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Oil Prices Fall After 2-Day Rise

Brazil Woos Oil Majors With Low-Carbon Crude Projects

Brazil is hoping to attract oil majors to new deepwater projects that would employ low-carbon extraction technology, Reuters has reported, citing country officials.

According to unnamed sources, Exxon, TotalEnergies, BP, and Chevron were among the targets for potential talks about the development of the new fields, to be auctioned this December.

“Projects that produce less CO2 will be the last ones to go” offline, the head of exploration and production at Petrobras, Fernando Borges, told Reuters at the Offshore Technology Conference in Houston. “This environment made our new projects more attractive.”

Brazil is on its way to becoming the single biggest supplier of offshore in the world, accounting for 23 percent of total offshore oil output in 2025, at a rate of 1.3 million bpd. This would be thanks to the development of its massive reserves in the presalt zone of its shelf, which has already attracted a lot of supermajor attention because of the low production costs.

The county is home to the largest deepwater field, Buzios, which currently produces about 600,000 bpd, but Petrobras has plans to boost this more than threefold over the next decade.

“Brazil’s prolific pre-salt layer in the Santos Basin has produced a strong portfolio of offshore projects [...] These projects have shown robust economics, such as development breakeven oil prices averaging US$40 per barrel and have significantly contributed to South America’s trend of surpassing North America’s offshore production by 2023,” said GlobalData senior oil and gas analyst Effuah Alleyne in the report forecasting Brazil to take the lead in offshore oil.

Petrobras, the state-owned oil major, also has plans to boost its total production, from 2.7 million barrels of oil equivalent daily now, to some 3.3 million boepd by 2025. To that end, it is eyeing the development of new fields close to the border with Guyana—the location of a string of recent discoveries made by Exxon and its partner in the Stabroek Block, Hess.

By Irina Slav for Oilprice.com


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