Rosneft takes control of PetroRio Oil Venture in Brazil’s Amazon

OAO Rosneft, Russia’s largest oil producer, has taken control of an exploration venture in the Brazilian Amazon, Chief Executive Officer Igor Sechin said.

Rosneft will hold 100 percent of two onshore oil and natural gas exploration leases in the Amazon’s Solimoes Basin after buying a stake from PetroRio, according to two people with direct knowledge of the deal who asked not to be named because the agreement isn’t public. The deal is valued at $55 million and will be announced as early as Monday, one of the people said.

“This is a good deal,” Sechin said Saturday in an interview in Sochi, Russia. He wouldn’t discuss details of the agreement. PetroRio, based in Rio de Janeiro, declined to comment.

The agreement puts an end to more than a year of negotiations between the Moscow-based company and the Brazilian independent oil producer over their venture in Solimoes. In March 2014, Rosneft announced a deal to boost its stake in the project to 51 percent, taking over the operation of the venture from PetroRio. The terms of the negotiation weren’t concluded, the Brazilian company said May 14 in its first-quarter earnings statement.

PetroRio, a startup that went public in 2010 and is formally known as HRT Participacoes em Petroleo SA, is selling exploration assets as it focuses on generating revenue by acquiring fields that already are in production. In January, the company agreed to buy an 80 percent stake in the offshore Bijupira and Salema fields from Royal Dutch Shell Plc.

PetroRio, backed by Brazilian magnate Nelson Tanure, also operates the offshore Polvo field in Brazil’s Campos basin.

Source: BloomBerg Business