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.

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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

(END) Dow Jones Newswires

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