Political Risk Latin America Blog @PolRiskLatam

Petrobras buys refinery stake, sets stage for expansion

Posted in News and Articles, Political Risk by politicalrisklatam on December 15, 2010

by Vincent Bevins for Financial Times – Beyond Brics, December 14th, 2010.

At a year-end breakfast in Rio de Janeiro this morning, Petrobras announced a bit of pre-holiday housekeeping to help set the stage for the expansion planned over the next few years. The Brazilian state-controlled oil company will pay $850m to buy back complete control of the Refap refinery, Brazil’s fifth-largest, from Repsol.

The Spanish group is selling back its 30 per cent stake in the refinery to Petrobras for $350m, who will also take on $500m of debt to acquire full control. The purchase will allow Petrobras to press forward with new investments, as well as increase synergies, said Paulo Roberto Costa, supply director at Petrobras.

“It’s very important for Petrobras to seek synergies between all its refineries,” Costa said. ”Now we can supply it 100 per cent with our oil.” Petrobras said Repsol’s strategies diverged with its own after selling its network of petrol service stations. The buyout comes months after Chinese company Sinopec made a $7.1bn investment in Repsol to fund energy ventures in Brazil. (continue reading… )

 

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