Petrobras Submits High Bids on 53 Tracts in Western GoM Lease Sale 196

Petrobras America, subsidiary of Petrobras in the USA, presented the highest number of winning bids in the Gulf of Mexico Leases Sale 196 held by the Minerals Management Service. The company presented proposals for 57 blocks, being the highest bidder for 53 blocks, in a total amount of US$ 30.1 million With this result, Petrobras ensured 100% of participation, and the condition as Operator, in a set of blocks comprising eight prospects with high potential for oil and gas reserves, from which three are in ultra-deep waters, four in the western US Gulf of Mexico, and one in deepwater in the Garden Banks area.

The success in the current bid addresses the priorities established by Petrobras in its Strategic Plan, including deep and ultra-deep waters in the Gulf of Mexico, among the focus areas for participation in the exploratory activities abroad. At the same time, the Company consolidates its position as one of the leaders in the exploration activities in Gulf of Mexico ultra-deep waters, where it is associated with giant worldwide oil industry companies, with participations in three major discoveries in that region, and in an already producing field.

In the set of blocks acquired, one is near to the Cottonwood discovery, located in the GB 244 block, in water depth of 700 meters, where the first well operated by Petrobras in deep waters in the Gulf of Mexico is being drilled. Depending on the results of this well, first oil may happen in 2007. The inclusion of this new block in the projects portfolio, in the Garden Banks quadrant, will allow higher synergy through the joint development of future discoveries.

The current bid allowed the extension of Petrobras participation in other area the company has interest, the region located in the western region of the US Gulf of Mexico, in the Corpus Christi, Padre Island and Mustang Island quadrants. The Company chose such quadrants as priority, with a differentiated view about the geological perspectives, where there are a number of structures not yet tested that, potentially, may contain large oil and gas reserves. The drilling of the first well in this region is planned for the next year.

Petrobras America estimates investing near US$ 150 million this year and, until 2010, approximately US$ 1.7 billion expecting a production over 100 thousand barrels of oil per day in the beginning of the next decade.

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