Brazil’s Brava Energia to sharpen its offshore focus

Brazil's Brava Energia, the result of the 3R Petroleum-Enauta Energia merger, will turn its attention to offshore oil and gas exploration and production.

Press reports indicated that the company has put its onshore portfolio up for sale. Two sources told BNamericas that maybe not all onshore assets, but at least a substantial part will be offered. 

Onshore activities were the initial focus of 3R Petroleum, which acquired several assets from federal oil company Petrobras over the last few years in the Potiguar and Recôncavo basins. 

But the company then bought offshore assets, beginning with the Pescada, Arabaiana and Dentão Potiguar shallow water fields, followed by the Peroá and Cangoá fields and the BM-ES-21 (Malombe) block in the Espírito Santo basin, as well as the Papa-Terra field in the Campos basin, also from Petrobras. 

Including the portfolio that came with Enauta, Brava operates the Atlanta and Oliva fields in the Santos basin, and is a partner of Petrobras in the Manati field in the Camamu Almada basin. It is currently awaiting the conclusion of the acquisition of a 23% stake from Qatar Energy in the Abalone, Ostra and Argonauta fields, which are part of Parque das Conchas complex in Campos, operated by Shell. 

Offshore projects in the pipeline, such as the first definitive production system of Atlanta, as well as the production development of Papa-Terra and Malombe, will require significant resources from Brava Energia.

On December 17, Brava hired a financial adviser to support the company in evaluating potential partnership transactions or asset sales.

On the same day, it announced the signing of an exclusive contract with Azevedo e Travassos and Petro-Victory Energy for the potential sale of onshore oil and gas concessions in Rio Grande do Norte state.

The perimeter of the possible transaction comprises 11 assets in the Potiguar basin, which recorded average daily production of 250boe between January and November.

A day later, Brava declared that it would concentrate its efforts on 10 of its 51 concessions, which represent 90% of the company's estimated value and reserves, directing resources towards the most profitable projects with the shortest payback period.

“In parallel, management's intention is to rationalize the portfolio, promoting partnerships and divestments in the less material assets,” the company said in a statement. 

Last week, the oil company signed a contract with Petrorecôncavo to sell 50% of its natural gas flow and processing infrastructure in Rio Grande do Norte. 

The company’s press office told BNamericas that Brava is constantly looking for moves that can accelerate and optimize value generation. 

"Possible partnerships, investments and divestments are evaluated, seeking to identify actions that help the company capture value or operational and financial synergies. Steps are taken transparently, in accordance with the best practices in the market."

Acquisition deal canceled 

Petrobras has terminated the contract with Brava Energia for the sale of the Uruguá and Tambaú fields, in the deep waters of the post-salt Santos basin. 

The closing of the transaction was conditional, among other factors, on the conclusion of the acquisition, by Brava, of FPSO Cidade de Santos, owned and operated by Modec, which did not materialize. 

The contract for the acquisition of Cidade de Santos was signed by Enauta and Modec in December 2023 and involved US$48.5mn. 

The platform has the capacity to produce 25,000b/d of oil and 10Mm3/d of gas and store 700,000b.

In July, Enauta notified Modec of its decision to terminate the contract for the acquisition of Cidade de Santos. The company said it was discussing with Petrobras the impacts of the decision on the acquisition of Tambaú and Uruguá. 

Petrobras said that it remains with a 100% stake in the Uruguá and Tambaú fields and will evaluate alternatives for managing the assets.

New contracts

Brava Energia has signed a gas supply contract with São Paulo distribution concessionaire Comgás. 

The three-year deal will begin in January 2025 and provide for the supply of 150,000-450,000m3/d of gas. The sales price is fixed at 11% of Brent, in US dollars per million British thermal unit.

The gas will be supplied by the company's operations in Recôncavo Baiano, Espírito Santo and Rio Grande do Norte, which are integrated into different transportation grids, allowing the supply profile to be adjusted to the consumption of customers served by Comgás throughout the year.

Brava additionally inked a contract with Cerâmica Serra Azul, located in Sergipe state. The three-year deal calls for the supply of 77,000m3/d of gas from January. 

This is the group’s first gas contract with a free customer, i.e., not with a gas distribution concessionaire.