THE Petrobras Thread (merged)

[rockdoc123]

Seahorse, just an interesting piece of information I came across yesterday is that in WoodMackenzie's analysis of BG's worldwide holdings they are suggesting that first production from Tupi won't be reached until 2015 and peak not until 2017. So my guesstimate for this new one wasn't too much out to lunch.

[seahorse2]

Yes Rockdoc, I meant to thank you for that info. The time and expense in getting oil in the ground is always a dose of realism that people have to take into consideration when these new "finds" are made. There is an interesting article on the Bakken posted today at Energy Bulletin saying essentially the same thing you have said about the time required to bring the Brazil find online. It will take at least another five years to get to maximum production out of the Bakken and will probably produce around 100kbpd as a best guestimate. It compared the Bakken to Thunderhorse, which is expected to produce about 250k per day, when and if it gets up running. Thunderhorse is just another dose of production realism, that getting oil out of the ground is never easy and nothing is guaranteed. It shows that with Brazil and Bakken, 5 years to first oil production has a lot of built in assumptions and may be too optimistic.

In the end, peak oil for me has become an issue of production. The world doesn't need oil reserves, it needs oil produced. Getting oil out of the ground is becoming more and more difficult not only with the increasing difficulty of the geology involved, but with the increasing difficulty of politics and now, peak finances.

It seems clear the end of cheap energy is over. Its just very expensive and lots of risk getting oil out of the ground these days. What I don't know is what is the financial breaking point for society? It seems that at some point, energy may become more expensive than society can bear. I'm not sure, but its a consideration.

[OilFinder2]

So your whole case is based upon some possible interpretation of one comment?

It's not my interpretation of the comment, here is what Suisee Credit themselves said, in case you didn't read the 2nd article:

"We believe Lima was saying that the whole Sugar Loaf structure might contain 33 billion barrels. That's something we certainly think is possible," he said, explaining that part of the confusion was in the name Carioca, sometimes applied just to the BMS-9 find, and at times to the whole Sugar Loaf area.

[OilFinder2]

Oilfinder,

When do you believe oil production will start in this new area?

What do you believe the recoverable reserves will be in this area?

What do you believe will be the maximum rate of production and when?

We don't know until Petrobras announces something official, will we.

Without this find, when do you believe the world will hit peak oil?

That's a somewhat ridiculous qualification since this find does exist and it will be produced.

With this find, when do you believe the world will hit "peak oil"?

The production of oil will peak when demand for oil peaks. I don't know when that might be - maybe 15 years from now, maybe 50 years from now, maybe longer.

[OilFinder2]

Seahorse, just an interesting piece of information I came across yesterday is that in WoodMackenzie's analysis of BG's worldwide holdings they are suggesting that first production from Tupi won't be reached until 2015 and peak not until 2017. So my guesstimate for this new one wasn't too much out to lunch.

That's just full production, they will actually be starting up earlier than that:
http://europe.theoildrum.com/node/3853#comment-331354

I was in Rio last week and there is no doubt that there is great deal of optimism within Petrobras that the Carioca Field will be enormous. Petrobras are currently negotiating a contract for an FPSO (Floating, Production, Storage and Offloading) and hope to have first oil from Tupi in Q2 of 2009. Petrobras have already contracted an FPSO to operate in 2600 m of water in the US Gulf (Chinook and Cascade Fields) so there is no technical challenge of operating in the depth of water over the Tupi Field. Estrella was orignally over optimistic when suggesting first oil from the TLD (Test, Long Duration) unit in 2008. I am inclined to agree with others who believe that we will find enough oil to see us safely over to other sources of energy - but we will have a choppy time during the transit period - and particularly during the next 1-2 years. The 8 billion bbls is recoverable for Tupi.

Note:
Plan for Tupi: TLD production of 30 000 BBL/day commencing from Q2 2009
Pilot: 100 000 BBL/day commencing Q2 2010
Full Production by perhaps 2015 of 1 000 000 BBL/day. (Requiring approx 10 floating production units).

[seahorse2]

OF,

Thanks for the info. However, I would question the assumptions in the article you linked:

(1) It says they will be able to find enough oil to transition "us" to other forms of energy. I question this for several reasons. First, it doesn't specify what these other forms of energy will be, and every forecast I have read from any source says that oil will continue to provide most of the world's energy needs for the forseeable future, even out to 2030, that nothing is on the horizon that can substitute for oil. So, it will be more than a 1-2 year transition period off of oil.

Second, to believe they may be able to start pumping in 2009 may be too optimistic. Again, Thunderhorse delays should provide some realism into these estimates. Its been delayed now for 3 years.

