Petrobras, which regularly announces its average monthly hydrocarbons output, set an oil production record in June 2008 with 2.2 MMboe/d. The same month, the company set a production record for gas — 2.5 Bcf, which amounts to 12.1% over June of the previous year and 8.9% more than in May 2008.

Over all, Brazil’s production numbers are trending upward, and Petrobras is taking measures to ensure that production continues to go up.

Brazil became a net exporter of crude in 2006, and although the country still imports light crude, one of Petrobras’ objectives is to reverse that situation.

In the company’s 2008-2012 business plan, Petrobras published its goal of becoming one of the five largest integrated energy companies in the world. Part of the means to this end, not surprisingly, is to increase oil and gas production and to ensure reserves sustainability.

The company plans to invest US $65.1 billion in E&P through 2012, with $11.6 billion going to exploration and $53.5 billion going to production.

The business plan says that of the 34% increase in total capital spending over the previous plan period, $13.3 billion is due to the inclusion of new projects that include enhanced recovery efforts and exploration.

Some of the objectives stated in the plan include increasing oil production to maintain self sufficiency, guaranteeing access to natural gas reserves to ensure domestic supply, strengthening the company’s position in deepwater and ultra-deepwater exploration, developing exploration efforts in frontiers, and guaranteeing a high replacement of reserves, maintaining the annual Reserve Replacement Index above 100%.

The lofty objectives of the 2008-2012 plan are grounded in reality, based in part on several domestic finds that in time will increase Brazil’s production numbers considerably.
In fact, Brazil’s production potential is so significant that there are analysts who believe Brazil could be the world leader in hydrocarbons production by 2050.

Discovery of the giant Tupi field, which lies in Block BM-S-11 in the Santos Basin 155 miles (250 km) southeast of Rio de Janeiro in 6,975 ft (2,126 m) water depth, made headlines in Oct. 2006. Initial huge reserves estimates met with skepticism, but as it turned out, the seemingly exaggerated numbers were not far off the mark. Official estimates place Tupi’s recoverable reserves at 4 billion to 8 billion bbl, which means Tupi is about twice the size of the Roncador field, which was previously Brazil’s largest.

Petrobras has laid the groundwork to begin a long-term production test at Tupi in March 2009 as part of the field development plan. The production test reportedly will last two to three months, during which 30,000 b/d will be produced from three wells. The company expects Tupi to produce an initial 100,000 b/d when full field production begins in early 2011 and believes the field could eventually reach an output peak of up to 1 million b/d.

Though the news about Tupi is big, bigger news, perhaps, is the fact that this field is only part of the offshore picture.

The Tupi discovery was impressive, but Carioca in Block BM-S-9 discovered in Sept. 2007 and Sugar Loaf, discovered in Dec. 2007, hold estimated reserves that are five times as large as Tupi’s. Agência Nacional do Petróleo (ANP), Brazil’s national oil sector regulatory agency, places estimates at 33 billion boe. Petrobras officials, however, say Sugar Loaf could produce up to 40 billion bbl of oil. Either number is impressive. And the big plus is that the reserves are sweet crude. When these huge volumes come online, Brazil could be very close to achieving its goal of eliminating crude imports.

Surprisingly, the discovery list that includes the Tupi and Sugar Loaf fields grew to include another giant in January of this year, when Petrobras discovered Jupiter.

The ultra-deep Jupiter field, which lies in Block BM-S-24, holds an estimated 5 billion to 8 billion boe. The block lies 23 miles (37 km) east of Tupi 180 miles (290 km) offshore in 7,175 ft (2,187 m) water depth. Petrobras reported that the hydrocarbon-bearing interval measured more than 393 ft (120 m).

These discoveries indicate that the potential of Brazil’s offshore far exceeds earlier assumptions. The size of these fields and the likelihood that others of comparable size exist nearby will undoubtedly encourage increased exploration on the part of Petrobras and have already sparked the interest of a number of international operating companies.