Petrobras Adds to Deepwater Portfolio at GOM Lease Sale
Ranking amongst the top ten competitors, with the biggest number of winning bids, Petrobras was the highest bidder for 26 blocks in the Lease Sale 205 held by the MMS. The value of the winning bids totaled $108.1 million. This value was offered for the blocks located in central and eastern Gulf of Mexico, in one of the most competitive auctions ever held in the region.
In total, 73 oil & gas companies bid for blocks, particularly those found in deep and ultradeep waters. Of the 26 blocks, Petrobras ensured 100% participation and the operator status for 20. The remaining 6 were bid for in partnership with Devon Energy, 2 of which will also be operated by Petrobras, while four by the partners. Participation will be shared 50/50.
Pursuant to auction rules, the MMS must still confirm the winning proposals. Once confirmed, these blocks will be incorporated to the Company’s exploratory project portfolio, which totals 338 blocks, 200 of which operated by Petrobras.
As was the case in the auction held in August 2007, when it was the highest bidder for 34 blocks, Petrobras sought to consolidate its position in areas it is focusing its activities on in the Gulf of Mexico, targeting deep and ultradeep waters in the Walker Ridge, Mississippi Canyon, Green Canyon, Garden Banks, Keathley Canyon, and Lloyd Ridge quadrants. This will allow the company to boost its quality exploratory prospect chart.
Participation in the Lease Sale 205 auction is in line with Petrobras’ Strategic Plan, which calls for strong international growth with investments in priority areas, among which the American sector of the Gulf of Mexico. With this outcome, Petrobras – in agreement with the oil & gas industry’s model –once again shows the company is willing to compete and invest in all environments that are both promising for the use of its technology and knowledge, and are safe and attractive for investments. This reinforces Petrobras’ position as one of the leaders in deep and ultradeep Gulf of Mexico waters, where it is associated to other oil companies.
Petrobras has participation in three of the most important discoveries made in the region’s Lower Tertiary reservoirs, in the Cascade, Chinook, and Saint Malo fields, located in the Walker Ridge Quadrant. The Cascade and Chinook fields are operated by Petrobras, which will be the pioneering company, both in the production of this reservoir located in ultradeep waters and in the use of an FPSO- (Floating Production, Storage and Offloading) type platform there. Production is expected to be kicked-off in 2010. The main agreements required to deploy production development projects at these fields will be signed in late 2007.