If Brazil’s Petrobras Is in the News It Ought to Have Struck Oil Again

Oil exploration by Petrobras Petrobras, Brazil's government-controlled oil and gas multinational announced on Thursday, July 7, a new discovery of light oil with an API grade of around 30 in the ultra deep Santos Basin off the São Paulo coast.

The new discovery well, called 1-BRSA-618-RJS (1-RJS-656) and informally knows as Iara, is located in the smaller area of the original Tupi block, approximately 230 km (143 miles) off the coast of the city of Rio de Janeiro, and 2,230 meters (7316 feet) from the water line.

The well is still being drilled in search of deeper prospects, said the Petrobras release.

The oil in the Iara field, controlled 65% by Petrobras, 25% by the BG Group and 10% by Portugal's Galp Energia is near the Tupi field, where Petrobras has estimated recoverable reserves at between 5 billion to 8 billion barrels.

The discovery was proved by a light oil sampling collected via a cable test carried out in reservoirs at a depth of 5,600 meters (18,373 feet) and was officially reported to the Brazilian National Petroleum Association (NPA) this week, reported Petrobras.

Experts agree that the sub-salt production may be technically challenging and costly, partly because salt movement requires reinforced piping, which can still be damaged. Production from above the salt level is easier.

Nevertheless analysts are bullish on Brazil's oil potential, expecting the country to become a major world oil producer in the next decade. Brazil already produces enough to meet its net oil needs of about 1.8 million bpd, and exports some crude.

Last week in London Petrobras president, José Sergio Gabrielli de Azevedo and the corporation's European general manager Joaquim Dib Cohen following a meeting with investors, announced the beginning of production in the pre-salt field.

Gabrielli said output from the first pre-salt well in the Jubarte field, in the Campos Basin, is expected to begin in September. Initial production is anticipated to be 10,000 bpd. The well is interconnected to platform P-34, which went online in late 2006, in Espí­rito Santo, in the Brazilian southeast.

Gabrielli also revealed that long term testing at the Tupi field is scheduled for March 2009 and the pilot project should begin production by 2010 with initial output in the range of 100,000 bpd together with some 3.5 million cubic meters of natural gas pd.

Petrobras also announced that the Agbami Field off Nigeria began production this week. The Brazilian corporation holds a 13% stake of the consortium made up of Norway's StatoilHydro, US Chevron, acting as operator, plus the Nigerian National Petroleum Corporation and Famfa Oil Limited.

The FPSO (Floating Production, Storage and Offloading) type vessel that operates in block OML-127 (Agbami) is the largest ever of its kind and is capable of producing 250,000 barrels of oil per day. The field's average depth is 1400 meters.

Agbami production is expected to peak in the second half of 2009. Petrobras' share will be 33,000 boed of the light oil production, with API gravities ranging from 43 and 45 degrees. This production will represent some 13% of the volume Petrobras produces abroad.

Mercopress

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  • Show Comments (4)

  • João da Silva

    Joseph
    [quote]Has anyone noticed how whenever the dollar begins to gain ground there is a “new” find and call for more investments to enter Brazil?[/quote]

    Yes, Joseph. I have noticed it. It is not only related to dollar gaining ground but also to other “political crises”. I have commented before about it. To summarize it : A “new” oil find a month keeps the crisis away. I am just massacring an old proverb “An apple a day keeps the doctor away” 😉

  • Joseph

    speculation
    Has anyone noticed how whenever the dollar begins to gain ground there is a “new” find and call for more investments to enter Brazil?

    Lula and similar ilk control inflation by a weaker dollar. I predicted this “find” the day before it happened as I saw the dollar gathering strength….my friends think I have some kind of esoteric knowledge but alas, I just have a penchant for watching the obvious manipulations here in Brazil.

    Want to see the next find? If the dollar gets near 1.65..look for the next announcement!

  • ch.c.

    Dont worry !!!!!
    Even if Brazil will produce as much oil as Saudia Arabia, Brazil will never ever be as wealthy as the Saudis, wether you agree or not.

    – Saudi Arabia has inland and shallow oil ! Making it much cheaper and easier to pump. Brazil oil is mostly offshore at around
    7000-8000 meters depth. for Tupi alone, US$ 240 billion are necessary to fully develop the field…for the Brazilian part only.

    – Saudi Arabia has a fraction of the Brazilian population . Meaning the cake is eaten by much fewer people.

    Enjoy !!!

    Strange…..little is published in Brazil on the world oil price that just went down by Us$ 40.- per barrel !

    Is this really bullish for Petrobras ? Hmmmmmm…may be not so.
    Proof is that since Petrobras has announced its Tupi field and later its apparently even bigger Carioca field , the company shares prices are down by around a third, and this despite oil price is still higher than when the discoveries were annouced !

    Viva Petrobras !

  • Frank

    Brazil Rocq
    😉 I love to read your Great news!
    I so happy for Brazil , It was time to show the World where we can Go!

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