Brazil and up and coming producer Guyana both plan to continue boosting production in the coming years, but it’s not exactly a race, Petrobras CEO Jean Paul Prates said during a separate event in Houston while attending the Offshore Technology Conference (OTC).

Prates said a competition between the two Latin American producers wouldn’t make much sense in response to a question from Hart Energy. Rightfully so, as Brazil and Guyana are currently at two different extremes of the oil production spectrum.

Brazil is Latin America’s largest oil producer, with production averaging 3.36 MMbbl/d in March 2024 from 24 listed floating production, storage and offloading (FPSO) vessels combined with just over 40 other offshore platforms and vessels, according to details from Brazil’s oil regulator ANP.

In comparison, Guyana, which reported initial oil production in late 2019, produced on average approximately 620,000 bbl/d in the first quarter 2024 from three FPSOs, according to details from Texas-based Exxon Mobil Corp., which leads a consortium in Guyana’s offshore Stabroek Block that includes partners Hess Corp. and China National Offshore Oil Corp. (CNOOC).

Between 2000-2023, Brazil’s oil production grew  176%. But between 2013-2023, its growth rate averaged just 5%, according to ANP data. Despite Brazil’s massive offshore production installations, the country has yet to significantly increase its production in recent years.

Compared to Guyana’s offshore production growth since 2019, “we aren't in a race, but we won it,” Prates said.  

Petrobras’ Chief E&P Officer Joelson Mendes said it was important to consider the amount of production that Brazil has to replace each year just to offset declines.

“In the last four years we put around 1 MMbbl/d of new oil [in production]. The problem that we have, a decline of the same amount, is the reason that we have production that is static,” Mendes said. “[But] in the next few years, with the vessels that are coming, we will bring on more oil than declines.”

“Our production is going up as well, but we have to consider where we are coming from and where we are going,” said Carlos Travassos Petrobras’ chief engineering, technology and innovation officer. Travassos said it was important to remember that Guyana’s production base started from zero just years ago.

Looking forward from 2024-2028, Brazil and Guyana will add a combined 17 FPSOs offshore South America.

Petrobras seeks to add 14 FPSOs with a combined production capacity of 2.31 MMbbl/d by 2028. In Guyana, Exxon Mobil and its partners look to bring on three FPSOs by 2027 with a combined production capacity of 750,000 bbl/d. Exxon Mobil expects its six FPSOs in the Stabroek Block will produce around 1.3 MMbbl/d by 2027.

Prates sees opportunities for Brazilian industries in Guyana, Suriname and the whole coast of Africa in the future, adding that there was also potential in Brazil to build a shipyard industry with Chinese and Korean companies.

Vaca Muerta gas for Petrobras and Brazil

Petrobras continues negotiations with its counterparts in Bolivia and Argentina as it looks to lock in necessary gas volumes.

Petrobras has traditionally imported piped gas from land-locked Bolivia, but production there has been declining in recent years due to under investments.

“We don't have anything against working with Bolivia; we are good partners with them. We find it's a nation and a state company [YPFB] that we consider as a sister company in Latin America. But the fact is that they’ve got years of non-development of new reserves,” Prates said.

“So, they didn't replace [their] reserves, [and] reserves and production are falling. It's not because they don't have gas anymore, it's because they don't have ready gas to produce. And this leaves an opportunity for Argentina,” Prates said.

Despite the political uncertainties in Argentina involving the country’s new president Javier Milei, Petrobras said the company had no problem tapping gas from Argentina, specifically the Vaca Muerta shale play.

Argentina has technically recoverable shale gas resources of 802 Tcf, trailing only China, which has an estimated 1,115 Tcf. And Argentina’s Neuquén Basin, home to the Vaca Muerta, boasts technically recoverable shale gas resources of 308 Tcf, according to the U.S.-based Energy Information Administration.

“So, I guess the use of gas will end before Vaca Muerta is really dead,” Prates said.

Prates said Brazil was the “immediate obvious” consumption center for Argentina’s gas and that both countries will continue to analyze working together.

Petrobras exploration offshore Colombia continues

Petrobras, in partnership with its Colombian counterpart Ecopetrol, plans to drill two wells, Uchuva-2 and Buena Suerte, offshore Colombia this year. A drillship is expected to start on Uchuva-2 in May.

In the summer 2022, Petrobras and Ecopetrol found gas at the Uchuva-1 well, which was drilled 32 km off Colombia’s Caribbean coast and some 76 km from the city of Santa Marta in a water depth of approximately 830 m.

Uchuva-1 was drilled in the Tayrona Block where Petrobras is the operator with a 44.44% interest. Ecopetrol holds the remaining 55.56% interest.

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