Oct. 11 (UPI) -- Murphy Oil has taken over Petrobras's Gulf of Mexico assets in a joint-venture accord that included $1.1 billion in payments for an 80 percent participation.
The transaction will involve "up to $1.1 billion" to be received by Petrobras, with a cash compensation of $900 million for the value difference between the assets contributed by both companies. In addition, Murphy will make payments up to $150 million until 2025, Petrobras said late Wednesday.
For Petrobras, not only is the "inflow" important, but also that the sharing of investment will result "in a final portfolio with a better balance of risk-return."
For Murphy, the company said it gains production and new reserves.
"The addition of high quality, oil-weighted assets, such as the St. Malo Field, complements our existing Gulf of Mexico portfolio," said the president and CEO of Murphy, Roger Jenkins.
The transaction "adds approximately 41,000 net barrels of oil equivalent per day to Murphy's Gulf of Mexico production, of which 97 percent is oil," Murphy said. It will also add "86 million barrels of oil equivalent of proven and probable reserves (2P)."
The transaction became effective at the start of October and is expected to close by the end of the year, The Arkansas-based company said.
Petrobras said that the joint venture will have an estimated average production of 75,000 barrels of oil equivalent per day in the fourth quarter.
The St. Malo field in ultradeep U.S. Gulf of Mexico waters started production in December 2014.
Besides the St. Malo field, the accord also includes the other deepwater fields Cascade, Chinook, Lucius and Hadrian North, Cottonwood, Hadrian South, Dalmatian, Front Runner, Clipper, Habanero, Kodiak, Medusa and Thunder Hawk. The shallow water fields South Marsh Island 280, Garden Banks 200/201 and Tahoe are also included.
Petrobras noted that Murphy has, in addition to other offshore production in Southeast Asia, Canada and onshore production in North America, a 20 percent interest in four deepwater blocks in the Sergipe-Alagoas basin in Brazil.