Petrobras (PBR) Postpones Parque das Baleias Project by a Year

Zacks Equity Research
·3-min read

Petroleo Brasileiro S.A. orPetrobras PBR recently rescheduled its pre-salt production plans amid the coronavirus-induced unstable market scenario. Initiation of the producer’s offshore Parque das Baleias project in the Campos Basin will be delayed by a year and now the first oil extraction from the project is expected in 2024. As a result, the company cancelled the platform charter bidding and authorized the start of a new bid process. However, relocation of wells between platforms will likely be carried out as planned in 2022.

This Brazilian state-owned oil company had initially considered this project to be part of its long-term strategy for the pre-salt. Three floating production, storage and offloading (FPSO) vessels were scheduled to come online in the region during 2023 including in the Marlim and Mero fields. Further expansion in production capacity was forecast by not less than 250,000 barrels per day.However, this year’s economic downturn forced Petrobras to cut down on all non-essential outlays. With a decent amount of output already booked and paid for, Petrobras can afford to push back some of its long-term projects until the oil price recovers.

Parque das Baleias also called the Whale Park includes seven deep-water oil and gas fields within its bounds in the northern Campos Basin, off the coast of Espírito Santo, Brazil. The present aggregate production from the Parque das Baleias cluster is approximately 222,000 barrels of oil and six million cubic metres of gas daily.

Earlier in August, Petrobrasalong with its partners in the Libra Consortium took a decision to launch the third phase of the Mero project (Libra block), located deep offshore at 111.8 miles (180 kilometers) off the coast of Rio de Janeiro.

The Libra Consortium is operated by Petrobras holding 40% interest. Other partners include TOTAL TOT and Royal Dutch Shell RDS.A with 20% stake each, and CNOOC Limited CEO and CNPC, which own a respective 10% share.

Company Profile

Petrobras is the largest integrated energy firm in Brazil and one of the biggest in Latin America. The company’s activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks. The operations also include refining, processing, trading and transportation of oil and oil products plus natural gas and other fluid hydrocarbons besides other energy-related operations.

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