MercoPress. South Atlantic News Agency

Repsol partner in a huge deposit off the Brazilian coast with 1.25bn barrels of oil

The Spanish oil company struggling to recover from Argentina celebrates in Brazil

Spain’s Repsol, recovering from the recent seizure of YPF by the Argentine government, said an area off the coast of Brazil it is exploring with partner China Petroleum and Chemical Corp. contains the equivalent of at least 1.25 billion barrels of oil.

The BM-C-33 block of the Campos Basin, where the Repsol Sinopec venture has already drilled three wells, contains at least 700 million barrels of light crude and 3 trillion cubic feet of gas, Repsol said in a filing Thursday. Repsol’s stake in the block is 21%. Sinopec, as the Chinese company is known, has 14%, Norway’s Statoil 35% and Petrobras 30%.

Repsol has discovered 14 new deposits of oil and gas in Brazilian territory since 2008 as it ramped up exploration work to reverse a decline in reserves. The company’s first Brazilian well, Guara, is due to start pumping next year and output will peak at as much as 270,000 barrels a day.

“Brazilian offshore is one of the areas with the highest hydrocarbon reserves growth in the world,” Repsol said on Thursday.

Repsol is hunting for oil in 31 countries around the world including the US, Russia, Venezuela and Algeria. It is drilling exploratory wells in Bolivia, Guyana, Sierra Leone and Alaska. The company plugged wells off the coast of Cuba and abandoned exploration work there after failing to find oil, Repsol said last week.

With its most recent Brazilian well, Pao de Acucar, Repsol tapped a column of oil 500 meters tall beneath the Atlantic seabed -- that’s more than twice the height of the skyscrapers opposite the company’s Madrid headquarters. The well lies beneath 2,800 meters of water some 120 miles off the coast within the BM-C-33 block.
“We’re very happy to have made another giant discovery,” Statoil’s Executive Vice President for Exploration Tim Dodson said in an interview. “Pao came as a very positive surprise. The reservoir quality, the light oil and the column height, all of those three things are moving things in a positive direction.”

New discoveries at Repsol overtook production in 2010 and last year the excess rose to 62% from 28% the year earlier. The company plans to increase production pumping oil and gas from new deposits in Spain, Peru, Bolivia and Venezuela over the next three years.