NEWS FROM SPE ATCE 2013 Petrobras E&P chief sees deepwater pick-up, at home and worldwide


NEWS FROM SPE ATCE 2013 Petrobras E&P chief sees deepwater pick-up, at home and worldwide

BY KURT ABRAHAM, Executive Editor

NEW ORLEANS -- Deepwater oil activity is picking up, and it had better, because demand requires it. That was the message delivered on Monday by Petrobras Chief Exploration and Production Officer José Formigli during the Chairman’s Luncheon, at SPE’s Annual Technical Conference in New Orleans.

Noting that “nature has been very good” to Brazil in providing bountiful crude oil, Formigli said that global oil and gas demand is expected to grow 29% by 2035. “Substantial new oil capacity will be needed,” continued Formigli. “We will need to add about 72% of current production, or about 50 MMbopd, to get the total figure up to 100 MMbopd by 2035. This means that more than $750 billion of expected, annual investments in new oil and gas production will be needed.”

Formigli said that the top four countries for expected, added production growth in the period to 2035 included Iraq (+5.5 MMbopd), Brazil (+3.6 MMbopd), Canada (+2.6 MMbopd) and Kazakhstan (+2.1 MMbopd). In addition, “A rising share of the global crude oil supply will have to rely on deepwater assets, despite the growth of unconventionals.” He added that deepwater and ultra-deepwater fields will deliver roughly 50% of new offshore oil supply in the coming years, to 2035. This means that the share of total global oil supply provided by deepwater assets will double, to 13%, in the next 22 years.

As regards Brazil’s role in this global equation, Formigli said that right now, 85% of the country’s oil output comes from offshore fields. During 2012, 1.26 MMbopd came from deepwater fields; along with 390,000 bopd from ultra-deep output; 470,000 bopd from land and shelf resources; and 260,000 bcpd from gas fields. Formigli said that he expects Brazil’s oil reserves to jump, from 15 billion bbl to 30 billion bbl, in the not-too-distant future. In the 2013-2017 period, Petrobras capital expenditures (capex) will total $236.7 billion, of which 62.3% will go E&P. Within that figure, the $147.5 billion earmarked for E&P will be divided, with 54.1% going to pre-salt projects and 34.8% slated for post-salt activity. Accordingly, Petrobras will more than double oil production, from 2.0 MMbpd to 4.2 MMbpd.

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