TNK-BP close to buying 45-% stake in 21 Brazilian exploration blocks for $1 bn

Anglo-Russian oil firm TNK-BP is close to finalising a deal to buy a 45-per cent stake in several Amazon oil-exploration blocks from Brazil's HRT Participações em Petróleo SA for $1 billion.

The deal, expected to be signed early this week, would be the biggest upstream overseas investment by TNK-BP, said local financial newspaper Valor Economico.

TNK-BP will buy the stake in Brazilian oil start-up's 21 inland exploration blocks in the Amazon jungle area known as the Solimoes Basin estimated to hold around 783 million barrels of light oil and between 10 trillion to 20 trillion cubic feet of natural gas.

The paper said that the transaction would allow TNK-BP to buy an additional 10 per cent stake within three years, which will make it the operator of the blocks.

TNK-BP would be investing around $300 million to $500 million annually and first oil production is expected around 2013, which will peak to about 100,000 barrels a day later in the decade.

The deal would be the third overseas acquisition for TNK-BP after it purchased producing assets from BP in Venezuela and Vietnam.

TNK-BP, a 50:50 joint venture company between British energy giant BP plc and Alfa-Access-Renova, a consortium comprising of Russian billionaires, is Russia's, third largest oil company.