Media reports indicate that state-run oil and gas companies companies in India plan to pool their resources to bid for the Libra field, located around 180 km off the coast of Rio de Janeiro in the Santos basin, Brazil.
This is said to be the first petroleum rights sale under the new production-sharing rules by Brazil and the sale may take place in November, reports indicate. The auction will be conducted under a new production-sharing contract regime that guarantees the state a greater share in profits from the highly promising pre-salt field.
According to some analysts, the state-run Indian companies must also be part of a consortium of global firms to imbibe new exploration technologies.
Libra, which is the largest oilfield discovered in Brazil and one of the biggest in the world, may hold around 26-42 billion barrels of crude, an estimate of Brazil’s National Petroleum Agency shows. The recoverable reserves are estimated at about 8-12 billion barrels, based on an estimated 30 per cent on-site recovery rate.
The size of the field can be assessed from the fact that Marlim, which is Brazil’s largest field at present, produces just 600,000 barrels per day and is estimated to have a recoverable oil volume of 2 billion barrels.
The winning bidder may have to invest around $250-$500 billion in the asset, reports indicate.