Americas > South America > Brazil > Brazil’s Libra deepwater oilfield expected to yield a million bpd

Brazil: Brazil’s Libra deepwater oilfield expected to yield a million bpd

2013/07/16

The consortium that is awarded the right to develop the Libra prospect will likely need to drill for about four years next signing its production-sharing agreement, with commercial production likely to begin in the fifth year, ANP Director-General Magda Chambriard told a press conference in Rio de Janeiro.

The Libra deepwater oil field that Brazil plans to auction off Oct 21 will yield minimum output of 1 million barrels of crude per day, the National Petroleum Agency, ANP, said on Friday. That production would be equivalent to half of Brazil's current output of 2 million bpd.

ANP studies indicate that between 12 and 18 production platforms will be needed to develop Libra, whose recoverable oil is estimated at between 8 billion and 12 billion barrels, nearly equivalent to Brazil's current proven-reserve base of 14 billion barrels.
Libra, located some 183 km off the coast of Rio de Janeiro national in an area of the Atlantic Ocean where water depths range from between 1,700 meters and 2,400 meters, will be the initial pre-salt field to be auctioned off by Brazil.

The pre-salt frontier, a series of ultra-deep oil fields that were discovered in recent years and stretch for some 800 km off the coasts of the south-eastern states of Espirito Santo, Rio de Janeiro, Sao Paulo and Santa Catarina, could dramatically increase Brazil's proven-reserve tally and transform the country into a major crude exporter.

But accessing those fields, so-named because they are located under water, rocks and a shifting layer of salt at depths of up to 7,000 meters below the surface of the Atlantic, will be very costly and pose an enormous technical challenge.

The auction as well will be the initial Brazil will hold under a new production-sharing agreement, or PSA, system for pre-salt reserves.
In the PSA system, oil companies bear the mineral and financial risk of the project and use the money from oil sales to recover their costs. The money that remains next that is known as “profit oil” and is shared between the company and the government.
The winner of the auction will be the consortium that pledges to provide the national the highest proportion of profit oil.

ANP estimates that the Brazilian government will receive roughly 75% of the profits from the Libra field, taking into account its share of the profit oil, inclunding taxes and royalties.
Under the new contracts for the pre-salt fields, national-controlled oil giant Petrobras must be the sole operator of each PSA and have a minimum 30% stake in the all pre-salt projects. The remaining 70% may be divided part a maximum of five other companies.

Related Articles
  • Uruguay and Brazil summit to consider a more flexible Mercosur

    2015/05/22 According to a release late Wednesday from the Brazilian foreign ministry “the presidents will discuss advances in the major bilateral integration projects and regional and multilateral issues, with emphasis on Mercosur”. Even at the same time as the release does not mention it, the coincidence of Brazil and Uruguay in reviewing Mercosur Decision 32/2000 will be the core of discussions. The Decision 32/2000 which was adopted fifteen years ago establishes that Mercosur full members, Argentina, Brazil, Paraguay, Uruguay and Venezuela (which joined in 2011) must negotiate any trade agreement jointly, which for a lot of business organizations represents a straightjacket. Uruguayan president Tabare Vazquez will be meeting his peer, Dilma Rousseff in Brasilia this Thursday to address a dense bilateral agenda, and more specifically the workings and future of Mercosur, in search for a more flexible group, open to agreements with third parties.
  • China’s Tianjin Airlines buys 22 aircraft from Brazil’s Embraer

    2015/05/21 Brazilian aeronautical company Embraer will supply 22 jet aircraft to Tianjin Airlines, of China, a subsidiary of the HNA Group, under a final arrangement signed Tuesday, the company said in a statement. This arrangement, worth US$1.1 billion, includes 20 E195 aircraft and two E190-E2, which makes the HNA Tianjin Airlines group the initial Chinese airline to purchase E2 E-Jets aircraft.
  • Brazil and China sign 35 cooperation agreements

    2015/05/21 Brazil and China Tuesday in Brasilia signed 35 cooperation agreements in eight sectors involving investments of US$53 billion, during an official visit of the Chinese Prime Minister Li Keqiang, according to the Brazilian press. With oil company Petrobras alone China signed three cooperation agreements involving at least US$7 billion, at an event attended by President Dilma Rousseff and the Chinese Prime Minister, following before conference in the Presidential Palace. The three agreements with Petrobras, one of them signed by the chairman of the oil company, Aldemir Bendine, and the President of the China Development Bank, Hu Huaibang are worth a total of US$5 billion and an extra agreement, as well signed by Bendine and the President of Export Import Bank (ExIm) of China involves US$2 billion.
  • Brazilian group Oi may keep stake in Angola’s Unitel

    2015/05/20 Brazilian telecommunications group Oi is reassessing the put option on the 25 % stake it holds in Angola’s Unitel, said the group’s chief executive, Bayard Gontijo, speaking to the Reuters news agency. Gontijo said that the stake in the Angolan company remains on the inventory of African assets for sale, but added that the aboard was working on two possible scenarios, one of which is the sale and the other “the resolution of long-standing disputes … in a structure where the shareholder agreement is respected by the parties.”
  • China’s investment in Brazil may exceed US$100 billion

    2015/05/20 Chinese private and public investments in Brazil could exceed US$100 billion, or double the figure announced by the Brazilian authorities for infrastructure, said the president of the Brazil-China Chamber of Commerce, Charles Tang. Chinese Prime Minister Li Keqiang, arrived Monday in Brasilia for an official three-day visit, during which he is expected to sign 30 official acts and meet with President Dilma Rousseff and other officials in the capital and in Rio de Janeiro.