Statoil to Sell 40% of Offshore Brazil Oil Field to Sinochem for $3B Cash

Statoil ASA has agreed to sell 40% of the Peregrino field offshore Brazil to China’s Sinochem Group. Statoil maintains 60% ownership and the operatorship of the field which is set to start production in early 2011.

Map of the Peregrino field. Click to enlarge.

Sinochem Group will pay a total of US$3,070 million in cash for the 40% share of the Peregrino field, located 85 km offshore Brazil in the Campos basin at about 100 meters of water depth in BMC-7 and BMC-47.

The first phase of the development includes two drilling- and wellhead platforms and a ship-shaped floating production, storage and offload unit (FPSO). The field was discovered in 1994. Statoil (then Norsk Hydro) acquired 50% in the discovery in 2005, and the remaining 50% and its operatorship in 2008.

The transaction is subject to government approvals in Brazil and China. The consideration is based on an effective date of 1 January 2010 and subject to customary adjustments.

The divestment of a 40% share of Peregrino will reduce Statoil’s equity production guiding for 2012 by 40,000 boepd to a range of 2,060 000 – 2,160 000 boepd.

Brazil will continue to form a key part of Statoil’s international strategy. The company remains committed to complete the Peregrino development as planned, operate the field efficiently, and to explore further growth opportunities in the region.

Sinochem Group, incorporated in China in 1950, is 100% state owned and is China’s 4th largest oil company and the largest integrated agrichemical product and service provider.