Commercial operation of the field is expected for the end of 2005 or beginning of 2006 at the latest, he said.
About 800mn reais will be invested in initial development and the remaining 20% is budgeted for two years after that to keep the field's production rate at the projected 6 million cubic meters a day (mcm/d), he said. "This is the only gas source in the northeast that can be made available in the short term," he said. "It's a very feasible project."
Manati is located in shallow waters off the northeastern state of Bahia.
Queiroz Galvão, federal energy company Petrobras, and Brazilian oil company Petroserv own respective 55%, 35% and 10% stakes in the exploration license, which they bought in 1998. Investment to date at Manati has reached 120mn reais.
Reserves there are 23 billion cubic meters (bcm), or about 50% of the total gas reserves in Brazil's northeastern region, which aside the Camamu Almada includes the Sergipe Alagoas, Reconcavo, Jequitinhonha and Potiguar basins, he said.
The expected output of 6mcm/d will more than double the current 4mcm/d available in Bahia state, and Petrobras' Termobahia power plant will be one of the offtakers for the gas. But gas production there may not stop at the Manati field. "There could be a couple of other Manatis in the region," Fernandes said, referring specifically to the most promising exploration block in which his firm has interests - the B-CAM-40 block in which Manati is located.
Queiroz Galvão plans to invest 40mn-50mn reais in exploration in 2004 and as much as 90mn reais in 2005, including drilling three or four exploration wells in the Camamu basin. The investment includes eight exploration blocks, including two that were acquired in this year's sixth licensing round. The company's portfolio also includes five offshore blocks and one onshore in the Reconcavo basin where Petrobras has recently declared small light oil finds. Queiroz Galvão is operator in two blocks, he said.
The company is also eyeing the exploration-licensing round scheduled for 2005 to renew its exploration portfolio. "We bid in almost all the licensing rounds in the country, and we have very high expectations for the upcoming round, since it is always important to renew the portfolio," he said.
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