Petroleo Brasileiro S.A. or Petrobras PBR announced plans to sell its stakes in the four offshore oil fields in shallow waters off the coast of Brazil’s Ceara state, namely Atum, Curima, Espada and Xareu. Per management, the plan is in sync with its strategy to cut costs and improve capital allocation. This state-run energy giant is the sole owner of this stake and plans to sell 100% operating interest in the project.
Located at a water depth of 130 feet and 20 miles from the coast, the field came online in 1980s and produce oil as well as gas through nine platforms. The four fields have 4,200 barrels of daily oil output, on average, and 76,900 cubic meters of natural gas per day.
The latest sales offer is part of the company’s strategy to regain its financial footing by selling assets and curtailing debt as it continues to grapple with issues since the breakout of a major corruption scandal years ago when it had accepted bribes from construction firms in return for awarding them contracts at inflated prices.
Petrobras targeted to sell assets worth $20-$30 billion over the next five years under its 2020-2024 investment plan. In early 2020, it put the Papa-terra deep-water oilfield besides Golfinho and Camarupim fields up for sale. Asset sales are part of the company’s portfolio optimization strategy and accordingly, it previously put more than 100 mature onshore and shallow-water offshore fields up for auction. Although some of the areas are already sold or are still in the sell-off process, divestiture of the deep-water oilfield in Campos Basin marks Petrobras’ transaction of higher-quality mature assets that still hold some upside potential.
Company Profile
Petrobras is the largest integrated energy firm in Brazil and one of the biggest in Latin America. The company’s activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trading and transportation of oil and oil products, natural gas and other fluid hydrocarbons besides other energy-related operations.
Petroleo Brasileiro S.A. Petrobras Price
Petroleo Brasileiro S.A. Petrobras price | Petroleo Brasileiro S.A. Petrobras Quote
Zacks Rank & Key Picks
Petrobras currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the energy space are Gulfport Energy Corporation GPOR, Devon Energy Corporation DVN and Chesapeake Energy Corporation CHK, each presently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Zacks Investment Research