José Fernando de Freitas ANP – Onshore Area Coordination Chief

CNPE

E&P POLICIES

REATE •General Policies - MME •Regulatory - ANP •Commercial - EPE

MME

Institutional Framework

Contractual Improvement

Decomissioning Rules Onshore

Regulation

Reserve Based Lending

Open Acreage

Infrastructure and Trading

Royalties Police

Environmental Permits

Changes’ Pathway

Production Assets Access

Produção Realizada Projeto Complementar

Royalties de 10%

Royalties de 5% a 10%

Life Extension

Recovery Factor

Mature Fields

Competitiveness

Profitability

Royalties Reduction for Mature Fields' Incremental Production

7,5 or 5% Royalties

10% Royalties

Historical New Project Life Extension

14ª Rodada – Redução de Royalties

Bac

ias

Basi

n

Royalties as for 14th Bid Round on

Royalties Reduction for Onshore Basins

Contractual Improvement

Decomissioning Rules Onshore

Regulation

Reserve Based Lending

Open Acreage

Infrastructure and Trading

Royalties Police

Environmental Permits

Changes’ Pathway

Production Assets Access

Oil and Gas Scenario

Final Remarks

EOR Review

Opportunities: Open Acreage 884 Blocks

Area:

346,035 km²

14 Mature

fields

15 Sedimentary

basins

722 blocks in 9 onshore basins

162 blocks in 6 offshore basins

158 Blocks ready to offer

Open Acreage 1st Wave

Contractual Improvement

Decomissioning Rules Onshore

Regulation

Reserve Based Lending

Open Acreage

Infrastructure and Trading

Royalties Police

Environmental Permits

Changes’ Pathway

Production Assets Access

FAZENDA BELÉM CLUSTER

Concessions: 2

Production: 1227 bbl/d (Oil);

1000 m3/d (Gas)

SERGIPE TERRA 1 CLUSTER

Concessions: 6

Production: 68 bbl/d (Oil);

200 m3/d (Gas)

MIRANGA CLUSTER

Concessions: 9

Production: 1446 bbl/d (Oil);

558000 m3/d (Gas)

MACAU CLUSTER

Concessions: 7

Production: 4855 bbl/d (Oil);

249000 m3/d (Gas)

RIACHO DA FORQUILHA CLUSTER

Concessions: 34

Production: 7.094 bbl/d (Oil);

271000 m3/d (Gas)

SERGIPE TERRA 2 CLUSTER

Concessions: 3

Production: 4426 bbl/d (Oil);

27000 m3/d (Gas)

SERGIPE TERRA 3 CLUSTER

Concessions: 1

Production: 2036 bbl/d (Oil);

3000 m3/d (Gas)

1,0 % of our total output in

Brazil

TOTAL PRODUCTION

28 thousand boe/d

January to December 2017 period

There are 62 onshore fields in the ongoing selling process

Technology Number of Projects Operator's Evaluation

Thermal

Steam 15 fields in 4 Basins Success

In-situ Combustion 2 pilots Fail

Chemical

Polymer 4 pilots Fail

Miscible Gas

CO2 3 pilots 1 success and 2 Fails

Microbial

MEOR 10 Wells and 1 Full field 7 wells: Success; Full field: Fail

EOR projects in Brazil’s Onshore – A limited experience

More than 300 onshore fields

0

200

400

600

2015 2016 2017

Develpment Onshore Wells Drilled

75%

129

(2015/2017)

Oil

Gas

Onshore Production

(2017)

127

Thousand

bbl/d

21

Million

m³/d

30%

(2017/2012)

200 Million boe

New Reserves

World Average

0% 10% 20% 30% 40%

SEAL

Espírito Santo

Recôncavo

Potiguar

Onshore Recovery Factor per basin

Current RF Final RF

1% addition in the

onshore recovery

factor:

Onshore production Perspective

Huge potential to significantly increase

onshore production in short/medium term

José Fernando de Freitas ANP – Onshore Area Coordination Chief

THANK YOU