[copious.abundance]

Ladies and gentlemen, we have the world's third largest oil field.

33 billion barrels

This still hasn't been confirmed by Petrobras, but the head of the Brazilian National Petroleum Agency has announced it.

And we're still waiting to hear about the Sugar Loaf field! However, I read something which said Petrobras is trying to figure out whether this Carioca field and Sugar Loaf are two separate fields, or one large, connected one, so this figure may or may not include both.

--> LINK <--

A deep-water exploration area off Brazil's coast could contain as much as 33 billion barrels of oil, the head of Brazil's National Petroleum Agency said Monday. That would make it the world's third-largest known oil reserve.

Haroldo Lima cautioned that his information on the field off the coast of Rio de Janeiro is unofficial and needs to be confirmed.

The state-run Petrobras oil company declined comment on what would be the planet's largest oil find in decades, and its shares moved wildly in positive territory after Lima made the comments.

[darren]

Ladies and gentlemen, we have the world's third largest oil field.

Well, well... something actually worth posting about for a change. If the 4.5mbbl/day in 2015 estimate is correct, we have something here that won't delay peak (which will have happened by 2015), but might actually extend the plateau for a few years. Not bad.

[Starvid]

WOW.

But what's the recovery factor?

If it's not too great, this is still smaller than Kashagan, and not the third biggest field by a long shot, more like 30th greatest.

edit: I don't think I need add this is very good news for deep sea drillers like the one I'm invested in Pride International.

edit2: I especially like this part.

However, it does cast new doubt on peak oil theory, which postulates that world oil demand will soon outpace supply.

The fact that they need to mention and try to dispel it means we have managed to make an inprint on the global news media. The fact that this field, even if you add Sugar Loaf, Tupi etc will not change the big picture in the least, is another thing.

[copious.abundance]

^
In the past, Petrobras has advertised the size of its discoveries as recoverable amounts. Tupi's 5-8 billion barrels, for example, is the recoverable amount (one of Petrobras' partners in the Tupi field said the real size of the field was something like 15-30 billion barrels). However, since this announcement isn't coming from the mouth of Petrobras itself, it's not sure whether this amount is the recoverable amount, or the OIP.

In one of the other articles on this today it said Petrobras is drilling the 2nd well in Carioca as we speak, so maybe we'll get official word from Petrobras in the next several months? We'll have to wait and see.

[Starvid]

Do you have any good article or something with an overview of everything in that area, what is going on etc? I guess it's the Campos basin we are talking about? Jupiter, Tupi, Sugarloaf, this baby etc.

Damn, this is great news!

But why oh why didn't I buy the Petrobras shares at $80?

[copious.abundance]

And we're still waiting to hear about the Sugar Loaf field! However, I read something which said Petrobras is trying to figure out whether this Carioca field and Sugar Loaf are two separate fields, or one large, connected one, so this figure may or may not include both.

It looks like I might have been right about that. This might include (or be) the Sugar Loaf field: http://www.rigzone.com/news/article.asp?a_id=60169

Estado newswire later said that Lima had in fact been referring to the Pao de Acucar (Sugar Loaf) field. Dow Jones reported that both names could be referring to the same oil reserve.

It's a bit confusing now, I guess we'll have to wait for Petrobras to clear things up.

[copious.abundance]

Do you have any good article or something with an overview of everything in that area, what is going on etc? I guess it's the Campos basin we are talking about? Jupiter, Tupi, Sugarloaf, this baby etc.

Damn, this is great news!

But why oh why didn't I buy the Petrobras shares at $80?

This was a good article. This is also the one where I read that Carioca and Sugar Loaf could be the same field. They aren't sure:
http://www.worldoil.com/magazine/MAGAZI ... R=Feb-2008

Two other subsalt tests were drilled to the west of Carioca during the fourth quarter of 2007. The first of these is Well 1-SPS-51 on Block BM-S-21, about 50 mi southwest of the Carioca location. Petrobras (operator) and partners Galp Energia and BG Group Plc said that the well proved a light oil field in a pre-salt layer in the basin. The well is located 174 mi off the coast of the State of Sao Paolo in 7,329 ft of water, and was drilled to a 17,552-ft TD. The second subsalt test is the Sugar Loaf well on Block BM-S-8, about 30 mi northeast of 1-SPS-51 and 30 mi west of Carioca.

