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Brazil Oil and Gas On The Way Up - What Can NORWEP Do To Support Partners
Brazil Oil and Gas On The Way Up - What Can NORWEP Do To Support Partners
1. Country overview
2. E&P overview
3. Policies in place and impact on business
4. Coming bid rounds
5. Opportunities
6. How NORWEP can support our partners
7. Final Remarks
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Country Overview
Country outlook - challenges
• Deep prolongued economic recession
• Challenging fiscal imbalance
• Political turmoil
• Corruption scandal “lava jato” (car wash operation)
• High unemployment rate
• Complex legal and regulatory framework
• Complex tax regime
• Logistics challenges
• Low oil price
• Geopolitical risks
Country outlook - opportunities
Lower inflation and interest rate (SELIC)
Pre-salt fields production
Petrobras turnaround
Petrobras divestment plan
Adjustments in legislation
9 bidding rounds scheduled (2017/2018/2019)
Permanent offer of exploration areas
Local content adjusted
Program Gas para crescer “Gas to grow”
E&P Overview
Country E&P overview
• Oi Production : 2.5 Mbpd
• Gas Production: 101 Mm3/d
• Reserves: Oil 12.7 Bbbl / Gas 378 Bm3
• Economic groups in E&P activities: 95
• Foreign Companies: 48
• Sedimentary Basins: 29
• Exploratory Blocks: 311
• Fields: 443
• Wells: ~30.000
• Offshore Production Platforms: 143
Country E&P overview – Oil Production
Country overview – Pre-salt
Source: ANP
Drastic Reduction in Activity
5 years without licensing bidding rounds
Policies in place and impact on business
National Policies in Place
Upstream
• E&P National Policy
• Onshore E&P Policy (Reate) – revitalization program
• Transfer of Rights Renegotiation
• Local Content Policy
• Tax Regime Renewal (Repetro)
• 2017‐2019 Bidding Rounds
• Unitization Agreements
• Petrobras’ Right of First Refusal (Pre‐salt Operatorship)
Midstream
• “Gas para Crescer” program (Gas to grow) o
Framework improvements with impact on business
Local Content review
New policy for the 14th bidding round and following
• Scheduled for Sept, 27 ‐ 2017
• 32 Oil Companies registered and approved to bid
• 287 Exploratory Blocks
• 11 Sedimentary Basins
5 Offshore
6 Onshore
• Lower local content percentage
• Opportunities for new comers as operators (Exxon, e.g.)
Production Sharing Contract bidding round - Pre-salt
Areas to be unitized
• Carcará – estimated in place volumes: 2,2 Bbbl (exploration phase)
• Gato do Mato (exploration phase)
• Sapinhoá (in production: 25.000 bbld
• Tartaruga Verde (under development; first oil in 2017)
New areas
• Alto de Cabo Frio Oeste
• Alto de Cabo Frio Central
• Pau Brasil – unrisked in place volumes: 4.1 Bbbl
• Peroba – unrisked in place volumes: 5.3 Bbbl
Opportunities
Several impediments to foreign investments lifted – Offshore market to grow by 3% p.a.
30
25
20
15
10
0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1
Number of wells expected to double towards 2021 driven by exploration activity
180
Exploration
150
Wet
Dry
120
90
60
30
0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2
Green and mature fields opportunities
Several opportunities in the OPEX
Source: Petrobras
Petrobras Business Plan – 19 new Production Units
Source: Petrobras Strategic Business and Management Plan 2017‐2021
O&G Companies Operating in Brazil
Mb/d
2017
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