Brazil Oil And Gas Industry

Brazil Oil And Gas Industry. Brazil Oil and Gas Brazil’s Petrobras has confirmed a continued focus on exploration and production activities and also its divestment plans Petrobras does not foresee renewables in its portfolio yet its R&D Center will continue to research offshore wind power report that in a recent Webinar organized by Rio thinktank FGV Energia Roberto Castello Branco CEO of national oil company Petrobras confirmed that the company will continue to focus on exploration and production it will.

In 2019 Brazil produced 1018 billion barrels of oil in the entire year – up 778% from 2018 according to the Brazilian National Oil and Gas (ANP) data Brazil´s natural gas production reached 44724 billion cubic meters in 2019 a 946% increase in relation to the previous year The domestic oil production growth especially since 2013 was mainly due to the presalt Santos Basin´s high productivity which relied on oil outputs per well above the global oil industry´s average.

Brazil Oil and Gas International Trade Administration

Upstream Sector as a Significant Market As of 2018 Brazil was the 10th largest producer of oil and gas in the world the largest producer in South America and the 7th largest oil products consumer in the world Almost 8090% of oil and gas produced in Brazil are from the offshore.

Allin for the Brazilian oil and gas industry

Brazil’s Economy in The PreSalt EraThe Ambitious “30 Years in 10” PlanPetrobras Divestment PlanPreSalt Development PlansIt is not unusual for NOCs that have access to a large O&G resource base to become an instrument for the government to deploy its agenda for the economy The Petroleum Law approved under a liberal regime established some conditions that created “mandatory local content” in upstream capex Local content became a relevant component in the bidding processes for exploratory acreage and the commitments made voluntarily by the bidding participants increased very quickly in a short period of time The leftwing federal government that ruled Brazil in the beginning of the presalt era sought to reshape the Brazilian economy through the O&G sector as part of an extreme nationalist agenda which in the end did not deliver the expected results Supply chain/local content issuesConceptually the idea that a local supply chain will be created if the demand for goods and services exists has proven to be nonapplicable to Brazil Brazil is a challenging country in which to make decent profita The challenges embedded in this idea of (once again) trying to boost the Brazilian O&G sector as a lever for the entire economy are amazingly high It would be correct to summarize this program as a “30 years in 10” effort to speed up the growth process But it is highly questionable whether the ambitions of the government/industry are in synch with the country’s and the industry’s capabilities Surely there are solutions that can be deployed to make the 2020s a much better decade for the industry But many things have to be addressed from a different and more creative perspective RequirementsIn other words there are several initiatives in place to boost the O&G sector Each one is a major challenge to execute Addressing all of them at the same time does seem unachievable Prioritization is needed as well as governmental support in the form of tax reforms and a stable regulatory framework Industry capabilities will actually set the pace of the “30 years in 10” program It There is a plethora of parallel initiatives for the O&G arena today that will have to overcome many challenges As previously mentioned ambitions and capabilities are not in synch but the good news is that there are solutions Not easy ones but there are no problems that can’t be solved Divestment/investmentThe backbone of this ambitious program is Petrobras in two ways—total focus on the pre salt development and a portfolio optimization leading to a huge divestment program that may reshape the local industry Yet the underlying idea is to create a competitive market in Brazil in almost all the parts of the value chain and to create conditions for investments and operations in the O&G value chain to be carried out with the support of an efficient and sustainable local supply chain Petrobras’ divestment program has become more tangible and aggressive since 2017 Divestments in several directions were executed and continue to be executed such as assets outside Brazil (most Not only Petrobras but all the other players that have working interests in presalt assets are totally focused on presalt production increases The coronavirus pandemics and its effects do not alter the presalt story Development going forwardWe can expect a slower pace of development given reduced cash flow generation at potential lower oil prices and from more stringent conditions to access the debt market But the economics of presalt even at $45/bbl Brent are NPVpositive given very low opex associated with well productivity—one can fill a 150000bopd capacity FPSO with only six wells At $60/bbl Brent it is possible that 15 to 20 new FPSOs will be installed in the presalt by 2030 and production might reach 45 MMbopd Before the presalt Brazil had only one super giant field Roncador Now there are three other supergiant fields (Tupi Búzios and Mero) in production and possibly this number could more than double by 2030 But there are two big underlying con.