Total and Petrobras have signed an Assets Package Agreement in the framework of their Strategic Alliance announced in October 2016, to strengthen their cooperation in the upstream and downstream sectors.
In the upstream sector, the companies will jointly assess the exploration potential in key prospective areas in Brazil and the development of new technologies. Total will acquire interests from Petrobras in two pre-salt licenses of the prolific Santos basin: Total will take over a 22.5% in the BMS-11 license that includes the Iara field currently under development, along with a 35% stake and operatorship in the BMS-9 license that includes the Lapa field which has just entered into production. In turn, Petrobras will have the option of acquiring a 20% stake in the Perdido Belt deepwater exploration Block 2 recently awarded in Mexico to Total.
In the downstream, sector Total will acquire from Petrobras some regasification capacity in the Bahia LNG terminal and a 50% interest in two co-generation plants located in the Bahia area as well as pipeline transport capacity, enabling Total to supply gas to the two CHP plants.
Total acquisitions amount to around US$2.2bn, made of cash, carry and contingent payments. The transaction is subject to the final execution of the Sale and Purchase agreements, to the relevant regulatory approvals and to partners’ preemption rights only on the Iara transaction.