Petrobras Drives Record Growth in Brazil's Offshore Oil Production
Brazil's energy agency reports that monthly oil output hit a new record in June, driven by outstanding performance in Brazil's offshore oil patch. Almost all of that output comes from state oil and gas company Petrobras, which has been speeding up commissioning of its newest FPSOs and taking steps to get the most out of its existing fleet, capitalizing on high oil prices from the Hormuz crisis and boosting its sales.
In June, Brazil's oil output set a new record at 4.5 million bpd - about 700,000 bpd higher year-on-year. This gain in itself is enough to offset roughly one-tenth of the overall supply deficit from the Strait of Hormuz crisis, and has played a material role in keeping benchmark prices contained.
About 80 percent of that output comes from Petrobras, and virtually all of Petrobras' oil production is offshore. Its success comes in part from a steady pipeline of new FPSO commissionings, which are helping expand production at its giant Buzios field as older wells mature. The eighth platform at Buzios, P-79, started up ahead of schedule in May and has been ramping up, increasing the field's maximum production capacity. Buzios has repeatedly beaten past performance records over the past few months, hutting 1.2 million bpd in late June. More is coming: FPSOs P-80, P-82, and P-83 are under construction for installation at Buzios, and Petrobras is taking bids for a 12th FPSO for the field.
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The company is looking at ways to push the new P-79 platform past its rated output of 180,000 bpd - as it has already done at seven existing FPSOs around the region. The company's engineering director told Bloomberg that it has added about 130,000 bpd of production by exceeding nameplate capacity on seven FPSO installations, with careful management. It picked up the idea from a third-party FPSO operator, which has one platform in Guyana running 10 percent over design capacity, the official told Bloomberg.
Like its upstream division, Petrobras' downstream operation is running its refineries above 100 percent of capacity, setting records and reaping the massive profit margins available for producers of gasoline and diesel in an undersupplied market.
