Brazilian oil company Prio is currently in discussions with China’s Sinochem regarding the acquisition of a 40% stake in the Peregrino oilfield, reported Reuters, citing CEO Roberto Monteiro.
Although no binding agreement has been reached, the company disclosed in a securities filing that negotiations are ongoing.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The potential deal could see Prio close the purchase by the end of the week, with the transaction valued at up to $1.9bn, the news agency said, citing a report by newspaper Folha de S.Paulo.
Prio’s chief executive highlighted the natural synergies between Peregrino and the company’s existing assets, noting the field’s proximity to the company’s operations.
Monteiro said: “We see it as a good deal for us but there is still a lot of water to pass under this bridge.”
The acquisition would boost Prio’s production, adding approximately 40,000 barrels to its current daily output of around 80,000 barrels of oil equivalent.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataSinochem has been seeking a buyer for its stake in Peregrino since 2017.
The company acquired the stake from Norway’s Equinor for $3.07bn (21.53bn yuan) in 2010, outbidding several Chinese competitors.
Equinor retains a 60% stake in the field and is the operator.
Peregrino, situated offshore east of Rio de Janeiro in the Campos Basin, is Equinor’s largest field outside Norway and produced 110,000 barrels of oil per day last year.
The heavy oilfield, lying at a depth of around 100m, began production in 2011 and has since extracted 34.92% of its total recoverable reserves.
With peak production expected in 2024, the field is forecast to maintain output until it reaches its economic limit in 2055, contributing around 2% of Brazil’s daily production.
Equinor recently initiated Phase 2 of Peregrino’s development, which includes new drilling facilities and a gas pipeline for power generation connected to the existing floating production storage and offloading unit.
In separate development news, Sinochem is reportedly planning to divest its 40% stake in a US shale joint venture with ExxonMobil, with the sale potentially exceeding $2bn.
