Petrobras, Partners Get Nod for Manati Start-up

Brazil's federal environmental protection agency Ibama has authorized federal energy company Petrobras (NYSE: PBR) and its partners to start operations of the Manati gas field, Ibama said in a statement.

The field will start production by the end of January, a Petrobras spokesperson told BNamericas. The project was previously due to start operations by mid-November 2006.

Ibama certified environmental problems with project development had been resolved and operators are committed to implement actions to protect the local environment.

The operating license was delayed after Ibama inspectors identified environmental damage and alleged the consortium had not complied with Ibama licensing conditions.

As a result, Ibama levied three fines on the project totaling 26 million reals (US$12 million), an Ibama spokesperson said in an interview.

"The group has appealed the fines and it will take some time before Ibama analyzes the appeal," the spokesperson said. "We don't yet know what the companies are arguing."

Initial production is expected to reach 3 million m3/d, but could rapidly rise to 6 million m3/d, BNamericas previously reported. Investment in the Manati project was initially estimated at 1 billion reals.

Manati was discovered in 2000 at depths of 35-50m some 10km from the coast. Reserves are estimated at roughly 24 billion m3.

Infrastructure is in place to transport the gas to consumption centers.

Bahia state-controlled gas distribution company Bahiagas has invested 35 million reals to build infrastructure to transport the gas to clients.

Petrobras has a 35% stake in the project and Brazilian engineering company Queiroz Galvao is operator with 55%. Norwegian oil company Norse Energy has 10% of the project.

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