Brazilian state-run energy firm Petrobras will seek other ways to raise capital if congress turns down plans for the government to pump billions of dollars into the company, a newspaper reported.

Under the plan, the company would get rights to develop 5 billion barrels of oil in exchange for shares. The oil would come from massive subsalt resources discovered in 2007 several miles under the sea floor off Brazil's southeastern coast.

If, in spite of our bet that it will, this approval doesn't materialize, we will have to capitalize in another way, the Estado de Sao Paulo newspaper quoted Petrobras Finance Director Almir Barbassa as saying.

Barbassa said he expected approval by the end of the month.

The funding would bolster Petrobras's balance sheet as it gears up to develop massive deepwater reserves.

The company has ruled out new borrowing because it would increase debt. It has proposed that the capitalization be performed through a rights issue of shares.

Petrobras said late on Friday it would propose that the company and the government negotiate a preliminary value for barrels of oil as part of the capitalization plan.

The valuation of the oil has become a contentious issue, particularly as time runs out for the government to act before the general elections in October.

(Reporting by Eduardo Simoes; Writing by Peter Murphy; Editing by Ted Kerr)