On Thursday, Dec 19, Brazilian state-run energy major, Petroleo Brasileiro SA, or Petrobras (PBR) had submitted a Declaration of Commerciality (DoC) for the Carioca area to Brazilian National Agency of Petroleum, Natural Gas and Biofuels (:ANP). The consortium also submitted a Discovery Evaluation Plan to ANP, which will be later followed by a Field Development Plan.
Petrobras, with a 45% stake, is the operator of the consortium BM-S-9 that submitted the DoC. Other partners include BG E&P Brasil and Repsol Sinopec Brasil that hold 30% and 25% interest, respectively.
The new oil field, in the pre-salt Santos Basin, contains good quality oil and at water depth of 2,140 meters. The oil field, which is expected to hold recoverable reserves of around 459 million barrels of oil equivalent (boe), will likely be named Lapa by the consortium. The 2013–2017 Business and Management Plan of Petrobras anticipates this field to draw first oil in the third quarter of 2016.
In a separate declaration, the company announced the submission of DoC to ANP for two other areas – Franco and Sul de Tupi – also located in the Santos Basin pre-salt. These fields are to be renamed as Búzios and Sul de Lula.
The Franco field rests at a water depth ranging from 1,600–2,100 meters, 200 kilometers off the coast of Rio de Janeiro and contains good quality oil between 26º and 28º API. Petrobras’ Business and Management Plan predicts five production systems to come online by 2020.
The Sul de Tupi field is at a water depth of around 2,200 meters, 300 kilometers off the coast of Rio de Janeiro and contains good quality oil of around 27º API. Petrobras’ Business and Management Plan expects first oil from this field in the first quarter of 2017.
Headquartered in Rio de Janeiro, Petrobras currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile one can consider better-ranked energy sector stocks such as Abraxas Petroleum Corp. (AXAS), Harvest Natural Resources Inc. (HNR) and Clayton Williams Energy, Inc. (CWEI). All these currently sport a Zacks Rank #1 (Strong Buy).