Third, assuming they can eventually pump 1 mbpd is a lot, but will not even make up for the loss of Cantarell during the same time period.

Fourth, Rockdoc has lots of experience in the oil industry and I have learned to respect his opinion. As he says:

So my guess it is one of those things that will extend the peak but not actually affect it.

Therefore, tempered optimism at best. Even this article states there will be a "choppy" two years, whatever that means. So, if things are going to get choppy, and if we are to transition off of oil to new energy sources which is the belief of this article, the time to start transitioning is right now. We should be building lots of nuclear, coal, GTL right now, not two years from now, not five years from now, but right now. Otherwise, things may be choppier for a lot longer time period than envisioned in the article.

[EnergyUnlimited]

With this find, when do you believe the world will hit "peak oil"?

The production of oil will peak when demand for oil peaks. I don't know when that might be - maybe 15 years from now, maybe 50 years from now, maybe longer.

And demand will peak when one barrel cost $500 - 1000, naturally at today's value of dollar.
4 - 7 years from now on perhaps, maybe faster.

Another possibility is that demand for oil will be largely wiped out with pending economy collapse.

[TheDude]

The production of oil will peak when demand for oil peaks.

"There is no place I know that compares to pure imagination..."



Will it matter if the only people capable of doing the demanding are earning 500k in today's dollars? Didn't think so!

How come you had the MySQL sever down message as your signature? Maybe the Mods were having a little fun with you?

Dave Cohen article on the Bakken at EB,thanks for the tip seahorse2.

Luis de Sousa's comment after the one OF2 quoted:

As I reported last November, production through a 2000 metre layer of salt is not a solved matter yet.

[pstarr]

The production of oil will peak when demand for oil peaks.

"There is no place I know that compares to pure imagination..."



Will it matter if the only people capable of doing the demanding are earning 500k in today's dollars? Didn't think so!

How come you had the MySQL sever down message as your signature? Maybe the Mods were having a little fun with you?

Dave Cohen article on the Bakken at EB,thanks for the tip seahorse2.

Luis de Sousa's comment after the one OF2 quoted:

As I reported last November, production through a 2000 metre layer of salt is not a solved matter yet.

This is just another pedantic trick by OF1&2. He can say such things knowing that demand is not measured. What a tricky little turkey

[OilFinder2]

This is just another pedantic trick by OF1&2. He can say such things knowing that demand is not measured. What a tricky little turkey

No, I am saying that demand will determine production levels. You peakers believe that production levels will dictate consumption levels.

[rockdoc123]

That's just full production, they will actually be starting up earlier than that:

that maybe someone in Petrobras' story but the WoodMac view (which they do on about 37 IOC's as part of their services) analyzes a number of things including rig availability, fiscal regime, political regime, average turnaround time on similar projects across the industry, delivery by that company, project challenges etc. Their view is that potential delays are not factored into Petrobras viewpoint. Note that de Silva actually said in a conference late last year that first production wouldn't be until 2012. Indeed as of February Petrobras had not even submitted a field development proposal (according to a report in Oil and Gas International). A 2009 startup in these water depths is a bit pie in the sky in my estimate. We shall see. The last FPSO project I was involved with has taken 4 years from intial discovery to production and that was in a couple of hundred metres of water and very small in areal extent.

[pstarr]

This is just another pedantic trick by OF1&2. He can say such things knowing that demand is not measured. What a tricky little turkey

No, I am saying that demand will determine production levels. You peakers believe that production levels will dictate consumption levels.

Yes that is what we say, anything else is voodoo economics and bad geology.

[seahorse]

No, I am saying that demand will determine production levels. You peakers believe that production levels will dictate consumption levels.

OF, I'm not following your logic above. Please understand that I'm not trying to argue, simply trying to understand where your coming from. It seems that both can be true depending on which side of the production curve we are on. If we have not hit peak oil, then you are correct, demand will determine production. However, if a geological peak is reached, production levels limit demand.

[OilFinder2]

No, I am saying that demand will determine production levels. You peakers believe that production levels will dictate consumption levels.

OF, I'm not following your logic above. Please understand that I'm not trying to argue, simply trying to understand where your coming from. It seems that both can be true depending on which side of the production curve we are on. If we have not hit peak oil, then you are correct, demand will determine production. However, if a geological peak is reached, production levels limit demand.

I am saying:
-- 1) There is plenty of oil to satisfy human wants for a very long time.
-- 2) At some point, human wants for oil will diminish, not because the earth is running out of oil, but because we've found a better substitute for it, or because we've learned to use it so efficiently that demand starts to decrease, and/or because human population starts to decrease (which is projected to happen around 2070 anyway). Or some combination of the above. It is impossible for me to say when all these factors might come together. As I said before, it could be 15 years, it could be 50 years, or maybe longer, I don't really know.

