CNOOC intends to buy $2bn stake in Petrobras’ Buzios field
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CNOOC intends to buy $2bn stake in Petrobras’ Buzios field

30 Sep 2021 (Last Updated September 30th, 2021 12:26)

The Chinese oil firm currently owns 5% stake in the ultra-deepwater oil field, which started production in 2018.

CNOOC intends to buy $2bn stake in Petrobras’ Buzios field
The Buzios field, which is located within the Cessão Onerosa (Transfer of Rights) region. Credit: Bruno / Germany / Pixabay.

Petrobras received an expression of interest from China’s CNOOC to exercise an option to buy an additional stake in production rights for the Buzios oilfield, offshore Brazil, for $2.08bn.

The purchase option was provided in the contract signed in 2019 by Petrobras, CNOOC and CNODC in the bidding of the surplus volume to the ‘transfer of rights’ (TOR) agreement of the offshore field.

The contract included an option for the Chinese firms to increase their stake at a later stage.

Currently, Petrobras owns 90% of the exploration and production rights for the surplus volume of the Transfer of Rights of the Búzios field.

The remaining stake is split between state-run oil companies China National Offshore Oil Corporation (CNOOC) and China National Oil & Gas Exploration & Development Corporation (CNODC).

The expression of interest follows Petrobras receiving $2.9bn for the obligations of its partners CNODC and CNOOC in the Búzios Coparticipation Agreement.

The amount covers previous exploration costs under the TOR rights to surplus oil found at the area, which was defined in a deal between the government and Petrobras signed in 2010.

Petrobras said that the amount to be paid by CNOOC for the stake includes compensation of $1.45bn.

It also includes $600m towards reimbursement of the signature bonus, referring to the additional participation of the Chinese firm.

The Buzios field, which is located within the Cessão Onerosa (Transfer of Rights) region of the pre-salt Santos Basin, started production in 2018.

The transaction with CNOOC is contingent on approvals from Brazil’s Administrative Council for Economic Defense (CADE), the National Agency of Petroleum, Natural Gas and Biofuels (ANP), as well as the Ministry of Mines and Energy (MME).

In May 2021, Petrobras awarded a $2.3bn contract to Keppel Shipyard to build the P-78 floating production, storage and offloading (FPSO) vessel, which will be the seventh unit to be deployed in the Búzios field.