Petrobras confirms major oil find off Brazil coast

Brazil's state-owned energy giant Petrobras says it has confirmed the presence of significant quantities of light oil in deep waters off the country's southeastern coast. The company said in a statement released late Monday that the high-grade oil was in the Carcara well, located 230 kilometers (140 miles) off the coast of the Sao Paulo state, in the BM-S-8 block. The find had been announced March 20 and drilling has been underway since then to determine "the total thickness of the oil reservoirs as well as the presence of deeper zones of interest." It is within the so-called "pre-salt" reserves, buried beneath several kilometers of ocean, bedrock and hot salt beds. "New oil samples were collected at depth of up to 6,131 meters (19,000 feet)," Petrobras said, adding that the samples measured at a relatively light density of 31º API. The statement noted that the drilling has already confirmed "an oil column of over 400 meters, showing reservoirs that are mostly continuous and connected." Oil expert Adriano Pires, head of the Brazilian Infrastructure Center, said the announcement was "good news" but cautioned that Carcara's proven reserves were not yet known. "The drilling has not been completed. The column is big but nobody knows the proven reserves, the results from all of the drilled wells. There is no word on its commercialization. It's all speculation," he added. Pires recalled that earlier this month Petrobras blamed its second-quarter net losses of $663 million on the closure or abandonment of 41 drilled wells deemed not economically viable between 2009 and 2012. The National Petroleum Agency estimates that the huge pre-salt reserves, discovered in 2006, could hold more than 100 billion barrels of high-quality recoverable crude and could turn Brazil into one of the world's top exporters. Less than 10 percent of oil production currently originates in the pre-salt layer. With planned investments of $235.5 billion through 2016 for pre-salt exploration, Petrobras hopes to double its production -- currently two million barrels a day -- by 2020. The Carcara well is operated by Petrobras (66 percent) in partnership with Petrogal Brasil (14 percent), Barra Energia do Brasil Petroleo and Gas Ltda. (10 percent) and Queiroz Galvão Exploração and Producao S.A. (10 percent).