Devon Expands Exploration Portfolio in Campos Basin

US oil company Devon Energy (NYSE: DVN) reaffirmed its interest in expanding its exploration portfolio in Brazil after winning three more offshore blocks in the prolific Campos basin at the seventh licensing and exploration round on Monday.

For the first time the company will be the operator in a partnership with Brazil's federal energy company Petrobras (NYSE: PBR).

Devon won the operatorship with a 50% interest in the deepwater Campos C-M 471 and C-M-473 blocks. The company also won the C-M-535 block with a 35% interest with Petrobras holding the other 65%, Brazil's hydrocarbons regulator ANP announced.

Another three deepwater blocks were awarded by the ANP in the SC-AP4 sector of the Campos basin during the morning session of the seventh licensing round. Petrobras won the C-M-401 and the C-M-403 blocks alone while Spanish oil company Repsol YPF (NYSE: REP) will be operator with a 50% interest in the C-M-539 block with Norwegian state oil company Statoil owning the other 50%.

Devon Energy is currently developing the Polvo field in the M-C-8 block of the Campos basin, which is expected to start producing oil in 2007. The company is already in talks to lease a floating, production, storage and offloading (FPSO) vessel for the field, a company official who declined to be named told BNamericas.

The company also plans to start exploration activities soon in two other blocks in the Campos basin and the BM-BAR-3 offshore block in the Barreirinhas basin in Brazil's northeastern region, the official said.

According to ANP information, Devon is the operator of the C-M-61 offshore block in the Campos basin with a 60% interest and US oil company Kerr McGee has the other 40%. It also has a 25% minority interest in the C-M-101 block in which Kerr McGee is operator with 30%. Canadian oil company EnCana has 25% and Korean oil company SK Corp 20%.

The M-C-8 block is operated by Devon with a 60% interest and SK Corp with 40%.

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