RIO DE JANEIRO: The discovery of a massive new oil field off Brazil triggered speculation yesterday the country will become a major world energy supplier of the 21st century - and also official fury the find was revealed so soon.
The head of the country’s National Oil Agency, Haroldo Lima announced on Monday the field, in a site offshore from Rio de Janeiro known as Carioca, could contain 33bn barrels of oil.
That is more oil than all the current proven reserves in Brazil (11.8bn barrels) and the US (21.8bn) combined, making it possibly “the biggest discovery in the last 30 years,” Lima told a Rio conference.
But reaction inside Brazil to the information - which Lima cautioned was “unofficial” and unconfirmed – was chillier than the ocean depths that would have to be plumbed to get at the oil.
An irritated President Luiz Inacio Lula da Silva called the disclosure “improper” and hasty, according to the Folha de S Paulo newspaper.
Lula knew of the “high probability” the find was significant but was waiting for confirmation from Petrobras, the state-run oil company, before saying anything, it reported.
The oil company itself issued a statement smacking down Lima’s assertion.
“More conclusive data on the potential of the discovery will only be known after the completion of further phases in the evaluation process,” it said in a statement to financial markets.
Geological surveying was continuing, company representatives tersely told a Rio media conference on Tuesday.
“Petrobras will not declare anything as long as we don’t have a concrete result,” Petrobras’s international director, Jorge Zelada, said, declining to comment further.
Brazil’s stock market regulator, CVM, criticised Lima for issuing such a bombshell, considering it “prejudicial” to trading standards, and said it would look into the matter.
Investors though now see Brazil as possibly becoming one of the top 10 oil suppliers in the world, rivalling Opec nations such as Nigeria.
Shares in Petrobras and its partners in the Carioca field, Britain’s BG Group and Spain’s Repsol-YPF, soared on Lima’s announcement.
The enthusiasm was spurred by the recent—and confirmed—oil discovery in the Tupi offshore field next to Carioca, in the Santos Basin.
Tupi, estimated to contain up to 8bn barrels of oil, generated market euphoria by itself when it was announced in November.
But Carioca, according to Lima, could be five times bigger, making it possibly “the third biggest field in the world.”
With the price of oil storming over 113 dollars a barrel, the news was welcome in many countries.
It also challenged so-called “peak oil” theory, which holds that world oil production is on a bell-shaped curve, and that after a certain date it will decline as the fossil resource is depleted.
Experts, however, pointed out that even if Carioca does contain 33bn barrels, it was far from certain that all of it could be pumped out.
Because of the problems in reaching deposits at that depth, through water, sand, rock and unstable salt layers, typically only around a third of that amount may be recoverable.
And even then, the platforms and technology required means it would be up to a decade before the oil could be brought to the surface. - AFP