Equinor bids adieu to its largest offshore asset outside Norway for $3.5 billion

Brazilian oil and gas company PRIO, formerly known as PetroRio, is expanding its interest in a field off the coast of Brazil by buying the stake Norway’s Equinor holds in what is considered to be the Norwegian state-owned energy player’s largest operated field outside Norway. This comes after the Brazilian independent acquired non-operated interests of two Chinese players in the same field offshore Rio de Janeiro.

After PRIO completed the acquisition, worth $1.92 billion, which enabled it to get its hands on a 40% interest SPEP Energy Hong Kong and Sinochem International Oil had in the Peregrino and Pitangola fields, the firm joined the consortium with Equinor, the operator of the Peregrino asset that holds the remaining 60% stake in this field.

The firm’s affiliate, Prio Tigris, has now taken steps to become the sole owner of the Peregrino field thanks to a deal with Equinor Brasil Energia, a subsidiary of Equinor, which will allow it to buy the latter’s 60% operated interest in the field for a consideration of $3.35 billion and a maximum of $150 million in interest to be paid to Equinor for the asset.

According to the Norwegian giant, the final cash payment will reflect the closing date and any deductions generated by the asset since the effective date of January 1, 2024. Equinor will be responsible for field operations until the closing of the transaction, after which PRIO will take over the operatorship role.

Philippe Mathieu, Executive Vice President for Exploration and Production International at Equinor, commented: “With this transaction we realise value from a long-standing asset in our Brazil portfolio. Brazil will continue to be a core country for Equinor, as we focus on starting up the Bacalhau field and continue progressing the Raia gas project.

“With these two operated projects and our partnership in Roncador our equity production in Brazil will be close to 200,000 barrels per day by 2030. This deal is part of Equinor’s ongoing effort to high-grade its international portfolio through asset divestments and acquisitions. We continue to see growth potential and opportunities to extend the longevity of our international oil and gas portfolio, also in Brazil.”

The company has been operating the Peregrino field since 2009, producing around 300 million barrels of oil. This is a heavy oil field, which consists of a floating production storage and offloading (FPSO), supported by three fixed platforms – Peregrino A, B, and C – in the Campos Basin, east of Rio de Janeiro. Equinor´s share of production from Peregrino was around 55,000 barrels per day during Q1 2025.

This transaction is subject to regulatory and legal approvals, and the payment will occur in two tranches, one at signing and a further one closer to closing, which will be subject to customary adjustments. The deal is divided into two parts, one for the acquisition of a 40% interest and the operatorship of Peregrino, the second for the acquisition of the remaining 20% stake.

While the 40% transaction will require a payment of $2,233 million, with an additional payment of $166 million, this is contingent on the completion of the second part of 20%, which will have a value of $951 million. The final component is $150 million of maximum interest, reaching the total of $3.5 billion.

PRIO claims the deal will add 202 million barrels of oil in 1P+1C reserves and resources based on reserve estimates as of January 2024. Upon completion, Peregrino will be fully owned and operated by the Brazilian independent following approval by the National Petroleum Agency (ANP) and the Brazilian Antitrust Authority (CADE).

The firm expects the transactions to be completed between the end of 2025 and the first half of 2026, with all amounts paid using resources already available in its current accounts, combined with the company’s cash generation until the closing and a temporary increase in leverage levels.

Veronica Coelho, Senior Vice President and Country Manager for Equinor Brazil, remarked: “PRIO has been a valued partner since joining the Peregrino license last year and we look forward to a smooth hand-over with them. We are very proud of the work that has been done by our team over the past 20 years on the Peregrino field. This asset has been the cornerstone of Equinor’s history in Brazil.

“Our journey in Brazil continues with full momentum, building on the legacy of those that have worked on Peregrino. We are preparing for operations on Bacalhau, as well as the startup of the Serra da Babilonia renewable hybrid project by our subsidiary Rio Energy and we are progressing the Raia gas project.”

The Peregrino field, discovered in 1994, had its first oil in 2011. Located 85 kilometers off the coast in the Campos Basin, within blocks BM-C-7 and BM-C-47, and 28 kilometers from the Polvo and Tubarão Martelo cluster, the FPSO Peregrino, which has an oil processing capacity of 110 kbbl/d and 300 kbbl/d of water, works at the field.