Drilling Deeper Petrobras

The majorPetrobras Deepwaters Projects

The majorPetrobras Deepwaters Projects

Marcos AssayagEquipment &Logistics Project Manager

Petrobras E&P London OfficeAberdeen – Scotland - March 15th, 2012

Marcos AssayagEquipment &Logistics Project Manager

Petrobras E&P London OfficeAberdeen – Scotland - March 15th, 2012

The presentation may contain forecasts about future events. Such forecasts merely reflect the expectations of the Company's management. Such terms as "anticipate", "believe", "expect", "forecast", "intend", "plan", "project", "seek", "should", along with similar or analogous expressions, are used to identify such forecasts. These predictions evidently involve risks and uncertainties, whether foreseen or not by the Company. Therefore, the future results of operations may differ from current expectations, and readers must not base their expectations exclusively on the information presented herein. The Company is not obliged to update the presentation/such forecasts in light of new information or future developments.All projects forecasted herein are subject to approval by the appropriate stakeholders.

The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation, such as oil and gas resources, that the SEC’s guidelines strictly prohibit us from including in filings with the SEC.

CAUTIONARY STATEMENT FOR US INVESTORS

DISCLAIMERDISCLAIMER

SummarySummary

Major Production Development Projects: pre-salt and post-salt scenarios

Recent results in E&P

Petrobras Overview

Production Development Strategy

Main Challenges

Final remarks

Demands of Goods and Services

Exploration and Production

•2.4 mm boed production

• 576 Concession Areas

• 318 production fields

•91.2% of Brazilian production

• 20% of global DW and UDW production

RTM (incl. Petrochemicals)

• 12 refineries (Brazil)

•2.0 mm bbld refining capacity

• 11.2 mty materials nominal capacity (1)

Distribution

• 7,485 service stations

•39.2% share of distribution volume

•20% share of service stations

Gas and Power

• 9,251 km of pipelines

• Participation in 21 of the 27 gas discos in Brazil

• 5,806 MW of generation capacity

International

• 28 countries

• 0.7 Bn boe of 1P(SPE)

• 245 thous. boedproduction

• 231 thous. bbl/d refining capacity

•Petrochemicals, Gas & Power activities

Biofuels

• 3 new Biodiesel Plants

• Ethanol: Opening new markets

•The largest national producer of biodiesel

• The 3rd national producer of Ethanol

Note: (1) Through Braskem and Quattor

2011 Proven Reserves (SPE)16.412 billion boe

Shallow Water(0-300m)8%

Ultra-Deep Water(>1,500m)34%

Deep Water(300-1,500m)

50%Onshore8%

Number of Employees: 81,918

Petrobras Overview:Fully Integrated across the Hydrocarbon Chain

32%

49%

19%

Outras Descobertas Águas Profundas

New Discoveries 2005‐2010

(33,989 million bbl)

Source: PFC Energy

BRAZIL LEADERSHIP IN RECENT DISCOVERIESDeep‐water discoveries in Brazil represent 1/3 of the worldwide discoveries in the last 5 years

BRAZIL LEADERSHIP IN RECENT DISCOVERIESDeep‐water discoveries in Brazil represent 1/3 of the worldwide discoveries in the last 5 years

• In the last 5 years, more than 50% of the new discoveries (worldwide) were made in deep waters. Brazil alone accounts for 62% of these discoveries.

