Exxon Eyes Brazil Expansion

By Bradley Olsen and Paul Kiernan

Exxon Mobil Corp., the only big oil company without a major foothold in Brazil, is in talks to gain access to the country's prized deep-water resources, according to people familiar with the matter.

The talks have included discussions about a joint venture partnership through which Exxon would invest in projects with state-oil firm Petróleo Brasileiro SA, or Petrobras, as well as potentially buying stakes in offshore tracts the Brazilian government plans to lease out this year, the people said.

The specific terms of any agreement have yet to be completed. One person cautioned that talks between Exxon and Petrobras remained at a preliminary stage. But Exxon, which has eyed deep-water resources in Brazil for at least a decade, is working with Hess Corp. in seeking to expand in the country after Brazil revised its regulations last year to attract greater foreign investment, the people said.

Representatives for Exxon, Hess and Petrobras declined to comment.

Exxon would join French giant Total SA and Norwegian state-controlled Statoil ASA, both of which have formed partnerships with Petrobras and expanded in Brazil in the past year. Royal Dutch Shell PLC has said it plans to invest $10 billion in the country over the next five years as part of a push to double its global deep-water production.

The race to expand in Brazil comes as Petrobras is selling tens of billions of dollars in assets in a bid to work off the largest debt burden in the global oil industry. Brazil's conservative government, in power since the impeachment of President Dilma Rousseff last year, sees foreign investment in the oil sector as key to an economic recovery after Brazil's worst recession on record.

Write to Paul Kiernan at paul.kiernan@wsj.com

(END) Dow Jones Newswires

April 04, 2017 10:40 ET (14:40 GMT)

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