Brazilian court suspends Petrobras’ field sale to Statoil

A Brazilian court is blocking the transfer of Petrobras’ stake in the BM-S-8 offshore exploration block, which contains the Carcará oil field, to the Norwegian oil company Statoil. 

According to a Monday statement by the Brazilian oil giant, the 2nd Federal District Court, Sergipe state, granted an injunction to suspend the transfer of the stake to Statoil and the exploration of the field, until further court deliberation.

The Brazilian and the Norwegian oil company agreed last July for Statoil to acquire Petrobras’ 66% operated interest of the BM-S-8 offshore license in Brazil’s Santos basin for $2.5 billion. The acquisition included a substantial part of the Carcará oil discovery, which Statoil claimed to be one of the largest discoveries in the world in recent years.

Statoil estimated the recoverable volumes within the BM-S-8 license to be in the range of 700 to 1,300 million boe. BM-S-8 holds exploration upside that may significantly increase its resource base. The license was in its final exploration phase with one remaining exploration commitment well to be drilled by 2018.

On completion of the transaction in November, Statoil paid Petrobras $1.25 billion, which is half of the total consideration, with the remainder paid at the passage of certain future milestones.

In the statement on Monday, Petrobras also noted that this transaction had already been finalized after the fulfillment of all the precedent conditions set forth in the contract, with no restrictions, such as approval by the Administrative Council for Economic Defense (Cade) and by the National Agency of Petroleum, Natural Gas and Biofuels (ANP).

Furthermore, the Brazilian company stated that the amount received after the closing of the transaction was used in full for early settlement of part of the financing contract between Transportadora Associada de Gás S.A. (TAG), a wholly-owned Petrobras subsidiary, and the National Bank for Economic and Social Development (BNDES), where such a measure was adopted to reduce its indebtedness.

Petrobras added that it will take the appropriate legal action on behalf of its investors and own interests.

Sale ‘result of competitive process’

Offshore Energy Today has reached out to the Norwegian oil company seeking further details about the suspension and the company’s course of action.

A spokesperson for Statoil confirmed the court suspended the Carcará sale process and all activities related to it.

When asked about the reason behind the suspension, the spokesperson said: “We cannot speculate in the reason for this decision, but are confident that Brazilian institutions will confirm the legality of the transaction and Statoil will take appropriate actions to support this.

“The deal was a result of a competitive process as part of Petrobras’ divestment plan and the deal was closed on 22 November 2016. It has been approved by the Brazilian anti-trust agency (CADE), the National Petroleum Agency (ANP) as well as the partners in the license.

“Statoil was also named in the decision and we are currently evaluating our next steps.”

Further regarding the reason for the suspension, Reuters reported that the National Federation of Oil Workers said it had filed the lawsuit because Petrobras, as a state-controlled enterprise, is required to hold an open bid for any asset sale.

Offshore Energy Today Staff