• Projections indicate that as Brazil develops these newly discovered reserves, it will lead non‐OPEC supply growth in the coming decades

Other Discoveries Deep‐Waters

Net Changes in Non‐OPEC Productive Capacity Between Now and 2030 for Non‐OPEC Countries

Million barrels pe

r day

Brazil(62% of deep waters discoveries)

100

5

8

8

9

10

12

12

13

15

15

45

0 20 40 60 80 100

Others

ENI/Agip

ConocoPhillips

CNOOC

Total

Anadarko

Chevron

BP

ExxonMobil

StatoilHydro

Shell

Petrobras

FPSO Semi Spar TLP Other

1977Enchova410ft125m

1988Marimbá1,610ft491m

1994Marlim3,370ft1,027m

1997Marlim Sul5,600ft1,707m

2003Roncador6,180ft1,884m

2009Lula

7,125ft2,172m

Deepwater Production2010 Gross Global Operated¹

Offshore Production Facilities

Source: PFC Energy Note: (1) These 15 operators account for 98% of global deepwater production in 2010. Minimum water depth is 1,000 feet (about 300 meters)

Long history of technological and operational

leadership in deepwater

Long history of technological and operational

leadership in deepwater

53%

33%

8%2%1%2%1%

E&PRTCG&EPetrochemicalsDistributionBiofuelsCorp. Projects

127.5(*) 70,6

13.25,1

2,53,52,8

US$ 224.7 billions

Investment Plan by Business Segment2011 / 2015

Investment Plan by Business Segment2011 / 2015

6%

57%

31%

• 5% of investments will be made overseas, 87% of which in E&P.

• Obs: HSEE (US$ 4.2 bi), IT (US$ 2.7 bi), Technology (US$ 4.6 bi), Logistics (US$ 17.4 bi) and Maintenance & Infrastructure (US$ 20.6 bi)

Annual investments of more than US$ 4 billion in exploration

Investments of US$ 12.4 billion related to the transfer of rights areas in 2011‐15

Pre‐Salt

US$ 53.4 billion

Post‐Salt

US$ 64.3 billion

17%

65%

Production Development

18%Exploration

Infrastructure68%

Other areasTransfer of Rights

26%Pre‐salt

6%

Exploration

Production Development

Pre‐salt37%

Transfer of Rights

Other areas48%

15%

E&P investments in Brazil: US$117.7 bn

Note: Pre‐salt includes Basins in Santos, Campos and Espírito Santo

TOTAL E&P INVESTMENTS IN BRAZIL2011-15 BUSINESS PLAN

TOTAL E&P INVESTMENTS IN BRAZIL2011-15 BUSINESS PLAN

SummarySummary

Major Production Development Projects: pre-salt and pos-salt scenarios


Petrobras Overview


Main Challenges

Final remarks


VISIONIncrease oil and gas reserves and production, in a sustainable manner, and be recognized for its excellence in E&P operations, placing the Company among the world’s five largest oil producers

2011‐15 Business Plan Highlights:

Allocate 65% of Capex to Production development.

Deliver 19 major growth projects, adding capacity of 2.3million bpd.

Drilling of more than 1,000 offshore wells, of these 30% is exploratory and 70% is production development.

In 2020, the pre‐salt production will correspond to 40.5% of the oil production in Brazil.

STRATEGYSustainable development of hydrocarbon reserves

STRATEGYSustainable development of hydrocarbon reserves

SummarySummary



Petrobras Overview


Main Challenges

Final remarks


BW Cidade de São Vicente• Well RJS‐647 AreaEarly Production System

BW Cidade de Angra dos Reis• Lula Pilot

FPSOs currently Operating in Pre-Salt clusterFPSOs currently Operating in Pre-Salt cluster

Prodution: 10,500 bpd

Prodution: 66,000 bpd

Santos Basin Pre Salt Cluster:Current Production: 76,500 bpd

Mar/2012

SummarySummary

Major Production Development Projects: pre-salt and post-salt scenarios


Petrobras Overview


Main Challenges

Final remarks


1.855 1.971 2.004

321 317 334 435

618

1.120

111 132 144141

180

246

2.100

99 9693 96

125

142

2008 2009 2010 2011 2015 2020

Oil Production‐ Brazil Natural Gas Production ‐ Brazil Oil Production ‐ International Natural Gas Production ‐ International

2,386 2,516

6,418

3,993

1,148543

Pre-SaltMM boe

/day

2,772

845Transfer of Rights

13

+10 Post‐Salt Projects

+8 Pre‐Salt Projects

+1 Transfer of Rights

Added Capacity

Oil: 2,300,000 bpd

2,575

Note: Does not include non‐Consolidated International Production.

