Oil Majors Flock to Offshore Brazil

May 20, 2013

French supermajor Total said it secured awards for 10 new exploration licenses during the latest auction for Brazilian reserves, UPI reports.

Total said it will serve as the operator with a 40 percent stake in five blocks in the Foz do Amazonas basin, take on a 25 percent stake in three blocks in the Espirito Santo basin, a 45 percent stake in the Ceara basin and a 50 percent stake in the Barreirinhas basin.

"We will be able to play a key role in Brazil's dynamic exploration sector," Total Senior Vice President for Exploration Marc Blaizot said in a statement. "These acquisitions will be major drivers of Total's strategy of profitable growth in the deep offshore."

British energy company BP said this week it joined Total in a block during the 11th auction by the Brazilian National Petroleum Agency.

Energy companies submitted bids for 289 blocks in 11 different basins, with most explorers focused on the frontier offshore Foz do Amazonas basin. Wood Mackenzie oil analyst Ruaraidh Montgomery told Bloomberg News the level of interest during the latest round represented something "of a herd mentality."

There may be as much as 50 billion barrels of oil offshore Brazil, putting it just behind Venezuela in terms of proven oil reserves in South America.

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