Unofficial, but credible, reports have suggested that these new wells may be testing the same large structure discovered at Carioca. If true, the feature may cover almost 1,000 sq mi. On December 11, UBS Pactual in Rio de Janeiro reported that the Carioca-Sugar Loaf feature “touches four blocks: BM-S-22 and BM-S-9 have ‘large stakes’ in Sugar Loaf; BM-S-21 has a medium stake; and BM-S-8 a small stake.” A week later, Next Energy News wrote that “according to officials at Petrobras, Sugar Loaf field may produce up to 40 billion bbl of oil...Preliminary exploration of the area has determined that Sugar Loaf field is five times the size of Tupi field.”

^
You can see Tupi is off on the right. Jupiter is to the right of that. Sugar Loaf and Carioca are to the left of Tupi, in four blocks which are sort-of attached to each other. I think the block labeled "1-SPS-51 discovery" is also part of Sugar Loaf.

They got that map from here:
http://anp.gov.br/brasil-rounds/round8/ ... ro2006.pdf

There's also a very good document here:
http://www2.petrobras.com.br/ri/pdf/200 ... re-sal.pdf
^
And regarding Tupi and its recoverable amounts, notice what it says on page 10.

[Starvid]

Great post! You're on a roll today.

I wonder which finds they mean with the "two other carbonate reservoirs" in RJS-646 are?

Well, I guess they are not Sugar loaf or any of the other named parts here, but rather already known things, let's call them Tupi-2 and Tupi-3, which pushed Tupi from 4,5 billion barrels to 5-8 billion barrels.

[Starvid]

If reports about the potential size of the Carioca-Sugar Loaf structure prove correct at an estimated 33 billion bbl of oil (the mean of 25 and 40 billion bbl), and Tupi and Jupiter reserve estimates are accurate at 6.5 billion barrels each (the mean of 5 and 8 billion bbl), Carioca-Sugar Loaf would be the third-largest oil field in the world. It would also be the largest field discovered in the last 30 years, with Tupi-Jupiter being the 6th largest discovered in that timeframe, Fig. 3. For further comparison, Prudhoe Bay is the largest field in the US, with 15.2 billion barrels of recoverable oil, and East Texas Field is the second largest with 5.4 billion bbl. It is unlikely that the Carioca-Sugar Loaf structure will be a single field; it will probably be a complex of somewhat smaller fields, similar to the emerging deep GOM Wilcox play, with each perhaps averaging the size of Tupi.

[copious.abundance]

Petrobras has now spoken. They aren't denying this figure, but they say they need to do some more drilling before they come to any firm conclusions:

--> CNN <--

State-run oil firm Petroleo Brasileiro SA (PBR), or Petrobras, said in a note late Monday to Brazil's stock exchange commission it needs more data to evaluate the size of a new discovery in the country's ultradeep pre-salt oil area.

Earlier Monday, Haroldo Lima, the head of Brazil's National Petroleum Agency, or ANP, said that according to unconfirmed and unofficial reports he read, the new discovery could contain up to 33 billion barrels in oil equivalent, or BOE, an ANP press official said.

"More conclusive data on the potential of the discovery will only be known after the completion of further phases in the evaluation process," Petrobras said in the note.

[...]

Petrobras also said it has started drilling a second well in a different area of the BM-S-9 block in late March, but so far hasn't reached the necessary depth to know whether oil was there as well.

Hess has a stake in the area known as "Sugar Loaf" and says . . .

A Hess spokesman told Dow Jones Newswires that it expects news on the BM-S- 22 block in June.

So I guess we'll learn more in the coming months.

[TheDude]

This is odd:

RIO DE JANEIRO -- Brazil has discovered a new offshore oil field that could prove to be "the third biggest field in the world," the head of the country's National Oil Agency, Haroldo Lima, said Monday.

The find, located off the southwest coast near another field called Tupi whose immense reserves were announced in November, is calculated to hold 33 billion barrels of oil, he said.

