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Petrobras (PBR) Confirms the Sale of REMAN Refinery to Atem

Petrobras (PBR) to divest REMAN refinery to distributor Atem's unit Ream Participaces S.A. for a deal value of $189.5 million.

This story originally appeared on Zacks

PetroleoBrasileiro S.A. or Petrobras PBR recently entered into an agreement to sell its REMAN refinery in the northern state of Amazonas to Ream Participaçes S.A., a subsidiary of distributor Atem, for $189.5 million.

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Petrobras was paid $28.4 million from the deal. The remaining will be cleared at closure, which is expected by this year-end, subject to revisions and regulatory approvals. Per management, the refinery will be operated by Petrobras until the purchase is concluded.

Management informed that this state-run energy giant’s sale process of Abreu e Lima (RNEST) refinery in Pernambuco state was unsuccessful and it chose to halt the same. The deal fell through because the interested buyers declined to offer a bid. Hence, the company plans to end the divestiture of RNEST and assess the next measures.

Petrobras is currently on track to sell eight refineries, which are estimated to be completed by the first quarter of 2022. These refinery sales are part of the company’s $25-$35 billion asset disposal program for the 2021-2025 time frame.

Of the eight refineries with 1.15 million barrels per day (bpd) of installed capacity, binding proposals for Petrobras’ four refineries in different states including REFAP in Rio Grande do Sul, REGAP in Betim, LUBNOR in Ceara and SIX in Parana are still in progress.  

Earlier this year, the company reached an agreement to sell its Landulpho Alves Refinery (RLAM) to Abu Dhabi’s Mubadala Capital for $1.65 billion, contingent on regulatory nods.

Company Profile

Petrobras is the largest integrated energy firm in Brazil and one of the biggest in Latin America. The company’s activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks. Its operations also include refining, processing, trading and transportation of oil and oil products, natural gas and other fluid hydrocarbons apart from other energy-related operations.

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Petrobras currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the energy  space are Devon Energy Corporation DVN, Matador Resources Company MTDR and Continental Resources, Inc. CLR, each presently flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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