Shell Expands Brazil Project After Blocking Sinochem Bid
The partners, together with Brazil’s Petroleo Brasileiro SA, started output at the Argonauta O-North field, The Hague-based Shell said today in a statement. It expects peak production of as much as 35,000 barrels of oil equivalent a day.
Shell and ONGC are expanding off Brazil after last month pre-empting a $1.54 billion bid by Sinochem Group for a stake held by Petrobras in their Parque das Conchas venture, which includes Argonauta. The Latin American country has attracted investment to its oil industry since Petrobras discovered the Tupi field in 2007, the Americas’ biggest find in 30 years.
The Parque das Conchas, in the Campos Basin, is a phased project where production from the Abalone, Ostra and Argonauta B-West deposits began in 2009. Extraction from those fields peaked at 90,000 barrels a day in 2010 before falling to 35,000 barrels a day, Shell said.
The first-phase output “declined naturally as expected,” Julia Dudley, a London-based Shell spokeswoman, said by phone. Output from the second and third phases -- the latter still under construction -- will boost production, she said.
Shell, Europe’s largest oil producer, holds 50 percent of Parque das Conchas, also known as BC-10. ONGC has 15 percent and Petrobras 35 percent. Shell operates the heavy-oil block, about 110 kilometers (70 miles) off southeast Brazil. The third phase will add volumes from the Massa and Argonauta O-South reservoirs, which will pump as much as 28,000 barrels a day.
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