"It could be the biggest discovery in the last 30 years," Lima told a conference, according to Brazilian media.

"But nothing is confirmed," he cautioned.

He explained that his information was "unofficial" even though it came from Petrobras, Brazil's state-run oil company.

Pertrobras declined to comment.

Inquirer.net

CNN has a good story on the Cariocaloaf:

Also, there was confusion as to the name of the new discovery.

While Petrobras avoided giving a name to the new discovery, Lima, according to his press officials, talked about the Carioca field. Estado, however, said he was referring to the area as the Pao de Acucar field - or Sugar Loaf in English.

Both ANP and Petrobras press officials said the two names possibly mean the same oil reserve. Any names given to discoveries are only preliminary until an official reserve estimate has been made, Petrobras said.

Still early in the game:

Petrobras said it had informed the ANP of the discovery in the BM-S-9 exploration block in Brazil's Santos Basin in September, after it had found oil in one exploration well, but so far hadn't made a comment on the possible size of the block. The company added it will present a plan to the ANP in coming days on how it will continue to explore the block.

Petrobras also said it has started drilling a second well in a different area of the BM-S-9 block in late March, but so far hasn't reached the necessary depth to know whether oil was there as well.

The new find could contain five times as much oil reserves as the nearby Tupi field, Lima was quoted as saying on Estado.

Petrobras in November said Tupi could contain up to 8 billion barrels of oil equivalent.

[copious.abundance]

@TheDude -

The post I made above with the map of the offshore blocks explains the Carioca-Sugar Loaf issue. They aren't sure if those 2 are the same field, or 2 different ones. Not sure the announcement today clears it up, either. I guess we'll have to wait for more info from Petrobras' further drilling.

[DantesPeak]

Earlier Monday, Haroldo Lima, the head of Brazil's National Petroleum Agency, or ANP, said that according to unconfirmed and unofficial reports he read, the new discovery could contain up to 33 billion barrels in oil equivalent, or BOE, an ANP press official said.

So I guess we'll learn more in the coming months.

The Wall Street Journal is also reporting this as barrels in oil equivalent - which is not the same as oil.

Unforrtunately BOE can't be sent to my local refinery and turned into gasoline and diesel from there.

While I don't blame Brazil for the media's misunderstanding, Brazil could do a lot more to clarify whether we are talking about just gas here, or some combination of mostly gas and some oil.

Did I miss something here - or did they actually say somewhere that they measured crude oil flowing from the test well?

[copious.abundance]

The Wall Street Journal is also reporting this as barrels in oil equivalent - which is not the same as oil.

Unforrtunately BOE can't be sent to my local refinery and turned into gasoline and diesel from there.

While I don't blame Brazil for the media's misunderstanding, Brazil could do a lot more to clarify whether we are talking about just gas here, or some combination of mostly gas and some oil.

This is not about Sugar Loaf/Carioca, but go here:
http://www.worldoil.com/magazine/MAGAZI ... R=Feb-2008
^

Oil from the Tupi area is 28-30°API with a gas/oil ratio of about 15-20%.

So yes, for this one at least it's mostly oil.

[copious.abundance]

The Wall Street Journal is also reporting this as barrels in oil equivalent - which is not the same as oil.

Unforrtunately BOE can't be sent to my local refinery and turned into gasoline and diesel from there.

While I don't blame Brazil for the media's misunderstanding, Brazil could do a lot more to clarify whether we are talking about just gas here, or some combination of mostly gas and some oil.

This is not about Sugar Loaf/Carioca, but go here:
http://www.worldoil.com/magazine/MAGAZI ... R=Feb-2008
^

Oil from the Tupi area is 28-30°API with a gas/oil ratio of about 15-20%.

So yes, for this one at least it's mostly oil.

Also, if the flow results from wells are any guide, the gas/oil ratio in Carioca looks like it might be higher than Tupi.

BG group is one of Petrobras' partners in both the Tupi and Carioca fields.

Here is an announcement they made for one of the Tupi wells:
http://www.bg-group.com/media/archive_2 ... 107-sx.htm

The appraisal well flowed at a rate of 2 000 barrels of oil and 65 thousand cubic metres of gas per day, with the rate constrained by surface facilities.

