Brazil’s state energy giant Petrobras has decided not to go through with a drilling plan at a field operated by Chevron, effectively ruining the supermajor’s plans for the field, Reuters reports, citing unnamed sources familiar with the matter.
Chevron has a 52-percent stake in the Frade field and Petrobras has 30 percent, but for the Brazilian company, this field is not a priority, the source said. The priority is the pre-salt zone, which is seen as the biggest production growth area in Brazilian oil.
Petrobras, in fact, is so disinterested in the Frade field that it might sell its stake in it. Earlier this week, a private Brazilian energy company, Petro Rio, bought 12 percent in the Frade field from another firm, Frade Japao, and its chief executive told Reuters it could also buy Petrobras’ stake in the field.
“We see extending the life of the field as a positive, drilling new wells,” Nelson Queiroz said. Earlier, Petrobras had planned to drill six new wells at the field, worth some US$20 million.
Reuters notes exploration at the Frade field was suspended in 2011 after a spill. The project, whose cost was back in 2009 estimated at US$3 billion by Chevron, produced first oil in the same year, and at the time Chevron expected peak output of 90,000 bpd of oil and natural gas, to be achieved in 2011.
While the Frade field is in the Campos Basin, a prolific oil and gas area, it is not part of the pre-salt zone that has attracted the most attention from the energy industry and has seen supermajors compete for a bite of this pie that could contain several billion barrels of crude.
Some Big Oil majors are already in Brazil, including Statoil, Shell, and Total. The Norwegian state oil company is developing the Carcara field—part of the prolific Santos Basin. Shell is a strategic partner of Petrobras in the pre-salt layer, holding minority interests in the Libra and Lula fields and in other areas such as Sapinhoá, Lapa, and Iara, all of which are located in the Santos Basin. Total is the partner of Shell, Petrobras, and CNPC in the Libra field, also in the Santos Basin, and is considered one of the biggest offshore discoveries in the Brazilian pre-salt zone.