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Page added on August 12, 2015
Brazil Offshore Subsalt Holds 176 Billion Barrels Of Oil, Gas
Brazil’s Subsalt Polygon, an offshore area that has already yielded some of the world’s largest recent oil finds, may hold enough undiscovered petroleum and gas to supply the world’s current oil needs for more than five years, researchers said.
The Polygon, which covers most of Brazil’s Santos and Campos offshore sedimentary basins, contains at least 176 billion barrels of undiscovered, recoverable resources of oil and natural gas (barrels of oil equivalent), according to study released last week by Cleveland Jones and Hernane Chaves of the National Institute of Oil and Gas (INOG) at Rio de Janeiro-State University.
That is more than four times the 30 billion to 40 billion boe already discovered in the area.
“This is a conservative estimate with a high probability of coming true, 90 percent in fact,” Jones said. “In theory, total undiscovered, recoverable resources in the Subsalt Polygon could be as high as 273 billion barrels, but the higher number only has a statistical certainty level of 10 percent.”
Subsalt refers to oil trapped far beneath the Earth’s surface or seabed by a layer of mineral salts. The Polygon is a Brazilian legal district that covers an offshore area near Rio de Janeiro and Sao Paulo where Brazil already gets about 85 percent of its oil and gas.
The INOG’s estimate is the only major public assessment of the Subsalt Polygon’s potential. The 2015 estimate is 54 percent bigger than the INOG’s 2010 estimate of 114 to 288 billion boe. That survey put the probability of the lower estimate at 90 percent and the higher outlook at 10 percent.
Unlike other democratic, oil-producing countries such as the United States, Canada, Britain and Norway, Brazil’s government and petroleum regulator ANP does not publish estimates of potential Brazilian offshore resources.
“Brazil has been remiss in not making such numbers public,” said John Forman, a former director of Brazil’s oil regulator ANP. He added that the INOC estimate is the only reliable public estimate available and that it uses industry-accepted methods.
Taken individually, the average size of undiscovered fields within the Subsalt Polygon is 246 million boe, according to the 2015 study’s most conservative estimate.
Recoverable resources are exploitable using current technology, but may not be viable depending on the price of oil, the cost of equipment and the financial health of the companies that own the rights to produce them. Resources can only become reserves if they economically exploitable.
39 Comments on "Brazil Offshore Subsalt Holds 176 Billion Barrels Of Oil, Gas"
shortonoil on Wed, 12th Aug 2015 7:15 pm
Very interesting; when you figure out how to get it out of the ground for $43/ barrel – get back to us!
The price of oil is now not high enough for producers to replace the reserves that they are extracting. It never will be again:
http://www.thehillsgroup.org/depletion2_022.htm
That is the last thing that the industry will admit. There is still over a trillion barrels in the ground, and that is exactly where it is going to stay.
http://www.thehillsgroup.org/
Plantagenet on Wed, 12th Aug 2015 7:34 pm
Shortonoil’s predicition that oil will never again rise much above $43/bbl is silly. Oil prices go up and oil prices go down in response to supply and demand. Right now we are in an oil glut, so oil prices are extremely low. Eventually the oil market will tighten, and oil prices will go back up. —Thats the way the oil market works.
CHEERS!
Nony on Wed, 12th Aug 2015 8:30 pm
What’s the business climate in doing work in Brazil? Home sourcing restrictions? Nationalization worries?
hosj on Wed, 12th Aug 2015 9:02 pm
Meanwhile, Plantagenet hasn’t even read or even looked at the study short is referencing. Just throwing out his/her canned lines about the “Oil glut”
CHEERS?
Boat on Wed, 12th Aug 2015 9:13 pm
Short,
Let’s make predictions. I say oil will go back up and not only that but the frackers will be back within 10 years. I am talking at least $65 dollars per barrel. Not all the frackers but a substantial number of them.
Plantagenet on Wed, 12th Aug 2015 9:37 pm
@haj:
Of course I looked at shortonoil’s report. It is out-0f-date because it is only based on data through 2013, and doesn’t include the current oil prices.
Nonetheless, we can determine if the model is valid by seeing how well it describes what has happened in the last two years—and it clearly fails.
