Petrobras enters Australia via MEO JV
April 14, 2010
BRAZILIAN national oil giant Petrobras will make its first Australian foray by paying up to $US80 million to take a 50 per cent stake in an exploration permit offshore Western Australia.
The deal, which could involve more milestone payments to the Brazilian's partner MEO Australia, will give Petrobras a foothold in an Australian gas market that's fast developing into a major global export player, thanks largely to sustained demand for energy from fast-growing Asian economies.
MEO has been searching for a partner to help it develop its acreage in the Carnarvon Basin, located on Australia's gas-rich North West Shelf, for over a year and market watchers had suspected that Petrobras could be in the running.
Its Artemis prospect could contain up to 12 trillion cubic feet of gas, according to MEO. That would be more than enough to support a stand-alone liquefied natural gas export project, or provide a bountiful third party gas supply source to other LNG projects in the area.
Exploration success, however, isn't guaranteed and MEO got disappointing results from its first exploration well there, Zeus-1, early in 2009.
Petrobras will buy 50 per cent of the permit WA-360-P by funding up to $US41m of the first well's costs, paying MEO $US31.5m cash and covering about $US7.5m of MEO's share of previous costs, adding up to $US80m in total.
In the event of a successful discovery, Petrobras will pay for two follow-up wells to a cap of $US62m and another $US31.5m cash to MEO in January 2011, MEO said in a statement.
MEO will remain operator until completion of the first well, Artemis-1, and then Petrobras has the option to assume operatorship.
An option has been secured over a drilling rig to drill the first well in late 2010, MEO said.
Petrobras' investment had been held up after a minority holder in the exploration permit, Cue Energy Resources, requested changes to some of the deal's provisions.
MEO said today that Petrobras taking 50 per cent of the permit will reduce its holding to 20 per cent. Cue and Moby Oil & Gas will retain their 15 per cent holdings, MEO said.
Source:theaustralian.com.au
Ecopetrol Looks to Expand in Brazil, Buys Hess Stake
May 07, 2010, 10:47 AM EDT
By Peter Millard
May 7 (Bloomberg) -- Ecopetrol SA, Colombia’s state-run oil company, is looking to expand in Brazil to boost production after buying a 30 percent stake in an offshore block from Hess Corp., said an Ecopetrol official.
Ecopetrol, based in Bogota, received approval from Brazil’s petroleum regulator to buy half of Hess’s 60 percent stake in the BM-ES-30 block in Brazil’s Espirito Santo offshore basin, oil regulator ANP said today on its website. The purchase price wasn’t disclosed. Spain’s Repsol YPF SA owns the remaining 40 percent of the concession.
“We are evaluating all the opportunities that may come along,” Francisco Celso Ponte, Ecopetrol’s exploration manager for Brazil, said in a telephone interview from Rio de Janeiro. “We continue looking.”
Ecopetrol plans to spend $6.9 billion this year to almost double output to 1 million barrels of oil per day in 2015 from last year. International oil companies including Royal Dutch Shell Plc and Exxon Mobil Corp. are exploring Brazilian offshore areas, where state-run oil producer Petroleo Brasileiro SA discovered Tupi, the Americas’ largest crude find since 1976.
Drilling Timetable
Hess, the fifth-biggest U.S. oil company, will continue to run the deepwater block’s operations, Ponte said. Hess found noncommercial quantities of hydrocarbons last year in an exploration well in the area, Gregory Hill, Hess’s president of worldwide exploration and production, said Oct. 28.
Hess, based in New York, and its partners haven’t yet made a decision on the timetable to drill a second exploration well, Ponte said. The contract gives the companies two years to decide on a drilling site, he said.
“We will continue with the exploration plan and we are evaluating the block,” Ponte said.
Ecopetrol is seeking to purchase assets and form ventures in Brazil as part of its expansion plan, Ecopetrol Chief Executive Officer Javier Gutierrez said last month in an interview. Ecopetrol has minority stakes at blocks in Brazil’s Campos, Santos and Para Maranhao basins.
