Petrobras, BG Found Light Oil, Gas in Brazil Waters

Brazil's state-owned oil company Petrobras and two partners have confirmed significant quantities of light oil and natural gas in deep water about 280 kilometers off the coast of Rio de Janeiro, Petrobras said Wednesday.

Test drilling produced 4,900 barrels of oil and 150,000 cubic meters of natural gas daily, and the reserve would be expected to deliver much more if put into production, though possible amounts were not disclosed.

Though Petrobras announced in July that oil and gas had been discovered in the area, Wednesday's announcement marked the first time that oil and gas volumes were disclosed.

The company called the area of the Santos Basina "new frontier" for possible Brazilian offshore production because it has never been tapped before.

Petroleo Brasileiro SA is exploring the possibility of extracting oil and natural gas from the bloc in a consortium that also includes Britain's BG Group PLC and the Petrogal division of Galp Energia, Portugal's biggest oil and gas firm.

Petrobras and BG Group said more evaluation and drilling is needed to determine whether it's possible to extract oil and gas from the extremely deep reserve. It lies several thousand meters (yards) below the ocean floor in a part of the Atlantic Ocean where the sea bed is already more than 2,000 meters (2,200 yards) below sea level

Petrobras engineers have recently said pumping oil from the extreme depths of the Santos Basin is very expensive and challenging because of complicated geographical conditions.

Petrobras has a 65 percent stake in the bloc, while BG Group has a 25 percent stake and Petrogal holds 10 percent.