MercoPress. South Atlantic News Agency

BP ups its stake in Brazil’s oil industry and will participate in September’s round

Guillermo Quintero, president of BP's Brazil division

British Petroleum is negotiating opportunities to buy stakes in oil fields in Brazil to accelerate production increases, the head of the company's Brazil division said on Wednesday.

London-based BP this week received approval from Brazil's ANP energy regulator for its purchase of assets from US-based Devon, a deal signed in 2010, but put on hold following the massive Gulf of Mexico oil spill.

The company, which plans to spend 20 billion USD expanding existing operations around the world in 2011, is looking to new areas including Brazil and Russia to increase oil output.

“We can't reveal the names for strategic reasons, but we have two or three farm-in negotiation processes underway” said Guillermo Quintero, president of BP's Brazil division, during a press conference. “We didn't come to Brazil just to continue what Devon started, Brazil is strategic for us.”

“Farming in” refers to companies buying stakes in existing oil projects.

The blocks acquired will give BP a diverse and broad deepwater exploration acreage position offshore Brazil with interests in eight licence blocks in the Campos and Camamu-Almada basins in water depths ranging from 100 to 2,780 metres, as well as two onshore licences in the Parnaiba basin.

The Campos basin blocks include four discoveries – Xerelete, pre-salt Wahoo, Itaipu and Fragata – and the Polvo field, which is currently producing around 25,000 barrels of oil per day.

Quintero said BP's production in Brazil could reach 100,000 bpd, but did not offer a clear time frame for this.

He said BP plans to participate in Brazil's 11th bidding round to be held in September, which will not include blocks in the coveted deep-water region known as the sub-salt that is home to the country's largest oil discoveries.

BP also plans to drill three exploratory wells this year for which it will be bringing a second drilling oil rig. BP over the last year has sold assets around the world to raise money to meet expenses and demands from the Gulf of Mexico spill