Shortonoil’s model predicts the price of oil would start to fall at the beginning of 2014 because of the declining “value” of the oil.. In actuality oil prices started to fall at the beginning of 2015 in response to an oil glut. Short on oil’s model predicted that oil would be $60 bill right now when its actually $43, i.e. shortonoil’s prediction is off by 40% already. The report goes on to predict oil will fall to $15/bbl by 2020.
Maybe it will and maybe it won’t—but given the failure of shortonoil’s model to accurately predict oil price movements over the last two years, there is no reason to believe it will accurately predict the price of oil five years out.
CHEERS!
BobInget on Wed, 12th Aug 2015 9:42 pm
Stickin to January predictions ($150 high, $100.+ January 31 close)
Doubtless, Brazilians will one day be able to penetrate ultra deep molten-salt layers.
I love it when the words “off shore” are used to identify one of the most difficult unsolved drilling situations on the planet.
Today all they have is bluster and corruption.
Another planted article with catchy headline
designed to keep oil prices low?
” Saw this on the internet machine, It must be true, if there’s so much oil, when Brazilians flood the market it will be too cheap bothering paying”.
kanon on Wed, 12th Aug 2015 10:51 pm
Shortonoil’s predicition that oil will never again rise much above $43/bbl is silly — except that is not what he said. He said “The price of oil is now not high enough for producers to replace the reserves that they are extracting. It never will be again” Even if the price rises to the magical break even point, costs will rise as well. The fracking miracle is proof, since the industry does not pay its costs or its debt.
idontknowmyself on Wed, 12th Aug 2015 11:06 pm
Shortonoil is writing like Gail the actuary. I would not be surprised if shortonooil is actually Gail the actuary.
Shoartonoil is obsessed with debt like Gail is and completely forget the complexity of it all.
This system is now so complexes that it cannot be mathematically modelled properly.
The peak oil community is now mainly made of people preying of weak and insecure people for their money.
Some example are Gail the actuary, Orlov, Nicole Foss, and some more.
Boat on Wed, 12th Aug 2015 11:10 pm
Actually fracking costs are dropping, kinda a moving number like electronics. Better tech, better efficiency, lower cost. Check the trends in costs of drilling/fracking.
Point is some wells have been reported needing $31 some up to $110. Fact is consumption is near highs, production is near highs. Were not drilling where we know there is oil. What does this mean? No fear for awhile. Relax
Plantagenet on Wed, 12th Aug 2015 11:26 pm
Anybody who believes in shortonoils model is claiming that oil will sell for $15/bbl in 2020
Yes we are in an oil glut but it isn’t that bad!!!!
apneaman on Thu, 13th Aug 2015 12:01 am
planty and boaty two corny morons united in their faith based claims. I see the same disconnect on the environmental trifecta – AGW, Ocean acidification, 6th mass extinction – all the time in comment sections on “environmental” sites. Always pushing it out to a far off future – almost always it’s conveniently after their life will be over. And today’s troubles always get down played.
“but it isn’t that bad!!!!” “No fear for awhile. Relax”.
Two more case studies for the next psychology text book in the cognitive dissonance and motivated reasoning chapters.
rockman on Thu, 13th Aug 2015 6:38 am
And friends let’s not forget the focus of this site: peak oil PRODUCTION…not peak oil RESERVES.
History of Oil in Brazil: In the late 1970s, the country produced an average of 200 thousand barrels of oil per day. In 2009, the country reached the milestone of producing two million barrels daily. The production growth in this period was associated with the great maritime discoveries of oil and gas in the Campos Basin, which began with the discovery of the Garoupa Field in 1974, starting the search in ever deeper waters. In the years 1980 and 1990, giant fields were discovered in the basin. In the first half of 2008, Petrobras announced the discovery of an oil field in the pre-salt in the Santos Basin. The potential of this discovery puts Brazil in the same reserve level of the major world producers
Import Situation Nowadays: Oil imports from Brazil rose more than 140% in July of 2013, while exports dropped by half. The reason for this decrease in exports is because even though the Brazilian production of the commodity is high it is widely used domestically to keep up with the ever increasing demands. Oil imports rose to $3.1 BILLION in July of 2013, compared to $1.2 BILLION in July of 2012. Exports shrank to $0.7 BILLION in July of 2013, compared with $1.3 BILLION in July of 2012, according to data released by the govt.
