Global Insight Perspective | |
Significance | Although the year-on-year increases are modest, Brazil's hydrocarbons reserves have increased significantly since the opening of the oil sector and recently announced discoveries in the pre-salt layer have led to expectations of future increases. |
Implications | The mysterious theft of data related to the Jupiter discovery is an indication of the interest that these finds have generated. |
Outlook | Brazil's recent and future reserve growth should ensure continued production growth in the years to come. |
Brazil's Oil Reserves at End 2007 Total 12.623 bil. Barrels
Brazil's oil regulator the ANP has released a statement announcing that Brazil's proven oil reserves at the end of 2007 totalled 12.623 billion barrels and its proven gas reserves 364.99 bcm. The oil agency said that these figures represented a 4.9% increase in proved gas reserves and a 3.6% increase in proved oil reserves. Additional gas reserves came from the Jubarte field in the Campos Basin and new oil reserves from the Parque das Baleias area and the Marlim Sul and Roncador fields. The ANP said that the figures included reserves for fields under development and those with development plans under study by ANP and not formally recognised by the agency. The ANP said that total oil reserves were 16.888 billion barrels and gas reserves 369.96 bcm.
The reserves data does not include the massive Tupi discovery announced last year or the Jupiter gas find in January—both in the pre-salt layer (see Brazil: 22 January 2008: Petrobras Announces New Important Gas Discovery in Brazil and 9 November 2007: Petrobras Announces Large Discovery in Brazil).
The Brazilian state oil company Petrobras announced in a separate statement in January that its proved oil and gas reserves in Brazil at end 2007 were 10.818 billion barrels of oil equivalent (boe), up from 10.573 billion boe the previous year, according to SEC criteria (see Brazil: 16 January 2008: Petrobras's Proven Oil Reserves See Slight Increase).
Data Stolen Related to Huge Gas Find
The ANP announcement was made as the repercussions of last week's theft of confidential data belonging to the Brazilian state oil company Petrobras continue to be felt. The theft is being investigated by the federal police, Petrobras, and the state intelligence agency Abin. Four laptops and two hard drives were stolen from a container owned by the oil service company Halliburton as it was being transported to offices belonging to Petrobras. According to local media reports, the federal police say that the stolen computers contained information on the Jupiter find. The police believe that the incident was industrial espionage rather than a common theft. According to a report by Business News Americas the federal prosecutor has asked the ANP to suspend the relaunch of the eighth licensing round and the scheduled 10th round both planned for this year following the data theft and a proposal to alter the regulatory framework following the Tupi discovery. The ANP reportedly has 10 days to reach a decision.
Outlook and Implications
Brazil's oil sector has undergone a radical transformation since it was opened to private participation in the 1990s. Although Petrobras has been the most successful in terms of commercial discoveries in exploration blocks awarded since 1998 and remains the country's largest oil producer, a number of foreign operators have made commercial discoveries that they are now developing.
If they fulfil expectations, the discoveries of the Tupi and Jupiter fields in the pre-salt layer could signify another new phase for the oil industry. Brazilian officials claim that the Jupiter find contains enough gas to allow the country to become self-sufficient in gas as well as oil, while the Tupi find with an estimated 5 billion-8 billion barrels of reserves could convert Brazil into one of the world's 10 largest oil producers. Nevertheless, the costs of exploring for oil in Brazil, where the most promising finds are located in ultra-deepwaters, are high.