RIO DE JANEIRO, May 18, 2015 /CNW/ - PetroRio1, the new brand of HRT Participações em Petróleo S.A. ("PetroRio" or the "Company") (BM&FBOVESPA: HRTP3, TSX-V: HRP), hereby announces that one of its subsidiaries and one of Rosneft Oil Company's subsidiaries ("Rosneft Brasil"), have signed definitive agreements for the sale and assignment of all its remaining interest in the rights and obligations in the Concession Contracts of Oil and Gas located in the Solimões Sedimentary Basin, in the State of Amazonas, Brazil. With this transaction, PetroRio completes negotiations started in 2014 for its divestment from the Solimões project and Rosneft Brazil will become the holder of 100% of both Concession Contracts.
The divestiture of the Solimões operations is entirely adherent to the PetroRio's new strategy, initiated last year. The Company´s focus is now driven to production increase through oil fields already in production, re-exploration, growth of operational efficiency, reduction in production costs and corporate expenses.
The aggregate consideration for the transaction will be US$55 million. The completion of the transaction is subject to the final approval by ANP and it no longer encompasses the sale of four heli-transportable drilling rigs.
The elimination of the exploration risk is a key factor for the consolidation of the Company´s strategy and, in this regard, the sale of Solimões operations has become imperative, demonstrating the commitment of PetroRio in achieving its main objectives, namely, the value creation for its shareholders and the protection of the Company´s liquidity, increase of revenues and profit, strengthening its position as one of the most important emerging companies in the scenario of the oil industry in Brazil.
For more information, please contact HRT's Investor Relations Department.
1 Company's corporate name approved in the Special Shareholders' Meeting held on May 15, 2015., subject to registration and approval in the competent bodies. The Company's shares and GDSs will continue to be traded under the tickers HRTP3 on the BM&FBOVESPA and HRP on TSX-V until the new corporate name is approved and the request to change the tickers is authorized by the BM&FBOVESPA and the Brazilian Securities and Exchange Commission (CVM). The Company will keep its shareholders and the market in general informed of the progress of this process.
PetroRio is one of the largest independent oil and natural gas producer in Brazil. It is operator of Polvo field which is located in the southern portion of the Campos Basin, Rio de Janeiro , and holds a 60% participating interest. Polvo has Brazil's seventh largest daily production of barrels of oil equivalent (boe), with 20.3º API, deriving from three producing reservoirs. PetroRio is the owner, through its subsidiaries, of "Polvo A" fixed platform and a 3.000HP drilling rig, currently in operation in the field, being the platform connected to the "Polvo FPSO" vessel, with capacity to segregate hydrocarbons and water treatment, oil storage and offloading. Polvo Field license covers an area of approximately 134km2, with several prospects with potential for further explorations.
On January, 2015, PetroRio announced the acquisition of 80% of the Bijupira and Salema Fields located at the same basin, Campos Basin, at a distance of approximately 80 km from the Polvo Field, tripling its current daily production to more than 33,000 barrels of oil. Such acquisition is subject to the approval of Brazil's Council for Economic Defense (CADE) and the National Agency of Petroleum, Natural Gas and Biofuels (ANP). Furthermore, PetroRio is born of a new corporate culture focused on increasing production through the acquisition of production assets, the re-exploration and optimization of the Polvo, Bijupirá and Salema Fields, increasing operational efficiency and reducing production costs and corporate expenses. The Company's main objective is to create value for its shareholders, protecting its liquidity and increasing revenue and profits, with full respect for safety and the environment. For more information, please visit the Company's website: www.petroriosa.com.br
This news release contains forward-looking statements. All statements other than statements of historical fact contained in this news release are forward-looking statements, including, without limitation, statements regarding the expected time for completing closing of the proposed acquisition under the Agreements, the proposed change of the Company name to PetroRio and our other plans and objectives. Readers can identify many of these statements by looking for words such as "expects", "believe", "hope" and "will" and similar words or the negative thereof. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. By their nature, forward-looking statements require us to make assumptions and, accordingly, forward-looking statements are subject to inherent risks and uncertainties. We caution readers of this news release not to place undue reliance on our forward-looking statements because a number of factors may cause actual future circumstances, results, conditions, actions or events to differ materially from the plans, expectations, estimates or intentions expressed in the forward-looking statements and the assumptions underlying the forward-looking statements.
The following risk factors could affect our operations, as well as our ability to complete the proposed acquisition under the Agreements: the contingent resource and prospective resource evaluation reports involving a significant degree of uncertainty and being based on projections that may not prove to be accurate; inherent risks to the exploration and production of oil and natural gas; limited operating history as an oil and natural gas exploration and production company; drilling and other operational hazards; breakdown or failure of equipment or processes; contractor or operator errors; non-performance by third party contractors; labor disputes, disruptions or declines in productivity; increases in materials or labor costs; inability to obtain required regulatory approvals; inability to attract sufficient labor; requirements for significant capital investment and maintenance expenses which HRT may not be able to finance; cost overruns and delays; exposure to fluctuations in currency and commodity prices; political and economic conditions in Namibia and Brazil; complex laws that can affect the cost, manner or feasibility of doing business; environmental, safety and health regulation which may become stricter in the future and lead to an increase in liabilities and capital expenditures, including indemnity and penalties for environmental damage; early termination, non-renewal and other similar provisions in concession contracts; and competition. We caution that this list of factors is not exhaustive and that, when relying on forward-looking statements to make decisions, investors and others should also carefully consider other uncertainties and potential events. The forward-looking statements herein are made based on the assumption that our plans and operations will not be affected by such risks, but that, if our plans and operations are affected by such risks, the forward-looking statements may become inaccurate.
The forward-looking statements contained herein are expressly qualified in their entirety by these cautionary statements. The forward-looking statements included in this news release are made as of the date of this news release. Except as required by applicable securities laws, we do not undertake to update such forward-looking statements.
Sedar Profile # 00031536
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SOURCE HRT Participações em Petróleo S.A.
For further information: PETRORIO INVESTOR RELATIONS: Praia de Botafogo 370, 1st floor, Botafogo, Rio de Janeiro, RJ, CEP 22250 040, website: www.petroriosa.com.br; IR CONTACTS: Phone: +55 21 3721 3810, e-mail:[email protected]