Petrobras expects to conclude Buzios negotiations with Chinese partners in 2021, says CEO

(Reuters) Petrobras expects to conclude negotiations with Chinese partners this year for the development of excess volumes from the Búzios field, in the Santos Basin pre-salt, and could buy part of the partners if “by chance” they want to sell, he said on Thursday. the president Roberto Castello Branco.

The block with excess volumes of oil and gas from the Búzios field, in the region known as transfer of rights, was purchased by Petrobras, with a 90% stake, in partnership with Chinese CNODC and CNOOC (5% each) in 2019.

Both companies need to decide on amounts to be reimbursed to Petrobras for investments already made in the asset, in addition to reaching an understanding of how the area containing reserves will be explored with the already operational field in Búzios.

“It is an extremely important asset for Petrobras and for Brazil. It is a jewel that Petrobras has. Low costs and risks, in short, all the characteristics and that I classify as a world-class asset”, said the executive, when participating in an online event from Credit Suisse.

According to him, “everything is ready” to reach an understanding with the Chinese this year. Asked if he would be interested in increasing participation in the asset, Castello Branco indicated that he would.

“We believe that our 90% share is ok. If the Chinese perhaps want to sell the 10% … ok, fine, we buy it and we will continue to be happy with the exploration of the Búzios field.”

The executive did not elaborate on the negotiations.

Sale of assets

Castello Branco also presented updates on the process of selling refineries and stakes in petrochemical Braskem and BR Distribuidora, noting that the company is divesting of lower return assets to focus on oil and gas production in deep and ultra-deep waters.

In the case of refineries, the executive stated that the company is in the final stage of negotiation for the sale of Refap, Rlam, SIX, Lubnor and Reman. Repar’s proposals are still under discussion, and the company will still receive proposals from Regap and Rnest.

According to Castello Branco, compared to the pre-salt, refineries are not a high return business and have been operated inefficiently in the past, which leads to high costs.

“There is a high consumption of energy, energy represents 50% of the operating costs of a refinery. So the results are not good,” he said.

In the case of BR Distribuidora, Petrobras considers that the shares of the largest fuel distributor in Brazil are below their potential and awaits an improvement in market conditions to completely dispose of the asset.

Braskem, according to him, “is much more complicated”.

Petrobras’ idea is to list the petrochemical company on B3’s Novo Mercado, the highest level of governance of the São Paulo stock exchange, and to sell its stake through the capital market.

However, according to Castello Branco, the company has encountered obstacles on the part of its partner, Odebrecht, and the process “has not been moving”.