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PetroRio: acquisition of additional interest in Frade field

Published by , Editorial Assistant
Oilfield Technology,

Petro Rio S.A. (‘Company’ or ‘PetroRio’), in addition to the material fact disclosed to the market on October 29, 2018, has announced the execution of a Share Purchase Agreement for the acquisition of Chevron Brasil Upstream Frade Ltda. (‘Chevron Frade’) - a limited liability company holding a 51.74% working interest and operatorship in the Frade Field - and of equivalent interest in assets operating in the field.

Once concluded, PetroRio’s will increase its working interest in the concession from 18.26% to 70% and become the field’s operator. With the transaction, PetroRio's combined production at Frade will reach 15 000 boe/d and contribute to a significant increase in the Company's total production, reaching approximately 28 000 boe/d. In addition, Company 2P reserves are expected to reach 83.6 million bbls.

The transaction also includes a 50% operated interest in the deepwater CE-M715 Block (Ceara Basin). The conclusion of the acquisition is subject to certain conditions precedent as well as internal and external approvals.

The transaction is accretive to cash flow and will result in PetroRio becoming the largest independent oil & gas player in Brazil. The agreement also reaffirms PetroRio’s strategy of growth through acquisitions of producing assets and represents a diversification of its portfolio of revenue generating assets.

The commercial conditions of the transaction are subject to confidentiality and shall be duly disclosed to the market through the relevant channels. Scotiabank acted as PetroRio’s financial advisor and Mattos Filho Advogados as external legal counsel on this transaction.

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Upstream news Offshore news Brazil upstream news Oil & gas news