(Bloomberg) -- Brazil’s oil giant Petrobras is seeking potential buyers for its long-held potash mining rights in the Amazon Basin at at time when fertilizer supply is tight and costs are high.
The state-run company assets for sale include 8 potassium salts mining concessions, 4 mining requests, and 22 mining titles in the process of obtaining a research authorization from the local mining agency.
Petrobras has held mining rights in the areas known as Fazendinha and Ariri for decades, studying alternatives for the business. The potash potential is equivalent to around 6% of current global production and more than a third of Brazil’s annual consumption, it said in a teaser.
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The sale is part of the oil producer’s strategy to divest non-core assets to focus on the exploration of hydrocarbon discoveries in the pre-salt offshore region. The war in Ukraine has made potash assets more attractive -- prices skyrocketed in response to the invasion, but are now dropping as Russian product stabilizes. Brazilian farmers have at times struggled to buy fertilizers, as the agricultural superpower imports around 80% of its needs.
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The Rio de Janeiro-based company is looking for bidders with minimum equity of $2 billion and makes a disclaimer: it can exclude competitors located in countries subject to sanctions imposed by the United Nations Security Council, the US, and the European Union, among others. In April Petrobras aborted a deal with Russia’s Acron PJSC to sell nitrogen fertilizer maker UFN-III, alleging the business plan couldn’t get the government approvals needed.
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