(Adds comments from analyst, TotalEnergies)
By Gram Slattery, Marta Nogueira and Sabrina Valle
RIO DE JANEIRO, Dec 17 (Reuters) - France's TotalEnergies
, Royal Dutch Shell, Malaysia's Petronas and
Qatar Energy on Friday scooped up big offshore fields in Brazil
together with state-owned Petrobras, paying nearly $2 billion to
its cash-strapped government.
While TotalEnergies (28%), Qatar Energy (21%) and Petronas
(21%) made the top offer for Sepia field, Petrobras, formally
Petroleo Brasileiro SA, later entered the consortium
by exercising preference rights to take a 30% stake.
Petrobras (52.5%), Shell (25%) and Total (22.5%) secured the
nearby Atapu field.
Officials, who had been keen to attract major foreign
players, deemed the auction a success, and analysts said the
offers agreed to were relatively rich.
The selloff was widely seen as a test of Brazil's investment
climate and of large oil producers' willingness to keep spending
big on traditional oil assets, despite increasing pressure over
climate change and toward energy transition.
TotalEnergies, which snapped up a stake in both blocks, said
the investment will bring output with "costs well below $20 per
barrel of oil equivalent" and with carbon emissions rates below
industry levels.
"These are unique opportunities to access giant low-cost and
low emissions oil reserves," CEO Patrick Pouyanné said in a
statement.
Signing bonuses were fixed in reais at the equivalent of
$1.3 billion for Sepia and $740,000 for Atapu. Companies bid for
a percentage of the production they were willing to share with
the government, winning the highest: 37.43% for Sepia and 31.68%
for Atapu.
Petrobras, TotalEergies and Shell shares fell on Friday,
following a 2.60% decrease in Brent prices.
Brazil attempted to auction both fields in 2019, but neither
received https://www.reuters.com/article/us-brazil-oil-auction-idUSKBN1XH1X3
offers, even from Petrobras. At the time, complex legal issues
and rich signing bonuses kept oil majors away https://www.reuters.com/article/uk-brazil-oil-petrobras-exxon-mobil-excl-idINKBN1XI2DC.
This time, the bidding terms were considered more attractive
https://www.reuters.com/article/idUSL1N2SZ1VO, several industry
sources told Reuters, largely due to big cuts in both signing
bonuses and minimum profit oil.
Government moves to streamline rules and lower fees "drew
bids well above the minimums for both assets," said Andre
Fangundes, vice president of consultancy Welligence.
"Companies were more aggressive than we expected," said
Marcelo de Assis, head of Latin America upstream research at
Wood Mackenzie.
Eleven companies signed up for the chance to bid on Friday.
Exxon Mobil Corp made final arrangements https://www.reuters.com/markets/commodities/exclusive-exxon-prepares-bid-new-oil-blocks-brazil-sources-2021-12-16
to bid together with Petrobras and a subsidiary of Portugal's
Galp Energia SGPS SA, people close to the negotiations
said, but never presented a final offer.
Oil majors will be able to add production to their
portfolios in the short term. Petrobras is ramping up production
at Sepia to 180,000 bpd and has reached the 160,000 bpd maximum
capacity at Atapu. A second platform is planned for each field.
Cementing Brazil's status as Latin Americas biggest oil
producer, the two fields could boost the country's production by
12% over the next six years, adding 700,000 bpd, and bringing in
almost $40 billion in investment, its energy ministry said after
the auction. Petrobras is set to receive $6.2 billion for past
investments in the two fields.
($1 = 5.68 reais)
(Reporting by Gram Slattery and Marta Nogueira in Rio de
Janeiro and Sabrina Valle in Houston; Editing by David Gregorio,
Diane Craft, Alexander Smith and Daniel Wallis)
