Thai state-owned operator PTT Exploration and Production (PTTEP) is buying a 20% stake in a deepwater block operated by Petrobras, with Shell choosing to exit the block.

PTTEP said its wholly-owned subsidiary PTTEP Brazil Investments in Oil and Gas E&P Ltd. (PTTEP BL) had entered into an agreement to acquire the participating interest from Shell’s subsidiary Shell Brasil Petroleo Ltda. in the BM-ES-23 concession. The deal is still subject to approval by the Brazilian regulator the National Petroleum Agency (ANP).

Located in the Espirito Santo Basin, the permit spans about 550 sq km (212 sq miles). If approved, the remaining partners will be Petrobras (operator) with 65% and INPEX 15%. The partners plan to conduct exploration and appraisal drilling both this year and next.

The Thai player already holds a 25% participating interest in four exploration blocks within the Barreirinhas AP1 project in Brazil’s Barreirinhas Basin.