MercoPress. South Atlantic News Agency

Petrobras targets Patagonia and offshore Mar del Plata

Following the discovery of two new hydrocarbons areas in the Patagonian province of Santa Cruz, Brazilian government oil company Petrobras announced plans to invest 1,4 billion US dollars from now until 2007.

In a short release Petrobras said this was the company's highest investment ever overseas, 50% of which would be geared directly for oil and gas exploration and production. Petrobras recently discovered oil and gas drilling in Agua Fresca and Puesto Oliverio, 130 and 180 kilometres northeast of Rio Gallegos.

Exploration and Production manager of Petrobras Energy Carlos Alberto Pereira de Oliveira said in Buenos Aires that the sum is actually 760 million US dollars of which 200 million will have been invested in 2004. No details were given of the rest of the announced 1,4 billion US dollars package.

The announcement seems geared to put an end to a strong controversy with the Argentine government which accused Petrobras of not investing sufficiently in Argentina. President Kirchner administration is eager to expand the capacity of the San Martín natural gas network which runs from the south to the north of Argentina and so ensuring sufficient supply in the coming years avoiding this winter's energy crisis.

Petrobras as one of the shareholders of the network was reluctant to invest but finally managed a loan from the Brazilian Development Bank with Argentine government to government repayment guarantees.

"Contrary to what has been said, we've come to Argentina with the purpose of growing. We have plans to further invest in exploration and developing technology", underlined Mr. Pereira de Oliveira who revealed that three new wells would be drilled in the Santa Cruz province areas.

Petrobras is also operating offshore the Argentine coast, between 220 and 420 kilometres east of Mar del Plata. "We're in the process of mounting are offshore operations in Argentina but first we're waiting for the Mar del Plata licences in the range of 2,000 to 3,000 metres deep", revealed the Petrobras official.