Brazil’s Petrobras could add several billion dollars of assets to its already ambitious five-year divestment plan, executives said on Dec. 4, underlining the state-run oil company’s rush to reduce its hefty debt load.
In the company’s 2020 to 2024 business plan released last week, Petrobras said it would look to sell $20 billion to $30 billion of assets during that period, including eight refineries spread around Brazil.
In a separate presentation Dec. 4, released during Petrobras’ New York Investors’ Day, the company said it may add its Bolivian assets to the divestment program, as well as its stake in petrochemical firm Braskem SA, legacy deepwater oil fields and its remaining stake in fuel distribution firm, Petrobras Distribuidora SA, commonly known as BR Distribuidora.
Talking to analysts and journalists, executives said they may sell parts of the Marlim oil field, one of Brazil’s largest, as well as its majority stake in the smaller Papa-Terra Field.
CEO Roberto Castello Branco estimated a piece of Marlim could fetch about $2 billion to $4 billion, while CFO Andrea Almeida said the potential sale of its Braskem stake could bring in $2 billion to $3 billion.
Petrobras has already failed previously, though, to sell its Braskem stake independently from controlling shareholder Odebrecht, but was not successful. Odebrecht and its creditor banks plan to keep the Braskem stake for at least more two years, Reuters reported earlier this week.
“The extra assets that are not included in the plan are BR Distribuidora, Braskem and other E&P assets,” Almeida told journalists. “It adds to the $20 to $30 billion plan.”
The comments indicate Petrobras is still laser-focused on selling off assets in a bid to reduce debt and sharpen its focus on Brazil’s deepwater presalt area, a geological formation where billions of barrels of oil are trapped underneath a layer of salt beneath the ocean floor.
In the presentation, Petrobras estimated it would boost its equity value by roughly 45% by 2021.
Capex from 2020 to 2024 will be concentrated in the presalt, with a special emphasis on its Buzios Field, the company said.
Some 59% of $75 billion in forecast capex over the next five years will be geared toward the pre-salt formation. Around a quarter of total capital expenditure will go to Buzios, considered one of the world’s most promising oilfields.
Petrobras also said it sees some $1 billion in “potential gains” in 2020 versus 2018 via increased sales of bunker fuel, which is generally used to power ships. International regulators are lowering the maximum allowed sulfur content in bunker fuel, which is seen as favorable for Brazil, as the nation's crude is naturally low in sulfur.
Brazil-listed preferred shares in Petrobras closed up 1.6% on Dec. 4.
The disappointment at Hassa-1 comes after Exxon said in November its crude discovery at the Tanager-1 well in the Kaieteur block was not financially viable on its own.
In a separate statement, TNOG owner Heirs Holdings said it had taken a 45% stake in the field, acquiring the stakes of Shell, Total and Eni.
The oil and gas rig count rose 13 to 373 in the week to Jan. 15, its highest since May, according to Baker Hughes Co.