opportunities for investments in the brazilian oil & gas ... · opportunities for investments ....

Opportunities for Investments in the Brazilian Oil & Gas Industry

& New Bidding Rounds

Magda Chambriard

Director general

February 26, 2013

Summary

Resumption of ANP Bidding Rounds 1

12th Bidding Round – Concession Contract 4

1st Pre-salt Round – Production Sharing Contract 5

Final Comments 6


Current Scenario & Investments Perspectives 2

Royalties Discussion

The resuming of ANP bidding rounds

Pre-salt discoveries: new paradigm

Pre-salt – new regulatory framework: Higher potential

Petrobras Capitalization

Creation of Inter-ministerial Group

Blocks in the Pre-salt cluster

ANP has invested in G&G surveys to increase knowledge of the Brazilian sedimentary basins.

MP 592/12 & Law 12734/12

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

“One country, three systems…”

7.5 million km2

~ 2% of sedimentary areas: Production Sharing Regime 1st Pre-salt Bidding Round

Other areas: Concession Regime 11th and 12th Rounds

Onerous assignment: 7 blocks

Summary




Final Comments 6



Proven Reserves Oil – ~15.3 billion bbl Gas – ~459.3 billion m3

Near future: x2

Imports/Exports Balance Oil – 237.9 thousand bbl/day Gas – 35.8 million m3/day

Production Oil and NGL – 2.2 million bbl/day

Gas – 70.7 million m3/day Near future: x2

Current scenario and perspectives (2012)

39 national companies 38 foreign companies

Petroleum Natural Gas

0

5

10

15

20

25

30

35

40

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Near future

Proven Reserves (Bboe)

Why invest in Brazil?

Source: BNDES. Study: Visão do Desenvolvimento nº 100 – April, 2012

7

11

14

21

25

25

26

56

58

354

0 50 100 150 200 250 300 350 400

Aerospace

Industrial Health

Textile

Steel

Electronics

Chemical

Paper and Cellulose

Automotive

Mining

Oil and Gas

R$ billion

Oil and Gas: 63%

Investments 2012-2015

Next decade, the demand for goods and services should reach U$ 400 billion

Opportunities for suppliers in the petroleum sector

6 7 9

13

18

22 24

26

0

5

10

15

20

25

30

2005 2006 2007 2008 2009 2010 2011 Valor Médio

(2012-2016)

Petrobras Investments in E&P in Brazil Average values in the 5- year period Business Plan

(US$ Billion)*

*Based on information from the Petrobras Business Plan

Shell OGX Queiroz Galvão BP Statoil Chevron BG Petrogal Others

Average values

(2012-2016)

Source: Adapted from the 4th balance of PAC 2, 2012

Brasfels Shipyard

P-57 (Jubarte)

P-56 (Marlim Sul)

P-61

6 rigs

Rio Grande Shipyard

P-55 – modules and topside

8 replicants – hulls

3 rigs

Petrobras – already auctioned

28 drilling rigs 7 in PE, 6 in BA, 6 in ES, 6 in RJ and 3 in RS

Rio Grande Harbor Shipyard

P-63

P-58

Action completed/operation

Running

Auctioned

Provided

Naval industry

Inhaúma Shipyard

Conversion of 4 FPSOs (P-74, P-75, P-76 and P-77)

Onerous Assignment

OSX Shipyard (under construction)

6 modules (OGX)

4 hulls (OGX)

5 drillships (BR)

7 WHP (OGX)

Jurong Shipyard (under construction) 6 rigs

Atlântico Sul Shipyard

7 rigs

P-62

São Roque Shipyard

P-59

P60

6 rigs

Naval Industry with LC Platforms, drilling rigs, supply boats

Sea Brasil – STX - RJ Atlântico Sul Shipyard - PE

Mauá Shipyard – RJ (P-50) BrasFels Shipyard – RJ (P-52)

Rio Grande Shipyard - RS

Summary




Final Comments 6



The 11th Bidding Round

Basin State Area (km2)

Foz do Amazonas AP 44,500

Pará-Maranhão PA, MA 4,616

Barreirinhas MA 13,074

Ceará CE 7,388

Potiguar CE, RN 7,326

Pernambuco-Paraíba PE, PB 6,291

Espírito-Santo ES 4,330

Parnaíba MA, PI 59,764

Sergipe-Alagoas AL 733

Recôncavo BA 475

Tucano Sul BA 6,455

Potiguar RN 588

Espírito-Santo ES 179

289 blocks in 11 states

Total area: 155,718 km2 or 60,123 sq. miles

Equatorial Margin

Shallow and deep-water areas – 75.6 M km2: Opportunities for oil companies and suppliers

