Petrobras purchases stake in Equatorial Guinea's deep waters

Peter Howard Wertheim
OGJ Correspondent

RIO DE JANEIRO, Jan. 16 -- Brazil's state-owned Petroleo Brasileiro SA (Petrobras) reported that the government of Equatorial Guinea recently approved Petrobras's acquisition of a 50% participating interest in a production-sharing contract covering Block L, in the deepwater portion of the Rio (River) Muni basin.

The block covers 4,250 sq. km, in 500 to 2,200 m of water. The participating interest in the PSC has been acquired from the current participants in Block L: Chevron Equatorial Guinea Ltd. 22.5%, Amerada Hess Equatorial Guinea Resources Inc. 12.5%, Energy Africa Equatorial Guinea Ltd. 10%, and Sasol Petroleum International (Pty.) Ltd. 5%. Chevron will remain operator of the block with Petrobras having the option of becoming the operator in the event of a commercial discovery.

Block L is in nearby the prolific Block G, operated by Amerada Hess, in which 8 oil fields have been discovered, including the Ceiba field, already in production. Drilling of the first exploratory well on Block L is planned for later this year. If successful, first oil may occur by the beginning of next decade.

With this acquisition, Petrobras increases its presence in Africa. The company currently holds interests in Angola, Nigeria, Tanzania, and Libya.

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