Petro-Victory signs MoU to advance non-associated gas resource development in Brazil

Petro-Victory Energy Corp., Calgary, has entered into a memorandum of understanding with Eneva for the development of Petro-Victory's non-associated gas resources in São João field, Barreirinhas basin, Maranhão, Brazil.

São João field non-associated gas reservoirs were discovered and tested by a previous operator. A resource report dated Dec. 31, 2023, lists about 50.1 bcf of non-associated gas.

Petro-Victory is operator of the field with 100% interest.

Eneva is one of the largest Brazilian integrated energy operators and onshore LNG producer, with operations 250 km from São João Field. Under the MoU, Eneva will perform and pay all costs related to the drilling, logging, completion, and testing of one non-associated gas well, targeting the Bom Gosto/Arpoador formations, at a depth of about 3 km.

Upon completion of the well commitment, Eneva will have an option to perform and pay all costs related to a 3D seismic data acquisition, processing, and interpretation program covering the entire field. Upon completion of which, the company will have the option to establish a joint venture company with Petro-Victory to develop the non-associated gas and agree on a unified gas monetization solution.

Eneva would hold a 72% participation interest in the joint venture, with Petro-Victory holding the remaining 28%. The JV structure would have Petro-Victory retain 100% of revenues from the oil production.

All activities under the MoU, and the establishment of the JV will be subject to approval of the National Petroleum Agency.