QGEP: 2nd Carcara payment from Statoil imminent

Brazil’s QGEP has informed that Statoil has so far paid it half of the total purchase price for its stake in a block offshore Brazil, and that the remaining payments would be following soon.

Statoil in December 2017 said it had completed the acquisition of a ten percent stake in the BM-S-8 block, located in the Santos basin offshore Brazil, and containing the Carcara discovery from from Queiroz Galvão Exploração e Produção (QGEP). The transaction worth $379 million was first announced in July 2017.

In an update on Friday, February 2, QGEP confirmed that it received $189.5 million from Statoil at the end of 2017, representing one-half of the total purchase price for QGEP’s 10% interest in Block BMS-8.

The second payment in the amount of $45 million is expected to be received within 30 business days of the publication in the Official Gazette (Diario Oficial) of the signing of the Adjacent Area Production Sharing contract, which took place last Friday.

The remaining payment, accounting for 38% of the purchase price is due to QGEP upon the signing of the Production Individualization Agreement, or unitization.

Statoil’s acquisition of QGEP’s 10 percent increased the Norwegian company’s position for operatorship of the unitized Carcará field, raising its ownership to a 76 percent. Statoil bought the initial 66 percent from Petrobras for $2.5 billion.

Paula Costa Côrte-Real, Chief Financial and Investor Relations Officer noted, “The strategic sale of our interest in BM-S-8 has significantly increased our already strong cash position and has materially reduced our medium and long capital expenditure obligations. As we enter 2018, we continue to finalize our capital allocation plans, and evaluate investments in our production and exploration asset portfolio as well as the potential distribution of special dividends to shareholders.”

The BM-S-8 block includes a substantial part of the Carcará discovery comprising high-quality oil of around 30° API and with associated gas in a thick reservoir with excellent properties. Statoil estimates the recoverable volumes within the BM-S-8 license to be in the range of 700 to 1,300 million barrels of oil equivalent.

Offshore Energy Today Staff