China’s Sinopec and the U.S. stationed EIG Global Power Partners have delivered non-binding deals to buy Brazilian refinery REGAP from state-run oil agency Petrobras, three individuals with knowledge of the matter said.
With a processing capability of 150,000 barrels per day, REGAP is the fifth-largest refinery of eight up for sale by Petrobras, as a part of a plan to raise nearly $10 billion to pay debts and sharpen its deal with offshore oil exploration and production.
REGAP is the one refinery up on the market sale in southeastern Brazil, the country’s economic powerhouse, and the heart of its oil trade.
The contract marks a debut in the race by Washington-based EIG, as the private equity agency appears to boost its downstream presence in Brazil’s energy sector. Last month, EIG was interested in REGAP.
Sinopec had already pushed a non-binding offer for RLAM, a refinery in the northeastern state of Bahia, which is a part of the first block of refineries put up on the market by Petrobras.
Other companies chosen for the second round of bidding on that block of refineries are Abu Dhabi’s state investor, plus fuel distributors Ultrapar Participações SA and Raizen.
REGAP might offer operational efficiencies for EIG, which controls the Port of Açu in Rio de Janeiro state. Oil received at the port might be transported 500 km (310 miles) inland to REGAP. EIG further owns a significant stake in a Bolivia-Brazil gas pipeline and has an offer on other assets divested by Petrobras.
EIG refused to comment. Sinopec didn’t instantly reply to a request for a remark. Petroleo Brasileiro SA, as Petrobras is officially recognized, stated it would declare any noteworthy developments through public filings.