© Reuters. FILE PHOTO: A man walks in front of the headquarters of Petroleo Brasileiro S.A. (Petrobas) in Rio de Janeiro, Brazil March 9, 2020. REUTERS/Sergio Moraes/File Photo
SAO PAULO (Reuters) – Brazilian state-run oil company Petrobras said on Monday it has decided to halt some key asset sales after concluding a broad revision of divestment processes, which were launched during the country’s previous administration.
The oil giant said in a securities filing it will no longer sell the onshore Urucu and Bahia-Terra clusters, as well as the Manati oilfield and Petrobras Operaciones, its subsidiary in Argentina.
The divestment processes had been kicked off by Petrobras’ previous management under former President Jair Bolsonaro, as the company sought to sell non-core assets to focus on deepwater oil exploration and reduce its debt.
But after President Luiz Inacio Lula da Silva took office in January, some of those processes were halted and expected to be called off – including that of Bahia-Terra, which the company had already said it would not move forward with.
The decision was a blow to smaller Brazilian energy firms Petroreconcavo and Eneva, which last year had a joint $1.4 billion offer for Bahia-Terra selected to move on to the negotiation stage.
Despite backing out of the sale, Petrobras had previously said it could still search for potential partners for the asset.
Petrobras said on Monday its new policy for the oil exploration and production segment is based on “maximizing portfolio value by focusing on profitable assets” as it justified the decision to call off the sales.
The policy also includes “replenishing reserves of oil and gas (including exploring new frontiers), increasing the supply of and promoting the decarbonization of operations,” the firm added.
Petrobras said the possibility of maintaining “other assets” in its portfolio would be periodically reassessed based on updated profitability targets and decarbonization opportunities, leaving the door open for potential new divestitures ahead.
The state-run company added it would move forward with the sale of its stakes in thermoelectric power plants Brasympe/Termocabo, Suape II and Araucaria. It holds about a 20% share in each of those assets.
In a separate filing, Petrobras also announced it had signed a memorandum of understanding with Mubadala Capital to explore a potential investment in a biofuel project being developed by the Abu Dhabi investor in Brazil.
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