Iara Formation Tests Prove Area's Potential at 3-4B Barrels

Petrobras has announced the completion of the formation tests for well 1-BRSA-618-RJS (1-RJS-656), located in the area informally called Iara in the BM-S-11 appraisal area, situated in the Santos Basin pre-salt, offshore Brazil.

The formation tests at Iara have proven the area's exploratory potential through of the production of light oil, of approximately 28 degrees API, and have allowed the estimated recoverable volume for the Iara area to be maintained between 3 to 4 billion barrels of oil and natural gas, as announced after the drilling that was completed in September 2008.

The well tested is located in a water depth of 2230 meters and is located approximately 230 kilometers from the coast of Rio de Janeiro State. Due to the need to relocate the rig, Diamond Offshore's Ocean Clipper drillship, the test on the well was not fully completed and another well is planned to be drilled in this area in 2010.

The Consortium, formed by Petrobras (65% - Operator), BG Group (25%), and Galp (10%), will carry on with the exploratory activities and make the investments required to assess the field, pursuant to the Evaluation Plan approved by the ANP.