Foz do Amazonas

Pará-Maranhão

Potiguar

Ceará

Barreirinhas

Equatorial Margin

Equatorial Margin Petroleum and natural gas shows

Pecém discovery

Discovered in September 2011;

Concessionaries: Tullow (27.5%), Shell (45%), Total (25%), Nothern Petroleum (1.25%) e Wessex Exploration (1.25%);

First deep-water well in French Guiana (LDA 2,048 m);

Zaedys >> 50 km from Brazilian boarder;

Forecasted VOIP: 700 MM bbl;

Well final depth ~ 6,000 m.

South America Analogues French Guiana - Zaedyus Prospect

Source: http://www.rigzone.com/news/article.asp?a_id=104992

Prospects

Equatorial Margin

Source: Modified from Brownfield & Charpentier. USGS, 2007

Guine Golf Province

Countries boarder

Natural gas fields

Oil fields

Analogues in African Equatorial Margin

Typical exploratory opportunity Foz do Amazonas Basin

Courtesy of GX Technology

Opportunities in the Eastern Margin

Deep water areas: Opportunities for oil companies and for suppliers Area: 10,621 km2 or 4,100 sq. miles

Espírito-Santo PEPB

Salt in Eastern Margin Espírito-Santo Basin

Gulf of Mexico Espírito-Santo basin

Salt in Eastern Margin Pernambuco-Paraíba Basin

Onshore new frontiers

Tucano-Sul Parnaíba

Area: 66,219 km2 or 25,567 sq. miles

Gas commercial discoveries: Gavião Real, Gavião Azul and Gavião Branco Electricity from Natural Gas → reduction of regional inequalities

Source: OGX and MPX

“Gaviões” Park – MA (OGX)

Parnaíba Thermoelectric Plant

Mature basins

Mature basins: opportunities for small companies Area: 1,975 km2 or 763 sq. miles

Sergipe-Alagoas

Potiguar Recôncavo Espírito-Santo

The 11th Bidding Round Participation Rules

Basin State Area (km2)

Foz do Amazonas AP 44,500

Pará-Maranhão PA, MA 4,616

Barreirinhas MA 13,074

Ceará CE 7,388

Potiguar CE, RN 7,326

Pernambuco-Paraíba PE, PB 6,291

Espírito-Santo ES 4,330

Parnaíba MA, PI 59,764

Sergipe-Alagoas AL 733

Recôncavo BA 475

Tucano Sul BA 6,455

Potiguar RN 588

Espírito-Santo ES 179

Total area: 155,718 km2 or 60,123 sq. miles

289 blocks in 11 states

The 11th Bidding Round Schedule - 2013

Pre-tender (up to March 10th) and tender protocol (after March 11th)

Access to data package: up to March 26th

www.brasilrounds-data.anp.gov.br/ebid

Technical-Economic-Financial qualification: up to March 26th

Technical-environmental Seminar: March 18th Legal & Tax Seminar: March 19th Bid bonds: up to April 26th Submission of bids: May 14th and 15th

Expression of interest from companies: up to March 26th

Signing of contract: August, 2013

Geological Summary Potencial Methods 2D and 3D Seismic

Wells Data Geological Reports Environmental Topics

The 11th Bidding Round Data Package

www.brasilrounds-data.anp.gov.br/ebid

http://www.brasilrounds-data.anp.gov.br/ebid



Exploration & Production Databank

The ANP Data Bank (BDEP) The BDEP website offers the BDEP Web Maps application which provides interactive maps with positioning and information about: 2D and 3D Seismic Data Well Data (Logs & Reports) Gravimetric and Magnetometric Data Geochemical data

Including Data Acquisition Companies - DAC information

www.bdep.gov.br

http://www.bdep.gov.br/

Petroleum companies can be qualified as A, B or C operators, or as non-operators (if part of a consortium*)

C Operator Onshore areas

Minimum Equity: R$ 3.8 million

B Operator Shallow water and

onshore areas Minimum Equity:

R$ 59 million

A Operator Deep, ultra-deep, shallow water and onshore areas

Minimum Equity: R$ 107 million

The 11th Bidding Round Technical-economic-financial

qualification

* Minimum Equity for non-operators: half of the operator minimum equity.

