Brazilian state-owned oil and gas group Petrobras has announced the sale of its activities in Argentina and Chile, for a total consideration of nearly US$1.4bn, as part of its plan to cut its massive debt and to raise capital to continue its core investments in Brazil.
The group has concluded the negotiations with Pampa Energía of the sale of its entire stake (67.19%) in Petrobras Argentina (PESA), its 33.6% interest in the Rio Neuquen concession and 100% of the Colpa Caranda asset (natural gas producing fields in Bolivia). The base price of the deal is US$892m.
Petrobras is one of the largest oil and gas producers in Argentina and is active throughout the whole value chain, including refining, petrochemicals and even power generation. Pampa Energia is the largest integrated power group in Argentina, accounting for around 8% of the country's power generation. The company also owns Transener, the operator of the largest high-tension power transmission line in the country, and has a stake in the largest power distributor, Edenor. The transaction would be subject to the approval of Petrobras' board and by the market regulators.
In addition, Petrobras has concluded negotiations with Southern Cross Group for the sale of 100% of Petrobras Chile Distribución (owned through Petrobras Caribe) for US$490m. PCD is the distribution company of Petrobras in Chile and has 279 service stations, 8 owned fuel distribution terminals, 11 operations at airports, participation in 2 logistics companies and 1 plant of lubricants. These assets will be integrated within Southern Cross Group, which manages US$2.9bn of assets in Latin America.