Petrobras Calls Companies With Minimum Assets of R$ 10 Billion to Purchase Its Potash Mining Assets in the Amazon Basin and Excludes Competitors Subject to Sanctions From the U.S., Europe, and the United Nations

Petrobras’ Potassium Mining Assets in Amazonas Have a Production Potential Equivalent to Approximately 6% of Current Global Production

Petrobras informed the market, on the morning of this day (10/03), about the start of the binding phase regarding the sale of its mining rights for the research and extraction of potassium salts located in the Amazonas Basin.

The state-owned company’s assets for sale consist of 34 mining titles for potassium salts located in the Amazonas Basin and granted by the National Mining Agency (ANM). These include 8 mining concessions for potassium salts, 4 mining requests, and 22 mining titles in the process of obtaining research authorization from the local mining agency.

The state-owned company is seeking bidders with a minimum net worth of US$ 2 billion and issued a warning: it may exclude competitors located in countries subject to sanctions imposed by the United Nations Security Council, the USA, and the European Union, among others. In April, Petrobras canceled an agreement with the Russian company Acron to sell the nitrogenous fertilizer manufacturer UFN-III, claiming that the business plan did not obtain the necessary governmental approvals.

It is important to note that the sale of potassium mining rights is part of Petrobras’ strategy to divest non-essential assets to focus on exploring hydrocarbon discoveries in the offshore pre-salt region.

“Qualified potential buyers for this phase will receive an invitation letter (Process Letter) with detailed instructions about the process at hand, including guidelines for conducting due diligence and for submitting binding proposals”, said the state-owned company in the announcement.

War in Ukraine Made Mineral More Attractive

For decades, Petrobras has held mining rights in areas known as Fazendinha and Ariri, studying alternatives for the business. According to Petrobras data, the potassium mining asset in the northern region of the country has a production potential equivalent to approximately 6% of current global production and more than one-third of Brazil’s annual potassium consumption.

Brazilian farmers have faced difficulties in purchasing fertilizers, with the country importing about 80% of the total.

One reason for the imports is the war in Ukraine, which has made potassium assets more attractive, as the mineral is one of the main components of the fertilizers used in national agribusiness, and currently, the demand for the product is growing increasingly.

“The conflict between Russia and Ukraine has reinforced concerns about Brazil’s vulnerability regarding dependence on fertilizer imports and highlights the opportunities associated with local production,” emphasized Petrobras in its statement, justifying the project to sell the potassium mining asset in the northern part of the country.