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Statoil Bets Big On Brazil, Aims To Triple Production By 2030

Brazil offshore

Statoil will more than triple its production in Brazil by becoming the sole operator of the Carcara discovery, according to the Norwegian company’s local subsidiary.

“We expect (Statoil's) equity production to more than triple in Brazil going towards 2030," Anders Opedal, chief of the company’s Brazil projects, told Reuters on Monday.

Statoil’s investments in the South American nation total $10 billion – the largest of any company active in Brazil.

The offshore Peregrino heavy oil field is Statoil’s largest project in Brazil so far, and the Norwegian giant owns a 60-percent stake.

The oilfield lies off the shores of Rio de Janeiro and produces 80,000-90,000 barrels of oil equivalent per day.

Statoil has been able to overcome legal challenges to its Carcara deal so far.

A Brazilian court suspended the $2.5-billion sale of scandal-ridden Petrobras’ stake in the giant Carcara field to Statoil in April, after the National Federation of Oil Workers filed a lawsuit arguing that Petrobras should have held an open tender for the interest.

The Brazilian state giant agreed with Statoil to sell its 66 percent in the Carcara field last summer. Half of the deal’s price tag was paid at the closing of the acquisition, which took place in November, and the other half is subject to the reaching of certain milestones.

Petrobras said it has already used up the $1.25 billion paid on completion to repay debts.

A tender offered by the Brazilian government lists the Carcara discovery as “material for those interested in an ongoing bidding round”. Statoil maintained its 66 percent stake in the field, the tender said.

For Petrobras, 2017 has been a banner year for corporate recovery. The company reported a net profit of US$1.417 billion in the first quarter, up from a net loss of US$318 million over the same period last year. The new revenues came from exports, which spiked 72 percent year-over-year.

By Zainab Calcuttawala for Oilprice.com

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