Brazil’s upstream prospects continue to brighten, as the state-controlled company makes another massive find Petrobras’ latest find could contain as much as 33 billion barrels of oil equivalent, according to Haroldo Lima, head of upstream regulator Agência Nacional do Petróleo (ANP). If confirmed, the prospect would be one of the largest oilfields in the world, the biggest discovery in around 30 years and would transform Brazil’s potential as an oil exporter. However, the state-controlled company, operator of the Santos basin’s block BM-S-9, with a 45% share, has not confirmed ANP’s claim, saying “more conclusive” data are needed. Petrobras plans to drill further wells in what it is referring to as the Carioca area and to conduct other tests before estimating the size of the discovery. ANP was first informed of the presence of hydrocarbons in the block in September, after the drilling of an initial well. In March, Petrobras began a second well and although this has not yet reached its target area, the indications must be extremely positive. It is more good news for Petrobras and Brazil – as well as a boost for the block’s other shareholders, the UK’s BG Group, with 30%, and Spain’s Repsol YPF, with 25%.
Brazil’s upstream prospects appeared to have been transformed in November, when Petrobras claimed to have discovered a new oil province – “comparable to the most important oil provinces in the world”. The Tupi accumulation, in block BM-S-11 of the Santos basin, contains 5-8 billion barrels of recoverable oil, according to Petrobras, and has the potential to boost Brazil’s oil and gas reserves of 14bn barrels of oil equivalent by more than 50%. That would make it twice the size of the Campos basin’s Roncador field – at that point Brazil’s largest field. However, at the time of the announcement, Petrobras said Tupi represents just a “small part” of a new frontier – ranging through the Espírito Santo, Campos and Santos Basins, in deeper horizons than previously explored, under large layers of salt in rock formations about 800 km by 200 km.That prediction would appear to be born out by Lima’s comments. And if the ANP’s assessment is validated, Tupi would be dwarfed by the BM-S-9 discovery, which could be more than five times the size.The find also enhances Brazil’s prospects of becoming a significant oil exporter. At present, the country is more or less self-sufficient in oil and aims to be exporting a net 350,000 barrels a day of crude and oil products by 2010. Even if no further discoveries were to be made, which seems very unlikely, Tupi and Carioca have the potential to push it far beyond that.It is a dramatic turnaround from five years ago, when doubts about Brazil’s attractiveness as an exploration play were beginning to creep in. When the upstream sector was opened up to private investment in 1997, Brazil was hyped as the world’s new exploration hotspot. The first international licensing round took place in 1999, but, for several years, upbeat exploration announcements were few and far between.The situation has now reversed and ANP is even holding back the most prospective acreage from its licensing rounds.The shareholders in Tupi are Petrobras (operator, with 65%), BG (25%) and Portugal’s Petrogal (10%).PHOTO: Petrobras’ CEO José Sergio Gabrielli has plenty to smile about