Sinopec acquires 40-% in Repsol’s Brazilain assets for $7.1-bn

China's state owned Sinopec, Asia's largest oil refiner today acquired a 40-per cent stake in the Brazilian asses of Spanish oil company Repsol YPF SA for $7.1 billion, its second-largest overseas investment to date.

Repsol, Spain's biggest oil company, which is looking for money to fund the development of its assets in Brazil, will carry out a capital raising of $7.1 billion in Repsol Brazil, which will be taken up entirely by Sinopec, valuing the company at $17.8 billion.

Repsol will retain 60 per cent of the company, which will become one of Latin-America's largest privately-owned energy companies.

With this new investment, Repsol Brasil will develop all of its current projects in Brazil, including world class oil discoveries in the Guara and Carioca pre-salt basins.

Repsol and Sinopec will continue their respective expansion plans in Brazil and will participate, jointly or individually, in future bidding rounds in the area, Madrid-based Repsol said in a statement.

Repsol is one of the largest independent upstream operators in Brazil and the country's third-largest oil producer in 2009. It is the largest foreign owner of exploratory blocks, with presence in the Santos, Campos and Espiritu Santo Basins.