Brazil to Offer Blocks Next to Pre-Salt Oil Finds in November

RIO DE JANEIRO Sep 20, 2007 (Dow Jones Newswires)

Brazil's National Petroleum Agency, or ANP, during its late November oil and gas block auction will offer 152 offshore blocks with an "elevated potential" to hit oil or gas, the agency said in a late Tuesday release.

Several of the blocks on offer are adjacent to the recent promising oil discoveries in the pre-salt layer of Brazil's Santos Basin.

State-run oil firm Petroleo Brasileiro SA (PBR), or Petrobras, and BG Group (BRG) earlier this month announced they hit oil in the Carioca field in the pre-salt layer of the Santos Basin BM-S-9 block. In October 2006, the companies discovered oil in the nearby Tupi field in the BM-S-11 block.

Several of the blocks on offer in November lie between those two oil finds.

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

BG has said the field could contain up to 10 billion barrels of oil, but Petrobras so far has declined to make an estimate.

The ANP in November also will auction promising blocks in the oil-rich Campos and Espirito Santo basins.

The agency, however, has excluded the C-M-273 block in the Campos Basin from the auction in order to avoid judicial injunctions that could derail the auction as they did last year.

Petrobras disputes that block where it said it hit oil, while the ANP says the company informed it of the find too late and has to return it to the agency.

The oil firm on Friday went to court to keep the block, and Tuesday in a release said the ANP's exclusion of the block from the November auction is a recognition of its rights.

In total, the ANP will offer 312 oil and gas blocks at on Nov. 27 and 28, of which 221 are offshore and 91 on land.

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

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