Petrobras finds more oil in Brazil's BM-S-9 block

Petroleo Brasileiro, Petrobras, found another deposit of oil and natural gas in Brazil's Santos Basin as Chief Executive Officer Jose Sergio Gabrielli sought to reassure international investors about the company's prospects.
The discovery was made together with BG Group and Repsol-YPF after a fourth well was drilled in the BM-S-9 block off the country's south-eastern coast, Petrobras, Brazil's state-run oil company, said.

The Abare Oeste field is neighbour to the Carioca, Guara and Iguacu fields, where the company has already reported the existence of crude.
"The discovery was proved via oil, natural gas and carbon gas content sampling via a cable test carried out in reservoirs located at depth of some 5,150 meters," Petrobras said.

Petrobras found the oil as Gabrielli met investors in New York to defend government plans to increase control over the energy industry as part of regulations under discussion in Congress. The rules would allow the state to boost its stake in the company and make Petrobras sole operator of so-called pre-salt fields. The deposits, below as much as 3,000 meters (9,840 feet) of water and 7,000 meters of seabed, may hold as much as 80 bn barrels of oil and gas equivalent, regulators say.
"We are in a fantastic moment," Gabrielli, 59, said in New York. Brazil has the world's biggest potential reserves and the ability "to develop the whole supply chain to provide goods and services to the oil industry," he said.

The Rio de Janeiro-based company may have an initial estimate by early next year on the value of 5 bn barrels of reserves that the government plans to give Petrobras exclusive rights to develop in exchange for shares, Gabrielli said. He responded to shareholders' demands that the government be excluded from deciding on the planned capital increase, saying Brazilian law requires all shareholders to approve the proposal.
The company will raise at least $ 25 bn through the share offering, according to Itau Unibanco Holdings, Brazil's largest non-state bank.

Petrobras is working with Brazil's oil agency to define where the 5 bn barrels of reserves will be located, Gabrielli said. The initial evaluation will be available to minority shareholders 30 to 45 days before the planned equity offering, he said. The government, which holds 32 % of total equity and 56 % of voting shares, may increase its stake because not all minority holders will take part in the offering, Gabrielli said.
Petrobras plans to invest $ 174.4 bn in the next five years to boost crude output by 53 %.

The company, the world's ninth largest by market value, is spending billions to tap offshore oil deposits including the Tupi field, the largest discovery in the Americas since Mexico's Cantarell in 1976.
"We have a very big decision-making process," Gabrielli said. "We are talking about projects that are worth billions of dollars."

Petrobras said on September 8th that the Guara field may hold as much as 2 bn barrels of oil and is estimated to yield a daily output of 50,000 barrels when it begins to operate in 2012. The company also said in April that Iguacu contained "significant" resources, while declining to estimate its size.
Petrobras is the operator of the BM-S-9 block, with a 45 % stake with the BG Group holding 30 % and Repsol 25 %. Petrobras wants to increase output to about 3.66 mm bpd by 2013, compared with 2.4 mm bpd in 2008, the company has said.