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EXPLORATION
The scale of discoveries BG Group has made
in the Santos Basin offers the opportunity to
build a material, long-term E&P business in
Brazil with net production from the first
three major developments planned to reach
over 400 000 boed in 2020. The Group is also
confident that the planned developments
are economic at oil prices below $40 a barrel.
In addition, there remains in BG Group’s
portfolio a number of significant untested
exploration prospects in the Santos Basin presalt
play, as well as further reserves potential
from the appraisal of existing discoveries.
In 2006, the Parati well in BM-S-10 (BG Group
25%) and the Tupi well in BM-S-11 (BG Group
25%) were both declared as discoveries. In
2007, the Carioca well on BM-S-9 (BG Group
30%) was declared a discovery and the Tupi
appraisal well, Tupi Sul (BM-S-11), confirmed
the 2006 Tupi discovery.
Tupi is a large structure with significant
reserves potential requiring further appraisal
drilling and evaluation. Initial estimates by
BG Group and partners are that Tupi could
contain from 12 billion boe to more than
30 billion boe gross hydrocarbons initially in
place and gross reserves of 5 to 8 billion boe.
The Tupi consortium is currently undertaking
further evaluation of the field under an
Evaluation Plan approved by the National
Petroleum Agency of Brazil (ANP).
An extended well test (EWT) and initial
development phase for Tupi were sanctioned
in 2008. The EWT started in May 2009 and is
planned to last 15 months, with production
expected to peak at around 14 000 bopd. The
EWT flowed first commercial oil production
from Tupi to the FPSO (BW Cidade de São
Vicente) in May 2009. The initial development
phase is expected to commence in late 2010,
with initial production of up to 100 000 bopd.
The full field development of Tupi may
involve up to 300 producing and injector
wells and up to ten FPSO modules with a
gross oil production up to 1 million bopd
and up to 1 bcfd of gas. Development activity
is advancing rapidly on Tupi with the award
of drilling and facilities contracts.
In BM-S-9, the Guará well was announced as
a discovery in June 2008 and in September
2009, BG Group announced that Guará is
estimated to contain recoverable volumes
of 1.1-2.0 billion boe. In September 2008,
BG Group announced the completion of
drilling on the Iara well in the BM-S-11
concession and estimated gross recoverable
volumes to be three to four billion boe. The
exploration success with Guará and Iara has
Block BG Group (%) Partners (%) Wells/prospects
BM-S-9 30 Petrobras 45, Repsol YPF Brasil S.A. 25 Carioca, Guará, Abaré West, Iguaçu
BM-S-10 25 Petrobras 65, Partex 10 Parati
BM-S-11 25 Petrobras 65, Petrogal 10 Tupi, Tupi Sul, Iara, Iracema
BM-S-13 60 Repsol YPF Brasil S.A. 40 –
BM-S-47 50 Repsol YPF Brasil S.A. 25, Vale 25 Saleta
BM-S-50 20 Petrobras 60, Repsol YPF Brasil S.A. 20 Sagittario
BM-S-52 40 Petrobras 60 Corcovado-1, Corcovado-2
BT-SF-2 50 Petrobras 50 –
led the partnership to fast track planning
on two 120 000 boed initial development
phases, with the objective of achieving first
production in 2012 on Guará and 2013 on Iara.
Evaluation Plans for the Carioca, Guará and
Iara discoveries have been approved by the
ANP (regulator). Further development phases
on Guará and Iara are expected to lead to
production of up to 150 000 bopd and
500 000 bopd respectively.
During 2009, there has been further drilling
activity on BM-S-9, with an exploration well,
Iguaçu, completed in April 2009. The Iguaçu
well has proven the presence of another
accumulation of light oil. Future operations
continue to determine the ultimate potential
and comply with Evaluation Plan obligations.
A further exploration well, Abaré West, also
on BM-S-9, has begun drilling. In June 2009,
BG Group announced that the Iracema well
on BM-S-11 had encountered hydrocarbons.
An exploration well is planned to commence
in 2009 on Sagittario (BM-S-50). On BM-S-52,
two exploration wells are being drilled in 2009.
BG Group has a 40% interest in the concession
and is operator during the exploration phase.
The first well, Corcovado-1 encountered
hydrocarbons in April 2009. The rig then
went on to drill a second well, Corcovado-2.
Evaluation of these two wells continues.
LNG
In June 2008, BG Group and Petrobras signed
a Master Sales and Purchase Agreement and
two confirmation memoranda to supply
LNG to Petrobras terminals in Pecem (State
of Ceará) and in Guanabara Bay (State of
Rio de Janeiro).
BG Group supplied the commissioning
cargoes to the Pecem terminal in July 2008
and to the Guanabara Bay terminal in
May 2009. In future, LNG will be supplied to
either the Pecem or Guanabara terminals
as required by Petrobras, subject to local
market demand.
BOLIVIA-BRAZIL PIPELINE (BTB)
With total capacity of 30 mmcmd, the
BTB is 3 150 kilometres long, of which
2 593 kilometres are in Brazil. The project
was developed through two different
companies: Gas Transboliviano (GTB), which
owns and operates the assets in Bolivia, and
Transportadora Brasileira Gasoduto Bolivia
Brasil (TBG), which owns and operates the
Brazilian portion of the pipeline. Operation
of the two pipelines is coordinated through
an Interconnection Agreement.
BG Group participates in TBG through BBPP
Holdings, together with El Paso and Total.
BG Group’s one-third equity in BBPP Holdings
represents a 9.67% interest in TBG. BG Group
holds a 2% interest in GTB. BG Group has an
effective overall interest of 7.65%, although
this does not represent a direct equity
holding, as GTB and TBG are two separate
entities. Construction of the pipeline was
completed in 2000, opening the Brazilian
energy market to Bolivian gas reserves.
Effective shareholders BTB (%)
BG Group 7.65
Petrobras 40.46
Transredes 22.27
El Paso 7.65
Ashmore Energy 7.42
Shell 7.42
Total 7.12
Figures rounded to 2 decimal places and are a result
of adding GTB’s and TBG’s equity positions.
BG Group Data Book 2009
31
AMERICAS AND GLOBAL LNG