Brazil’s Amazon may hold “super giant” fields of light oil in an area the country is starting to explore, HRT Participacoes em Petroleo SA Chief Executive Officer Marcio Mello said. The shares gained.
The Rio de Janeiro-based oil-exploration company will start producing from its wells in the Amazon’s Solimoes river basin as early as June, Mello said today in a Bloomberg Television interview in New York. HRT will begin drilling in February and expects to reach an oil reservoir in May, he said.
HRT raised about $1.5 billion in an initial share sale in October to help fund exploration in the Amazon and off the coast of Namibia. It has majority stakes in 21 exploration blocks in the Solimoes Basin and five offshore blocks in the African nation. HRT will drill 12 wells at the Amazon this year.
“The oil at Solimoes is the best in the whole of South America,” Mello said. “The Amazon is a completely unexplored frontier.”
HRT rose 40 reais, or 2.3 percent to 1,750 reais as of 4:09 p.m. in Sao Paulo trading. Earlier the shares gained as much as 5.3 percent.
HRT plans to transport production from Solimoes by river to state-controlled Petroleo Brasileiro’s refinery in Manaus. HRT has secured the environmental licenses it needs to explore and produce oil in the Amazon for the next two years, Mello said.
Oil and natural gas production at the Solimoes Basin was at 102,000 barrels a day in November, making it Brazil’s third largest behind the Campos and Espirito Santo basins, according to the country’s oil regulator. Petrobras is the biggest producer in the area and has a natural gas pipeline that connects Solimoes with Manaus. The Rio Urucu field in Solimoes is Brazil’s third-largest natural gas field.
“The Amazon is one of the last frontiers in the whole world where you can find giant and super giant oil and gas fields,” Mello said. “It has a third of all the gas in Brazil.”
HRT will drill three wells in Namibia in 2012, earlier than the company’s original exploration program, Mello said. The company will complete seismic research at 6,500 square kilometers off the coast of Namibia by August to pinpoint exploration targets, Mello said.
Namibia has similar geology to Brazil’s Santos Basin where Petrobras has made the two largest discoveries in the America’s in over three decades, Mello said. The company has two blocks in Namibia’s Walvis Basin and 40 percent stakes in three blocks in the Orange Basin.
Brazilian oil deposits below a layer of salt in the Atlantic Ocean hold at least 123 billion barrels of reserves, more than double government estimates, according to a university study by a former Petroleo Brasileiro SA geologist.
The research, which set out to show government figures were too optimistic, found they underestimated the area’s potential, said Hernani Chaves, a professor at the Rio de Janeiro State University who worked at Petrobras for 35 years. The forecast, which the study puts at a 90 percent probability, compares with the Brazilian oil regulator’s 50 billion-barrel estimate.