Thus the key question isn’t how much oil reserves Brazil will be able to book today or even decades down the road but how much they’ll be exporting. At the moment (and for many years into the future according to their govt’s projections) Brazil will be a net oil importer.
shortonoil on Thu, 13th Aug 2015 6:45 am
Shortonoil’s model predicts the price of oil would start to fall at the beginning of 2014 because of the declining “value” of the oil.. In actuality oil prices started to fall at the beginning of 2015 in response to an oil glut.
06/20/14 $107.95
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=RWTC&f=D
You can’t even read a graph you moron!
The paid trolls are climbing out of the woodwork in an attempt to obfuscate and confuse. Someone knows we are correct, and they are scared. The petroleum industry is now in big trouble, and it is going to get worse going forward.
http://www.thehillsgroup.org/depletion2_022.htm
They can no longer replace their reserves, and they will soon no longer be able to service the $2.5 trillion, and growing debt that they hold. Oil states can no longer supply their populations with toilet paper, and the richest oil state in the world is borrowing money to pay its bills.
What you are attempting to do is like trying to hide an elephant in your garage. You are fools for trying!
shortonoil on Thu, 13th Aug 2015 7:01 am
“Shoartonoil is obsessed with debt like Gail is and completely forget the complexity of it all. “
Shortonoil is focused on the entropic decay of the petroleum production system. Gail is focused on money. Money is an artificial construct that can be created, or destroyed at will; energy can’t be. The world will never run out of money, as long as Central Banks own a printing press. The world is rapidly running out of energy! When it does the printing presses will slow to a crawl; just before someone hauls them away for their parts.
http://www.thehillsgroup.org/
shortonoil on Thu, 13th Aug 2015 7:32 am
I will reiterate: the price of oil will never again rise high enough for producers to replace the reserves that they are extracting.
When what is there now is gone: the oil age ends!
If anyone is interested, our calculations indicate the amount of reserves that are presently economically, and thermodynamically extractable are 320 Gb. The probability that intense economic, and geopolitical crisis will present themselves as that extraction is occurring is almost 100%.
http://www.thehillsgroup.org/
John on Thu, 13th Aug 2015 9:01 am
Hello shortonoil,
I contend that world governments will cooperate with one another, and modify the monetary system to extract as much oil/gas as possible. I say the oil stops flowing when EROEI reaches 1:1, and any monetary constraints are irrelevant. I would think that what is economically extractable, and what is thermodynamically extractable, are two different things.
Davy on Thu, 13th Aug 2015 9:30 am
John, that is a big step you are taking. It is possible governments will continue to cooperate. We can see some coordination now in a competitive social, political, and economic global environment.
The markets are a disciplining factor. Markets are like the grizzly bear that must be fed. Once fed he is habituated to being fed. Isn’t that where we are. Being fed and the Fed was an accidental pun.
I think we will see cooperation decay as the social, economic, and political situation deteriorates. Then once a crisis is bad enough it is possible for renewed cooperation out of necessity. The problem is once the global system gets to that point it will be too late.
idontknowmyself on Thu, 13th Aug 2015 9:32 am
When someone is using words like I reiterate, this person knows nothing and don’t understand the chaotic nature of life.
Why are you here selling your stuff if you are so right and so intelligent. Should you be pitching that crap to oil companies instead of us people with no money. You are an amateur.
You are so amateur that you don’t even put the name and working experience of the people that are part of your so called company.
Another thing, measuring energy at the well head does not say much, how much energy is needed to keep international trade alive and how much energy is needed with a country to keep social stability will be more useful then just analyzing at the well head energy.
For example what is the energy input of Greece, Argentina, Ukraine versus US, Canada and how it does affect social stability will be way better analyze what is going then a bunch of graphic with a price on it.
John on Thu, 13th Aug 2015 9:46 am
Davy,
I can envision the United States taking on massive debt to extract all the oil it can, and then saying “Yeah? What are you going to do about it?” to anybody who tries to stop them. Where there’s a will, there’s a way. Same with Russia and China, actually. I just see oil as so precious that nothing will stop its use, certainly not climate change concerns.
Hi idontknowmyself,
Although I don’t wish to go back and forth on this, a logical response to your last comments would be that the oil companies know exactly what’s going on, and don’t need somebody like shortonoil to counsel them. I’m not 100% sure short has everything exactly right, but he appears to study the subject in detail, and his thoughts seem quite reasonable to me.
rockman on Thu, 13th Aug 2015 9:53 am
John – “I say the oil stops flowing when EROEI reaches 1:1”. A new well will not be drilled long before that point. Economic value determines if a well gets drilled…not EROEI. And somewhere around an EROEI of 5 a well loses its economic viability. IOW even if a well produces several times more oil then it takes to drill it won’t be spudded if it’s a money loser.
