Petrobras withdraws from the sale of Albacora to Prio and assets are maintained by the state-owned company, claiming lack of conditions

Last Thursday, the 8th, Petrobras withdrew from giving up the Albacora field, which was being negotiated with Prio. In a note, the state-owned company states that, despite great mutual efforts, it was not possible to find conditions that would reflect the valuation of the asset for Petrobras.

At the same time, Prio stated that, although Albacora is an asset with great potential, the company believes that a possible transaction with values ​​above those already offered would not guarantee the return, nor would it bring the adequate risk profile for this project. The community was disclosed on the same day of withdrawal. In addition, according to the statement, Petrobras will continue its project to revitalize the Campo de Albacora, located in deep waters in the Campos Basin, to develop production from the Forno reservoir. According to Petrobras, the project includes the hiring of a new platform for the field.

Finally, both companies stated that the decision to end the transaction does not affect the sale of the Albacora Leste field to Prio by Petrobras, which is still being evaluated by Petrobras. ANP (National Agency for Petroleum, Natural Gas and Biofuels). It is estimated that the purchase will be approved in the coming months. In a note, Petrobras states that it remains fully committed to its active portfolio management program. According to her, it is essential to emphasize that the company continues to periodically reassess its portfolio of assets, managing to continuously identify which ones should be divested, and which ones should be the focus of the state-owned company's investments. At the same time, Prio stated that the company reinforces its commitment to financial discipline, in addition to the allocation of capital at rates of return that reflect its objectives of creating value for its shareholders and customers.

Therefore, Petrobras will continue the project to revitalize the Campo de Albacora, which also includes the development of production at the Forno reservoir, located in the Albacora pre-salt layer.

Sale of Albacora indicates negative news for Prio, but Petrobras remains firm in the decision

Several industry experts evaluated the news as negative, especially for Prio, as it removes the company's potential advantage for the investment test, although it has not yet been incorporated into the base case. At the same time, the situation does not impede Prio's growth paths, despite Albacora. In this sense, Itaú BBA's research team evaluated the announcement of withdrawal as neutral, since investors were already attributing a high probability of a negative result to the operation due to the slowness in concluding negotiations.

On the other hand, the bank believes there is a positive indication as it eliminates the uncertainty that this reality cast on the company's prospects, managing to release the action to adequately respond to the organic growth that has been showing from its revitalization plans in the region. Therefore, the BBA reiterated the outperform valuation — equivalent to a purchase — for Prio, with a prevalence of BRL 45, representing an enormous potential for an appreciation of 64% compared to the closing price of the day before, BRL 27,56.

Furthermore, analysts of the Itaú BBA point out that the fair value estimate did not consider the Albacora Field, and encompasses the expected value creation from the continuous revitalization of the Campo de Frade, in addition to the future development of the Wahoo and Albacora Leste fields. After the pronouncement, Bradesco BBI highlighted that the value of the existing field in its target price for 2023 of R$49 per share was R$8 per asset, being based on a considerably conservative assumption of the field reaching the production of 80 thousand barrels per day over a five year period, scoring 20kdpd in the first year.

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