Brazilian oil giant Petrobras has sold its 30 percent stake in the Frade offshore oil field to PetroRio.
With the completion of the transaction, PetroRio now fully owns the field, located in the Campos Basin, north coast of the state of Rio de Janeiro.
In addition to paying $7,5 million back in 2019 when the sales deal was signed, PetroRio last Friday paid $36 million to Petrobras completing the transaction. Also, PetroRio will pay an additional $20 million n case of a commercially viable new oil discovery in the area.
The Frade field is located about 118 km off the north coast of the state of Rio de Janeiro, at a water depth of between 1,050 and 1,300 m. Production started in June/2009 and the average production in 2020 was around 20 thousand boe/day, of which Petrobras production stake was around 6 thousand boe/day.
Providing details on the amount paid, PetroRio said: "In addition to the US$ 7.5 million paid upon signing of the Share Purchase Agreement, on November 28, 2019, another US$ 36 million were paid on this date (after price adjustments due to the asset’s cash flow between the agreement’s signing and the closing of the transaction) and the Company will be entitled to an oil inventory of approximately 500 thousand barrels, which is currently at Frade FPSO.
The transaction increases PetroRio’s 1P reserves by 17 million barrels and adds 5.2 thousand barrels to PetroRio’s daily production.
"The acquisition represents the conclusion of yet another successful step in the execution of PetroRio’s growth strategy, through the acquisition and redevelopment of producing fields, replicating Polvo Field’s success in Frade, thereby increasing the Field’s profitability and extending its economic life," PetroRio said.
PetroRio became the operator of the Frade field when it in 2019 bought Chevron's 51.74% stake in the producing field - including the FPSO Frade - increasing its interest to 70%. It then, in October 2019, bought a further 18.3% stake from Japanese trio Inpex, Sojitz, and Jogmec.