BEIJING - China agreed to lend $10 billion to Brazil's Petrobras in return for guaranteed oil supply over the next decade, in a deal cemented on Tuesday as Brazilian President Luiz Inacio Lula da Silva ended a state visit.
Lula and Chinese President Hu Jintao signed 13 agreements in all, covering science, space, law, ports and farm products, the official Xinhua news agency said. It did not provide details.
The loan will come from China Development Bank, state-controlled oil company Petrobras said in a statement released in the Chinese capital.
Brazil will guarantee the supply of 200,000 barrels of oil a day to China's state oil firm Sinopec for the next 10 years, the statement added.
Petrobras and Sinopec also signed a memorandum of understanding on exploration, refining and petrochemicals.
The agreement for Brazil to supply China with oil was largely clinched in February, along with a memorandum of understanding on long-term financing for Petrobras. The firm needs funds to help extract massive, newly-found oil reserves deep beneath the ocean floor off Brazil's southern coast.
The discoveries of high-grade light oil and natural gas are in the Santos Basin, which analysts estimate could hold up to 80 billion barrels of oil, but it is very costly to extract.
Petrobras has been negotiating with other oil consumer countries to receive financing from them in exchange for future oil supplies.
Beijing, eager to secure long-term sources of energy, in April finalised a similar agreement under which Russia will supply China with oil for 20 years in exchange for loans to Russian state firms.
China for the first time displaced the United States as Brazil's top trading partner in April, a trend that is expected to continue as the resource-hungry Asian economy and the major agriculture and minerals producer expand commerce.
In 2009, China became Brazil's first trading partner. Now we still face the challenge of exploring the full potential of investments that our economies can offer to each other, China's Xinhua news agency quoted Lula as saying earlier in the day.
President Hu was quoted as saying: Our trade cooperation has expanded continuously as bilateral trade volume hit the target three years ahead of time.
Trade has boomed since Lula visited China during his first term in 2004.
With China one of the few economies still growing in defiance of the global economic crisis, Brazil's two-way trade with China reached $3.2 billion in April, surpassing the $2.8 billion trade total with the United States.
Exports to China grew by 65 percent from January to April compared with the same year-ago period, government data show.
Beyond trade, Lula met Premier Wen Jiabao and discussed boosting cooperation to tackle the global economic crisis, Xinhua said.
Both are large, developing countries with complementary economies, no borders to fight over, and a shared interest in prying open the multilateral institutions that tend to be controlled by the richest countries.
Lula used his China visit to reinforce a common position that the financial crisis was a good opportunity to push for a greater voice for developing countries in international economic forums, as without these nations the crisis will be harder to overcome.
This should be reflected ... in a greater participation of countries such as Brazil and China in the decision-making process of institutions such as the International Monetary Fund and the World Bank, Xinhua quoted Lula as saying.