We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Analyst Blog Highlights: Petrobras, Chevron, Royal Dutch Shell, TotalEnergies and Murphy Oil
Read MoreHide Full Article
For Immediate Release
Chicago, IL – October 18, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Petróleo Brasileiro S.A. - Petrobras (PBR - Free Report) , Chevron Corporation (CVX - Free Report) , Royal Dutch Shell plc , TotalEnergies SE (TTE - Free Report) and Murphy Oil Corporation (MUR - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Brazil Offshore Leases Draw Little Interest from Bidders
The coronavirus pandemic-led challenges resulted in a global economic slowdown and an oil market collapse. Although the global economy has been recovering from the pandemic-induced crisis and oil prices have also rebounded to multi-year highs, energy companies appear to be rather conservative in their outlook.
Brazil’s 17th bid round, which covers oil and natural gas licenses offshore, failed to attract the interest of major oil players as the pandemic continues to wreak havoc in the energy industry. The country was unable to sell exploration and production rights in the most prolific offshore oil-rich blocks. This is because the country’s first oil auction since the beginning of the pandemic brought just 37.1 million reais into state coffers.
Nine companies signed up for the auction compared with 17 at the 16th bidding round held in 2019. This is the smallest number for an oil rights auction in Brazil, which indicates the low attractiveness of the blocks for sale. Some of the companies, which registered for the oil rights auction, were Petrobras, Chevron, Royal Dutch Shell, TotalEnergies and Murphy Oil. Officials downplayed the lack of overall interest in the round.
In late 2020, Brazil announced details of its 17th bidding round. In total, there were 92 blocks up for sale in four offshore basins, which included Campos, Pelotas, Potiguar and Santos, covering 53,900 square kilometers. The combined minimum bids for the blocks were 558 million reais. However, only five blocks received bids, all of which are in the Santos Basin, offshore southeast Brazil.
A few blocks on sale prompted speculations that they comprised part of productive geology known as the pre-salt, wherein billions of oil barrels are trapped beneath a layer of salt under the ocean floor. The blocks had a combined minimum contract of 270 million reais. There were also some blocks available near ecologically sensitive marine protected areas. However, none of them attracted bidders.
Shell dominated the sale by acquiring stakes in five of the Santos basin blocks. The operator acquired 100% stakes in the S-M-1707, S-M-1715, S-M-1717, and S-M-1719 blocks for $5.5 million. Beside these, the company consolidated with Ecopetrol to lease S-M-1709 located in the Santos basin. Shell will hold a 70% operating interest in the block, while Ecopetrol will own the rest.
The unsold blocks will now be evaluated for possible inclusion in Brazil’s Open Acreage program, which involves all blocks and mature fields that were not sold at previous auctions. Despite the results, the bidding round was a success, considering the high exploratory risks of the blocks up for sale. Energy companies are likely to be selective about assets at difficult times, which affected interests in the blocks.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
The Zacks Analyst Blog Highlights: Petrobras, Chevron, Royal Dutch Shell, TotalEnergies and Murphy Oil
For Immediate Release
Chicago, IL – October 18, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Petróleo Brasileiro S.A. - Petrobras (PBR - Free Report) , Chevron Corporation (CVX - Free Report) , Royal Dutch Shell plc , TotalEnergies SE (TTE - Free Report) and Murphy Oil Corporation (MUR - Free Report) .
Here are highlights from Friday’s Analyst Blog:
Brazil Offshore Leases Draw Little Interest from Bidders
The coronavirus pandemic-led challenges resulted in a global economic slowdown and an oil market collapse. Although the global economy has been recovering from the pandemic-induced crisis and oil prices have also rebounded to multi-year highs, energy companies appear to be rather conservative in their outlook.
Brazil’s 17th bid round, which covers oil and natural gas licenses offshore, failed to attract the interest of major oil players as the pandemic continues to wreak havoc in the energy industry. The country was unable to sell exploration and production rights in the most prolific offshore oil-rich blocks. This is because the country’s first oil auction since the beginning of the pandemic brought just 37.1 million reais into state coffers.
Nine companies signed up for the auction compared with 17 at the 16th bidding round held in 2019. This is the smallest number for an oil rights auction in Brazil, which indicates the low attractiveness of the blocks for sale. Some of the companies, which registered for the oil rights auction, were Petrobras, Chevron, Royal Dutch Shell, TotalEnergies and Murphy Oil. Officials downplayed the lack of overall interest in the round.
In late 2020, Brazil announced details of its 17th bidding round. In total, there were 92 blocks up for sale in four offshore basins, which included Campos, Pelotas, Potiguar and Santos, covering 53,900 square kilometers. The combined minimum bids for the blocks were 558 million reais. However, only five blocks received bids, all of which are in the Santos Basin, offshore southeast Brazil.
A few blocks on sale prompted speculations that they comprised part of productive geology known as the pre-salt, wherein billions of oil barrels are trapped beneath a layer of salt under the ocean floor. The blocks had a combined minimum contract of 270 million reais. There were also some blocks available near ecologically sensitive marine protected areas. However, none of them attracted bidders.
Shell dominated the sale by acquiring stakes in five of the Santos basin blocks. The operator acquired 100% stakes in the S-M-1707, S-M-1715, S-M-1717, and S-M-1719 blocks for $5.5 million. Beside these, the company consolidated with Ecopetrol to lease S-M-1709 located in the Santos basin. Shell will hold a 70% operating interest in the block, while Ecopetrol will own the rest.
The unsold blocks will now be evaluated for possible inclusion in Brazil’s Open Acreage program, which involves all blocks and mature fields that were not sold at previous auctions. Despite the results, the bidding round was a success, considering the high exploratory risks of the blocks up for sale. Energy companies are likely to be selective about assets at difficult times, which affected interests in the blocks.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.