A huge block of the company's shares began frenzied trading Thursday on the New York Stock Exchange, hailing what officials hope is an era of improved disclosure, private-sector partnerships and world-class operating standards.

Aided by investment from foreign firms, Petrobras expects to ramp up production by about 10% a year over the next five years. It now pumps about 1.3 million barrels a day.

Petrobras, Brazil's biggest company - already traded in Sao Paulo - sold a total of $4 billion in stock divided between the U.S. and Brazilian exchanges. The sale had been delayed and reduced from $4.4 billion, as investors balked at exposure to Brazil's often-volatile economy and a short dip in oil prices. But the company's American depositary receipts quickly caught fire Thursday to number among the Big Board's top-traded counters for the day, with 36 million traded. Petrobras's ADRs opened at $24 each, climbing 19% to $28.63 in 4 p.m. NYSE trading.

Thursday's sale, in which the government unloaded 16.6% of Petrobras's total equity, shouldn't be mistaken for a privatization. That topic is still anathema in Brazilian politics, even though the government has auctioned off the national phone system and is in the process of selling its electricity grid to private buyers. Thursday's sale cut the government's stake in Petrobras to 56% from 84% of ordinary shares, but the state still runs the show.

Already, under the direction of former banker Philippe Reichstul, Petrobras has made unprecedented overtures to Wall Street, including regular conference calls to discuss earnings and a resourceful staff that quickly responds to e-mail inquiries. Investors browsing through the share-sale prospectus - the first public Petrobras document to meet U.S. accounting standards - found it brimming with never-before-disclosed data on employee pension funds and off-the-books debt. The government has also dropped subsidies that kept gasoline prices below international levels.

Petrobras, which had a virtual monopoly on the Brazilian oil market until 1997, is now counting on foreign firms to help it invest $32.9 billion over the next five years. Mr. Reichstul, the company's president and CEO, said Thursday that Petrobras has 44 joint ventures in the works to help explore for and produce oil under multiyear concessions.

Analysts praised the company's target for 10% annual production growth. Bigger oil firms will probably grow at about half that rate, said Jay Bhutani, an analyst at Donaldson, Lufkin & Jenrette Inc. Petrobras's production expenses are in line with the international average, he said.

But the company still has plenty of fat. Mr. Bhutani noted that while Petrobras has about 40,000 employees, private companies with comparable operations have 8,000 workers. The Brazilian company pays about $2 in refining costs per barrel, about four times the cost for large private firms.p And despite vast oil reserves and Petrobras's world-renowned talent for deep-water drilling, the company hasn't been able to meet demand at home. Brazil imports about a quarter of its crude oil.

-- (The Wall Street Journal)