And here is their announcement for their Carioca well:
http://www.bg-group.com/media/archive_2 ... 507-sx.htm

The exploration well flowed at a rate of approximately 2 900 barrels of 27 degrees API oil and 57 thousand cubic meters of gas per day. The rate was constrained by test equipment.

So Tupi = 2,000 bbl oil/day and 65K cm gas/day
Carioca = 2,900 bbl oil/day and 57K cm gas/day

So judging at least from this, Carioca may have an even higher percentage of oil to gas than Tupi's 15-20%.

[TheDude]

NO OIL (OR BOC!) FOR YOU!



Brazil's Petrobras denies giant oil field discovery

RIO DE JANEIRO, April 14 (Xinhua) -- Brazil's state-owned oil company Petrobras denied Monday an earlier announcement of the discovery of a gigantic oil and gas field in southeastern Brazil.

The salt layer of the second well drilled in block BMS-9 of the announced oil field has not even been reached yet, and the huge field, if it does exist, lies below the salt layer, the company said in a statement.

The announcement of the discovery had been made earlier Monday by the director of the government's National Oil and Gas Agency Haroldo Lima. The agency is in charge of regulating the oil and gas sector in the country.

The Securities and Exchange Commission of Brazil, which supervises the operation of the stock market in the country, criticized the announcement by the ANP director, which prompted a sudden climb of Petrobras' stocks on the Sao Paulo Stock Exchange (Bovespa).

The release of relevant information made by "outsiders" is "harmful" to the market's operation, the commission said.

Huh! How do you say "pump and dump" in Portuguese?

[BrazilianPO]

Huh! How do you say "pump and dump" in Portuguese?

The closest would be "Levanta e derruba" (something like "Pull up and knock down").

This discovery is going to make all the difference to Brazil in the future. Just hope our government uses the money wisely. I never though Brazil would become a major oil producer in the future, but that is what will probably happen.

Also, thanks God Petrobras was not privatized by the last right-wing government. We would have to nationalize everything again now and that would cast a shadow over Brazil's economy.

[TheDude]

Yeah, Brazil is in good shape for the foreseeable future, between all these crazy big offshore finds and actual productive ethanol. Be able to name your price - at least until/if those of us in temperate climes move away from liquid fuels.

Do you think Brazil will continue with ethanol production? You have all those engines and gas stations built around ethanol, after all. But it's awfully labor intensive to produce - presumably with increased revenues your per capita income will increase and people will be less interested in swinging machetes for hours on end. Or perhaps it can be mechanized to some extent. I've been reading about winemaking; many producers have stuck to time honored methods like treading grapes with the feet and destemming by hand, even though mechanical equivalents were developed at the end of the 19th century. But then ethanol isn't a high value product like wine.

[phaeryen]

So what then was this game of having some outside official make an announcement that develops into huge global news, then have the state-run oil company deny the find? Surely it can't be the simple 'pump and dump -scenario already suggested?

From reading over OilFinders excellent contributions to this thread I took note of Petrobras discussing their business in a very low key manner, so the denial of a big find is consistent behaviour from them.

The way Reuters spun this news piece was to just note that Petrobras & co. had made the huge find and were being frank and quite official about it.

I guess this is still a story in the making. Many thanks to you, OilFinder, on keeping such a close eye on developments in Brazil concerning oil. May I enquire as to why you follow the "brazilian scene" so keenly?

[rockdoc123]

So what then was this game of having some outside official make an announcement that develops into huge global news, then have the state-run oil company deny the find? Surely it can't be the simple 'pump and dump -scenario already suggested?

this is not all that unusual. If I had a nickel for everytime a government official who knows very little about oil and gas exploration spoke out of turn I would be a very rich man. Basically someone at the top in Petrobras mentioned to a gov't official the the field could be anywhere from X- Y MMBOE in size but that considerable appraisal drilling would be needed. That official then thought he could make some political hay by stating that a discovery was made that was Y MMBOE in size. This is preciously why you have to be cautious in reading press releases. For people that work in the oil industry it is often easy to separate the wheat from the chaff, but not always.