Pre‐salt and Transfer of Rights will represent 69% of the additional capacity up to 2020;

Pre‐Salt participation in the total oil production will enhance from the current 2% to 18% in 2015 and 40.5% in 2020.

3,070

4,910

PRODUCTIONWith broad access to new reserves, Petrobras can more

than double its production in the next decade

PRODUCTIONWith broad access to new reserves, Petrobras can more

than double its production in the next decade

+12 Post‐Salt Projects

+15 Pre‐Salt Projects

+8 Transfer of Rights

5% a.y

9% a.y

WHAT IS PRE‐SALT?WHAT IS PRE‐SALT?

Corcovado

Total depth from5,000 to 7,000 meters

Salt layer more than 2,000 meters thick.

Pre‐Salt LayerNew Exploratory Frontier

Water depths that canexceed 2,000 meters

Post‐Salt LayerFocus up to 2006

Large Oil CarbonaticReservoirs

Once upon a time ...Once upon a time ...

N

Total area: 149.000 km² Area already under concession: 45.625 km ² (30,6 %)

Area with Petrobras interest: 39.625 km ² (26,6%) Area without Petrobras interest: 6.000 km² (4%)

Area not under concession : 103.385 km ² (69,40%)

200 km

LULA

300km

L ≈ 800 kmW ≈ 200 km

WhalePark

PRE SALT PROVINCEPRE SALT PROVINCE

DEVELOPMENT OF PRE-SALTAll first-phase units under construction or being contracted

DEVELOPMENT OF PRE-SALTAll first-phase units under construction or being contracted

Significant production increase

After 2017

Phase 1b

Production > 1 MM bbl in 2017

2013/2017

• Guará Pilot

• Lula NE Pilot

• Guará N

• Cernambi S

• 8 definitive production systems (replicant)

• 4 production units in the Transfer of Rights area

Phase 1a

2008/2013

Phase 0

3 FPSOs in operation3 FPSOs in operation

In operation (only 4years after discovery)In operation (only 4years after discovery)

Already contracted(start‐up in 2012 and 2013)

Already contracted(start‐up in 2012 and 2013)

Hulls already contracted (conversion in the Inhaúma shipyard)

Hulls already contracted (conversion in the Inhaúma shipyard)

Under construction (hulls being built in the Rio Grande shipyard) + topsides

under bid

Under construction (hulls being built in the Rio Grande shipyard) + topsides

under bid

1st already contracted and 2nd being negotiated (start‐up in 2014)

1st already contracted and 2nd being negotiated (start‐up in 2014)

Acquisition of information

• Appraisal wells

• Extended well tests

• Lula Pilot

• Accelerated innovation

• Intensive use of new technologies specifically developed for pre‐salt conditions

Petrobras R&D Centre - Basic Design

Pre-Salt Replicating FPSO’s - 8 (eight)Pre-Salt Replicating FPSO’s - 8 (eight)

Module Function Module Function

01 CO2 Compression 02 Flare Systems

03 CO2 Removal & HCDP 04 Exportation Gas Compression

05 Gas Dehydration & Fuel Gas 06 Main Gas Compression

07 Gas Injection 08 Oil Processing

09 Production Manifold 10 Oil Proc & Produced Water

11 Water Inject. & Sulphate Removal 12 Topsides Utilities

13 Automation and Electrical 14 Lay Down Area

15 Power Generation 16 Power Generation

Basic Design by Petrobras Research

Center, CENPES

- Length: 288 m- Hull breadth: 54 m- Hull height: 31,5 m- Max Draft: 23,2 m- Accommodation: 110 persons- Cargo Capacity: 1.600.000 bbl- Offloading: 1.000.000 bbl/d- Live Time: 25 years- Power Generation: 4 TG’s (4 x 25 MW)- Oil and Gas Capacity: 150.000 bopd Oil, 6 MM nm³/d de Gas (Max)

