Dry wells: Brazil is no longer the oilman’s paradise, and the big companies are losing a lot … of money
Three exploration wells that Shell drilled in Brazil in hopes of making the next major discovery quickly ran out, Bloomberg reported, citing an analyst with Wood Mackenzie. This latest turn of events comes on top of bad news for Brazil and plans by the big oil companies to turn it into the next oil center.
Shell and several partners paid $ 1 billion for drilling rights to three offshore blocks in Brazil and spent three years drilling exploratory wells. None of them produced commercially viable volumes of oil, Marcelo de Assis, head of upstream research for Latin America at Wood Mackenzie, told Bloomberg.
Exxon previously suffered even greater losses of around $ 1.6 billion as its exploration wells drilled in Brazilian waters over the past three years proved impassable.
These developments are casting a lot of shadows on Brazil's expected boom in crude oil production, which is theoretically enormous given the large offshore area. However, it seems that the large deposits have already been found.
"In Santos and Campos, the great discoveries have already been made," Adriano Pires, who was one of the candidates for the position of Petrobras' new chief executive, told Bloomberg. "At the equatorial margin, we may still have surprising discoveries." That is north of where you are drilling now …
Meanwhile, Petrobras is also drilling. Earlier this month, BNAmericas reported that the Brazilian state-owned oil major has plans to drill three offshore wells this year.According to the Bloomberg report after the discovery of fields like Mero and Buzios in the Santos Basin, all Petrobras finds are relatively minor states. The nearly 100% success rate in discoveries that the Brazilian company boasted ten years ago has now disappeared, and the Brazilian oil paradise seems to have closed. Now, success rates have dropped to what appears to be the industry average, with just over a quarter of all wells drilled. A serious blow to the ambitions of Brasilia which aimed to become one of the world's largest suppliers outside OPEC, and also a blow to Europe's chances of finding new suppliers of black gold.
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The article Dry wells: Brazil is no longer the oilmen's paradise, and the big companies lose a lot … of money comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/pozzi-asciutti-il-brasile-non-e-piu-il-paradiso-dei-petrolieri-e-le-big-perdono-un-mare-di-denaro/ on Tue, 17 May 2022 16:33:41 +0000.