Emerging South

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1. Apr 14 2008

   Brazil is poised to overtake Venezuela as the largest oil producer in South America by 2013

   By John Baeyens | Share This | 3 Comments

   Update April 18: Another oil field has been discovered outside the coast of Rio, which could contain 33 billion barrels (as a comparison, the whole US reserves total 21,8 billion barrels). This adds up the the below discoveries of 2007 and 2008 which already ranks Brazil on place before Venezuele when it comes to oil reserves.
   
   I wrote before on the importance of the recent oil discoveries and the skills of Petrobras with regards to deepsea oil drilling. Tow days ago, the Washington post published an article which suggested that Brazil is to overtake Venezuela by 2013 with regards to oil production. To give youy some perspective to which level the recent discoveries are unique: Brazil didn't feature in the top12 countries with oil reserves less than a year ago.
   And the news of discoveries doesn't stop. In November and December the Tupi & Jupiter massive fields were discovered and now Shell ad Galp discovered in zone BM-S-8 new fields and Repsol discovred new fields in zone BM-S-9. All fields are deeper than 5000m and require very costly platforms to drill them.
   
   When i lived in Rio I was already impressed by the construction of the P-54 platform, which gas a capicity of 180.000 barrels of petrol a day and 6 million m3 of gas a day. It accomodates a crew of 160 persons, weights 73.000 ton and can dril 1400m deep.
   
   With these new discoveries (between 5 and 30 10⁹bbl), Brazil will pass to the 6th place in the ranking of countries with biggest reserves (just after the United Arab Emirates and just before Venezuela). Given the fact that Brazil doesn't consume a lot of petrol per capita (electricity comes suasi completely from hydroelectric, more than 5 million cars drive on ethanol and no need for central heating based on gas or petrol), this gives Brazil an enormous competitive edge.
   
   Don't underestimate Brazil too much. I was already impressed reading this presentation from the Ministry of planning back in 2003, but with Lula's announcement to support a joint venture between Brazil and Mexico's state-run oil companies (Petrobras + Pemex), my eyes are all wide open. Mexico's crude oil output is in decline, which gives sense to Brazil's move.
   
   

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