Brazil Field Vastly Smaller Than Claimed, Credit Suisse Says

(Bloomberg) — Brazil’s Carioca prospect may have 98 percent less crude than a figure cited by the country’s oil agency, Credit Suisse Group said, challenging claims that the field is the biggest-ever discovery outside the Middle East.

Haroldo Lima, director of Brazil’s National Oil Agency, sent shares of Petroleo Brasileiro SA and other Carioca stakeholders higher when he said April 14 that the offshore field may hold 33 billion barrels of oil. That figure is “way off the mark,” Mark Flannery, a Credit Suisse analyst in New York, said today on a conference call with clients.


An estimate of about 600 million barrels “sounds reasonable,” Flannery said, adding that the firm isn’t yet giving an official assessment of its own. The estimate cited by Lima was probably intended for the entire subsea geological formation known as Sugar Loaf, which encompasses multiple fields, Credit Suisse said.

“A lot of exploration and delineation is going to need to take place,” Emerson Leite, a Credit Suisse analyst who’s been following Petroleo Brasileiro for a decade, said on the conference call. “We are very early in the process here.”

Bloomberg