‘Brazil’s black gold’ is this month’s keynote article by consultants Booz & Co. Focussing on Brazil’s oil and gas industry, the article highlights the tremendous growth potential offered by the nation’s substantial pre-salt reservoirs both in terms of financial reward and long-term industrial development. This excellent article, which I encourage you to read, begins on page 10 and is itself a prelude to the forthcoming OTC Brasil Conference and Exhibition running from 4 – 6 October 2011 in Rio de Janiero.
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OTC Brasil is a brand new event put together by the Offshore Technology Conference (OTC), and is the organisation’s first to be held outside Houston, USA. That it has hit upon a rich vein is without question, with 292 confirmed exhibitors at the last count, from around the globe, occupying over 14 000 m2 of exhibition space, it is clearly a testament to the huge international interest the Brazilian oil and gas industry is currently generating. Please note that Palladian Publications Ltd, will be in attendance at the show and our regular oil and gas related publications, Oilfield Technology, World Pipelines and LNG Industry will be widely distributed amongst visitors and delegates in addition to our annual Portuguese language publication, World Pipelines and Oilfield Technology Brasil 2011, produced specially for this and for the Rio Oil and Gas Expo & Conference in Rio in mid-September.
So why the hype and why is the country attracting such interest? Essentially Brazil is a rarity in the current oil and gas arena. In the first instance, there are proven hydrocarbon reserves in a politically stable environment, in close proximity to major markets. This is very attractive to oil and gas majors who are increasingly being frustrated by a lack of access to new reserves by national oil companies (NOCs). Secondly, with the oil and gas trapped beneath approximately 7000 m of sea water, rock and salt, the technical challenges in bringing these hydrocarbons to the surface are immense. Brazil’s National Petroleum Agency (ANP) and Petrobras and its partners, actively require outside assistance in the form of technology and oilfield services. On the face of it, it would appear the perfect marriage for all concerned. US President Obama recently summed up this sentiment during a visit to Brazil in May, “We want to work with you. We want to help with technology and support to develop these oil reserves safely, and when you’re ready to start selling, we want to be one of your best customers”.
With an estimated 100 billion bbls of oil in pre-salt reservoirs at the base of the Campos and Santos basins alone and with substantial further reserves in the Carioca, Guara, Cernambi, Parati, Caraba and Lara fields, Brazil’s over-riding priority has been to safeguard these extremely valuable and extensive reserves. So it was no surprise that as this issue went to press, it was reported that Brazil has formerly announced plans to reclaim a number of key exploration blocks that had been won in 2007 by companies such as ENI, Repsol, ONGC and the then Norsk Hydro shortly before Petrobras’ discovery of the first subsalt reserves in the Tupi prospect. These blocks, which are now known to hold substantially more hydrocarbons than originally thought, will be returned to the Brazilian Government and re-auctioned at a future date once an agreement has been reached on how royalties from oil production will be distributed between Brazilian states.
Clearly there is still much to play for within the Brazilian oil and gas sector ensuring that the inaugural OTC Brasil will be a fascinating forum for discussion and a beneficial addition to the calendar of key international exhibitions and conferences.