09:08 AM EDT, 07/22/2024 (MT Newswires) -- Petrobras (PBR) was asked to reimburse chemical company Unigel for losses incurred after a tolling contract between the two companies fell through, Reuters reported Monday, citing a legal letter sent in June.

According to the report, Petrobras agreed to supply natural gas to Unigel's two leased fertilizer plants in return for fertilizer under a tolling contract signed in December. The deal fell through in June after Brazil's federal audit court said Petrobras could incur losses of 487 million reais ($87 million), the report said.

The fertilizer plants have stopped operations since the second half of last year, resulting in losses that could run into "hundreds of millions of reais" for Unigel, Reuters said, citing Unigel.

The report said the firms are currently in arbitration to resolve the dispute.

Petrobras did not immediately respond to MT Newswires' request for comment.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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