Light Oil Discovery in Brazil Opens Windows of Opportunity

Petrobras's probe ship off the coast of BrazilTests carried out by Petrobras through vertical well 1-RJS-628A drilled at 2,140 meters (7,021 feet) water-depth in BM-S-11 block, opens a new exploratory frontier offshore Santos basin and in Brazil. The tests confirmed  the existence of a significant volume of 30° API light oil with the discovery of a highly productive reservoir beneath a 2,000-meters (6,562-feet) thick salt base.

Drilling reached 6,000 meters True Vertical Depth (TVD).

Deep well drilling is sometimes more importantly characterized by the requirement of having the drill bit finally positioned within a specified radius of its surface starting location. This sometimes requires maneuvering the direction of the drill bit by various techniques (kicking) so as to arrive at the desired location at both the desired depth and within a specified radius of the starting point. The angle of drilling at any arbitrary azimuth can be derived by knowing the TVD (true vertical depth).

Petrobras is the operator of the BM-S-11 block, with 65% interest in partnership with British Gas (BG), 25% and Portugal’s Petrogal, 10%. The 1-RJS-628A indicated a flow of 4,900 barrels per day of oil and 150,000 cubic meters/day of natural gas (5/8 inch choke with stabilized pressure) and the gas oil ratio (GOR) is of around 180.

The drilling, which was especially challenging, went through sandstone, shales, salt and eventually lava flows in the sub-salt. However, high pressure, rather than high temperature, was one of the main concerns, said sources at Cenpes, Petrobras world class Research and Development center.

Several challenges face Petrobras and other companies in Brazil because of the complexity of the subsalt play. The salt layer can be mechanically unstable, wells can lose circulation and encounter lava flows beneath the salt existing in the rift section, because of volcanic flows that pre-date the formation of the salt-cap.

Brazilian geologists estimate that a well drilled in deep water depth costs an average of US$ 50 million and a subsalt well may range from US$ 100 million to US$ 150 million, but the "prize" is higher.

It is difficult to estimate the cost of subsalt field development in Brazil, say experts. However, the costs could surpass those of any other Brazilian development to date. In the future, if subsalt is established as a commercial play in Brazil, several Brazilian experts envision giant field-development costs in the US$ 2 – US$ 4 billion range or higher.

Geologists say that "up to some time ago, Petrobras believed that the subsalt rocks were too compacted, without permeability. However, with the confirmation of the Santos basin discovery, it was proved that the salt layer acts as a cushion for the compactation as well as for temperature."

Experts estimate that for a subsalt reserve to be commercially viable it must have a minimum of 700 million barrels reserves. The fact that Petrobras confirmed that there were "significant quantities of reserves" in Santos opens a new window of exploratory opportunity, say experts.

"There are good chances of new discoveries off the eastern coast of Brazil including Campos, Santos, Espírito Santo basins up to Pernambuco-Paraíba basin in the north," say geologists  who have been predicting for years that Brazil’s subsalt held billions of barrels of light oil reserves.

This is very important because the bulk of Petrobras daily production of 1.8 million barrels of oil per day is of heavy oil. This type of oil has high viscosity and is more expensive and complex to refine into gasoline, diesel or other oil products.

The 3D petroleum system modeling study of larger areas of the greater Campos basin showed that its potential hydrocarbon reserves are much higher than predicted and suggests the deep reservoirs, ranging from Lower Cretaceous (pre-salt and Albian carbonates) to Upper Cretaceous, as the new frontier for exploration in the area,

Petrobras Engineer Gets Prize

Marcos Isaac Assayag, General Manager of Basic Engineering at the R&D center (Cenpes) of Brazil’s state-owned Petróleo Brasileiro SA (Petrobras) was unanimously indicated by the Offshore Technology Conference (OTC) committee to be awarded the 2007 OTC Distinguished Achievement Award for Individuals, said a Petrobras communiqué.

OTC is made up of dozens of oil companies worldwide. Petrobras has won the OTC award twice for "excellence in deep water operations."

According to Petrobras, Assayag was indicated due to his "enormous contribution to the development of technologies for petroleum production in deep and ultra-deep waters."

Technological know-how is a strategic imperative for sustaining oil self-sufficiency achieved this year by Petrobras and Cenpes is responsible for anticipating and supplying the technological needs for all areas of the company, say company’s officials.

Assayag was the coordinator of Cenpes’ Petrobras technological innovation program on deepwater exploitation systems, Procap 1000 and its extension, the technological innovation in deep and ultra-deep waters, the Procap 2000.

In year 2000 Assayag was appointed to coordinate Procap 3000 and later became general manager of Cenpes’ basic engineering department.

Procap-3000 was implemented to enable Petrobras to produce oil and gas from offshore fields in ultra deep waters (1,000- 3,000 meters ) and incorporate reserves located at these depths. It was also expected to develop technological innovation projects aiming at reducing the cost of oil and gas production, in relation to the current conventional systems, in these fields.

During 2005 Cenpes’ basic engineering area participated in seven large projects, including natural gas production projects in the Santos Basin and heavy oil production projects in the Jubarte field in the Campos Basin .

In downstream activities, Cenpes was involved in projects at Presidente Bernardes refinery, Paulínia refinery, both in São Paulo state and Presidente Getúlio Vargas Refinery, Paraná state, encompassing improvements in fuel quality, the reduction of polluting emissions and expansion of heavy oil refining operations.

Petrobras received the OTC distinguished achievement  technological innovation award twice (1992 and 2001) due to production projects  in the Marlim and Roncador giant fields, Campos basin, now  responsible for around 80% of Brazil’s crude output of some 1.8 million barrels of oil per day.

Since 2005 Cenpes has restructured its exploration Research and Development program, which led to the creation of the Basin Modeling Program (Promob) and a Geophysics Department.

Promob is aimed at running geological simulations designed to reduce exploration risks. The new Geophysics Department will intensify the development of computer applications, emphasizing 4D seismic imaging used to explore areas with complex geological compositions.

Peter Howard Wertheim is a veteran international journalist specializing in covering South America’s petroleum and power sectors. He is based in Rio de Janeiro, Brazil, and is fluent in English, Portuguese and Spanish. Comments welcome at peterhw@frionline.com.br or peterhw@netflash.com.br.

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