Shell and Petrobras are evaluating the technical and commercial solutions for the third phase of development of their deepwater BC-10 (Massa) project in the Campos Basin offshore Brazil, with the go-ahead expected by the end of this year or early 2014.

The companies are partners in the Parque das Conchas heavy oil field (BC-10), which lies in a water depth of around 1,780 m (5,840 ft). Shell has a 50% interest in the project and is the operator, with Petrobras holding 35% and India’s ONGC 15%.

Andre Araujo, head of Shell’s Brazilian unit, told DI that more than US $2 Bn has been invested in BC-10’s second phase alone, which will produce the Argonauta O North field via the FPSO Espirito Santo, which has been receiving production from the phase 1 fields since 2009. Production of 35,000 boe/d from Phase 2 is scheduled to begin later this year, he added. “We are on schedule” he said, adding: “We are evaluating phase 3 technically and economically, and should make a decision later in 2013 or maybe in 2014”. BC-10 Phase 3 is forecast to produce around 30,000 boe/d.

BC-10 is of course reported to be amongst those blocks Petrobras has put up for potential sale in Brazil, alongside Xerelete and Maromba.

Shell’s CEO Peter Voser said in a briefing that Shell studies all such opportunities: “I understand Petrobras is reducing its portfolio. As usual, Shell will look at it and decide whether to go for it or not, depending on the attractiveness.”
Araujo added: “I can say we are very happy. It is a project we know, that we believe in and we are satisfied with our partners.”

- A total of 64 companies recently qualified for Brazil’s long-awaited 11th licensing round, including Shell, with the bidding for both onshore and offshore blocks scheduled to take place on 14-15 May. Brazil’s first pre-salt round will also take place in November. Mr Voser also commented that he did not consider it a disadvantage that there is a legal obligation for Petrobras to operate all the pre-salt concessions with a minimum 30% stake. The executive said Shell has “very successful partnerships with Petrobras” in Brazil and internationally.