(In 3rd paragraph of April 23 item, corrects to say Shell isset to become 2nd largest oil producer, and that BG purchaseagreement is not yet completed)
By Anthony Boadle
BRASILIA, April 23 (Reuters) - Royal Dutch Shell Plc has taken into account the risks presented by thePetrobras graft scandal to its expanding operations in Braziland is confident the Brazilian state-run oil company will emergestronger, Shell's CEO said on Thursday.
Chief Executive Ben van Beurden said oil production fromBrazil's offshore subsalt region will remain profitable, andpredicted that oil prices will rise from the low levels of thepast six months.
Van Beurden briefed Brazilian President Dilma Rousseff for1-1/2 hours on Thursday on his company's operations in Brazil,where Shell is set to become the second-largest oil producerfollowing its April 8 agreement to purchase rival BG Group.
The acquisition increases Shell's role in Brazil, where ithad been the No. 3 producer, giving it a financial stake ingiant new offshore fields operated by Brazil's troubledstate-run Petroleo Brasileiro SA, or Petrobras.
In January, BG's 140,562 barrels a day of oil and gas output(boepd) in Brazil was nearly four times greater than Shell's49,014 boepd.
While Shell will have to take a backseat to Petrobras onoperational decisions, it is believed to have the money andtechnology needed to push Petrobras-led projects forward.
Petrobras took a $17 billion charge on Wednesday to accountfor the costs of a political kickback scandal that forced it tocut investment, and paralyzed its contracts with engineeringfirms under investigation for bribery.
"I have 100 percent confidence that Petrobras will comethrough this probably as a stronger company than it was before,"van Beurden said at a news conference after meeting Rousseff.
He said Brazil's subsalt resources are among the best in theworld and that Shell is interested in deepening its involvement.
"The resources in production today are very, very strong. Ido not see any issue of profitability of the operation," hesaid.
Van Beurden said Shell has studied the risks of working withPetrobras.
"We have taken into account the impact that any of today'snews will have on the development of existing fields as well asthe Libra field going forward, and these risks have been fullyfactored into the commercial arrangements we have done with BG,"he said.
Van Beurden expects Brazil to account for 20 percent ofShell's global oil output in a decade due to the BG deal.
He said Shell would consider buying any Petrobras assets putup for sale "if the opportunities come up". (Reporting by Anthony Boadle; Editing by Peter Galloway)
