Subscribe to Entrepreneur for $5
Subscribe

Petrobras (PBR) Enters Binding Stage to Sell Off Deten Stake

Petrobras (PBR) begins the binding phase of the sale of its full 27.88% ownership holding in Deten as part of its strategy to lower expenses and impro...

By
This story originally appeared on Zacks

Petroleo Brasileiro S.A. or Petrobras PBR recently announced that it completed the non-binding phase of the sale of its full 27.88% ownership holding in Deten Qumica S.A. (Deten) and now began the project's binding phase. Prospective buyers who qualified for this phase will get a process letter outlining the divestiture process in full including rules for due diligence and the submission of binding offers.

- Zacks

Earlier in June, the company commenced the sale process of its full ownership in the petrochemical company Deten. Per management, the plan was in sync with the energy player’s strategy to reduce expenses and enhance its capital allocation for maximizing shareholder value.

Located in the Camaçari industrial complex in Bahia, Deten petrochemical is the sole national manufacturer of Linear Alkylbenzene (LAB) and involved in manufacturing and selling major raw ingredients used in the production of biodegradable liquid and powder detergents.

Also, recently, the state-run energy firm decided to divest two of its operated oilfields, namely Urugua and Tambau, located in the Santos Basin off the coast of Brazil.

The oilfields were acquired through the Round Zero of the National Agency for Petroleum, Natural Gas and Biofuels. The company operates with 100% interest in both fields.

The fields are located in the northern part of the Santos Basin between 140 kilometers and 160 kilometers offshore Rio de Janeiro at a water depth of 1,000-1,500 meters. In 2020, the fields produced 5 thousand barrels of oil per day and 32.4 million cubic feet of gas per day.

Petrobras is involved in an extensive divestment program with the aim to pay off debt and free up capital for deepwater offshore projects. The latest transaction is in line with the company’s portfolio optimization strategy as it focuses its resources on high-quality assets in deep and ultradeep waters wherein it showed a great competitive edge over the years.

Company Profile & Price Performance

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

Shares of the company have outperformed the industry in the past year. Its stock has gained 32.9% compared with the industry’s 7.6% rise.

Zacks Investment Research

Image Source: Zacks Investment Research

Zacks Rank & Stocks to Consider

Petrobras currently carries a Zack Rank #3 (Hold). Some better-ranked players in the energy space are Canadian Natural Resources Limited CNQ, Whiting Petroleum Corporation WLL and Continental Resources, Inc. CLR, each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, the Zacks Consensus Estimate for Canadian Natural’s 2021 earnings has been raised 14.7% while that for Whiting Petroleum and Continental has moved 52.8% and 52.7% north, respectively.



5 Stocks Set to Double

Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>



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

 

Petroleo Brasileiro S.A. Petrobras (PBR): Free Stock Analysis Report

 

Canadian Natural Resources Limited (CNQ): Free Stock Analysis Report

 

Continental Resources, Inc. (CLR): Free Stock Analysis Report

 

Whiting Petroleum Corporation (WLL): Free Stock Analysis Report

 

To read this article on Zacks.com click here.

 

Zacks Investment Research