Alvopetro Energy Ltd completes Brazil gas plant upgrade as September sales fall
A five-day shutdown reduced September deliveries, while the upgraded UPGN-Caburé plant can process more Murucututu gas.
Ines Halvorsen
September 2026 sales averaged 2,627 barrels of oil equivalent a day after Alvopetro Energy Ltd. CVEALV OTCMKTSALVOF completed a five-day shutdown to upgrade its UPGN-Caburé gas plant in Brazil, it reported Oct. 5. At Alvopetro's July 6 forecast of US$11.70 per thousand cubic feet for firm gas, the August-to-September decline would imply about US$32,000 less gross gas revenue a day if that price applied to all volumes. That calculation is illustrative: the company has not reported September revenue, and exchange rates affect its US-dollar realized price.
The gas is sold under a long-term agreement whose disclosed price window runs from Aug. 1 through Oct. 31. Alvopetro's July 6 pricing update did not identify the buyer or give the contract's expiry date.
Brazilian gas sales averaged 14.1 million cubic feet a day in September, down from 16.8 million in August. Condensate sales fell to 162 barrels a day from 187. Canadian oil sales declined to 119 barrels a day from 135. The companywide September rate was 16 per cent below August's 3,124 barrels of oil equivalent a day.
Third-quarter sales averaged 2,966 barrels of oil equivalent a day, compared with 3,067 in the second quarter. Alvopetro said Brazilian production has returned to previous levels after the planned shutdown. It did not report a post-upgrade daily sales rate, so the release does not quantify a rebound in sales.
Shares were little changed at C$9.76 on the TSX Venture Exchange as of 9:34:57 a.m. EDT on Monday CVEALV.
"In Brazil, we are on track with our 2026 facility projects with the upgrade of our gas processing facility now complete and our Murucututu field level expansions all underway," president and chief executive Corey C. Ruttan said in the Oct. 5 release.
Murucututu Expansion Targets Early 2027
The completed upgrade lets gas from Alvopetro's wholly owned Murucututu field account for as much as 50 per cent of UPGN-Caburé's processing throughput. That is a change in the mix of gas the plant can handle; the October release does not give a higher total processing capacity.
Alvopetro is separately targeting a fourfold increase in Murucututu takeaway capacity through expanded field processing and pipelines by early 2027. The company did not put a cost on that work in its Oct. 5 release, and the increase remains a target until the facilities are finished.
At Murucututu, logs from the 183-H2 well indicate 44.4 metres of potential gas pay, with completion now under way. Alvopetro expects that well on production later in October, while drilling of the 183-G2 development well is also due to finish later in the month.
In Saskatchewan, a partner is drilling the first of two planned wells in which Alvopetro holds working interests of 50 per cent and 30 per cent. Both are expected on production in the fourth quarter, with Alvopetro's share of costs estimated at C$1.6 million. A separate five-well program is due to start in early November; Alvopetro estimates its full cost at C$8.5 million and targets year-end completion.
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Alvopetro expects the 183-H2 well to enter production later in October, its next dated operating milestone.
