Equinor acquires Rio Energy
London, 21 July, 2023, (Oilandgaspress) – The transaction includes selected assets and the team, while Denham Capital will retain certain assets. With the acquisition, Equinor strengthens its position as a broad energy company in the Brazilian market.
“Through Rio Energy, Equinor will take a leading position in the rapidly growing Brazilian renewables industry. It accelerates production and cash flow, gives us a strong platform for growth, and adds capabilities and an attractive project pipeline,” says Pål Eitrheim, Equinor’s executive vice president for Renewables.
The deal is in line with Equinor’s strategy which includes growing its onshore renewables business in select markets through acquisition of local companies with high-quality teams and project pipelines.
Following the transaction, and after the carve-out of certain assets by Denham Capital, Equinor will hold a 100% stake in Rio Energy and retain the current management team and a total of about 140 employees. The acquired portfolio consists of the 0.2 GW Serra da Babilonia 1 producing onshore wind farm in the north-eastern state of Bahia, a 0.6 GW pre-construction solar PV portfolio and a project pipeline of about 1.2 GW of onshore wind and solar projects.
Rio Energy will be a fully owned Equinor subsidiary, and the team and management will continue to develop its current portfolio. The acquired project portfolio is anticipated to deliver at the high end of Equinor’s expected range of 4-8% real base project return for renewables projects, including acquisition price.
The produced power is planned to be managed in the Brazilian power market by Equinor’s wholly owned energy trading house Danske Commodities (DC). DC recently established a trading office in São Paulo to support Equinor’s activity in the country.
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