Fortress Energy has entered into a letter of intent to acquire 100% of the shares of a Brazilian private oil and gas company Alvorada Petroleo S.A. for an acquisition price of US$37 million. Alvorada owns a 100% working interest in 7 exploration Blocks located in the Reconcavo Basin, covering an area of approximately 200 sq km. In addition, Alvorada owns a 100% working interest in three onshore producing oil fields: Bom Lugar, located in the Reconcavo Basin, Jiribatuba, located in the Camamu Basin and Aracaju, located in the Sergipe Basin. These assets have current production of approximately 50 bbls/d of light oil.

The acquisition is subject to completion of due diligence, the execution of a formal purchase and sale agreement in due course and is also subject to regulatory approval in Canada and Brazil.

The Reconcavo Basin is located 85 km north of the city of Salvador where the Brazil oil industry found its beginning with the first oil discovered in 1939. Since then the cumulative production from the Reconcavo Basin has totalled 1.5 billion barrels of light oil from 86 fields. There have been 6,000 wells drilled into the Reconcavo Basin spanning an area of approximately 10,000 sq km.

Tags: Fortress Energy Inc.