|The P-50 rig|
The recent activation of Brazil’s newest offshore rig—the P-50—sets the country on the path to self-sufficiency—at least for awhile—in oil. The new rig will boost Petrobras’ total oil production to an average 1.9 million barrels per day this year—more than the average consumption of 1.85 million barrels per day. (The US, with a GDP 20-times larger, consumes more than 10 times as much oil.)
Oil self-sufficiency has been a long-term goal of the Brazilian government. Brazil has become the 10th largest energy consumer in the world and the third largest in the Western Hemisphere, behind the United States and Canada, according to the Energy Information Administration.
Brazil is also the largest emitter of carbon dioxide in the region, releasing 351.5 million metric tons of carbon dioxide in 2003, but has a carbon intensity (carbon dioxide per unit GDP) below the regional average.
Brazil has 10.6 billion barrels of proven oil reserves, second-largest in South America to only Venezuela. Most of Brazil’s crude oil production is offshore in very deep water and consists of mostly-heavy grades.
The P-50 is an FPSO, or a Floating, Production, Storage, and Offloading unit characterized by its capability to produce, process, store, and flow oil and gas. It has the largest capacity of any Petrobras floating unit, being able to produce up to 180,000 barrels a day—11% of the average volume produced in the Country in 2005.
The unit will also be able to compress six million cubic meters of natural gas and to store 1.6 million barrels of oil. It is 337 meters long, has a draft of 21 meters, and is 55 meters tall, equivalent to an 18-story building.
The P-50 is installed in the Albacora Leste field (Campos Basin), and is part of a project that has a 10% participation of the Spanish Repsol company. Albacora Leste is located 120 kilometers form Cabo de São Tomé (RJ), occupying a 141 square kilometer area, where the depth varies from 800 to 2,000 meters.
In addition to the 180,000 barrels per day that will flow from P-50 at peak production, Petrobras has three other platforms are scheduled to go into production in 2006: the P-34, extracting 60,000 barrels a day in the Jubarte field, in Espírito Santo; the SSP-300, producing 20,000 barrels/day in the Piranema field, in Sergipe; and the FPSO Capixaba (100,000 barrels/day) in the Golfinho field, also in Espírito Santo.
As these offshore rigs come online, Petrobras expects to become a global net oil exporter, with production exceeding demand by nearly 300,000 barrels a day in 2010.
The net-exporter status will boost Brazil’s trade surplus and help shield the country from expected oil-price shocks. Petrobras said it won’t pass on the spikes in international oil prices to Brazilian consumers. Crude oil prices broke through the $75 per barrel level on Friday on the New York Mercantile Exchange.
Brazilian oil production began in 1953, at 2,700 barrels per day. Consumption was 137,000 barrels per day. Brazil’s break came in 1974 with the discovery of the Garoupa field in the offshore Campos Basin.
More offshore discoveries followed, and now more than 80% of Brazilian oil production flows from offshore fields. Petrobras also became a world leader in deep-water drilling, developing state-of-the-art equipment and setting world records for deep-water drilling. It is Brazil’s biggest and the 14th-largest oil company in the world, with operations in 15 countries.
Brazil’s oil production has grown by an average of 9% per year since 1980. Brazil is also the largest producer and exporter of ethanol in the world. More than half of all cars in the country are of the flex-fuel variety, running 100% ethanol or an ethanol-gasoline blend.