Source: businessweek.com
April 14, 2010
BRAZILIAN national oil giant Petrobras will make its first Australian foray by paying up to $US80 million to take a 50 per cent stake in an exploration permit offshore Western Australia.
The deal, which could involve more milestone payments to the Brazilian's partner MEO Australia, will give Petrobras a foothold in an Australian gas market that's fast developing into a major global export player, thanks largely to sustained demand for energy from fast-growing Asian economies.
MEO has been searching for a partner to help it develop its acreage in the Carnarvon Basin, located on Australia's gas-rich North West Shelf, for over a year and market watchers had suspected that Petrobras could be in the running.
Its Artemis prospect could contain up to 12 trillion cubic feet of gas, according to MEO. That would be more than enough to support a stand-alone liquefied natural gas export project, or provide a bountiful third party gas supply source to other LNG projects in the area.
Exploration success, however, isn't guaranteed and MEO got disappointing results from its first exploration well there, Zeus-1, early in 2009.
Petrobras will buy 50 per cent of the permit WA-360-P by funding up to $US41m of the first well's costs, paying MEO $US31.5m cash and covering about $US7.5m of MEO's share of previous costs, adding up to $US80m in total.
In the event of a successful discovery, Petrobras will pay for two follow-up wells to a cap of $US62m and another $US31.5m cash to MEO in January 2011, MEO said in a statement.
MEO will remain operator until completion of the first well, Artemis-1, and then Petrobras has the option to assume operatorship.
An option has been secured over a drilling rig to drill the first well in late 2010, MEO said.
Petrobras' investment had been held up after a minority holder in the exploration permit, Cue Energy Resources, requested changes to some of the deal's provisions.
MEO said today that Petrobras taking 50 per cent of the permit will reduce its holding to 20 per cent. Cue and Moby Oil & Gas will retain their 15 per cent holdings, MEO said.
Source:theaustralian.com.au
Ecopetrol Looks to Expand in Brazil, Buys Hess Stake
May 07, 2010, 10:47 AM EDT
By Peter Millard
May 7 (Bloomberg) -- Ecopetrol SA, Colombia’s state-run oil company, is looking to expand in Brazil to boost production after buying a 30 percent stake in an offshore block from Hess Corp., said an Ecopetrol official.
Ecopetrol, based in Bogota, received approval from Brazil’s petroleum regulator to buy half of Hess’s 60 percent stake in the BM-ES-30 block in Brazil’s Espirito Santo offshore basin, oil regulator ANP said today on its website. The purchase price wasn’t disclosed. Spain’s Repsol YPF SA owns the remaining 40 percent of the concession.
“We are evaluating all the opportunities that may come along,” Francisco Celso Ponte, Ecopetrol’s exploration manager for Brazil, said in a telephone interview from Rio de Janeiro. “We continue looking.”
Ecopetrol plans to spend $6.9 billion this year to almost double output to 1 million barrels of oil per day in 2015 from last year. International oil companies including Royal Dutch Shell Plc and Exxon Mobil Corp. are exploring Brazilian offshore areas, where state-run oil producer Petroleo Brasileiro SA discovered Tupi, the Americas’ largest crude find since 1976.
Drilling Timetable
Hess, the fifth-biggest U.S. oil company, will continue to run the deepwater block’s operations, Ponte said. Hess found noncommercial quantities of hydrocarbons last year in an exploration well in the area, Gregory Hill, Hess’s president of worldwide exploration and production, said Oct. 28.
Hess, based in New York, and its partners haven’t yet made a decision on the timetable to drill a second exploration well, Ponte said. The contract gives the companies two years to decide on a drilling site, he said.
“We will continue with the exploration plan and we are evaluating the block,” Ponte said.
Ecopetrol is seeking to purchase assets and form ventures in Brazil as part of its expansion plan, Ecopetrol Chief Executive Officer Javier Gutierrez said last month in an interview. Ecopetrol has minority stakes at blocks in Brazil’s Campos, Santos and Para Maranhao basins.
Source: businessweek.com
