Petrobras: Oil Fields Beneath Salt Layer Not In Invest Plan

RIO DE JANEIRO, (Dow Jones Newswires), Aug 15, 2007

State-run oil firm Petroleo Brasileiro SA (PBR), or Petrobras, isn't incorporating in its new business plan production for potentially massive oil resources in ultra-deep fields under a salt layer of the Brazilian shelf.

"The pre-salt is not in our plan, because the (exploration) numbers we have aren't final," Chief Executive Sergio Gabrielli said on a Web cast Wednesday commenting on the company's $112 billion 2008 to 2012 investment plan.

Last October, Petrobras said production tests showed the existence of a "significant volume" of 30 degrees API crude at the Tupi exploratory field in Brazil's Santos Basin.

The field lies below a water depth of 2,140 meters, then a 2,000-meter-thick salt layer that itself is under 3,000 to 4,000 meters of sand and rocks.

Petrobras has a 65% stake in the BM-S-11 Santos Basin exploration block, which contains the Tupi field. U.K. energy company BG Group PLC (BRG) holds another 25%, and Petroleos de Portugal, or Petrogal, holds the remaining 10%.

In March, Petrobras announced another oil find in the ultra-deep pre-salt layer, but this time in the Campos Basin off the coast of Espirito Santo State.

To produce from the ultra-deep pre-salt fields, Petrobras would need a "completely different exploration and production plan," Gabrielli said Wednesday.

He said the investment plan could be changed in case significant progress were to be made in the pre-salt exploration.

Brazilian media have speculated that a second oil field the size of the Campos Basin could lie below the salt layer. The Campos Basin accounts for 80% of Brazil's oil output, but production comes from layers above the salt, as does all current offshore production. Brazil currently produces about 1.8 million barrels per day.

Petrobras executives recently said it is too early to make an estimate about what volumes of oil are contained in the pre-salt layer of the Campos and Santos basins.

Copyright (c) 2007 Dow Jones & Company, Inc.