Brazil Splash for Karoon and Woodside
Thursday 6 October 2016
Australia's Karoon Gas has paired up with compatriot Woodside with what looks like a winning bid for the acquisition of the Tartaruga and Bauna oil assets in Brazil from Petrobras.
Woodside is providing the financial muscle that has helped Karoon to edge out Portuguese rival Petroatlantic, according to sources with knowledge of the transaction.
Petrobras is selling a 100% stake in the Santos basin field Bauna, where the floating production, storage and offloading unit Cidade de Itajai is currently producing close to 50,000 barrels of oil equivalent per day, plus a 50% interest in Tartaruga Verde, where the Cidade de Campos dos Goytacazes FPSO is due to enter into production in 2017.
The Tartaruga Verde and Tartaruga Mestica fields are jointly expected to produce up to 150,000 boepd through a single FPSO.
The sale package was to have included the Golfinho field, in the Espirito Santos basin, but this was withdrawn.
The original bidding process for the three assets attracted a bid of about $1.7 billion by Petroatlantic, but the Portuguese newcomer struggled to obtain financing.
Petrobras is pursuing an aggressive divestment plan that involves selling riskier assets for those with a faster rate of return, aiming to restore lost investment capacity.
Karoon recently bought out its former partner Pacific E&P from Santos basin blocks S-M-1037, S-M-1101, S-M-1102, S-M-1165 and S-M-1166.
Pacific E&P had held a 35% stake in those five permits. Karoon has been engaged in market consultations about a possible floating production unit for development of the Kangaroo and Echidna fields.