Norwegian Statoil is to buy Brazilian E&P firm Queiroz Galvao Exploracao e Producao's 10% interest in the BM-S-8 licence in Brazil’s pre-salt Santos basin for $379mn, it said July 12, bringing its stake to 76%. 

"BM-S-8 includes a substantial part of the Carcara discovery comprising high-quality oil of around 30° API and with associated gas in a thick reservoir with excellent properties. Statoil estimates the recoverable volumes within the BM-S-8 licence to be in the range of 700mn - 1.3bn barrels of oil equivalent," Statoil said.

(Credit: Statoil)

"This acquisition is a further expression of our confidence in Brazil, a core area for Statoil. It also reinforces our position in a world-class asset which is a good match with our competence and capacity. The transaction supports our strategy to pursue high value and low carbon opportunities,” Statoil said.

This transaction is Statoil’s second in BM-S-8, following its purchase of state Petrobras' 66% operated interest for $2.5bn, and strengthens Statoil’s position for operatorship of the unitised Carcara field, it said.

Commenting on the first transaction last year, analysts at Rystad said: "In contrast to Libra, Carcara field developers may report and sell all production from the field. The deal implies $4/bbl for pre-development oil, with a breakeven price currently estimated between $55-75/bl depending on well productivity, development costs and actual field size.

Both purchases required Statoil to pay half up front, the remainder being paid when other conditions have been met including the unitisation of Carcara.

The Norwegian firm followed up the deal by announcing July 13 it had awarded contracts for exploration drilling in BM-S-8 to shipowner Seadrill, under which the West Saturn  6th generation ultra-deepwater drillship will be available to Statoil from December 1 2017 to March 1 2018. Statoil said it intends to drill the independent Guanxuma prospect, after which it will conduct a drill stem test on Carcara.

William Powell