Petrobras Trims Pre-Salt Breakeven Costs

Petrobras has increased productivity of its pre-salt wells and improved its knowledge of pre-salt reserve portfolio, enabling it to reduce investment costs by 45 percent. As result of these efforts, Petrobras CEO Jose Sergio Gabrielli now estimates its breakeven costs for developing pre-salt reserves offshore Brazil at $35-$40 per barrel.

This estimate is down from previous estimates of $40-$45 per barrel.

Petrobras will go ahead with plans for offshore hubs for drilling fluids to reduce transportation costs and improve operational efficiency, as pre-salt fields are located between 186 miles and 217 miles offshore Brazil. The company is studying logistical hubs for other supplies to determine what makes the most economic sense, Gabrielli said.

The Brazilian state energy company hopes to disclose later this month its new strategic plan for 2011 through 2015. Gabrielli described the company's information to date on Santos Basin reserves as "important data" that could improve results.

Petrobras also will forge ahead with plans to bring a new drillship to the Gulf of Mexico in early June to drill the second well at the Cascade field. Drilling is expected to begin in late June or early July.

The company has no plans at this point to acquire more blocks in the Gulf of Mexico. The company is studying its foreign investment portfolio right now to determine which blocks will provide the best cash flow.