Bloomberg News

Sinochem to Buy Stakes in Brazil Deep Water Blocks From Perenco

January 09, 2012

Jan. 7 (Bloomberg) -- Sinochem Group, China’s biggest supplier of chemical products, agreed to buy 10 percent stakes in five deep water natural-gas and oil exploration blocks off the coast of Brazil from Perenco SA.

The purchase of the project stake in the Espirito Santo basin “lays the foundation for the company’s further development in South America,” the company said in a statement on its website yesterday, without giving financial details. The purchase by a Sinochem unit in Brazil is subject to government approvals, according to the Sinochem statement.

Chinese energy companies including Sinochem Group have bid for at least $21 billion of assets in Latin America since the start of 2010 to help supply the world’s second-biggest economy, according to data compiled by Bloomberg.

Sinochem Group won’t comment about the purchase beyond the statement, a press officer who declined to identify himself in the company’s Beijing office said. Nicolas de Blanpre, a Paris- based spokesman for Perenco, confirmed the deal with Sinochem and declined to give further information on the deal.

The blocks cover water of 100 meters (328 feet) to 2,000 meters deep, according to information on Perenco’s website. Perenco and OGX Petroleo e Gas Participacoes SA, controlled by billionaire Eike Batista, each hold 50 percent of the projects and Perenco operates the concessions, according to data on the website of Brazil’s oil regulator.

State-owned Sinochem paid Statoil ASA $3.07 billion last year for 40 percent of the Peregrino oilfield off the Brazilian coast. The companies agreed to jointly seek additional opportunities in Brazil and elsewhere.

Sinochem, based in Beijing, last year signed an accord with Petroleo Brasileiro SA, Brazil’s state-controlled oil producer to cooperate on exploration and production.

--Aibing Guo and Daryl Loo, with assistance from Rodrigo Orihuela in Rio de Janeiro. Editors: Joshua Fellman, Jessica Resnick-Ault

To contact Bloomberg News staff for this story: Aibing Guo in Hong Kong at aguo10@bloomberg.net; Daryl Loo in Beijing at dloo7@bloomberg.net

To contact the editor responsible for this story: Amit Prakash at aprakash1@bloomberg.net


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