Despite The Crisis, PetroRio Is Urgently Pursuing The Purchase Of Petrobras’ Frade Field Located In The Campos Basin

In hopes of boosting profits and reducing costs, PetroRio announced urgency in negotiations with Petrobras regarding the purchase of 30% of the Frade field, located in the Campos Basin. The good news came amid the current global crisis in the oil industry due to the new coronavirus pandemic. The Gong Sounded at the Polvo Field in the Campos Basin! PetroRio Increases Its Oil Production by Almost 30%

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The negotiation between PetroRio and Petrobras regarding the purchase of 30% of the Frade field, located in the Campos Basin, was announced in November 2019 for 100 million dollars. Once the transaction is completed, PetroRio will hold 100% of the asset.

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“Our top priority is to pay for those 30% from Petrobras because that increases our revenue, reduces our ‘lifting cost’ and makes us even more competitive,” said Kassab in a telephone interview,” said George Kassab, Director of Investor Relations at PetroRio.

According to the executive, negotiations of this magnitude take about a year to obtain all the necessary approvals, as they depend on internal clearance and regulatory agencies, the executive said, without providing a specific deadline for closing the deal.

Another major goal for PetroRio will be to complete a deal involving the purchase of an FPSO OSX-3 type platform for 140 million dollars, along with the acquisition of 80% in the Tubarão Martelo field, where the vessel is located, a deal announced in February.

The two transactions, according to PetroRio, will allow integration between the Polvo fields, already operated by them, and Tubarão Martelo, both in the Campos Basin.

On the other hand, Kassab pointed out that the company announced to the market last month a review of its business plan, which postponed investments to “readjust” to the new industry scenario amid the pandemic.

“Due to Covid-19 and the price of Brent, we have discarded any investment in new wells in Frade and Polvo for the next 12 months,” he emphasized.

George Kassab also stated that to deal with the complicated scenario that the oil industry is facing today, with a decrease in demand due to the new coronavirus pandemic, PetroRio relies on hedge operations to contribute to the company’s revenue in the first half of 2020, in addition to having closed the year 2019 on a high.

PetroRio started 2020 with a cash position of 183 million dollars and a volume of 93 million dollars in accounts receivable “that materialized during the months of January and February.”