Petrobras has unveiled its updated five-year business strategy, boosting investments and its production forecast despite the impact of the Covid-19 pandemic and the planned divestment of some upstream assets.

The Brazilian state-controlled oil company expects to invest $68 billion between 2022 and 2026, of which 84%, or $57.3 billion, will be directed to exploration and production.

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The bulk of upstream investments will be channelled to pre-salt projects in deep and ultra-deep waters in order to maximise value, according to the oil giant.

Petrobras intends to direct 67% of upstream investments to pre-salt fields including Buzios, Tupi, Mero, Itapu, Jubarte, Sepia, Atapu, Berbigao, Sururu, Sapinhoa and its working interest in Block BM-C-33, home of the Pao de Acucar discovery.

The rest will head to post-salt developments such as Marlim, Marlim Sul, Marlim Leste, Roncador, Barracuda-Caratinga and the ultra-deepwater section of the Sergipe-Alagoas basin, where Petrobras is looking to install a floating production, storage and offloading vessel in the near future.

Some $5.5 billion of the upstream capital expenditure will be used for exploration work, with 58% of the total going to the Campos, Santos and Espirito Santo basins, and another 38% to the environmentally-sensitive northern equatorial margin.

Oil output is expected to increase from 2.1 million barrels per day in 2022 to 2.6 million bpd in 2026, while total hydrocarbons production is forecast to rise from 2.7 million barrels of oil equivalent per day in 2022 to 3.2 million boepd in 2026.

Pre-salt production will continue to represent the majority of Petrobras’ output, increasing from 70% of total output in 2022 to 79% in 2026.

To reach the projected target, Petrobras will deploy 15 new FPSOs in Brazil over the next five years. A dozen have been contracted already, including the recent Maria Quiteria floater to be supplied by Malaysia’s Yinson Holdings in the Parque das Baleias cluster.

The three FPSOs yet to be contracted are the P-80 and P-82 units to be deployed at Buzios and the P-81 vessel for Sergipe-Alagoas. All are earmarked to begin production in 2026.

Petrobras added a second FPSO would be installed on Sergipe-Alagoas after 2026 but did not disclose additional details.

The oil company is also setting $2.8 billion to decarbonise operations, invest in bioproducts and in the diversification of its renewables business.

These include $248 million to create a decarbonisation fund to develop solutions, perform studies and help implement projects that mitigate carbon emissions.

Petrobras is also setting a new target to divest between $15 billion and $25 billion-worth of assets, which is expected to impact production by 50,000 boepd in 2022 and 250,000 boepd in the remaining years of the plan.