Petrobras inks deal to shed LUBNOR refinery, related assets
Petróleo Brasileiro SA (Petrobras) has signed a contract to sell its 10,400-b/d Lubrificantes e Derivados de Petróleo do Nordeste (LUBNOR) refinery in Fortaleza, Ceará, Brazil (OGJ Online, Jan. 31, 2020).
As part of the deal signed on May 25, Grepar Participações Ltda.—jointly owned by Grecor Investimentos em Participações Societárias Ltda., Greca Distribuidora de Asfaltos Ltda. and Holding GV Participações SA—will acquire Petrobras’s ownership interest the LUBNOR refinery and associated logistics assets for an overall purchase price of $34 million, $3.4 million of which was paid as a guarantee at the contract signing, with $9.6 million to be paid upon closing of the transaction and the remaining $21 million in deferred payments, pending compliance with precedent conditions, including final approval by Brazilian regulators the Administrative Council for Economic Defense (CADE), Petrobras said in a release.
The total sale amount, however, currently excludes payment of contractual adjustments not due until closing, the operator said.
Petrobras did not reveal a timeline for when it anticipates officially completing the transaction.
One of Brazil’s leading asphalt production plants and the country’s only refinery equipped to produce naphthenic lubricants, LUBNOR processes ultra-heavy Brazilian crude oil from Espírito Santo basin and the Ceará cluster, according to the company’s website.
Refinery divestments, holdings
The fourth asset to have its purchase and sale agreement signed as part of Petrobras’s broader downstream divestment program, the LUBNOR deal, once completed, would follow sale of the operator’s 46,000-b/d Isaac Sabbá refinery (REMAN)—including a storage terminal—in Manaus, Amazonas, to Atem's Distribuidora de Petróleo SA (Atem) subsidiary Ream Participações SA, which is nearing the end of a 15-day waiting period required by law following CADE’s May 13 approval of the transaction (OGJ Online, May 16, 2022).
Petrobras’s previously completed divestment of its former 333,000-b/d Refinaria Landulpho Alves (RLAM) refinery—now renamed Refinaria de Mataripe—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., in 2021 (OGJ Online, June 10, 2021).
The downstream sales come as part of a June 2019 agreement between Petrobras and 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 said in a release.
As part of its portfolio management strategy and improved allocation of its capital, Petrobras said it will continue to concentrate investments on assets with lower greenhouse gas (GHG) emissions that have proved more competitive over the years.
In the downstream, Petrobras plans to invest in initiatives to expand existing refining capacity, increase efficiency, and improve operational performance of Brazilian refineries not involved in operator’s divestment portfolio, including the:
- 434,000-b/d Refinaria de Paulínia (Replan) refinery in Paulínia, São Paulo, Brazil
- 239,000-b/d Duque de Caxias (Reduc) refinery in the Baixada Fluminense area of Brazil’s Rio de Janeiro state
- 252,000-b/d Refinaria Henrique Lage (Revap) refinery in São José dos Campos, São Paulo
- 170,000-b/d Refinaria Presidente Bernardes (RPBC) refinery in Cubatão, São Paulo
- 57,000-b/d Refinaria de Capuava (Recap) in Mauá, São Paulo (OGJ Online, Mar. 9, 2021).
Robert Brelsford | Downstream Editor
Robert Brelsford joined Oil & Gas Journal in October 2013 as downstream technology editor after 8 years as a crude oil price and news reporter on spot crude transactions at the US Gulf Coast, West Coast, Canadian, and Latin American markets. He holds a BA (2000) in English from Rice University and an MS (2003) in education and social policy from Northwestern University.