Brazilian oil and gas company withdraws from FPSO acquisition from MODEC

Brazilian oil and gas player Enauta has prematurely terminated the purchase of a floating production, storage and offloading unit (FPSO). This decision to terminate the agreement to acquire the FPSO owned by MV20, a subsidiary of Japan’s MODEC, could hamper the expansion of the Brazilian player’s portfolio agreed with Petrobras in a set of oil and gas fields and related infrastructure.

By the end of December 2023, Enauta disclosed a contract worth USD 48.5 million, with USD 7.275 million paid at signature, for the purchase of FPSO City of Santosin which MODEC operates Uruguay AND Tambau fields. This FPSO has been on a charter agreement with Petrobras since 2010.

The acquisition of the FPSO is linked to the Brazilian company’s agreement with Petrobras for the Uruguá and Tambaú oil and gas fields in the Santos Basin and a 178-kilometer gas pipeline connecting the production platform to Mexico natural gas infrastructure in this field.

Explaining that it has notified MODEC of the termination of the contract regarding the purchase of the FPSO Cidade de Santos, Enauta claims that this provides for the refund of 50% of the amount paid upon signing the contract, or approximately USD 3.6 million.

Given the decision to shorten the FPSO acquisition process and terminate the contract, the Brazilian player is in talks with Petrobras on the impact of this decision on the ongoing acquisitions of the Uruguá and Tambaú oil and gas fields, as well as the gas pipeline from these fields to the Mexilhão field, where it connects with the Route 1 pipeline.

Further information will be provided as the situation evolves, depending on the progress and conclusion of these talks. In the meantime, Enauta has also prepared the ground for the acquisition of QatarEnergy Brasil’s entire stake in the oil fields Abalone, SharpAND Argonautincluding Conchas Park.

The Brazilian player is currently making progress in its merger with domestic player 3R Petroleum Óleo e Gás, as two further conditions for the proposed business combination have now been met.