John on Thu, 13th Aug 2015 9:59 am
Thanks, Mr. Rockman, and all. I have to leave now for the day, but will read comments later.
rockman on Thu, 13th Aug 2015 10:02 am
Also John: “I can envision the United States taking on massive debt to extract all the oil it can, and then saying “Yeah? What are you going to do about it?” to anybody who tries to stop them.” First, the “United States” doesn’t drill for oil and thus can’t take on “massive debt”. Energy companies drill for oil and they have taken on massive debts to do so. Some estimate over $500 BILLION just in last few years. And they are currently being stopped from going deeper in debt in order to continue their drilling efforts. They are being stopped to a fair degree by the capex lenders who are more focused on the repayment of existing loans then issuing new debt.
drwater on Thu, 13th Aug 2015 11:22 am
“Shortonoil is focused on the entropic decay of the petroleum production system. Gail is focused on money. Money is an artificial construct that can be created, or destroyed at will; energy can’t be. The world will never run out of money, as long as Central Banks own a printing press. The world is rapidly run.”
Short – I think your perspective is very valuable at this site. A couple comments:
1. Alternative sources of energy can offset the losses of available energy from petroleum. And by alternative, I would include natural gas, nuclear, wind, solar, etc. Liquid petroleum gradually becomes a means of storing energy for transportation uses. And if you compare the cost of liquid petroleum with batteries, there is good reason for liquid petroleum to stay somewhat valuable for a while. While your model correctly shows that petroleum has been the energy driver of the economy, I am not as sure that it has to be the only driver in the future.
2. As you state in your post, you draw the distinction between energy and money yet you still have to bring the two back together in your model. I see that as very challenging because there are so many games being played with “money.”
I appreciate your posts and hope you can keep fine tuning your model to address other factors.
shortonoil on Thu, 13th Aug 2015 11:39 am
“When someone is using words like I reiterate, this person knows nothing and don’t understand the chaotic nature of life.”
Webster: reiterate
“to say again, repeat”
Guess you don’t read much? You’er just the person everyone should listen to!
I would think that what is economically extractable, and what is thermodynamically extractable, are two different things.
Unfortunately, we exist in a universe that only has one reality. If a process is not thermodynamically possible it can not be economically possible. If anyone is saying different they are selling perpetual motion machines, and snake oil.
“For example what is the energy input of Greece, Argentina, Ukraine versus US, Canada and how it does affect social stability will be way better analyze what is going then a bunch of graphic with a price on it.”
Why don’t you get right on it – let us know what you come up with?
“Although I don’t wish to go back and forth on this, a logical response to your last comments would be that the oil companies know exactly what’s going on, and don’t need somebody like shortonoil to counsel them. I’m not 100% sure short has everything exactly right, but he appears to study the subject in detail, and his thoughts seem quite reasonable to me.”
Second response:
I was a consultant to many Fortune 500 companies for over 25 years. When somebody says “you should do this” or “you do that” it generally means that they don’t know how. EXXON is now in a bit of a profit crunch. It seems likely that they would big for your “opinions”! (sarc off)
Davy on Thu, 13th Aug 2015 11:47 am
Rock said “First, the “United States” doesn’t drill for oil and thus can’t take on “massive debt”. Energy companies drill for oil”
Rock that is status quo and true but what about a collapse and or martial law situation? I believe at some point it could be possible to have oil E&P nationalized.
rockman on Thu, 13th Aug 2015 1:09 pm
davy – good idea. They can let the Post Office run the oil patch. LOL.
Seriously though: describe what “nationalizing” the oil patch would look like. Would the govt take the $trillions in equity away from tens of millions of US citizens that own pubco stocks in their retirement accounts? Would the govt imprison oil field workers and run them on chain gangs to get wells drilled? Would the govt confiscate the entire oil patch infrastructure? If so who would operate it…the Nation Guard?
Don’t take it personal but folks always throw out “nationalization” and never describe exactly how that system would function. Would nationalizing the US oil patch work out as good as it did for Venezuela? Would all the drilling be funded with tax payer money? If not where would the capex come from? Maybe govt printing presses? Well, that’s working out really good for Vz these days, ain’t it? LOL
So again describe (in detail) this new system that would work so much better than the one we currently have in place.
