Equatorial margin is half of investment in oil – 07/20/2023 – Environment

Focus of clash between the environmental and energy areas of the federal government, the basins of the equatorial margin concentrate more than half of the investment and a third of the wells for oil exploration in the sea foreseen until 2027 in the country, according to the ANP (National Agency of Petroleum, Gas and Biofuels).

The agency argues that, given the “enormous potential” of the region, the government needs to unlock environmental licenses, which are already hampering the search for oil not only on the coast of Amapá, where the well that Petrobras is trying to release is located, but also in Maranhão.

“The pre-salt will reach its peak before 2030 and there will be a significant decline in Brazilian production if there are no new discoveries”, said the director general of the ANP, Rodolfo Saboia, in a seminar held on Wednesday (19).

Considered the main bet for renewing Brazilian oil reserves, the equatorial margin comprises five oil basins that go from Rio Grande do Norte to the border of Brazil with French Guiana. There are 41 of the 295 exploratory blocks currently under contract in the country.

Nine of them are in the Foz do Amazonas basin, including block 59, whose drilling project was denied a license by Ibama (Brazilian Institute for the Environment and Renewable Natural Resources) in May. Another 18 are in the Barreirinhas basin, on the coast of Maranhão.

Of these, says the ANP, 14 have contracts suspended at the request of concessionaires for issues associated with environmental licensing. In seven, signs of oil have already been found and are in the discovery evaluation phase, which requires the drilling of new wells.

“This signals the need to overcome these obstacles associated with environmental issues, so that we can advance in the exploration of the margin”, said Edson Montez, from the ANP Exploration superintendence.

The agency says that there are 11 drilling projects on the equatorial margin, eight of them in Foz do Amazonas and three in the Potiguar basin, including a Petrobras discovery named Pitu, which is also the subject of a license request for a new well.

Altogether, projects the ANP, these projects could generate investments of R$ 11 billion. It is more than half of the R$ 20.5 billion planned for drilling oil wells across the country in the period.

Ibama should not hinder the release of wells in the Potiguar basin, which already has oil activity. But it tends to reinforce the understanding of the MMA (Ministry of Mines and Energy) about the need for an AAAS (environmental assessment of the sedimentary area) before releasing the wells in Foz do Amazonas.

Petrobras asked Ibama for reconsideration and argues that the decision of the STF (Federal Supreme Court) in early July eliminates the need for the assessment. The state-owned company argues that the concession of block 59 was supported by a joint statement by the MMA and the MME (Ministry of Mines and Energy).

“Our understanding is very simple: this [a AAAS] it cannot be an impediment,” said the company’s Exploration and Production director, Joelson Falcão, at breakfast with journalists on Wednesday.

The position is supported by the MME and the company forces the government to call the AGU (General Advocacy of the Union) to mediate the conflict, arguing that the decision to explore oil in that area is “a matter of State”.

“It is important to be clear that, technically, the equatorial margin is the last great Brazilian exploratory frontier. It is something that can change the game”, defended Falcão. The ANP estimates that the region could contain 16 billion barrels of oil, a volume greater than the 14.4 billion that the country currently has.

“The license may take a while, but it will come,” said this Wednesday the president of Petrobras, Jean Paul Prates. The company set aside US$ 3 billion in its budget with the expectation of drilling 16 wells in this region over the next five years.

For block 59, the structure had already been mobilized in 2022 for a drilling test, which was demobilized in May after the license was denied. Falcão says that the state-owned company already has the structure contracted to drill in Pitu and is only awaiting approval from Ibama.