Current competition is forcing the global offshore oil and gas industry to undergo a technological revolution in order to access a broader range of reserves, and Brazil is no exception to this, stated a new report by energy experts GBI Research.
The new report stated that Floating Production Storage and Offloading (FPSO) technology is playing an increasingly important role in meeting the surging demand for fresh fossil fuel sources in more remote offshore locations. Brazil's national oil company Petroleo Brasileiro SA (Petrobras) is taking the lead in this, investing enormous amounts of money to benefit from the FPSO trend.
FPSO technology equips floating vessels with on-board processing units which can treat extracted hydrocarbons directly at offshore sources, allowing greater efficiency and cost effectiveness in production, storage and transport. The FPSO industry has become a now vital part of the offshore oil and gas industry, due to technological innovations and a growing interest in the exploitation of hard-to-reach offshore reserves.
Brazil ranked second in South and Central America last year in terms of proven oil and gas reserves, with a BP statistical review citing that the country held 15.1 billion barrels of oil and 16 trillion cubic feet (Tcf) of natural gas. However, some of Brazil's largest reserves are located in challenging deep and ultra-deep waters, and the country is therefore unsurprisingly set to register the biggest global expansion in FPSO-based oil and gas production capacity. The total number of FPSO vessels in Brazil was 32 at the end of 2011, but is expected to expand by a further 30 FPSO vessels by 2017.
Petrobras represents the largest exploration player operating in the country, and has around 65 percent of its exploratory blocks located at offshore sites. Their ambition to achieve a daily production of over one million barrels of oil by 2017 has led to aggressive expansion of the company's offshore capabilities, in order for Petrobras to exploit large reserves off the coast of the Santa Basin and the ultra-deep reserves of Tupi. On July 19, 2012, Petrobras and partners announced contracts had been approved for $4.5 billion worth of construction work, for eight FPSOs planned for the Santos basin pre-salt blocks, with the first vessel expected to commence production in 2015.
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