MercoPress. South Atlantic News Agency

More oil in Brazil’s Santos Basin; Petrobras investment plan: 45 billion USD

The pre-salt region runs 800 kilometres along the Brazilian coast

Brazilian government managed corporation Petrobras, Repsol-YPF and BG Group found more evidence of oil in the same offshore Brazilian sub-salt block where the companies’ Guara field holds as much as 2 billion barrels of crude.

The discovery was made at the BM-S-9 block in the Santos Basin, off Sao Paulo state’s coast, Brazil’s National Petroleum Agency said on its Web site. Petrobras and Royal Dutch Shell Plc also found signs of oil and natural gas at offshore block ES-M-525 in the Espirito Santo Basin, the regulator said.

Petrobras operates the Santos block, which also holds the Guara and Carioca discoveries. The company which holds 45% of the concession plans to start initial output of 50,000 barrels a day at Guara in 2012. England-based BG holds 30% of the BM-S-9 concession. Repsol-YPF from Spain owns 25%.

Petrobras also operates the ES-M-525 block with a 65%. Shell is also a partner in the concession.

Petrobras in November 2007 discovered the Tupi field, located near Guara in the Santos Basin. Tupi may have as many as 8 billion barrels of oil, making it the largest find in the Americas since Mexico’s Cantarell in 1976.

Petrobras also announced that it raised its 2010 investment target to 79.5 billion Real (45 billion US dollars), with 35.7 billion Real for exploration and production. Apparently the company lifted its spending target to include rising costs for steel and oil services. However the investment plan still has to be approved by Congress.

The pre-salt region runs 800 kilometers along Brazil’s coast from Espirito Santo to Santa Catarina states. It holds deposits beneath a layer of salt resting as much as 3,000 meters beneath the ocean surface and another 3,000 to 5,000 meters below the seabed.

Petrobras pre-salt production will reach 100,000 barrels a day this year as the company increases output at a Tupi pilot project, Chief Executive Officer Jose Sergio Gabrielli said in Houston.

Petrobras invested 50.7 billion Real in the first nine months of 2009. Total investment for 2009 is not yet available because the company last month delayed the presentation of fourth-quarter results.