ExxonMobil will join Statoil as a partner offshore Brazil, buying half of Statoil's interest in block BM-S-8, which contains part of the pre-salt Carcará oil field, for US$1.3 billion. The pair have also teamed up for a pre-salt licensing round held today (27 October) for the Carcará North block in a consortium that includes Portugese company Galp Energia.
The Carcará field contains an estimated recoverable resource of 2 billion bbl of high-quality oil, and Statoil says it hopes to bring the development online by the mid-2020s. The block is approximately 200mi offshore Rio de Janeiro.
Statoil currently holds a 66% interest in block BM-S-8, which contains about half the Carcará field. The other part of the field is in the adjacent North Carcará block. Statoil will continue to operate the Carcará development. Statoil reports that the $1.3 billion sale amount comprises an upfront cash payment of around $800 million and a contingent cash payment of around $500 million. The transaction is subject to government approvals and is expected to close in 2018.
Additionally, Statoil said it acquired all of Queiroz Galvão Exploração e Produção's (QGEP) 10% interest in block BM-S-8, of which it will divest 6.5%—3.5% to Exxon and 3% to Galp, for a total consideration of $250 million, which comprises a cash upfront payment of $155 million and a contingent cash payment of $95 million.
Once the sale is closed, both Statoil and ExxonMobil will hold a 36.5% interest in BM-S-8 and a 40% interest in Carcará North. Galp will have 17% in BM-S-8 and 20% in Carcará North. Barra Energia will hold 10% in BM-S-8 only.
The Statoil, Exxon, Galp consortium presented the winning bid (67.12% of profit oil) for the Carcará North block in the Santos basin during today's pre-salt round. The pre-determined signature bonus to be paid by the consortium is approximately $910 million (BRL 3.0 billion), Statoil said.
Statoil CEO Eldar Sætre said that today's move further strengthens Statoil's presence in Brazil's pre-salt. "These transactions help build a strong and aligned partnership across the two Carcará blocks," he said. "Together they significantly advance our strategy in Brazil, a core area for Statoil. Developing a world-class asset like Carcará as operator is a good match with our competence and capacity."
Similarly, ExxonMobil has been expanding its acreage offshore Brazil. "Over the last month, through bid rounds and announced farm-in agreements, ExxonMobil has added 14 blocks comprising more than 1.25 million net acres offshore Brazil to its portfolio, bringing its total acreage in the country to more than 1.4 million net acres," the supermajor said.
“These agreements and recent bid round results mark ExxonMobil’s entry into a world-class resource and prospective exploration acreage in Brazil,” said Darren Woods, chairman and chief executive officer of ExxonMobil. “ExxonMobil has a long history in the country and we’re confident our deepwater technology and project expertise can help to further grow the value of Brazil’s energy resources. We look forward to working with Petrobras and all our partners to begin to explore and develop this high quality acreage.”
Image from Statoil.
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