Shell Inks PSC For Formal Takeover Of Atapu Stake

Shell Inks PSC For Formal Takeover Of Atapu Stake
Shell has signed the production sharing contract (PSC) to formally acquire a 25 percent stake in the Atapu field.

Oil supermajor Shell has signed the production sharing contract (PSC) to formally acquire a 25 percent stake in the Atapu field.

Shell paid $ 1.12 billion to Petrobras for the increased stake in the field. With the contract now signed, Shell will start receiving its additional share of oil from the field.

The oil major stated that the production sharing contract was signed by its subsidiary Shell Brasil Petróleo Ltda.

“This transaction is the latest proof point of our commitment to further strengthening our advantaged deep-water positions in Brazil,” said Zoe Yujnovich, Shell Upstream Director.

“With a leading global deep-water portfolio, this stake in the Atapu field directly supports our Powering Progress strategy to deliver the stable, secure energy resources the world needs today while investing in the energy of the future,” she added.

Shell said that its Powering Progress strategy includes increasing investment in lower-carbon energy solutions while continuing to pursue the most resilient, competitive, and highest return Upstream investments to sustain material cash delivery into the 2030s, to support our dividend and fund Shell's transformation.

The supermajor’s global deep-water portfolio represents two core positions in our Upstream business with prolific basins in the U.S. and Brazil, along with an exciting frontier exploration portfolio in Mexico, Suriname, Argentina, and West Africa.

To remind, Shell along with the operator and 52 percent stakeholder Petrobras and TotalEnergies – which holds the remaining 22.5 percent – acquired the rights to volumes from the Atapu field in December 2021 in the Transfer of Rights auction.

This week, Total has also paid $938 million to Petrobras for its share in Atapu. According to an announcement by Petrobras, the French company was supposed to have already signed the production sharing agreement on April 27.

The Atapu field is a pre-salt oil field in the Santos Basin, located in water depths of about 6,500 feet. Production started in 2020 and has reached a plateau of 160,000 barrels per day with a first floating, production, storage, and offloading vessel (FPSO).

A second FPSO is planned to be sanctioned, which would increase the overall oil production of the field to around 350,000 barrels per day.

As recently as November 2019, Atapu failed to attract bidders in what was possibly the world’s priciest oil auction. Atapu was, at the time, offered along with the Sepia field. The prospects are part of an area estimated to hold as much as 15 billion barrels of recoverable crude, according to a study by Gaffney, Cline & Associates.

Atapu and Sepia are in an area that already produces oil. Petrobras is producing from a block bordering Sepia while Total, Galp, and Shell are partnering with the Brazilian giant in a block bordering Atapu.

To contact the author, email username.eldina@gmail.com


What do you think? We’d love to hear from you, join the conversation on the Rigzone Energy Network.

The Rigzone Energy Network is a new social experience created for you and all energy professionals to Speak Up about our industry, share knowledge, connect with peers and industry insiders and engage in a professional community that will empower your career in energy.