Vale In Talks With Woodside To Buy Stake In Brazil Gas Blocks

Brazilian mining giant Companhia Vale do Rio Doce (RIO), or Vale, said late Thursday it is in talks with Woodside Energia, a local subsidiary of Woodside Petroleum Ltd. (WPL.AU) to buy a 12.5% stake in a consortium formed to explore natural gas in the Santos Basin.

Vale said it will acquire a stake in the consortium BM-S-48 and BM-S-55 in the Santos Basin. The company didn't unveil the possible value of the deal.

Currently, Woodside Energia owns a 25% stake in the consortium, comprising Repsol YPF SA (REP) with 40% and Brazilian state-run energy giant Petroleo Brasileiro (PBR) with 35%.

"The exploration of energy sources, including natural gas, is part of Vale's strategy of diversification and optimization of our energy matrix, aiming to reduce costs and mitigate risks," Vale said in a statement.

The acquisition must be approved by Brazil's National Petroleum Agency, called ANP.

-By Rogerio Jelmayer, Dow Jones Newswires; 55-11-2847-4521; [e-mail]

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