Drilling in frontier offshore basins can be challenging and economically unattractive, according to a top executive at Brazilian state-controlled oil giant Petrobras, but taking on the exploration risk can reap rich rewards, as evidenced by the plethora of huge pre-salt discoveries made off the country more than a decade ago.
“We have a complex geological setting along the Brazilian coast, from the Foz do Amazonas basin in the northern equatorial margin all the way to the Pelotas basin in the south,” Petrobras executive manager for exploration, Mario Carminatti, told a panel at the Rio Oil & Gas 2020 digital conference on Thursday.
The biggest issue with frontier acreage is the lack of data and logistics for a potential future development in case of any significant find, he added.
Unlocking value offshore
In recent years, Petrobras has made a string of light oil discoveries in the deep-water section of the Sergipe-Alagoas basin, but given the economics of a project in an area with little infrastructure, first oil from the Barra, Farfan and Muriu finds has been postponed until after 2025.
“It is fair to consider that because of its many challenges, frontier basins are economically unattractive, but we have to take on these as a starting point to search for new opportunities so we can unlock the value of our exploration plays in Brazil,” said Carminatti.
As it readies its first exploration programme off Brazil since an unsuccessful attempt to discover pre-salt deposits in the Santos basin in 2010, US supermajor ExxonMobil is aware of the risks of conducting exploration work at a time oil prices are trading at low levels.
“Taking risk is something extremely challenging right now, but we are still committed to our campaign here in Brazil,” said ExxonMobil Brazil operations manager, Robert Prueser.
ExxonMobil is set to spud two wells — Opal and Titan — starting in January, targeting pre-salt resources with the Seadrill drillship West Saturn.
The programme will likely be extended with the drilling of one prospect in Sergipe-Alagoas in the second half of 2021.
Also attending the panel, executive from fellow supermajors Shell and Chevron stressed the importance of building knowledge and capability, as well as analysing state-of-the-art seismic data and applying new technologies to further reduce exploration risk.