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Shell, BP, Exxon big winners in historic Brazil oil auction

|About: BP p.l.c. (BP)|By: , SA News Editor
  • Brazil auctioned off six of eight exploration blocks in today’s historic opening of its coveted pre-salt offshore oil region to foreign operators, exceeding the government’s expectations with commitments for 6.15B reais ($1.88B) in signing bonuses.
  • Royal Dutch Shell (RDS.A, RDS.B) was especially active, winning stakes in half the blocks awarded and bolstering its position as the largest foreign operator in Brazil’s offshore oil sector, second only to state-run Petrobras (NYSE:PBR); Shell believes it can pump oil from the pre-salt fields at below $40/bbl.
  • BP took two blocks, including the Peroba block, which is estimated to contain 5.3B barrels of oil; it won as part of a consortium that included PBR and a Chinese group.
  • Exxon Mobil (NYSE:XOM) grabbed the Norte de Carcará block – which holds an estimated 2.2B barrels of oil, in a consortium with Statoil (NYSE:STO), which says it also sold a stake in a nearby block to XOM for $1.3B.
  • Brazil Pres. Temer says the auction will generate investments of more than 100B reais ($30B) in the country by the winning oil companies.

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