Brazil’s national oil company Petrobras will enter into a 30-day exclusive negotiation period with Argentine firm Pampa Energía for the sale of the former’s 67% stake in subsidiary Petrobras Argentina.
The board of Petrobras approved the talks, which can be extended for an additional 30 days, the Rio de Janeiro-based firm said in a statement.
Pampa is already one of the main players in Argentina’s electric power sector, boasting some 2.2GW of generating capacity, 17,774km of transmission lines and 3.6mn distribution customers, according to information on its website.
Raymond James analysts said in December that Petrobras Argentina’s oil and gas output of 65,000boe/d is six times that of Pampa, while Pampa’s generating capacity is twice that of Petrobras Argentina.
Petrobras Argentina has a market capitalization of US$1.25bn.
In a related note, Petrobras’ board approved the start of the process to transfer E&P rights in certain onshore fields, as well as the sale of the assets related to these concessions.
“This initiative, which is part of Petrobras Divestment Plan, will be conducted through a competitive bid,” said Petrobras.
Debt-burdened Petrobras also plans to sell its natural gas transport unit Nova Transportadora do Sudeste.
“The operation was handled by the floating platform FPSO Cidade de São Vicente, which will produce around 20,000 barrels of oil per day during the test period,” said Petrobras.
The FPSO was connected to the 1-RJS-691 well in water depth of 2,200m and will remain on-site for 180 days. The 26 API degree oil will be transported by shuttle tankers.
The early production system will collect technical information on the behavior of the reservoirs and outflow of the oil via the underwater pipes, among other data. This information will provide support for the development of the definitive production system, scheduled to begin operations in 2020.
Source: BN Americas, written by Andrew Baker