PRE-SALT FPSOs Main CharacteristicsPRE-SALT FPSOs Main Characteristics

TOTAL: 8 Units

CO2 separation by membranes, newapplication in offshore projects by PETROBRAS;

Reservoirs with high CO2 content and the presence of H2S;

Dehydration of the gas through molecular sieves, technology applied by PETROBRAS only in onshore units;

Compression and injection of gas at high pressures (approximately 550 kgf/cm2);

Compression and exportation of gas rich in CO2 at high pressures (approximately 300 ~ 550 kgf/cm2);

Pre-Salt – Topsides - FeaturesPre-Salt – Topsides - Features

o 2 Jack-ups under construction (P-59 and P-60) in São Roque (BA)o Inclusion of 900 new suppliers per year in Petrobras' Corporate Vendor List; o 13 new shipyards currently under construction, raising the total number to 50*;

Recently built platform: P-57: BrasFels – RJ

Capacity: 180 thous. boe/day Delivered two months ahead of schedule

8 FPSOs (Pre-salt - P-66; P-67; P-68; P-69; P-70; P-71; P-72; P-73 ): Ecovix – Rio Grande (RS)

P-61: Brasfels (RJ)P-62: Jurong (ES) / EASP-74, P-75, P-76 & P-77: Inhaúma (RJ)

P-63: QUIP (RS)

FPSO Cidade de Paraty: Brasfels (RJ) - modules and integrationFPSO Cidade de São Paulo: Brasfels (RJ) - modules and integration

Under Construction:

Under Construction:

PLATFORM CONSTRUCTIONJoint ventures with foreign shipbuilders

creating additional shipyard capacity

PLATFORM CONSTRUCTIONJoint ventures with foreign shipbuilders

creating additional shipyard capacity

P-55: Estaleiro Atlântico Sul – PE (hull) /QUIP- RS (modules)P-58: QUIP–RS , UTC Engenharia S/A – RJ e EBE – RJ.

*Source: Sinaval – Executive Summary -2011, Jan.

P-56: Brasfels (RJ)

Reduction in the complexity of the projects, using standard solutions

Contributing for the consolidation of Brazil as a supplying hub with international competitive level

Using international engineering patterns and metrics (KPIs) in our facility projects

Simplification and Standardization

Competitiveness/ Sustainability

Brazilian ContentTechnological & Engineering

Drivers

24

SummarySummary



Petrobras Overview


Main Challenges

Final remarks


Import

ACTION ROUTESGOODS AND SERVICES SUPPLY

Current Demand Future Demand

National Industry

Import

Expansion of

Capacity of National

Supply of Goods

and Services

1. Expand production capacity of high competitiveness sectors (Innovation)

2. Developing the competitiveness of middle competitiveness sectors (process quality and Innovation)

3. Encourage the development of new national entrants

4. Encourage association of domestic and foreign companies

NATIONAL COMPETITIVE SUPPLY OF GOODS & SERVICESADEQUACY OF NATIONAL SUPPLIER ESTATE

NATIONAL COMPETITIVE SUPPLY OF GOODS & SERVICESADEQUACY OF NATIONAL SUPPLIER ESTATE

5. Encourage the installation of foreign companies in Brazil

LOCAL CONTENT ACHIEVEMENTSHigh level of local content already in place

LOCAL CONTENT ACHIEVEMENTSHigh level of local content already in place

Jubarte Development P‐57 65% Local Content

Roncador Development P‐5468% local content

Marlim Sul development P‐56 73% local content

▲Relevance Considering Topside Facilities Costs.

