Brazil’s Petrobras is planning to start drilling in the Foz de Amazonas Basin by the end of the month, Reuters has reported, citing unnamed sources close to the company.
The company was currently waiting for coral-clearing at the future drilling site to end and move on to the actual drilling. The news comes on the heels of a report that Petrobras was nearing a conditional approval for its drilling campaign in the frontier region by Brazil’s environmental watchdog Ibama for its oil spill response plan.
The regulator recently approved the theoretical and methodological components of Petrobras’ response plan allowing the company to move to the final phase: an on-site emergency response simulation known as the Pre-Operational Assessment. This large-scale exercise will simulate an oil spill to test Petrobras’ readiness before Ibama clears it for drilling in the Foz de Amazonas Basin.
Ibama rejected Petrobras’ plan for drilling in the area two years ago following environmentalist protests sparked by the news that the company had interests there. The basin is located close to the mouth of the Amazon River in a sensitive ecosystem, so the protests were hardly a surprise.
Yet the government has its own priorities and besides its energy transition plans wants more oil and gas supply as well. The Foz de Amazonas Basin is part of the Equatorial Margin offshore Brazil, which includes three basins: Foz do Amazonas, Pará-Maranhão, and Barreirinhas. The area is estimated to hold large oil and gas reserves and is expected to share geology similar to that of Guyana’s offshore, where Exxon is finding billions of barrels of oil and has developed and is developing half a dozen projects.
Earlier this year, the country’s oil industry regulator announced a tender for more blocks in the Foz de Amazonas Basin, to be held next month. If Petrobras get the final go-ahead from Ibama to start drilling in the area, this will motivate more sector players to bid for blocks at the tender.
By Irina Slav for Oilprice.com
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