BG Group will obtain 100 percent ownership and operatorship of block BM-S-13 for a cash consideration of US$23.5 million, subject to Agência Nacional do Petróleo approval. BM-S-13 is in the gas prone area of the Santos Basin and is on trend with the Merluza gas field (Petrobras), the recent Luana gas discovery (2003, El Paso) and the giant Mexilhão gas discovery (2003, Petrobras) in block BS-400.
Speaking today, Rick Waddell, BG Group Managing Director and Executive Vice President South America, said:
"BG plans to explore for gas in BM-S-13 to supply the rapidly growing Brazilian market."
BG Group is already a partner in the Petrobras-operated BM-S-9, 10 and 11 deepwater exploration blocks in the Santos Basin with 20% to 30% interests.
BG Group also owns 60.1% of Comgas, which is Brazil's largest gas distribution company, transporting gas to industrial, natural gas vehicle, residential and commercial customers. At the end of 2003, Comgas was serving approximately 416,000 customers in the Sao Paulo area (378,000 in 2002).
Block BM-S-13 is in Exploration Phase 1 until September 28, 2004 after which it will enter Phase 2 for two years. Under the terms of the license, two exploration wells must be drilled during Phase 2.
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