Statoil builds up Brazil gas team

Gas commercialisation: Statoil Brazil president Paal Eitrheim

Norwegian operator Statoil is setting up a dedicated team in Brazil to work on gas commercialisation opportunities as it builds up a portfolio that is becoming increasingly gas-weighted.

Statoil Brazil president Paal Eitrheim said it is too early to tell how many people will join the new group, which will include both local and international members, as the company is only now in the process of setting it up.

The new group will look at “broader commercialisation issues in Brazil” but “obviously it is linked to the gas reserves we now have”, he told Upstream.

Statoil has long had a significant position in Brazil, where it has invested $10 billion in recent years. Most notably, the company has prioritised the Peregrino oilfield, where it is currently producing 68,000 barrels per day of oil and is working on a second phase development that will produce first oil in 2020.

However, expansion by the Norwegian giant this year has brought it a gassier portfolio, notably through the $2.5 billion acquisition of a 66% operating stake in Block BM-S-8 in the Santos basin, where the promising Carcara light-oil and gas discovery is located.

That deal was followed by the recent completion of a deal that saw Statoil take over operatorship of the Pao de Acucar pre-salt gas-condensate discovery in Block BM-C-33.

Speaking to a plenary session at the Rio Oil & Gas conference late Monday, Eitrheim pointed out that Brazil is a nation of 210 million people that has a gas market roughly the size of that in France, whose population is less than a third of its size.

“In general, I think that Brazil is a very interesting market for any upstream player with gas,” he said. “I see a lot of upside” for the sector.

Asked about the challenges involved in the local gas sector, he pointed out that “everything is a challenge in oil and gas”, adding that “this is no different than any other challenge that we deal with on a regular basis”.

“Gas is a business opportunity on par with oil, so for us, as an oil and gas company, gas is a tremendously valuable resource and we want to make sure we can do the most with it,” he said.

However, Eitrheim stopped short of agreeing that its positive stance on gas made Statoil more of a likely candidate to take on the Carcara asset than any other player. “Carcara is a very attractive asset… the total resource base in Carcara is very attractive for us,” he said.

Statoil’s planned acquisition of its stake in Carcara is currently awaiting approval by ANP, the Brazilian oil and gas regulator, before it can be completed.

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