Supplying Topside Facilities – Major GapsSupplying Topside Facilities – Major Gaps

3

4

56

6

8

8

Supplying Subsea Facilities – Major GapsSupplying Subsea Facilities – Major Gaps

71

2

3

▲ Relevance considering Production Development Costs(*) e (**) Special Alloys

8

Special alloys for tubing, casings and pipelines (13 Cr, Super 13 Cr, Duplex, Super Duplex);

Carbon steel coated with Inconel 625 (pipes to process vessels).

Some lines are in carbon steel with internal coating organic

316 stainless steel and 9% Nickel Steel.

Pressure vessels: super duplex stainless steel

Heat exchangers: super duplex stainless steel or Titanium plates

Obs.: The use of these materials is associated with high levels of CO2 found in Pre Salt fields and also the presence of H2S.

Materials with local supply constraintMaterials with local supply constraint

Opportunities for the marine industryOpportunities for the marine industry

Construction of Production, Drilling

and Completion Rigs in Brazil

Design and construction of hulls

Construction of several topsides modules

Hull and topsides integration

Supply boats

Maintenance and inspection of the fleet

Equipment for Drilling and Production Units Boats and safety equipment

Equipment for cargo handling

Pressure vessels

Motors, compressors and turbines

Several valves

Development for special

applications Special metallurgy resistant to

high pressures and CO2

Anchoring system with polyester

cables

Industrial pipes

Opportunities for the equipment industryOpportunities for the equipment industry

Growing demand for specialized services Design and construction of Natural Gas Processing Plants

Maintenance and inspection of subsea equipment

Project Management

Maintenance of large machines

Great Logistics Needs Different transportation alternatives

Cargo Transportation

Technologies and supply facilities

Technology and stock management

Specialized Human Resources Certification and training

Opportunities for the supply servicesOpportunities for the supply services

SummarySummary



Petrobras Overview


Main Challenges

Final remarks


Pre-salt Technological ChallengesPre-salt Technological Challenges

Reservoir characterization

Recovery Process

Well Construction

Flow Assurance

Logistics

Materials

Gas and CO2 Handling

Heterogeneous layered carbonateVariable reservoir quality

Offshore Logistics Main ChallengesOffshore Logistics Main Challenges

HUBFluido e SalmouraHUB

Diesel

HUBFluido e Salmoura

HUBFluido e Salmoura

HUBDiesel

UEPs fora de escala

Provide the necessary infrastructure- Construction of seaports- Construction of airports- Construction of warehouses

Use of Logistic Hubs- Diesel hub- Passengers hub- Fluids hub

Improve visibility and confidence - Operators spent reasonable percentage of their time trying to get information about the status of their requests - Implement to cargo track and trace technologies throughout the supply chain

Logistics Expected Growth - 30% in 2 years - 100% in 5 -7 years

32

None of the challenges mentioned is obstacle for pre-salt production development, but instead, a

good opportunity for optimization of the cost effectiveness of the projects.

Major Pre-Salt Ultra-deepwaters projects

SummarySummary



Petrobras Overview


Main Challenges

Final remarks

Local Content

The Post-Salt Projects are of paramount importance for the

production growth and will help fund the development of

Pre-Salt fields;

Petrobras has a worldwide recognized deepwater experience

to address technical and commercial challenges for Pre-salt

appraisal and development;

A new way to design and implement mega offshore project is

required to comply with Petrobras business plan;

Pre-Salt started production on May 2009, with a steep ramp-

up on the following years.

Final Remarks (1)Final Remarks (1)

33

Petrobras’s strategy of “Extended Well Test” followed by a “Pilot System” and a “Phased Development” has been shown suitable in reducing the capital exposure and increasing the operational flexibility;

There are huge opportunities for already installed and newcomers. Brazilian supply chain should be strengthened;

In order to carry out such portfolio, Petrobras is looking forward to establishing stable long term business relationships with all available companies that are willing to invest in Brazil in a sustainable basis.

Final Remarks(2)Final Remarks(2)

34

[email protected] [email protected]

Drilling Deeper Petrobras

Documents

Transcript of Drilling Deeper Petrobras