The likable Brazilian midfielder has penned a long-term deal with the Reds after recovering from a couple of lengthy injuries to again be a key contributor in the Anfield first team.
"It's another long-term contract that I have signed - but it was the same feeling as when I first came here," he told the club's official website.
"I am really delighted to have the opportunity to play for this club. It's where I think I belong and where I wanted to stay, so I am very happy and looking forward to a few more years here.
"It was an easy decision because after the long period of my career I have had here, I would like to give the best of my time to this club.
"It was not a difficult decision to make and I am really looking forward to what will hopefully be a few more years with a lot of success."