Full steam ahead off Brazil

Jennifer Pallanich
Wednesday, September 1, 2010

The pre-salt Tupi field may claim most of the interest when it comes to oil activity offshore Brazil, but plenty is going on along the large country's coastline. In the last two months, Petrobras has brought online two fields, updated its files on the Tupi field and decided to dedicate its exploration efforts along its shores. At the same time, Brazilian company OGX has reported several shallow water finds. Jennifer Pallanich reports.

In mid-July, Petrobras's Uruguá-6 deepwater well began producing 33°API oil to the FPSO Cidade de Santos and the Baleia Franca field began producing pre-salt oil the next day. The FPSO is producing the Uruguá and Tambaú fields in the Santos Basin in 4500ft water depth. Once the Brazilian operator has the Uruguá-6, -8 and -10 wells online, the company expects to reach output rates of 25,000b/d and 35,000b/d later this year after a fourth well is brought online.

The FPSO can produce 10mmcm/d of natural gas and 35,000b/d of oil and condensate and store up to 740,000 barrels of oil. The development plan for the field foresees four horizontal oil wells and five gas producer wells, which will be connected directly to the FPSO. The Tambaú field will have three horizontal wells of non-associated gas, which will be interconnected to a submarine production manifold to be connected to Cidade de Santos.

The company expects the Cidade de Santos to reach full production capacity by late 2012, when all Uruguá and Tambaú gas wells will have been connected.

Petrobras' Baleia Franca field in the Parque das Baleias, Campos Basin, now produces to the FPSO Capixaba, which SBM is chartering to Petrobras. The pre-salt well was slated to begin producing 13,000b/d of 29ºAPI oil the day after the operator turned on the taps at the Uruguá field. Petrobras expects to reach full capacity of 20,000b/d later this year.

Elsewhere offshore Brazil, Petrobras said its Tupi Alto appraisal well, 12km northeast of the discovery well in the Santos Basin, has found lighter oil than that found in the original pre-salt discovery wells. Located in 2100m of water, the latest well sampled 30°API oil. The results at this well, say partners in block BM-S-11, which contains the Tupi discovery, reinforce the estimates of the Tupi field holding 5-8 billion barrels of recoverable oil.

The consortium expects to declare commerciality at Tupi in December 2010; until then, the group – operator Petrobras and partners BG and Galp Energia – intends to continue drilling other wells on the block.

Commerciality may be expected to be declared later this year, but the partners have already produced the field to the FPSO BW Cidade de São Vicente for over a year via the extended well test at Tupi Sul. The pilot phase is expected to see production to the Modec-supplied FPSO Cidade de Angra dos Reis MV22 due to arrive in Brazil in 4Q 2010.

In July, Keppel Shipyard won a contract from SBM to convert the VLCC M/T Theseus into an FSPO destined for the Tupi field. Keppel will work on the hull and marine conversion, upgrading of the accommodation, fabrication, and installation of the flare tower, the helideck, spread-mooring system, and topside module supports, as well as part of the topsides modules installation. Work is scheduled to start later this year.

The Theseus is expected to leave Keppel Shipyard 1Q 2012, then head to Brazil for installation and integration of topsides. The FPSO will be chartered to Petrobras Netherlands to serve the deepwater Tupi Nordeste area in the Santos Basin.

Acergy recently won a fouryear, $220-million contract for flexible lay services in water depths to 2000m offshore Brazil for Petrobras. Work is slated to begin this month.

In June, Petrobras said it would reduce its focus on international E&P activities, choosing instead to earmark most of its investments for activities in and offshore Brazil. In its 2010-14 business plan, Petrobras said it expected to invest $224 billion, or about $44.8 billion per year, with 95% of the funds remaining in Brazil and 5% going abroad. The move comes based on the level of hydrocarbon opportunity within Brazil, the company said.

The lessened focus on international activity prompted Petrobras to drop its production target for 2020 from 5.7 million boe/d under previous business plans to 5.4 million boe/d. The revised 2020 target does not include any production from the new pre-salt regulatory framework. By 2014, Petrobras aims to produce 3.9 million boe/d.

Of the planned investment funds, 53%, or $118.8 billion, will go to E&P activities, while the remaining 47% goes to the company's other business units, such as downstream and petrochemicals.

The lump sum Petrobras intends to invest is 20% higher than the amount set out in the previous business plan. The current spending plan foresees spending $19.7 billion on new E&P projects. According to Petrobras, the funds will ‘be used to ensure the discovery and appropriation of reserves, to maximize oil and gas recovery in concessions already in production, to develop production in the Santos Basin pre-salt region, and to intensify exploratory efforts in the pre-salt areas as well as new frontiers, both in Brazil and abroad'.

The company plans to sustain increased production by developing the post-salt areas as well as pre-salt areas already under concession; Petrobras notes the pre-salt is expected to contribute more to the production curve in the post-2014 period. On average, about three production systems are planned for installation each year, as well as three extended well tests per year in the pre-salt areas. As such, Petrobras expects to invest $77.3 billion in the postsalt region and $30.9 billion on the pre-salt region. OE

Categories: FPSO Oil South America System Design Shallow Water

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