[TonyPrep]

I am saying:
-- 1) There is plenty of oil to satisfy human wants for a very long time.
-- 2) At some point, human wants for oil will diminish, not because the earth is running out of oil, but because we've found a better substitute for it, or because we've learned to use it so efficiently that demand starts to decrease, and/or because human population starts to decrease (which is projected to happen around 2070 anyway). Or some combination of the above. It is impossible for me to say when all these factors might come together. As I said before, it could be 15 years, it could be 50 years, or maybe longer, I don't really know.

No one really knows, but we do have pointers.

Consumption is already ahead of production, so your first point is incorrect, at least at the moment. According to EIA figures, that has been the case for at least 2 years. IEA figures show a narrower gap, but still a gap.

Even if China and India rein in their growth in oil consumption, to, say, 3% per year, those two countries alone will require an extra 6 million barrels a day in 15 years. At current growth rates, that would be 10 million barrel per day extra. If other countries' economies don't collapse, the extra amount of oil required, worldwide, would be about 21 million barrels per day, in 15 years (at 1.5% growth rate).

As the premature announcement of the 33 billion barrel find in Brazil, which may turn out to be much lower, has shown, people are desperate for more oil. OPEC is being entreated by world leaders to increase production but they continue to bleat the self-fulfilling reason that demand is falling. There is no reason to believe that Aramco can increase production significantly and Russian output is predicted to fall this year. You are basing your hopes for 15 to 50 years of growth on a cluster of small discoveries each year.

If CERA is correct, current producing fields will be declining at 4.5% per year. In 15 years, that's 43 million barrels per day gone from production. So you are hoping to see an extra 64 million barrels per day, in 15 years, to cover declines and the required additions. You then suggest it could be 50 years before oil production can't meet demand or until some better fuel is found. The former is wrong (it is already wrong and an extra 64 mbpd is a dream) and the latter (that a better alternative is found) requires a lot of crossed fingers. It also requires that no other limits are hit on the way.

It's amazing that you can keep believing but I guess the desire to do so is very strong in most people.

[mattduke]

Oil companies that can increase their production while the world is on the downslope will make their owners very wealthy.

http://www.guardian.co.uk/business/feedarticle/7549485

[mattduke]

Here's an article on Petrobras production increases over the last year.

http://www.anba.com.br/ingles/noticia.php?id=18340

[DantesPeak]

Petrobras is quite serious about getting to the oil. The complete article (below) mentioned they will be spending $25 billion just to get going - by 2017. We're really going to need the oil then, so I hope they are successful, but getting oil from that deep will be a great challenge.

Brazil Petrobras Board Approves Tender For 12 Drilling Rigs

DOW JONES NEWSWIRES
May 30, 2008 5:27 p.m.

RIO DE JANEIRO (Dow Jones)--Brazilian state-owned energy giant Petroleo Brasileiro (PBR), or Petrobras, said late Friday that its board approved a tender for 12 deepwater drilling rigs.

In a regulatory filing, Petrobras said that the rigs are expected to be delivered by the middle of 2012. However, the lack of local production capacity will force the company to look outside of Brazil for construction of the rigs.

The 12 platforms were the first phase of a plan to contract 40 drilling rigs by 2017. The total cost of the program is expected to top $20 billion.

Petrobras urgently needs more drilling equipment to explore and produce from its promising new pre-salt oil province off the coast of southeast Brazil.

In November, Petrobras estimated recoverable reserves at its Tupi field in the pre-salt layer of the Santos Basin off the coast of Rio de Janeiro state at up to 8 billion barrels of oil equivalent. The company has also said that test wells in other Santos Basin blocks have confirmed the presence of oil.

But drilling in the pre-salt layer is risky and expensive, according to analysts. Oil found in Brazil's pre-salt area lies at a water depth of more than 2,000 meters, as well as under an additional 5,000 meters of sand, rock and salt.

WSJ

[OilFinder2]

There's already a whole ongoing thread with lots of information about these Brazilian finds and related info.
http://www.peakoil.com/fortopic34662-90.html

[Spanktron9]

This is from an internal corporate newsletter at my employer:

Another Petrobras Rig At Risk

On, November 27, Scorpion Offshore said it has been unable to secure the needed financing needed to complete theDSS-38 class semi-submersible slated for delivery in December 2011 and under contract to PBR.

We believe this is one of several of the initial rigs contracted by PBR for deepwater work that could be at risk due to the turmoil in capital markets

It appears that production on the brazillian superfields may not come on line as quickly as anticpated.