Mr. Helio Costa reports

PETRORIO ANNOUNCES ANNUAL AND SPECIAL SHAREHOLDERS MEETING VOTING RESULTS

At Petro Rio S.A.'s annual and special shareholders meeting held today, April 29, 2016, all the matters proposed on the agenda were approved.

Board of directors and fiscal council

According to the management proposal, the current members of the board of directors, Helio Calixto Costa, Vinicius do Nascimento Carrasco, William Connel Steers, Ronaldo Carvalho da Silva, Haroldo Borges Rodrigues Lima and Pedro Grossi Junior have been re-elected for a two-year term of office. For the fiscal council, with a term of office until the next annual general shareholders meeting, Elias de Matos Brito, Roberto Portella and Gilberto Braga have been re-elected as effective members, and Ronaldo dos Santos Machado, Anderson dos Santos Amorim and Luis Alberto Pereira de Mattos as alternatives, respectively.

Reverse split of shares

In the context of discussions about the management proposal for the reverse stock split at a ratio of one common share for 15 common shares, also including the reverse split of the global depositary shares (GDSs) issued by the company, at the rate of one for 15 GDSs, the company's shareholders resolved by majority to approve the reverse stock split at a ratio of one common share for five common shares, also including the reverse split of the global depositary shares issued by the company, at the rate of one GDS for five GDSs, maintaining the same proportion currently in force of one common share for two GDSs.

Reasons for the reverse split

Management of the company proposed the reverse split of shares to mitigate the excessive risk of volatility in the price of these securities, given that it will allow the price per share and per GDS not to be so low that minor fluctuations could represent a high percentage. Additionally, the reverse split reduces the possibility of breaching the BM&FBovespa rules (Regulamento para Listagem de Emissores e Admissao a Negociacao de Valores Mobiliarios), which do not allow stock prices quoted below one Brazilian real.

Reverse split effects

Petro Rio shareholders (holders of common shares or GDSs) will have until June 10, 2016, to, at their own discretion, dispose of or acquire as many shares as necessary to eliminate fractional shares that may result from the implementation of the reverse split by the company. After the deadline mentioned above, the group of shares formed by fractions of shares will be sold by auction on the stock exchange, intermediated by a brokerage firm in Brazil and a selling agent in Canada. The amount resulting from the sale of fractional common shares or GDSs will be credited to their holders. From June 13, 2016, on, the common shares and GDSs start to be traded aggregated, according to the reverse split. The reverse split of shares will not impact: (i) the value in Brazilian reais of the company's consolidated capital, (ii) the rights attributed to common shares and GDSs, or (iii) the interest of each shareholder in the company's capital, except if the reverse split, otherwise, results in a holder holding a fraction of a common share or GDS, as the case may be. The reverse split will not result in the company's name change. On this date, April 29, 2016, the company has 65,945,675 common shares issued and outstanding. After the conclusion of the reverse split of shares approved herein, there will be 13,189,135 common shares issued and outstanding (on an undiluted basis and subject to the fractions mentioned in this material fact). Also on this date, the company has 8,078,546 GDSs issued and outstanding. After the conclusion of the reverse split of the GDSs, there will be approximately 1,615,709 GDSs issued and outstanding (on an undiluted basis and subject to the fractions mentioned in this material fact).

The reverse split is subject to the approval of the TSX Venture Exchange.

Common share buyback program

Also according to the management proposal, Petro Rio shareholders approved the proposal of implementation of a buyback program of up to 16.5 million common shares issued by the company (3.3 million common shares after the conclusion of the reverse split of shares now approved) within 18 months, without capital reduction, to be held in treasury, cancellation and/or subsequent sale. The share buyback program, as it relates to GDSs, is subject to the approval of the TSX Venture Exchange, and no GDS shall be purchased by the company before such approval is received.

Objective

The common shares buyback program aims to ensure that the market price of Petro Rio's shares more appropriately reflects the company's intrinsic value. Due to the amount in the proposed buyback program compared with the company's cash availability history and considering the general evaluation from management regarding Petro Rio's financial situation, it is understood that the share buyback shall not affect the compliance with creditors or the payment of mandatory dividends.

Number of outstanding shares to be acquired

The common share buyback program approved on this date authorizes the buyback of up to 16.5 million common shares issued by the company (3.3 million common shares after the conclusion of the reverse split of shares now approved), without capital reduction.

Acquisition period

The maximum period for the acquisition of shares approved in the buyback program is of 18 months as of this date, ending on Nov. 2, 2017.

Authorized brokers:

• Itau Corretora de Valores S.A., headquartered in the city and state of Sao Paulo, at Avenida Brigadeiro Faria Lima, 3500, 3o andar, Itaim Bibi, CEP: 04538-132, inscribed in the corporate roll of taxpayers (CNPJ/MF) under No. 61.194.353/0001-64;
• XP Investimentos CCTVM S.A., headquartered in the city and state of Rio de Janeiro, at Praia de Botafogo, 501, Sala 601 (bloco Pao de Acucar), inscribed in the corporate roll of taxpayers (CNPJ/MF) under No. 02.332.886/0001-04;
• Santander Corretora de Cambio e Valores Mobiliarios S.A., headquartered in the city and state of Sao Paulo, at Avenida Presidente Juscelino Kubitschek, 2041/2235, 24o andar, Vila Olimpia, CEP 04543-011, inscribed in the corporate roll of taxpayers (CNPJ/MF) under No. 51.014.223/0001-49.

The minutes of the annual and special shareholders meeting are available on the websites of Comissao de Valores Mobiliarios: CVM, BM&FBOVESPA S.A.: Bolsa de Valores, Mercadorias e Futuros, and the company.

We seek Safe Harbor.