Executive Says: Permit Delays Slow Total's Brazil Drilling Plans
RIO DE JANEIRO, Dec 15 (Reuters) - Environmental permit delays are likely to set back the Brazilian offshore drilling activities of French oil company Total SA by about a year, a senior executive said on Monday.
Total, which has stakes in 13 Brazilian offshore blocks and runs drilling activities in seven of them, is grappling with the a slow environmental approval process that has become a recurring complaint for many in the industry, said Denis Palluat, Total's managing director in Brazil.
"Environmental licensing takes a long time. Drilling will only take place in 2016 or 2017," Palluat said. "Licensing makes things a little harder ... exploration and production is a long-term job, that takes a long time in general."
Oil prices have fallen to their lowest levels in six years, prompting oil firms to seek cut costs and improved efficiency. Lower prices could force oil companies to reconsider some investments, Pallaut said.
Even so, he said, Brazil continues to be a "priority" for Total.
Total owns 20 percent of the Libra field in the Santos Basin south of Rio de Janeiro. The area was the first in Brazil to be auctioned under new production-sharing rules. Libra contains an estimated 8 billion to 12 billion barrels of recoverable oil in Brazil's so-called sub-salt district.
The sub-salt refers to oil in fields off Brazil's coast in the Santos and Campos Basins trapped far beneath the seabed by a layer of mineral salts. Libra, if its potential is confirmed, would be one of the biggest oil fields discovered anywhere in the last 50 years.
Environment watchdog Ibama's press office told Reuters that the licensing process is taking place "within legal deadlines."
Libra is 40 percent-controlled by Brazilian state-run oil producer Petróleo Brasileiro SA, known as Petrobras, which is also the operator of the concession. Royal Dutch Shell Plc owns 20 percent, and Chinese oil companies CNOOC Ltd and China National Petroleum Corp each own 10 percent.
In relation to a corruption scandal involving Petrobras, Palluat said he "didn't see any difference at all" in the company's activities.
Prosecutors are investigating a graft and money-laundering scheme at the company, which allegedly funneled billions of reais in contract over-payments to Brazilian political parties, politicians and company executives.
Palluat expects drilling at Libra to allow the consortium to conduct its first long-duration well test in 2017.
(Writing by Guillermo Parra-Bernal; Editing by Leslie Adler)
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Weatherford CEO's Rebound Plan Relies On Getting Smaller
- Iran Says Oil Market Is Too Tight For US Zero Exports Target
- China's Squeezed 'Teapots' Eye Petchem Path To Riches
- Baker Hughes: US Drillers Add Oil Rigs For Second Week In Three
- Venezuela Hands China More Oil Presence, But No Mention Of New Funds
- ExxonMobil Racks Up Discoveries in Guyana Block Eyed by Chevron
- Oil Market Sentiment Has Improved Significantly
- EU, US Eye Collaboration on Nuclear Materials
- USA Driving Activity to Increase to All-Time Highs
- TC Energy to Sell Prince Rupert Gas Pipeline Project to First Nation
- EU Electricity Export to Ukraine Up 94 Percent in Two Years
- China Coal Output Falls for First Time since Government Ordered More
- BP Pulse Buys One of Europe's Largest Truck Stops
- UK CCUS Plans Outdated: Think Tank
- North America Enters Rig Loss Streak
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- Rystad Looks at the Buzz Around White Hydrogen
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension