RIO DE JANEIRO, Sept. 10 (UPI) -- Petroleo Brasileiro SA, Brazil's state-controlled oil company, says its tests show the Guara deepwater offshore field holds between 1.1 billion and 2 billion barrels of oil and initial production may start in 2012 with 50,000 barrels of oil equivalent a day.
Petrobras discovered Guara, part of the BM-S-9 area in the offshore Santos Basin, last year but remained guarded about its estimates till now. At least two other fields in the area, known as Carioca and Iguacu, are also said to contain "significant" quantities of oil.
The Petrobras statement was echoed by British Gas plc, which has headquarters in Reading, England, and holds a 30 percent stake in the field. Spain's Repsol-YPF has the remaining 25 percent.
News of the confirmed oil resource was reflected in stock market gains by all three companies.
Industry sources said the delay in Petrobras' announcement of the full extent of Guara reserves was explained by the complex technologies involved in exploring the pre-salt region where the field is located.
Petrobras has been investing heavily in developing technologies to enable it to reach the pre-salt levels and make the oil commercially viable.
The latest discovery follows a series of smaller discoveries along a 500-mile offshore region and a huge 2007 find at Tupi, the largest discovery in the Americas since Mexico's legendary 1976 find, discovered by a fisherman, Rudesindo Cantarell.
The Cantarell field has since peaked and declined and been superseded by Ku-Maloob-Zaap, offshore in the Bay of Campeche.
Petrobras has announced plans to spend $174.4 billion over the next five years to more than double Brazil's oil production, but it has not taken up numerous offers of joint ventures with foreign operators. This is because Petrobras on its own has been developing deepwater drilling technologies and working out ways of exploiting fields that are hundreds of miles from the shore.
Petrobras said it would use a floating platform -- virtually a vessel -- capable of producing, storing and offloading crude oil to develop Guara.
The company estimates it may be producing 3.66 million barrels a day of oil equivalent by 2013, compared with 2.4 million barrels a day in 2008.
Most of the new oil will be extracted from the pre-salt region, where oil deposits are located beneath a layer of salt up to 10,000 feet below the ocean surface and another 16,500 feet under the seabed.
Petrobras is facing important challenges, the company says on its Web site. "These include analyzing the multiple specifications of this new exploratory frontier, working to develop technological solutions to produce oil and gas in the location, and carrying out the necessary tests to choose the best alternatives, since there are presently no models to be followed."