Petrobras: More Transparency Would Be Nice

Petrobras (PBR) has announced that the first oil produced from pre-salt Tupi extended well test was ferried ashore.

From Energy-Pedia wire:

The work of processing the first 264,000 barrels from the Tupi field began Thursday at the Revap refinery in Sao Jose dos Campos, Sao Paulo state, the company said in a statement.

Certainly that sounds like good news, until you consider it apparently took 160 days to produce at an average of 2000 bopd -- far less than the 14,000 bopd that Petrobras announced in May.

From BW website:

BW Offshore's FPSO BW Cidade de São Vicente received first oil in 2200m water depth on the Petrobras-operated Tupi field offshore Brazil 25 April. The FPSO arrived at the field in March 2009

From PennEnergy (PWE):

This first extended well test of the subsalt formations began producing at a rate of 14,000 b/d of oil and should peak around 30,000 b/d, operator Petrobras says.

Then the problems began.

From Rigzone:

Jul. 2009 - BG Group said Wednesday it is making steady progress with operator Petrobras in the development of the large Tupi oil field discovered offshore Brazil. An extended well test on Tupi, which peaked at 14,800 bopd, was temporarily suspended to conduct some routine maintenance.

From BW website:

Aug. 2009 - The FPSO BW Cidade de São Vicente received first oil late April and has since been operating successfully. Due to subsea problems experienced by Petrobras the unit is currently on standby at 95% of full rate due to lack of oil production.

I accept that operating an arguably novel ultradeep well can be complicated and require engineering adjustments. But I have some questions about what Petrobras has learned after five months of fiddling with the iron.

1. Was it necessary to work over or reperf the well?
2. Did asphalt or gas coning gum up the tree?
3. Is 3-RJS-646 producing? At what rate?

The world was led to believe that Tupi is the biggest oil discovery in the Western Hemisphere since Cantarell. Maybe so. That's why it would be nice to have more transparency from Petrobras.

A big resource that can't be produced isn't much of a resource.

Disclosure: no position long or short in PBR or any ETF or oil options.

Comments

[Alan von Al...:]

Note to SA editors: PennEnergy www.pennenergy.com/ind... and better known Oil & Gas Journal are published by privately held PennWell Corp - not PWE

Oct 11 08:11 AM

[Jeep:]

Alan:

Are you hearing rumors on Tupi or is this just based on the inadequate public data? I ask because, as you know, material information on PBR often seems to circulate first as rumors in Rio.

Oct 11 08:47 PM

[OilFinder:]

Back in July Petrobras had an equipment failure at the production test well. Aparrently this was the fault of the manufacturer and production from the well had to be suspended for a couple months while they fixed it:
in.reuters.com/article...
About a month or so ago they resumed the test.

Oct 11 10:16 PM

[OilFinder:]

OK here we go.

www.rigzone.com/news/a...

The test began on April 25. Production was suspended on July 6, and was resumed on September 5. By my count that's only 106 days of production.

264,000 / 106 days = 2,490 barrels/day. Not a big difference I suppose.

However, your article says they're processing the "first" 264,000 barrels. Does that mean *all* of the oil produced cumulatively through last Thursday? Or perhaps it was just the oil produced until the well was suspended? Or maybe some of the oil produced through some arbitrary date in September? That's not clear.

Also, if they had an equipment problem for the first 2+ months I would assume it wasn't producing at top capacity.

Oct 12 12:04 AM

[Alan von Al...:]

Bad bolts on an FMC tree? www.upstreamonline.com...

So, who did the remotely piloted installation? FMC probably. Huge silence from all concerned. And this had absolutely nothing to do with reservoir pressure, flow assurance, or balls of goo?

Meanwhile pre-salt reserves keep growing. Lula's chief of staff Dilma Rousseff surpasses the 80-billion barrel forecast made in November 2008. [Bloomberg]

Oct 12 01:08 AM

[Alan von Al...:]

I'm three continents away and have no right to speculate, however I suspect Petrobras was unhappy with the flow rate, tried to swab the well, and rattled the tree too much. Goo everywhere. That's why all the silence.

Oct 12 07:30 AM

[Jeep:]

You might be right. That oil is supposed to have a high wax content.

Oct 14 03:54 PM