The consolidation of Petrobrás as a transnational company occurred at a moment in which the internationalization of Brazilian firms was intensified. One of the characteristics of international investment in developing countries is their concentration within their own regions. This is the Brazilian case, in which an important part of foreign investments has been devoted to South America, and to Argentina in particular - where Brazil has today become one of the major foreign investors. Petrobrás Energia S/A, a subsidiary of the state-owned Brazilian company and the second largest petroleum company in the neighboring country, became an important economic actor with activities in all segments of the energy sector.. The goal of this article is to analyze Petrobrás investments in Argentina between the years 2000 and 2005, the context in which they took place and what motivation lay behind them. For these purposes, we evaluate the relationship between the processes of the firm's internationalization and reforms in gas and petroleum sectors in both countries. We have been able to ascertain that institutional advantages of locality encouraged Petrobrás to choose Argentina as a base for its activities in the region: from the point of view of formal rules, the country furnished a favorable institutional environment for foreign investment, since from the upstart reform projects for the Argentine gas and petroleum sector were based on the idea that it should be internationalized, allowing for the entrance and exit of foreign firms and exposing the internal market to the international one.
International Political Economy; transnational companies; Petrobrás; reforms in the petroleum and gas sectors; Brazil-Argentine relations