Davy on Thu, 13th Aug 2015 1:40 pm
Rock, I never said it would work. I agree with you on the details. I will say this if the economy collapses do you really think the oil patch will be functioning as we know it? No. Desperate measures require desperate actions.
apneaman on Thu, 13th Aug 2015 2:52 pm
Hey guys, I don’t know about the rest of the world, but the US postal service kicks the ass of Canada Post any day of the week. There many things in America that are taken for granted and will be missed after the fact.
apneaman on Thu, 13th Aug 2015 2:58 pm
Davy, speculate on how they might try it. I’m thinking using the military or some kind of national security pretext to draft workers. Do you think the folks running the MIC will go quietly into the night?
Dredd on Thu, 13th Aug 2015 3:32 pm
“Brazil Offshore Subsalt Holds 176 Billion Barrels Of Oil, Gas”
That explains why the 4th fleet was brought out of mothballs and set to assist with the diplomacy (The Fleets & Terrorism Follow The Oil – 2).
idontknowmyself on Thu, 13th Aug 2015 3:32 pm
People are intelligent enough to make their own opining and they don’t need mine of shorttonoil.
Well people should go and watch it is web site.
When someone show up and pretend to know the truth, this is went you have to doubt him or her. People that have live a life and struggle with other people should know that.
idontknowmyself on Thu, 13th Aug 2015 3:33 pm
Put your name on your website if you were such good consultant and let you past track record speak for itself.
rockman on Thu, 13th Aug 2015 3:47 pm
Davy – ” I will say this if the economy collapses do you really think the oil patch will be functioning as we know it”. Heck…during good times we can be a tad dysfunctional. And today ain’t exactly good times. LOL. We’re going thru a slow burn right now and don’t expect it to get better anytime soon. Companies/individual will do what they have to do to survive…just like any other businesses and 99% of the people you know.
And if it gets worse? Don’t count on us helping very much. It might upset a few folks but I’ll repeat what I’ve said many times before: we ain’t your mommy. You’re not our responsibility. The US economy ain’t our responsibility. We’ve never signed on for that duty despite what those Big Oil TV spots say. We’re a business and are driven by the demands of business. When it gets really bad you’ll be stuck because the only help will come from the govt. Good luck with that.
antaris on Thu, 13th Aug 2015 4:06 pm
Ha Ha HA !
Govt.Right.
And how did that go after Katrina?
idontknowmyself on Thu, 13th Aug 2015 4:36 pm
I also forget to add, that you are responsible to protect your personal identity online and should not give your personal identity to a web site that look suspicious. It is your own responsible to protected yourself and be suspicious of everybody. Especially in a world were natural resources depletion will force people to do anything to survive.
idontknowmyself on Thu, 13th Aug 2015 5:04 pm
I don’t know what will happen in the future. But expect the human survival behaviour to kick in and the human specie trying to survive at any cost.
Everything is possible, nationalization of oil companies, bail out of lenders with bad oil debt, military involvement, direct bail out of bad shale producer and guarantee of further load.
Human surival behavior will kick in eventually and something will happen.
We will see in time.oil.
shortonoil on Thu, 13th Aug 2015 7:16 pm
“Everything is possible, nationalization of oil companies, bail out of lenders with bad oil debt, military involvement, direct bail out of bad shale producer and guarantee of further load.”
Undoubtedly everyone of those will be attempted. The problem will not be a lack of human initiative, the problem will be a lack of energy. It takes energy to produce oil, and that is what we are running short of. To produce one barrel of oil, and its products would take the equivalent of 7,456 men working for one day. When oil can no longer support its own production it – ceases.
“So long as oil is used as a source of energy, when
the energy cost of recovering a barrel of oil becomes
greater than the energy content of the oil, production
will cease no matter what the monetary price may
be.” (M. King Hubbert)
You may want to entertain the notion that the day when oil fails is far, far away. That is but a day dream. The day when the oil age ends is a calculable quantity. It is like calculating when water flowing out of a barrel will cease. We have measured the depth of the water in the barrel; it is getting very, very low!
http://www.thehillsgroup.org/
Kenz300 on Fri, 14th Aug 2015 9:12 am
Electric vehicles, bicycles and mass transit are the future.