Oil Firms Ask Brazil's Regulator to Mothball 29 Fields

April 20, 2020

Illustration only: An offshore platform in Brazil - Image Credit: Petrobras
Illustration only: An offshore platform in Brazil - Image Credit: Petrobras

Brazil's oil industry has requested 29 oilfields be mothballed so far, including 16 offshore and 13 onshore, with a total production of 65,000 barrels per day, as the sector struggles with lower demand amid the coronavirus outbreak, local regulator ANP said.

Twenty of the oilfields expected to be mothballed are in the process of being divested by Brazil's state-run company Petrobras and were showing a decline in output, ANP director Marcelo Castilho said in a video briefing on Thursday.

All requests but one were filed by Petrobras. The exception was an onshore oilfield in the Reconcavo Basin explored by a smaller oil company, Castilho added.

"The main motivation for these production stops is related to the pandemic, which has led to a reduction in the demand for oil and oil products in Brazil and in the world and the sharp fall in prices," the ANP director said.

Castilho noted that more hibernation requests were likely to be filed, as Petrobras has recently announced plans to cut production by 200,000 barrels a day.

(Reporting by Marta Nogueira; Writing by Gabriela Mello; editing by David Evans)



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