Herbert Smith Freehills has advised OGX Petróleo e Gás Participações S.A. (“OGX”) on the sale of a 40% stake in two blocks in the Campos Basin, offshore Brazil to Malaysian state oil and gas company PETRONAS.
Under the agreement signed on 7 May 2013, PETRONAS will acquire 40% of OGX’s interest in each of Blocks BM-C-39 and BM-C-40 for a total consideration of US$850 million. The blocks are located in the shallow waters 95 km offshore the state of Rio de Janeiro and contain the Tubarão Martelo field which is currently under development.
The proposed acquisition will mark PETRONAS’ first entry into the exploration and production business in Brazil. The completion of the transaction is conditional upon relevant regulatory approvals.
OGX is Brazil’s largest private oil & natural gas exploration company, and its assets compromise of interests in 26 exploratory blocks in Brazil and 5 in Columbia. Brazil is considered to be one of the world’s top holders of hydrocarbon reserves with about 145 billion barrels of oil reserves.
The transaction involved a cross-border and cross-practice team from Herbert Smith Freehills.
The London team was led by London energy partner Simon Tysoe who was assisted by senior associate Clare Pope, associates Mitasha Chandok and Natalia Camargo-Barros.
The Asia team was led by Hong Kong energy partner Hilary Lau who was assisted by associate Dominic Johnson.
London disputes partner Nick Peacock also provided input to the transaction and his team consisted of associates Rahima Patel and Dominic Kennelly.
Simon Tysoe commented:
“We are very pleased to have acted on this major oil & gas transaction for OGX, our second for them in as many years. Our role in this, plus other recent deals such as FI-FGTS’ investment in Sete Brasil, not only highlights the strength and depth of our Latin American energy practice but also the strength of our Asian practice too.”
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