The huge subsalt oil and gas fields announced last week to have been discovered offshore Brazil will need oil at prices of $55 per barrel in order to break even, says the CEO of the country’s oil-asset management firm Pre-Sal Petroleo (PPSA).
That’s $10 per barrel higher in price than the break-even estimate given previously by state-run oil producer Petrobras, which is the lead partner in the multinational consortium behind the Libra field discovery, which it announced last Wednesday (October 14).
Oswaldo Pedrosa CEO of PPSA (which will manage the government’s share of output from Libra) said it would need that kind of increase in the oil price for the field to be viable.
Petrobras spokesmen stuck by their estimate. They are in partnership in the Libra project with Shell, Total, China National Petroleum Corporation (CNPC) and China National Offshore Oil Corporation (CNOOC) as well as PPSA.
The subsalt is an offshore region where oil and gas are trapped deep below the seabed by a layer of mineral salts, making production costs high.
Libra, located in the Santos Basin about 230 kilometres off of Rio de Janeiro, is believed to contain between 8 billion and 12 billion barrels of oil.