SIGNATURE BONUS

MINIMUM WORK PROGRAM (MWP)

LOCAL CONTENT

Evaluation of the offers: Signature Bonus

Local Content

Minimum Work Program (MWP)

Bid-rounds held by ANP allow the participation of Brazilian and non-Brazilian companies with a branch office in Brazil

40%

20%

40%

The 11th Bidding Round Offer Requirements

How to make an offer?

Bid Model

How to offer Local Content? Example

Sub system: Operational Support

LOGISTICAL SUPPORT (AIR, SEA, BASE)

Sub system: Geology & Geophysics

PURCHASE

Weight Local Content

Offered

Local Content

Minimum

INTERPRETATION& PROCESSING

Sub system: Drilling, Evaluation & Completion

RIG LEASE

DRILLING + COMPLETION

AUXILIARY SYSTEMS


Offered Local Content

Minimum


Offered

Local Content

Minimum

Equatorial Margin Eastern Margin

Mature basin

Onshore new frontier

Shallow water Deep water Deep water

Minimum Signature

Bonus (R$ x 1,000)

588 – 5,503 1,869 – 13,591 128 – 8,075 25 – 246 44 – 1,767

Minimum Work Program

(UT) 92 – 408 225 – 449 225 257 515 – 1,056

The 11th Bidding Round Minimum signature bonus &

Minimum work program

5 to 8 years 27 years

The 11th Bidding Round E&P activities

Summary




Final Comments 6



12th Bidding Round (30 and 31/10/13)

Natural Gas onshore

São Francisco Basin Buritizeiro County

Parnaíba Basin “Gaviões” Park

Opportunities for electric power generation

Acre Basin

Parecis Basin Teles Pires River

Paraná Basin Barra Bonita field

Recôncavo Basin

Pending approval from CNPE

Reserves - 30 TCF in 1,196 km3 of rock Average depth: 1,500 to 2,400 m

“Analogue”– Barnett Shale

Forecasted in situ volumes (if valid analogue)

Parnaíba – 64 TCF

Parecis – 124 TCF

Recôncavo – 20 TCF

São Francisco – 80TCF

Paraná – 226 TCF* (EIA/2011) * not endorsed by ANP

12th Bidding Round (30 and 31/10/13)

Possibilities for unconventional gas

Summary




Final Comments 6



1st Pre-salt Bidding Round (28 and 29/11/13)

Production sharing regime

Signature Bonus, MWP and LC

Defined in Tender Protocol

% OF PROFIT OIL ?% BID PARAMETER

The winner best offer!

Petrobras as operator with at least 30% participation.

• “Libra” – forecasted VOIP ~ 18 billion bbl; • Adjacent areas to findings and/or fields; • Other areas in Santos Basin.


Opportunities under consideration

“Libra” – VOIP ~ 18 billion barrels

Net pay: 326.4 m 27 API oil Test at 5548 a 5560 m: 1. Flow, Ø = 32/64” – 3667 bopd

2. Flow , Ø = 16/64”– 1057 bopd

(to collect fluid)

Libra Prospect– Fast track – Salt base – mapping in time

2-ANP-2A-RJS 2-ANP-2A-RJS


Opportunities under consideration

Summary




Final Comments 6



Final comments

Brazil is resuming bidding-rounds for O&G exploration and production, after the new pre-salt regulatory framework;

The Country is aware of the scale of its opportunities, therefore it tries to use the O&G sector to boost the industrial development, using the Local Content policy;

This means Brazil has not only opportunities for O&G companies, but also opportunities for suppliers, mainly for those that are willing to establish themselves in Brazil; The resuming of Brazilian bidding rounds, opening the Equatorial Margin, the pre-salt and the search for gas onshore in enormous basins can give a good idea of the size of the country’s potential;

In Brazil, exploratory opportunities go far beyond the pre-salt.

National Agency of Petroleum, Natural Gas and Biofuels – ANP

Av. Rio Branco, 65 – Centro – Rio de Janeiro – Brasil 12º to 22º andar

Phone: +55 (21) 2112-8100

www.anp.gov.br

http://www.anp.gov.br/

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