Petrobras updates status of refinery divestments

Petróleo Brasileiro SA (Petrobras) has signed a deal to sell its 46,000-b/d Isaac Sabbá refinery (REMAN)—including a storage terminal—in Manaus, Amazonas, to Atem's Distribuidora de Petróleo SA (Atem), a Brazil-based fuel distributor (OGJ Online, Jan. 31, 2020).

As part of the contract signed on Aug. 25, Atem subsidiary Ream Participações SA will purchase all of Petrobras’s ownership interest in the REMAN refinery and associated logistics assets for $189.5 million, $28.4 million of which is to be immediately paid as a security deposit, with the remaining $161.1 million to be collected a closing subject to adjustments, Petrobras said.

Without disclosing an anticipated timeframe for closing of the REMAN transaction, Petrobras confirmed signing of the purchase and sale agreement with Atem remains subject to approval of relevant corporate bodies, including Brazil’s Administrative Council for Economic Defense (CADE) per Petrobras’s June 2019 agreement with CADE governing the operator’s ongoing program to divest most of its Brazilian refining and related logistics assets, as well as the opening of Brazil’s refining sector to increased competitiveness and transparency.

Petrobras—which will continue operating REMAN and its associated assets until the transaction closes—also has agreed to offer ongoing support to Atem for a transitional period following the sale as part of a service agreement to ensure the safety and uninterrupted operation of the assets.

Of eight refineries involved in Petrobras’s downstream divestment program, REMAN is the second to have a purchase and sale agreement signed. Earlier this year, the operator finalized the deal for sale of its 333,000-b/d Refinaria Landulpho Alves (RLAM) refinery in São Francisco do Conde in the Recôncavo Baiano region of Bahia, Brazil, to Mubadala Capital (MC), an arm of Abu Dhabi-based Mubadala Investment Co. (OGJ Online, June 10, 2021).

Potential buyer walks away

In a separate release late on Aug. 25, Petrobras confirmed potential buyers previously interested in purchasing 130,000-b/d Refinaria Abreu e Lima (RNEST) refinery in Pernambuco—which has the potential to double its capacity 260,000 b/d with startup of a second processing line also includes both a terminal and a 101-km set of short pipelines—have formally declined to submit a binding proposal for the assets.

Petrobras said it will evaluate next steps regarding RNEST’s future once it completes internal procedures now underway to end the refinery’s current sale process.

Otherwise, the operator said the competitive sales process remains underway for remaining refining assets included in the divestment program, including:

• The 208,000-b/d Refinaria Alberto Pasqualini (REFAP) refinery—with assets that include two storage terminals and a set of pipelines totaling 260 km—in Rio Grande do Sul.
• The 166,000-b/d Refinaria Gabriel Passos (REGAP) refinery—including a set of pipelines of more than 720 km—in Betim, Minas Gerais.
• The 8,000-b/d Lubrificantes e Derivados de Petróleo do Nordeste (LUBNOR) refinery in Fortaleza, Ceará, which is one of the national leaders in asphalt production, as well as the only plant in Brazil to produce naphthenic lubricants.
• The 6,000-b/d Unidade de Industrialização do Xisto (SIX) unit—including a mine in one of the largest oil shale reserves in the world and a shale processing plant—in São Mateus do Sul, Paraná.

Regarding sale of its 208,00-b/d Refinaria Presidente Getulio Vargas (REPAR) refinery and related assets—including five storage terminals and a 476-km set of pipelines—in Paraná, Petrobras earlier in the year decided to close the sale process with an aim of starting a new competitive process “in due time” after initial binding proposals fell short of Petrobras' economic-financial evaluation for the assets (OGJ Online, Feb. 9, 2021).