This item does not say a lot except to bring home that Brazil’s success offshore is phenomenal and is likely to continue for a long time. At the present reserve picture of 70 billion barrels, they are well on the way to been a major supplier. Been all offshore it is all capital intensive, but that is the nature of today’s oil industry at the level of the majors.
Otherwise, the great untapped potential of Brazil is really the onshore basins that have barely been explored. The biggest single basin in the Western Hemisphere is in Brazil and is in the south and is called the Parana Basin. It has been hampered by a basalt flow that acts as a seismic shield making it impossible to use seismic.
I think it is time for Brazil to take a page from Alberta and to establish a section by section bidding system to stimulate local investment and development of an indigenous oil industry. The majors are actually no longer serious players in the onshore stuff and that is particularly true in North America. Outside North America, they have focused on large concessions which never get the proper attention that comes to the offshore.
Recall that any given onshore basin, and there are hundreds of them, needs around two dozen dry holes for the geology to be well understood. It is not unusual for hundreds of dry holes to be drilled in good country before it all comes together. Alberta had over a hundred before Leduc #1, and today you look at a map and wonder how they ever missed.
The Parana and Brazil in general needs that sort of drilling action to piece together the subsurface geology. It they are finding billions of barrels offshore then the onshore potential is surely spectacular. Remember blind drilling luck found the East Texas field in the early thirties ands it was a mega field. It was too big to miss forever.
Brazilian oil: China's carnival?
Western energy firms wanting access to Brazil’s vast offshore oil fields must navigate complex political currents in the country, and its growing ties with China, argues Juliet Hepker
The recent discovery of potentially vast oilfields buried beneath a thick layer of salt off the coast of Brazil has become a focus of excitement among many of the world’s big energy firms.
Though the total size of reserves is not yet known, government officials estimate 80bn to 100bn barrels – enough to vault Brazil well into the top ten of oil-producing countries.
Described as “a gift from God” by Brazil’s President Lula da Silva, the pre-salt fields could significantly boost Brazil’s economy and influence on the world stage, while shifting the dynamics of global resource geopolitics.
For major oil and gas firms the pre-salt fields present a tantalizing opportunity for replacing their reserves (and this is notwithstanding the economic downturn – the planning horizon of most such firms is decades, beyond the current slump).
Several western energy firms including Shell, ExxonMobil, BG Group, and StatoilHydro were fortunate to be awarded concessions before the government realized the vastness of the reserves. These and many other companies may soon be vying to expand their involvement.