CEO of Brazil`s Petrobras says will not resign

The chief executive of Brazil`s state oil giant Petrobras said Wednesday that she will not resign despite the corruption scandal shaking the company and the ruling Workers` Party.

CEO Graca Foster insisted she had President Dilma Rousseff`s "trust," but said she and her board of directors would all be investigated as part of an independent audit into accusations a corrupt network laundered $4 billion of company money, much of it allegedly going to politicians from Rousseff`s party.

Foster also outlined a plan to reverse Petrobras`s sinking fortunes by investing less and saving more in 2015.

Besides being engulfed in scandal, Brazil`s largest company has also been hit hard by a weakening local currency and the recent slide in oil prices, sending its shares plummeting to a decade low this week.

Foster, 61, said she had spoken several times with Rousseff about resigning.

But ultimately she and her board of directors will remain after the leftist leader gave her vote of confidence, she said.

"I`m here today as the president of Petrobras, for as long as I have the president`s trust and she believes I should stay," Foster told a press conference.

She said auditors would make it their priority to investigate the directors of Petrobras and its subsidiaries.

"They`ll go into their closets, take a look at all their papers, take their computers, their iPhones, their iPads. And that`s a very good thing. It`s an independent investigation. It`s apolitical," she said.

Vowing that Petrobras would emerge a "much better" company from the scandal, Foster announced 66 management measures she said would be taken to improve corporate governance, including creating a new directorship charged with overseeing legal compliance.This year has been a rough one for Petrobras, which is also reeling from oil prices that have recently slid to less than $60 a barrel -- down almost 50 percent since June -- as well as a weakening real that has made it harder for the company to pay off the 80 percent of its debt that is denominated in dollars.

Petrobras shares have lost half their value in three months.

And the company has repeatedly delayed releasing its third quarter financial results, spooking investors.

The company has said it will release the results by January 30.

For next year, Foster said, the corporate motto will be "save, save, save."

"Spend less and do more," she said.

But that comes at a bad time for Petrobras, which needs $82 billion in investment by 2018 to tap massive stores of hard-to-reach "pre-salt" oil off the Brazilian coast.

In October, ratings agency Moody`s lowered Brazil`s debt rating to "moderate risk" (Baa2), and Fitch has warned it could do the same.

The Petrobras scandal erupted in March with the arrest of a former director who told investigators about a massive kickback scheme worth millions of dollars.

At least 36 people, mainly executives in the construction industry, have been accused of operating a cartel that inflated Petrobras contracts by up to six percent with illicit surcharges.

The extra cash would then be passed on to front companies to be laundered and paid out in bribes.

Dozens of politicians from three parties, including the Workers` Party, have been implicated, though so far none have been charged.

Police estimate some $4 billion was stolen in a decade.Rousseff narrowly won a second four-year term in October after fighting off scathing attacks on her management of the world`s seventh-largest economy.

She has faced calls to oust Foster and the entire Petrobras board, including from attorney general Rodrigo Janot, who criticized the "disastrous management of the company."

A political cartoon on the cover of Brazil`s Globo newspaper this week showed Rousseff, 67, sitting on a barrel of oil connected to a burning fuse.

Rousseff has tried to regain market confidence by appointing a more business-friendly economic team for her second term.

But the scandal has threatened to catch her in its spiral.

She was chair of the Petrobras board during most of the period in question, from 2003 to 2010, when she stepped down to run for president.