Norway’s Statoil and Brazil’s Petrobras agreed that Statoil will acquire a 25% interest in Roncador, a large oil field in the Campos Basin in Brazil, from Petrobras for up to $2.9 billion.
“The transaction nearly triples Statoil’s production in Brazil, with attractive break-evens and potential for additional value creation for both parties through the application of Statoil’s expertise in improved oil recovery (IOR),” said Statoil.
“The total consideration comprises an initial payment of USD 2.35 billion, plus additional contingent payments of up to USD 550 million.”
Statoil CEO Eldar Sætre, said: “This transaction adds material and attractive long-term production to our international portfolio, further strengthening the position of Brazil as a core area for Statoil.
“We are also pleased to advance our strategic partnership with Petrobras by expanding our technical collaboration, sharing technology, competence and experience to increase oil and gas recovery.”
Statoil said Roncador was the largest discovery offshore Brazil in the 1990s and is currently the third largest producing field in Petrobras’ portfolio with around 10 billion barrels of oil equivalent (boe) in place and an expected remaining recoverable volume of more than 1 billion boe.
“The ambition is to increase the recovery factor by at least 5 percentage points, bringing the total remaining recoverable volumes to more than 1,500 million boe,” said Statoil.
“The field has been in production since 1999 with output, during November 2017, of around 240,000 barrels of oil per day plus around 40,000 boe per day of associated gas.
“The transaction increases Statoil’s equity production in Brazil by around 175% to around 110,000 boe per day from around 40,000 boe per day.
“Petrobras retains operatorship and a 75% interest.”
In conjunction with the transaction, the two companies said they are entering into an agreement with the aim of maximising value creation and the longevity of the Roncador field.
Statoil said it will leverage its IOR technology, competence and experience from the Norwegian Continental Shelf (NCS) and elsewhere, and Petrobras its experience as the largest deep-water operator and pre-salt developer in the world.
Several specific opportunities for increased recovery and value creation have already been identified.
Petrobras CEO Pedro Parente said: “Strategic partnerships are an important part of our business plan and Statoil’s knowledge and experience in increasing the level of oil recovery in mature fields will add value not only to our joint operations in Roncador, but to other mature fields in the Campos Basin, with huge potential to positively impact future production in the area.”
The effective date for the Roncador transaction is January 1, 2018. Closing is subject to certain conditions, including government approval.