2010-06-21-2010-05-24

To buy 40% WI in Peregrino field offshore Brazil in the Campos Basin.

Chinese state-run oil and chemical company Sinochem Group will purchase a 40% interest in the Peregrino field offshore Brazil from Norwegian E&P Statoil ASA (NYSE: STO) for approximately US$3.1 billion in cash.

Statoil will retain 60% of a previously 100% ownership stake and will continue to operate the Brazilian field. The Norwegian oil major will also reduce its equity production guidance for 2012 by 40,000 barrels of oil equivalent per day to approximately 2.1 million to 2.16 million barrels of oil equivalent per day.

Peregrino is on BM-C-7 and BM-C-47 blocks in the Campos Basin, approximately 53 miles off the coast of Brazil, in close to 330 feet of water. The shallow-water field is currently being developed for commercial production in early 2011, and has estimated recoverable reserves ranging from 300- to 600 million barrels of oil.

Statoil acquired a 50% interest in the Peregrino discovery in 2005; the remaining 50%, along with operatorship, was farmed into in 2008.

Statoil chief executive Helge Lund says, "The transaction confirms the high quality of the Peregrino asset, reflecting Statoil's value added through the field development…The divestment is a natural step in our continuous effort to optimize our portfolio."

Lund also confirms that both companies have signed a memorandum of understanding to jointly pursue further opportunities in Brazil and elsewhere.

The effective date is January 1.

Statoil has oil and gas operations in 40 countries. Equity production in 2009 was approximately 2 million barrels of oil equivalent per day. The company has booked oil and gas reserves of 5.4 billion barrels.

Sinochem is China's fourth largest oil firm and a leading provider of fertilizer, pesticides and seed products.