Danish firm Maersk Oil has agreed to purchase Brazil’s SK do Brasil Ltda for an estimated $2.4 billion. The investment gives the firm access to three oil blocks owned by SK do Brasil in Latin America’s biggest economy. Maersk Oil is a unit of A.P. Moeller- Maersk A/S.

Currently, Maersk Oil is the biggest oil producer in the Nordic states. The agreement will see the firm pick up a 40 per cent stake in the Polvo field, a 20 per cent stake in the Wahoo discovery and a 27 per cent stake in the Itaipu discovery. The acquisition is however subject to government approval. SK do Brasil is a unit of South Korea's largest oil processor.

The Danish firm is engaged in oil exploration in Brazilian deep waters, known as the subsalt region. Maersk’s Tupi find in Brazil is considered the largest such oil find since 1976 in the Americas. Other companies exploring for oil in the region include Royal Dutch Shell Plc, Repsol YPF SA and BG Group Plc.

In March, Maersk agreed to buy a 20 per cent stake in the BM-C-34 license off the coast of Brazil from Devon Energy Corp. Brazil has attracted international oil majors because of its massive oil reserves and big upside potential for fresh discoveries.

Brazil will add the most oil production of any country outside of the Organization of Petroleum Exporting Countries, or OPEC, over the next 25 years and surpass Venezuela and Mexico to become the second-largest producer in the Americas, behind the United States, the EIA said in its International Energy Outlook.

China Petrochemical Corp., Sinopec's state-controlled parent, agreed on to pay $7.1 billion for a 40 per cent stake in Repsol YPF SA's Brazilian unit, last year. Brazil's state oil company Petrobras, issued about $42.5 billion of stock to the government in September in exchange for the rights to develop 5 billion barrels of oil reserves. Besides Brazil, Maersk has also been examining opportunities in Greenland, the Gulf of Mexico and Angola to revive production growth.

Maersk has embarked on an aggressive expansion strategy in the oil and gas space. SK do Brasil's share of production at Polvo is 10,000 barrels of oil a day, Maersk said. The Wahoo and Itaipu discoveries will be appraised next year and production may start by 2016 and 2018, respectively.

17 Feb 2011.