Statoil, Sinochem team up for Brazil's oil

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OSLO, Norway, June 14 (UPI) -- A memorandum of understanding with China's Sinochem Group is an indication of the prospects for oil development in Brazil, Norway's Statoil said.

Sinochem and Statoil signed the MOU during a ceremony in Oslo. The MOU outlines a "long-term" relationship between the two companies.

"I believe that we have supplementary skills and areas of expertise, strengthening both our opportunities globally by cooperation," said Helge Lund, the chief executive officer at Statoil.

The MOU specifies developments in Brazil "and elsewhere." The document follows an earlier transaction in which Sinochem acquired a 40 percent stake in the Peregrino offshore oil field in Brazil from Statoil.

Operator Statoil said it expects to start production at Peregrino in early 2011. The field is about 50 miles offshore in the oil-rich Campos basin in 325 feet of water. Statoil estimates the field holds at least 300 million barrels of oil.

"The recent transaction confirms the high quality of the Peregrino asset, reflecting Statoil's value added through the field development," added Lund.