Brazil and the

improvement of their competitiveness,

due to the reduction in the travelling

time and in transportation costs

Possible path of the project

Concession Period: 40 years

Construction Period: 5 years

Start of Construction: 2010

Opportunities

Construction - Planning and execution of all

stages of building works on infrastructure,

transportation and leisure, further to refurbishment

and construction of sports stadiums and arenas.

Cement & Steel Industry - As a result of diversified

investments in civil construction, the cement industry

foresees a significant increase in the next years, as well

as the steel industry, concerning steel production and

treatment.

Sanitation - Development of several measures at

the host cities aiming at improving the sanitary

conditions of a certain region through the appropriate

sewage, water distribution and garbage administration

treatment. 12 million houses have yet to be serviced –

Just in Rio de Janeiro, 50.8% of the houses have no

sewage treatment, as an example.

Opportunities

Power - Development of undertakings related to the

production and distribution of different forms of power to

meet the demand that the infrastructure works will

generate, always seeking the implementation of

alternative power in such undertakings, to cause less

impact to the environment.

Real Estate - Construction and sale of

infrastructure undertakings in the host cities,

such as hotels, apartments, flats or any other

means of accommodations for the tourists

expected to visit all host cities.

Tourism - Development of activities related to

the construction and/or management of tourism and

leisure undertakings in the host cities.

Opportunities

Airports and Ports - The great increase in demand

caused by those sports events will require considerable

refurbishment works of the airports in cities hosting the World

Cup and Olympic Games.

Ground Transport - Performance of the road

infrastructure works required to improve the ground

transportation structure at the cities involved in the

events.

Publicity - Development of projects intended to

advertise ideas associated with the competitions as well as

negotiations of sponsorship quotas for the events, in

different media.

Opportunities

Technology - The global aspect of both competitions

will demand the development of products and services of

information dissemination, communications, Internet and

broadcasting of the competitions to the entire world.

Likewise, the indirect demand for technology applicable to

infrastructure works will be considerable.

Language Courses - Development of language

courses, especially English and Spanish, in the host cities,

to qualify the local population to receive the great number

of tourists that the country will attract by hosting the two

competitions.

Rio - Olympic City

Areas to be developed:

• Construction/improvement of the arenas that shall

hold the Games;

• Rental and disposal of equipment (vehicles, medical

devices, identification and security equipments);

• Accommodation and leisure activities for athletes

and attendees from all over the world , including

modern press facilities;

• Improvement of public transportation used in the

2014 Soccer World Cup;

• And also Airports, Toll Roads, Energy, Urban

Development, Ports, Sanitation and more!

Organization Structure

Opportunities

An aquatic sports stadium with 18,000 seats with an estimated construction cost of US$40

million;

An Olympic Park to host gymnastics, cycling, handball, and other sports competitions with

an estimated building cost of US$200 million.

An Olympic village of 32 buildings with 12 floors each and a capacity of over 17,000 beds,

estimated at US$450 million.

An Olympic Tennis Center with 16 courts (US$45 million).

A renovated rowing stadium at Rodrigo de Freitas Lagoon, which will cost approximately

S$2 million.

An arena in Copacabana for beach volley (US$7 million).

The renovation of Maracanã Stadium (where the opening and closing Olympic ceremonies

will be held as well as soccer games) will cost approximately US$400 million, and must be

completed before 2014 to use in the 2014 Soccer World Cup.

Tourism Opportunities

2010: The number of visitors to the city is expected to increase 10% in

comparison to 2008, when 1.68 million tourists visited Rio.

After 2014 Soccer World Cup and 2016 Olympic Games, this number will

increase even more.

Several hotels are being refurbished.

Authorities from Rio may reduce taxes to attract new investments in hotels;

thereby creating opportunities for International hotel chains in refurbishment,

architectural projects and building or acquiring existing facilities..

THE INVESTMENT IN TOURISM INFRASTRUCTURE FOR 2016

SUMMER OLYMPIC GAMES IN RIO DE JANEIRO are expected to be

worth approximately USD 6 Billion.

The estimated investment in infrastructure is about US$15 billion, including

US$5 billion in logistics upgrades at seaports and airports.

The main projects include:

• The modernization and enlargement of the two International Airport terminals

(increasing the airport’s capacity from 15 million passengers per year to 25

million);

• Highway widening, Construction of ―Olympic lanes‖;

• The Port of Rio area revitalization to include a new 30,000 square meter

leisure area featuring bars, restaurants, an amphitheater, a multiuse space

and parking, Port dredging, Construction of two new subway lines;

• The creation of a Bus Rapid Transit (BRT) system, Housing projects

(including low income housing) and water sanitation.

Infrastructure Investments

Contact Us

MELLO MARTINS ADVOGADOS

Bruno Gonçalves - Partner

bruno.goncalves@mellomartins.com

Brazil - Rio de Janeiro

Rua México, 90 – 8º andar

Centro - CEP 20.031-141

Telefone: 55 21 2196-6000

Fax: 55 21 2196-6001

www.mellomartins.com