God only knows how much we have off of Florida.
BG, Petrobras Find More Oil in Brazil's Santos Basin (Update3)
By Alexander Kwiatkowski and Eduard Gismatullin
June 13 (Bloomberg) -- BG Group Plc, the U.K.'s third-largest oil and gas company, and Petroleo Brasileiro SA made a second discovery in Brazil's Santos Basin.
The Guara exploration well struck oil in the BM-S-9 concession area, according to the partners, which also include Repsol YPF SA. That's in the same block as the Carioca discovery in September, which Brazil's petroleum regulator said may contain as many as 33 billion barrels of oil.
``This discovery will yet again stimulate debate as to whether Carioca, along with Guara, are one and the same massive structure,'' David Thomas, a London-based analyst at Citigroup Global Markets Inc., said in an e-mailed report. The prospect ``will not be properly tested until a well is drilled in the neighbouring BM-S-22 concession'' later this year.
BG rose as 16 pence, or 1.3 percent, to 1,259 pence in London trading. Repsol increased 31 cents, or 1.2 percent, to 27.11 euros in Spain.
Petrobras, Brazil's state-controlled oil company, plans to invest about $33.5 billion in projects this year to ramp up production and explore the offshore fields. That would be the world's largest investment program in the oil and gas industry, followed by OAO Gazprom which has earmarked $30 billion and Royal Dutch Shell Plc with $27 billion.
Guara and Carioca are ultra-deep wells beneath a salt layer under the seabed known as pre-salt fields. These fields lie below as much as 10,000 meters (33,000 feet) of ocean and seabed, forming a new province of Brazilian oil reserves beneath shallower existing fields.
Tupi Field
BG and Rio de Janeiro-based Petrobras are also exploring the Tupi field in the Santos Basin. Tupi, the biggest discovery in the Americas since 1976, and the nearby fields may cost $240 billion to exploit, according to estimates from Peter Wells, director of U.K. research firm Neftex Petroleum Consultants Ltd. and a former Royal Dutch Shell Plc exploration manager.
``This new discovery extends the very significant potential of this world class-hydrocarbon province,'' said BG Chief Executive Officer Frank Chapman in the statement. ``We will now continue to advance our evaluation and development program, targeting initial production from the pre-salt Santos Basin during 2009.''
The Guara discovery is BG's fifth consecutive drilling success in the deep-water Santos Basin since the company began drilling there in 2005. BG has interests in seven concessions in the Santos Basin, the company said today.
BG has a 30 percent stake in the concession area. Petrobras is the operator with 45 percent and Spain's Repsol has a 25 percent interest.
On April 14, Haroldo Lima, head of Brazil's petroleum regulator, said that Carioca may contain as much as 33 billion barrels of oil, making it one of the world's largest discoveries. Petrobras declined to confirm Lima's estimate, which he attributed to a magazine article, and said the company lacked sufficient information to make a projection.
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