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OSLO - Equinor Brasil Energia Ltda, a subsidiary of Norwegian energy company Equinor (OSE: EQNR, NYSE: EQNR), has agreed to sell its 60% operated interest in Brazil’s Peregrino oil field to Prio Tigris Ltda., part of PRIO SA (PRIO3.SA), the largest independent oil and gas company in Brazil. The deal, valued at USD 3.35 billion with an additional potential USD 150 million in interest, marks a significant transaction in the energy sector. InvestingPro data shows Equinor as a prominent player in the Oil, Gas & Consumable Fuels industry, with a market capitalization of $61.8 billion and annual revenue of $106.8 billion. According to InvestingPro’s Fair Value analysis, the company appears undervalued at its current trading price.
The effective date of the transaction is January 1, 2024, and final adjustments will be made to the cash payment based on the closing date and any deductions related to the asset’s performance since the effective date. Until the transaction is closed, Equinor will continue to manage the field’s operations, after which PRIO will assume operatorship. The company’s strong financial position is evident in its current ratio of 1.54, indicating ample liquidity to manage the transition. For deeper insights into major energy sector transactions and comprehensive financial analysis, InvestingPro subscribers can access detailed Pro Research Reports covering 1,400+ top stocks.
Philippe Mathieu, Executive Vice President for Exploration and Production International at Equinor, stated that the sale allows Equinor to realize value from a long-standing asset while maintaining Brazil as a core focus area. Equinor is directing its efforts towards starting up the Bacalhau field and advancing the Raia gas project. The company anticipates its equity production in Brazil to reach approximately 200,000 barrels per day by 2030.
The Peregrino field, which Equinor has operated since 2009, has produced about 300 million barrels of oil to date. It is a heavy oil field located in the Campos Basin, east of Rio de Janeiro, and features a floating production storage and offloading (FPSO) platform supported by three fixed platforms. Equinor’s share of production from Peregrino was approximately 55,000 barrels per day in the first quarter of 2025.
Veronica Coelho, Senior Vice President and Country Manager for Equinor Brazil, expressed pride in the achievements at Peregrino and anticipated a smooth transition with PRIO, which acquired a 40% stake in the field from Sinochem last year.
This divestment is part of Equinor’s strategy to optimize its international portfolio through targeted asset transactions. The company continues to identify growth opportunities and extend the life of its global oil and gas portfolio, including in Brazil. Currently trading near its 52-week low of $21.41, Equinor maintains a healthy balance sheet with moderate debt levels. InvestingPro reveals several additional bullish indicators and financial health metrics available to subscribers, along with expert analysis of the company’s strategic moves in the energy sector.
The transaction is contingent upon regulatory and legal approvals, and the payment will be made in two tranches—one at signing and another closer to the transaction’s closing, subject to customary adjustments. The agreement is composed of two parts: the acquisition of a 40% stake and operatorship of Peregrino, and the acquisition of the remaining 20%.
This information is based on a press release statement from Equinor ASA.
In other recent news, Equinor ASA experienced a downgrade from Redburn-Atlantic, which adjusted the company’s stock rating from ’Buy’ to ’Sell’ and reduced the price target from NOK330.00 to NOK230.00. This change is driven by the firm’s concerns about Equinor’s financial stability amid a lower oil price forecast and a potential increase in net debt. Additionally, the Empire Wind 1 offshore wind project, owned by Equinor, has been halted due to insufficient analysis by the Biden administration, impacting its timeline and financial structure. Equinor is also exploring market interest in its Vaca Muerta assets in Argentina, with holdings in Bandurria Sur and Bajo del Toro Norte valued at a combined $1.3 billion by Wood Mackenzie.
In other developments, Equinor has corrected a clerical error in its dividend information in a recent SEC filing, with the updated cash dividend per share now set to be communicated on February 20, 2025. Meanwhile, British Prime Minister Keir Starmer signaled support for Equinor’s Rosebank project, despite previous court rulings blocking its development. This move provides some stability for Equinor as it navigates the complexities of energy production and environmental concerns. Equinor has not commented publicly on these developments, leaving investors to assess the potential impacts on the company’s future operations.
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