Oil companies and investment funds dispute Petrobras refinery divestments

Aug 28, 2019

In addition to global oil giants such as Exxon, Shell, Total and Saudi Aramco, banks, investment funds and trading companies, also move the pieces in the game for the purchase of eight refineries that Petrobras has placed for sale.

According to sources, nearly two dozen companies signed the confidentiality agreement with the state-owned company to gain access to refinery data and study the business. The first round of offers for four of the eight units is due to take place in October.

Three major oil companies of Chinese capital are also contenders: PetroChina, Sinopec / Repsol and CNPC, which this month is set to move forward with Petrobras on a project to build a refinery at Comperj in Itaboraí (RJ). The first two already work in consortia with Petrobras in oil exploration in Brazil. Among traders, sources cite the interest of Trafigura and Glencore.

Among the Brazilian companies, one of the interested groups is Cosan, which operates in the energy and logistics areas, and controls Raízen, which operates Shell’s stations in Brazil. Last year Raízen acquired Shell’s fuel refining and distribution assets in Argentina.

The sale of Petrobras’ eight refineries, with a total processing capacity of 1.1 million barrels of oil per day, is considered fundamental to the end of the de facto monopoly exercised by Petrobras in the fuel market. The market estimates that the deal could yield to Petrobras revenue of about U$ 20 billion.

Felipe Perez, Downstream Director of International Consulting IHS Markit, says that despite being positioned in the dispute for Petrobras refineries, the world oil giants may not be interested in the assets because, at this moment, they are strategically reducing their refining projects in the world to invest in more lucrative activities.

This is also what motivates Petrobras to sell part of its refining park. In this context, the executive believes that banks and investment funds may surprise in the final stretch of competition for refineries, including forming consortia:

– There may be non-typical stakeholders, such as refined oil producers, or trading companies and national fuel companies. National and international banks and investment funds could enter the fray and create new companies

For an industry source who prefers not to identify himself, about five applicants will reach the end of the process:

– In the non-binding phase (first round of offers) there are always companies that have no genuine interest in the assets offered but are seeking some market information. So I believe that only about five will remain.

Source: O Globo

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