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Shell and Petrobras have signed an agreement to set up a long-term cooperation initiative to develop pre-salt fields in Brazil, the Anglo-Dutch oil major said on Monday.
Under the memorandum of understanding (MoU), Shell and Petrobras will share expertise and experience in technical and operational solutions, contract management, cost efficiency initiatives, and deepwater experience. The cooperation deal is for five years and can be additionally extended.
“Competitive growth of deep-water resources remains key to our company’s strategy for decades to come, and we’re very pleased to advance the technical and operational benefits of our joint-ventures with Petrobras in Brazil,” Wael Sawan, Executive Vice-President, Deep Water at Shell, said.
Shell is a strategic partner of Petrobras in the pre-salt layer, holding minority interests in the Libra and Lula fields and in other areas such as Sapinhoá, Lapa, and Iara, all of which are located in the Santos Basin.
Currently, Petrobras and Shell are partners in ten exploration and production consortia, each operating in five blocks, according to Petrobras’ press release on the agreement.
In May this year, Shell started deep-water production at the floating production storage and offloading (FPSO) P-66 at Lula South in the Santos Basin. Shell holds a 25-percent stake in the consortium developing the Lula field in the BM-S-11 block, while Petrobras is the operator of the field with a 65-percent interest. Galp, through its subsidiary Petrogal Brasil, holds the remaining 10-percent stake. The P-66 can process up to 150,000 barrels of oil and 6 million cubic meters of natural gas per day.
Brazil’s pre-salt layer, considered one of the most promising energy assets for development offshore the country, has attracted the interest of ten oil companies that have registered to bid on eight blocks in the Santos and Campos basins in Brazil’s second and third oil exploration rights auctions, scheduled to take place on October 27.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.