Looking for a stake: Vale eyes blocks off Espirito Santos State
Vale eyes Brazil oil blocks
Brazilian miner Vale signed a preliminary accord today with state-run oil company Petrobras to buy a 25% stake in exploration rights for oil and gas blocks off Brazil's coast.
Vale said in a statement the accord laid the foundations for Vale's acquisition of exploration rights in the ES-M-466, ES-M-468 and ES-M-527 blocks off the coast of Brazil's Espirito Santo State, which Petrobras acquired via auction.
The partnership between Brazil's two biggest companies would still have to be approved by authorities, Vale said according to Reuters.
Vale, the world's largest producer of iron ore, has expanded its energy operations in efforts to provide for its own consumption needs.
"Exploring for energy sources, such as natural gas, is a part of Vale's strategic objective to diversify and optimize its energy supply in order to reduce costs and mitigate risks," the company said in a statement
It relies on natural gas to power operations in the southern parts of Brazil.
On Tuesday it announced plans for a $500 million project to make biodiesel that by 2014 could displace 20% of its current diesel consumption in its northern Brazil operations.