Brazilian oil company Prio has agreed to acquire a 40% interest in the Peregrino and Pitangola Fields, jointly known as Peregrino, in the Campos Basin, offshore Brazil, for $1.92bn (10.43bn reais).

The deal to acquire Sinochem Petroleum Netherlands, which indirectly owns a 40% interest in the Peregrino field, has been signed with SPEP Energy Hong Kong and Sinochem International Oil (Hong Kong) (Sinochem).

Last week, Reuters reported that Prio was in discussions with China’s Sinochem regarding the acquisition of a 40% stake in the Peregrino oilfield.

The acquisition deal involves an initial payment of $191.5m, with the remaining $1.72bn to be paid upon closing.

The final price, accounting for net working capital and other adjustments, is expected to be between $1.67bn and $1.72bn.

Equinor operates the field with a 60% stake. Following completion of the deal, the Norwegian company will form a new consortium and remains the operator of the field. Prio holds the remaining stake and will become a part of the new consortium.

This acquisition is expected to boost Prio's production by roughly 35,000 barrels per day (bpd).

Discovered in 1994 and commencing production in 2011, the Peregrino Field is situated 85km off the coast in the Campos Basin, within blocks BM-C-7 and BM-C-47.

The field's infrastructure includes the FPSO Peregrino and three fixed platforms, with a current production of approximately 88,000bpd from 26 producing and six injection wells.

PRIO also plans to leverage synergies in marketing the field's oil, combining off-takes from Peregrino with other operations to optimise logistics. 

Bank of America advised Prio on the transaction. The oil company received legal counsel from Tauil & Chequer Advogados in association with Mayer Brown in Brazil and Mayer Brown International.