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GlobalData: South America will

overtake North America on oil output

THE combination of Guyana’s new oilfields and Upstream operators are treating South
output from Brazil’s pre-salt region could help American projects as good investment pros-
push South America’s oil output beyond that of pects, even though global oil markets remain
North America within four years, according to relatively weak, with Brent selling for about $40
new research. per barrel, GlobalData said. Break-even prices
“Despite the effects of COVID-19 [the coro- for Brazil’s pre-salt region are running as low as
navirus pandemic] on global demand and sup- low as $35 per barrel, while some ultra-deepwa-
ply, the outlook for South America’s offshore ter projects in the frontier Guyana-Suriname
production is on track to surpass volumes com- Basin have break-even oil prices of no more than
ing from North America by 2024,” the consul- $23 per barrel, it said.
tancy GlobalData said in a statement. The consultancy also pointed out that final
For the Americas as a whole, oil production investment decisions (FIDs) had been taken
is on track to increase steadily from the expected recently on several projects in Brazil and Guy-
level of 8.65mn barrels per day (bpd) in 2020 ana, meaning that work at these fields is less
to 9.15mn bpd in 2024. This is largely due to likely to be postponed or suspended than it is at
positive trends in South America, particularly sites in North America, GlobalData said.
the expansion of development work in Brazil’s It also pointed out that the pandemic had
pre-salt area and the launch of newcomer Guy- delayed several key projects off the coast of the
ana’s ultra-deepwater projects, the firm said in US.
research published on its website. “Delays and pending approvals will not help
“Brazil’s prolific pre-salt region is surviving North America reverse its declining trajectory,
the industry downturn, mainly due to the robust as production is expected to drop by 15% over
economics of its current and upcoming projects a period of 2022-2024,” said Effuah Alleyne, a
– a result of high-productivity, high-quality senior analyst at GlobalData.
crude wells,” it said. “Improving the region’s trend will require a
It also pointed out that Brazil’s national oil combination of factors not exclusive to better
company (NOC) Petrobras had steadily stream- market pricing to support project economics,
lined its portfolio to focus on exploration and enhanced recovery for existing projects and the
production activities in the pre-salt layer, while expansion of resource base especially in Mex-
divesting non-core assets in onshore, shal- ico,” she added.
low-water and post-salt areas. Expanding pipeline infrastructure could
At the same time, it added, Guyana’s “short- also help in the US and Canada, Alleyne said.
term production [is] expected to grow 10-fold Both countries have experienced pipeline bot-
by 2024 from projects such as Liza-2.” tlenecks, she noted. ™

BRAZIL
BP to sell stake in Campos

basin blocks to PetroRio

THE British oil major BP has agreed to sell its BM-C-32 block, which contains the Itaipu find.
stakes in two offshore blocks in Brazil’s Campos The rest of the Wahoo discovery is owned
Basin to PetroRio, a Brazilian oil company. by IBV Brasil Petróleo, with 35.7%; the French
PetroRio, formerly known as HRT Partici- oil major Total, with 20%, and the former US
pações em Petróleo, said Thursday that it would independent Anadarko, now part of Occidental
become the operator of the two pre-salt blocks. It Petroleum, with the remaining 8.6% share.
explained that it was on track to acquire a 35.7% The rest of Itaipu, meanwhile, is owned by
interest in the BM-C-30 block, which contains Total, with a 26.7% share, and Anadarko, with
the Wahoo discovery, and a 60% stake in the 13.3%.

P14 www. NEWSBASE .com Week 47 26•November•2020