To expand footprints in Brazil's Pre-Salt Region, Ecopetrol S.A. EC has inked an agreement with the Royal Dutch Shell plc RDS.A and Chevron Corporation CVX groups.
Per the deal, Ecopetrol has acquired a 10% stake in the Saturno block, located in the central region of the Santos basin. This stake was allotted to Royal Dutch Shell and Chevron on Sep 28, 2017 in the Fifth Pre-Salt Round held by the Brazilian National Agency of Petroleum, Natural Gas and Biofuels (ANP).
The agreement is subject to approval by Brazil's Ministry of Mines and Energy, the ANP as well as other customary closing conditions. The deal signed by the three companies in Río de Janeiro provides access to the Saturno block.
Located off the coast of the states of Sao Paulo and Rio de Janeiro, the Saturno is spread across 1,100 square kilometers. The consortium, which originally comprised Royal Dutch Shell and Chevron, had carried out a proposal assigning a production stake of 70.2% in favor of the Brazilian State. On completion of Ecopetrol’s acquisition of 10% interest in the block, Royal Dutch Shell, the operator, and Chevron hold an interest of 45% each.
This is the second block in Brazil where Ecopetrol holds a stake. Also, the company won another block in the Santos basin of Brazil's Pre-Salt Region along with two other companies. Ecopetrol holds 20% of the Pau-Brasil exploratory block. The other partners are CNOOC Limited (CEO) and BP plc BP holding 30% and 50%, respectively.
Currently, Ecopetrol is active in five blocks in Brazil, located in the Santos, Foz de Amazonas, Potiguar and Ceara basins along with two Pre-Salt blocks.
Currently, Ecopetrol carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>
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
Ecopetrol S.A. (EC) : Free Stock Analysis Report
Chevron Corporation (CVX) : Free Stock Analysis Report
BP p.l.c. (BP) : Free Stock Analysis Report
Royal Dutch Shell PLC (RDS.A) : Free Stock Analysis Report
To read this article on Zacks.com click here.