Petro Rio has signed today a Sale and Purchase Agreement with Petrobras for the acquisition of a 90% interest and the operation of the Albacora Leste Field.

The consortium will then be formed by PRIO, operating the Field with a 90% interest, and Repsol Sinopec Brasil (“RSB”), with a 10% interest. The deal is subject to the usual conditions precedent for this type of operation, such as approval by the National Agency of Petroleum, Natural Gas and Biofuels (“ANP”), approval by the Brazilian antitrust entity (CADE), and a waiver of the preemptive rights by RSB within 30 days.

The transaction will have a fixed price totaling US$ 1,951 million, of which US$ 293 million to be paid upon signing of the agreement, and a further US$ 1,658 million upon closing of the acquisition and transfer of the operation to the Company, subject to adjustments until the closing of the transaction (counted from October 1st, 2022) and to the fulfillment of the conditions precedent.

The deal also includes the possibility of (cumulative) additional payments of up to US$ 250 million, depending on annual average Brent prices for the years 2023 and 2024. 

Albacora Leste has water depth of 1,200 meters, and is located in the north of the Campos Basin, 23 km from the Frade Field.

The Company estimates economically recoverable 1P reserves of approximately 280 million barrels for the Albacora Leste Field, with net reserves of over 240 million barrels net to PRIO, and expects the Field to be abandoned after 2050. These estimates consider a long-term price of US$ 62 per barrel of oil.

All amounts will be paid using the funds already available in PRIO’s accounts, along with the Company’s cash generation up to the closing of the transaction. Leverage levels will remain within healthy and conservative ranges of less than 1,0x Net Debt/EBITDA.

Albacora Leste Field

Discovered in 1986, the Albacora Leste Field had its first oil in 1998 and currently has a production of approximately 30 kbbld in March, with 19º API oil and low-sulphur content, produced through its 17 production wells and 15 injection wells. The Field comprises an area of 511 km².

Production in the Field is carried out through the P-50 FPSO, with an oil processing capacity of 180 kbbl/d and 6 MMm³/d of gas, while the Field’s artificial lift system is carried out by gas lift.

KeyFacts Energy: PetroRio Brazil country profile