Brazil says subsalt oil finds could triple total reserves

Brazil’s giant subsalt oil and gas region could yield 35 billion barrels of recoverable oil equivalent, more than double Brazil’s existing reserves, an energy ministry representative said on Tuesday.

Analysts have said the total amount of oil in the New York State-sized subsalt region that was discovered in 2007 could be about 100 billion barrels of recoverable oil, or enough to provide all current U.S. oil needs for about 14 years.

“Subsalt discoveries that have been evaluated so far suggest a volume of recoverable oil more than double Brazil’s proven reserves,” said Marco Antonio Martins Almeida, secretary of oil and gas at Brazil’s Ministry of Mines and Energy.

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Brazil puts expats on notice with Chevron charges

Jeffrey Jones & Jeb Blount – Reuters, 03/27/2012

Brazilian criminal charges against energy industry employees over an oil spill have made foreign workers leery of new legal risks, but so far concerns seem to be outweighed by the lure of good-paying jobs and a famously laid-back lifestyle.

The big question among expatriates is whether last week’s charges against Chevron Corp, Transocean and 17 of their staff are political grandstanding in a country actively seeking foreign expertise to help develop its newfound oil riches, or a real risk of doing hard time.

“This prosecution is strange. I think people, more than anything, were surprised they’ve taken it, or appear to want to take it, to this extent. It’s really politically driven from what I can see in talking to some of my Brazilian friends,” said Tom Rothfels, a Canadian who recently returned to Toronto from a five-month stint in Brazil working with a helicopter company that serves the offshore oil industry.

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Chevron becomes the BP of Brazil

Kenneth Rapoza – Forbes, 03/20/2012

It wasn’t suppose to turn out this badly.

Chevron’s Brazilian oil spill, tiny in comparison to major spills like BP’s Macondo well in the Gulf of Mexico in 2010, has cost the company dearly.  It was forced this week to close off its Frade field well in the Campos Basin, 230 miles (370 km) off the coast of Rio de Janeiro.  It has to deactivate its drilling platform. In short, Chevron now has one foot out of Brazil and it just might cost them $2.5 billion — which is what the company spent on their Brazilian oil venture.

Brazil was never known as a place for oil. But around 2007, government owned oil company Petrobras made headlines when it found multiple fields of black gold deep under the ocean floor.  There are not many country’s that allow for foreign oil companies to drill on their home turf, but Brazil does and so ever segment of the global oil economy, and every big name from Russia to Norway to the U.S. has a stake in Brazilian oil production.  For the Western world, this country’s newfound oil wealth is the Saudi Arabia of the Atlantic Ocean. And while volume surely could not compare to desert oil fields in the Persian Gulf, friendly politicians made up for it. One small spill has ruined that for Chevron, at least for now, and maybe for years to come.

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Brazil oil spill contained; safety issue lingers

Jeff Fick – MarketWatch, 02/02/2012

Brazil’s second major offshore oil spill in four months appears to have been contained, but the latest accident raises questions about the safety of offshore drilling as the country barrels ahead with plans to develop massive offshore reserves.

State-run energy giant Petroleo Brasileiro (PBR, PETR4.BR), or Petrobras, continued recovery operations Thursday, piloting ships armed with water cannons to slice through oil slicks scattered over a 70-square-kilometer area in the Atlantic Ocean. Petrobras estimates that 160 barrels of crude were dumped into the sea after a tube ruptured during a long-term well test at the Carioca Nordeste field.

In a written statement Thursday night, a government team evaluating the Petrobras effort reported that “the oil slick has been significantly reduced since yesterday [Wednesday].” The report said there was virtually no chance any oil would reach the Brazilian coastline. The team includes government environmental and energy experts as well as the Brazilian Navy.

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Asia to reap rewards of Brazil’s crude export boost

Florence Tan & Simon Webb – Reuters, 11/01/2011

Asian refiners look set to be big winners as Brazil boosts sweet crude production from its bountiful deepwater pre-salt region in the second half of the decade.

Exports from Brazil, home to four of the world’s largest oil finds in the past 10 years, will have to look for buyers in fast-growing Asia as the United States will use more of its own shale oil output toward the end of the decade, pushing West African imports back to Europe.

Besides changing trade flows, higher sweet crude production from non-OPEC countries combined with tighter supply of cheaper sour grades from the Middle East could narrow the price gap between the two.

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