Ecopetrol SA subsidiary Ecopetrol Óleo e Gás do Brasil Ltda. will acquire a 30% stake in two Brazilian blocks from Royal Dutch Shell PLC unit Shell Brasil Petróleo Ltda.
The deal is still subject to approval from Brazil's Ministry of Mines and Energy and the National Agency of Petroleum, Natural Gas and Biofuels, according to an Oct. 21 news release from Ecopetrol. The blocks are BM-S-54 and the Sul de Gato do Mato.
The transaction is expected to add 90 million barrels of crude oil in contingent resources as of 2020 to Ecopetrol's reserves, with production estimated to total about 20,000 barrels of oil per day in 2025.
Shell's stake will drop to 50% from 80% following the transaction, while Total SA will continue to hold its 20% stake. The Brazilian government also participates in the project through Pré-Sal Petróleo SA under a shared production agreement, in which the consortium will take their shares after the deduction of government royalties.
Three wells were discovered to have light hydrocarbons in the two blocks, but the consortium will continue conducting activities and operations to start production.
Ecopetrol also holds stakes in the Brazilian Pau-Brasil and Saturno blocks.