Galp Subsidiary Awarded 20% Interest in Carcara North

By FeaturesDow Jones Newswires

Galp Energia SGPS (GALP.LB) said Friday that its Brazilian subsidiary Petrogal Brasil SA was awarded a 20% interest in the Carcara North area in the latest bidding round.

The company said that Statoil Brasil Oleo e Gas Ltd. and ExxonMobil Exploracao Brasil Ltda. will hold a 40% interest each.

Continue Reading Below

It was also agreed that Statoil will be the operator of the area, it said, subject to the authorities' approval.

The Carcara North area is adjacent to BM-S-8 concession, where Petrogal Brasil currently holds a 14% interest, it said, and that includes the Carcara pre-salt discovery.

The consortium offered a profit oil share of 67.12%, Galp said. Additional commitments include the payment of a signature bonus of around $930 million gross--or approximately $186 million net--to Petrogal Brasil, and the drilling of an exploration well.

Petrogal Brasil also agreed with Statoil to acquire an additional 3% stake in the BM-S-8 concession for around $114 million, it said, comprising an upfront cash payment of about $71 million and a second payment contingent on conditions being met.

This acquisition is subject to the completion of the transaction entered into between Statoil and Queiroz Galvao Exploraçao e Producao and to customary conditions, including partner and government approvals, the company said.

These acquisitions reflect Galp's interest in expanding its presence in Brazilian pre-salt area and to develop assets through partnerships, Galp said.

Write to Marc Bisbal Arias at marc.bisbalarias@dowjones.com

(END) Dow Jones Newswires

October 27, 2017 11:35 ET (15:35 GMT)