Brazil’s Petroleo Brasileiro SA (Petrobras) has launched production at the deepwater Gulf of Mexico (GOM) Chinook field, connecting its second well to the first floating, production, storage and offloading (FPSO) vessel platform in U.S. waters.
The Chinook No. 4 well was drilled and completed near Petrobras’ Cascade well, which increased production to 174,554 bbl of oil in June from 85,348 bbl in March. Cascade, 100% owned by Petrobras, ramped up earlier this year (see Daily GPI, March 5). The producer has a two-thirds stake in Chinook; Total Exploration Production USA Inc. owns the remaining interest.
Like Cascade, the Chinook well is connected to the FPSO via a system composed of subsea equipment and lines, in addition to free-standing risers (vertical production lines). Oil is to be transported to shore via shuttle tankers, while the gas would be transmitted through a pipeline. Unlike a traditional offshore platform, an FPSO vessel doesn’t require an oil pipeline to operate and the vessel can be moved in the event of storms.
The FPSO BW Pioneer, which is about 155 miles off the Louisiana coast and 8,200 feet above the seafloor, is capable of storing 500,000 bbl of oil and can process up to 80,000 b/d of oil and 16 MMcf/d of natural gas.
Petrobras, considered a worldwide leader in FPSO design, obtained approval four years ago from U.S. officials to develop the first U.S. platform to use in the Cascade-Chinook area of the promising Walker Ridge region of the Lower Tertiary trend (see Daily GPI, April 30, 2008). Last year subsidiary Petrobras America Inc. won final approval to begin production using the floating storage system (see Daily GPI, March 21, 2011).
According to a recent report in the Wall Street Journal, Petrobras is seeking a partner to take over as much as half of its considerable GOM investments with an infusion of up to $4 billion. Petrobras apparently has hired Morgan Stanley “to seek out potential partners for the assets, which the seller pegs at roughly $8 billion,” sources told the newspaper. “The bank has begun sending out initial financial information to prospective buyers, including foreign and U.S. oil companies.”
The GOM partnership would be part of a previously announced plan by Petrobras to raise almost $15 billion to fund its five-year investment plan, the Journal noted.
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