Aussie E&P Joins Brazil Oil Equity Pipeline

Karoon Gas Australia, the Australian E&P company with ownership of Brazilian and Peruvian oil exploration blocks, plans to sell 35%-30% of its LatAm assets via an IPO on Brazil’s Bovespa. It has hired Morgan Stanley to lead the sale, which would create the Karoon Petroleo e Gas unit. Karoon does not indicate timing or BRL value. Karoon expects to retain 70%-75% ownership in the Brazil assets, and also will look to raise funds privately before the IPO, it says in a statement. The issuer adds that it will use a 1-month review period following filing of a preliminary prospectus to determine whether to proceed. ASX-listed Karoon owns 5 blocks in Brazil’s Santos Basin, and 2 in Peru. It claims to have an unrisked mean estimate of 2.15bn barrels of reserves. It agreed last month to take a 20% stake in 2 Santos wells through a joint venture with Petrobras. Karoon has a market cap of AUD1.24bn ($1.15bn). It joins an equity pipeline awaiting a $25bn-$30bn Petrobras offer September 23, before other oil operators, including Repsol Brasil and HRT Participacoes, come with IPOs of their own.