BRAZIL
Petrobras revs up its
deepwater drilling program
Brazil has ambitions to become one of the largest oil export- ers in the world over the next decade or two, but the coun- try’s ability to reach that goal is the pressing question. In September 2014, Brazilian federal energy planning company Empresa de Pesquisa Energetica (EPE) laid out its 10-year
plan for energy expansion, which foresees that the country will be
able to produce 5 MMb/d of oil by 2023. That would be a significant
jump from the roughly 2 MMb/d of oil the South American nation
currently produces. According to the EPE, domestic demand will
only consume approximately 3. 5 MMb/d, leaving 1. 5 MMb/d to be
directed for export to the international market.
A significant level of investment will need to be placed in Brazil’s hydrocarbon segment if this goal is to be reached. Of the BRL 1. 26 trillion
($540 billion) the EPE believes will be spent on energy projects in the
country over the next decade, including electricity generation and bio-fuels, 61.6%, or BRL 778 billion ($332.7 billion), will need to go toward
the exploration of oil and natural gas. It is likely that a large portion of
that investment will be spent on presalt areas, as the EPE expects two-thirds of oil production to come from those fields by 2023.
Libra to lead presalt movement
To meet these targets, Brazil’s largest producer, Petrobras, will
need to keep ramping up production, which is something the operator
has been doing with regularity during 2014. The company achieved
new record production levels in December, hitting 2.286 MMb/d of
oil and natural gas liquids. The majority of this volume is coming from
the historically prolific postsalt areas of the Santos and Campos basins, and new facilities came online in 2013 and 2014 at several fields
including Papa-Terra, Roncador, Baúna, and Parque das Baleias.
However, presalt production also hit a new high point in December
when Petrobras crossed the 700,000 b/d mark, which is a fairly significant jump from the 500,000 b/d the company was drawing from presalt
fields only six months earlier. Each presalt well is highly productive,
because while a total of 12 facilities are currently pumping from presalt
fields, including newer FPSO vessels at Sapinhoá, Lula and Iracema,
the entirety of the volume is coming through a mere 34 wells.
While this clearly demonstrates that presalt fields are increasing
in importance, one in particular, Libra, is the field du jour in Brazil.
Discovered in 2010 and covering an area of 1,548 sq km (598 sq mi),
the Libra oil field is located in the Santos basin presalt layer in water
depths of around 2,000 m ( 6,562 ft). This gigantic field is of such im-
portance in the mid-to-long-term future in Brazil that national regu-
lator Agencia Nacional do Petroleo, Gas Natural e Biocombustiveis
(ANP) held a lease sale for solely this field in 2013. Petrobras, which
was guaranteed at least a 20% operating interest in the block, now
holds 40% interest, while Shell and Total each hold 20%, and CNPC
and CNOOC each hold 10%. In addition to the signing bonus of $6.9
billion, the group will have to conduct a minimum exploration pro-
gram valued at approximately $281.1 million.
The reservoir depth at Libra is around 3,500 m ( 11,483 ft) below the
seafloor, for a total depth of approximately 5,500 m ( 18,045 ft). According to estimates by the ANP, the field holds an expected recoverable
volume of 8 to 12 Bbbl of oil, plus total gross peak oil production could
reach 1. 4 MMb/d. That said, further appraisal is required to firm up
that estimate, as well as the full development plan and a first oil date.
To that end, Petrobras started drilling the first two appraisals well
in the Libra area in August. Being drilled by Schahin drillship
Cer-rado, this is the first of two wells planned for the first phase of the
block’s minimum exploration program, while the second well is being drilled by another Schahin drillship, Sertao. Both of these wells
have encountered oil and gas in the anticipated layers. The exploration program also calls for the acquisition of 3D seismic data over
the block, which the operator has already completed, as well as an
extended well test (EWT). Petrobras plans to start the EWT in December 2016 and wrap up the appraisal program by the end of 2017.
Frontier areas beckon
Libra may have gotten its own bidding round in 2013, but it was not the
only recent lease sale. The ANP’s 11th Licensing Round, the first such
bid round held in five years, earned record revenue with signing bonuses
in the amount of $2.8 billion. Of the 289 blocks that were offered across
11 sedimentary basins both onshore and offshore, 142 were sold.
Presalt areas were not the focus of that sale, which instead favored
mature and frontier areas. Blocks located in the frontier regions of
the country, primarily those around the north and northeast coasts,
garnered serious attention from international operators. In fact, the
largest signing bonus during the sale, which was approximately
$171.4 million, was offered for block FZA-M- 57 in the Foz do Amazonas basin by a consortium operated by Total (40% interest) with
partners Petrobras (30%) and BP (30%). That consortium beat five
other bidders to secure the block.
At least one operator has already started making moves to explore
the frontier areas it won in that sale. In July, Premier Oil released a request for information for a floater capable of working in at least 2,100 m
( 6,870 ft) of water to undertake an exploration program in the Ciara and
Potiguar basins. The 400-day firm program, for which a tender should
Justin Smith
IHS Petrodata
Brazil remains
center stage in rig market
The drillship Dhirubhai
Deepwater KG1 will
operate offshore Brazil
at a rate of $440,000/d.
(Photo courtesy
Transocean)
