Tupi find has Brazil considering OPEC
Brazil is to consider joining OPEC after it has gauged the impact on its oil exports from its newly discovered giant offshore Tupi oil field, the country’s ambassador to Saudi Arabia said Nov. 16.
Isnard Penha Brasil told Dow Jones Newswires on the sidelines of an Organization of Petroleum Exporting Countries summit that he was here to talk with OPEC officials and that “a membership decision will come after we know what our export capacity will be and we think this will be good.”
Earlier in November Brazil confirmed a monster offshore oil discovery and promising fields near the find which could help the country join the ranks of the world’s major oil exporters, although full-scale extraction is unlikely until 2013 and will be very expensive.
State-run Petroleo Brasileiro SA (PBR), or Petrobras, said reserves at the ultra-deep Tupi field could be up to a massive 8 billion barrels of oil equivalent, and initial production should exceed 100,000 barrels daily, though experts believe the amount will then go much higher.
Pilot production in 2010 Petroleo Brasileiro SA will start pilot pumping in 2010 or 2011 but it will take several more years for full production to get under way, at a cost of billions of dollars.
The ambassador said Brazil will have a clearer idea about Tupi’s export viability within six to 12 months.
Business Monitor International forecast Brazil’s daily crude output will rise from 1.8 million barrels to 2.75 million barrels by 2011 and that Tupi could mean continued high-level growth well into the next decade, taking exports to a potential 1 million barrels a day by around 2015.
Brazil doesn’t export any crude oil today, making it essential that Tupi yield huge commercial amounts of crude if South America’s biggest economy is to join OPEC.
Brazil imports light oil for refining into gasoline products. A lot of the oil Brazil produces is a heavier, high-sulfur crude more suitable as lubricant rather than transport fuel.
Petrobras is Tupi’s leading field operator with a 65 percent stake, and British energy company BG Group PLC holds another 25 percent of the field. The remaining 10 percent stake is controlled by Portugal’s Galp Energia SGPS SA.
—The Associated Press
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