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Exxon, Equinor complete partnership offshore Brazil

Exxon becomes a partner with Equinor at a field off the coast of Brazil said to hold around 2 billion barrels of reserves.

By Daniel J. Graeber
Copacabana Beach and the surrounding area is seen from the Christ the Redeemer Statue, Rio De Janeiro, Brazil. Exxon and Norwegian major Equinor close a deal to establish a partnership at an oil basin off the nation's coast. File Photo by Kevin Dietsch/UPI | <a href="/News_Photos/lp/3a4e36831355047ed9863ec3bca10212/" target="_blank">License Photo</a>
Copacabana Beach and the surrounding area is seen from the Christ the Redeemer Statue, Rio De Janeiro, Brazil. Exxon and Norwegian major Equinor close a deal to establish a partnership at an oil basin off the nation's coast. File Photo by Kevin Dietsch/UPI | License Photo

June 6 (UPI) -- Development of oil basins off the coast of Brazil remains a core focus, Norwegian energy company Equinor said after selling off interests to Exxon Mobil.

Equinor, formerly known as Statoil, completed a transaction with Exxon that puts the latter in an equity partnership at the BM-S-8 block off the coast of Brazil with a 36.5 percent stake. The block is within the Carcara oil field, which has an estimated 2 billion barrels of reserves.

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"Carcará is a world-class asset and has strengthened our position in Brazil, one of Equinor's core areas due to its large resource base and excellent fit with our technology and capabilities," Anders Opedal, the country manager for Equinor, said in a statement.

Brazil ranks second behind Venezuela in terms of proven oil reserves in South America. Its Libra field alone holds between 8 billion and 12 billion barrels of recoverable reserves.

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By the middle of last year, the country had already produced an average of 3.3 million barrels per day in oil and other petroleum liquids. That was up from the full-year 2016 average of 3.2 million barrels per day.

Much of the oil from the offshore basins is buried underneath a thick layer of salt on the ocean floor and producers have been able to crack into that in recent years. Output from pre-salt basins has accelerated since 2009 as exploration and production technology acclimates to the region's tough conditions.

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Brad Corson, the president of exploration and production ventures at Exxon, said both sides would work toward delivering first oil from the field within the next five years.

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The Brazilian Central Bank said in May the Brazilian economy was softening, which it said was expected during a period of gradual recovery. There may be frustrations with the pace of inflation, however, and broader risks in the global economy.

Michel Temer tabled a proposal to cut prices for 60 days and suspend some highway tolls in an effort to appease the striking workers. Lorry drivers had been protesting higher fuel prices for much of the month.

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