Petrobras awaits bids for second refinery in Aug

Brazil's state-controlled Petrobras will receive binding offers for the 208,000 b/d Araucaria refinery (Repar) in the southern state of Parana in August, chief executive Roberto Castello Branco said today.

Petrobras has resumed the sales process for eight refineries with around 1.1mn b/d of combined refining capacity it plans to divest by the end of 2021 after postponing the binding phase in mid-March. Offers for the remaining assets will be accepted through year-end, Castello Branco said on a webinar.

Last week, Petrobras received binding bids for the 333,000 b/d Mataripe refinery in the northeastern state of Bahia.

"We are happy with the offers we received. They met our expectations," Castello Branco said, without specifying how many bids came in. "It is the first big asset put on offer this year and in such a complex time for the global economy and oil industry, it was a very good result."

China's state-owned Sinopec and Abu Dhabi's state-owned investment fund Mubadala are among the parties that have expressed interest in the refinery.

Castello Branco said none of the parties in the non-binding phase of the sales process has dropped out, though some have requested more time to evaluate the market and secure financing.

The Repar sale includes around 476km (295mi) of pipeline and five terminals with 4.9mn bl of crude, LPG and fuel storage capacity. With a Nelson Complexity Index (NCI) of 7.7, Repar is one the most efficient of the refineries in the sales portfolio.

Brazil's antitrust watchdog Cade has obligated Petrobras to dispose of refinery stakes by the end of 2021. "Our expectation is still to sign contracts this year, some in 2021," Castello Branco said.

Petrobras plans to sell around $20bn-$30bn in non-core assets through 2024, according to its current 2020-24 business plan. But lower valuations stemming from deteriorated market conditions could reduce the revenue target.

In addition to dozens of shallow-water and onshore assets on offer in recent weeks, the company is also selling downstream and midstream assets in Brazil, Colombia and Uruguay.

By Nathan Walters