Equinor Sanctions $8B Bacalhau Field Development in Brazil
Norwegian oil and gas company Equnior has made a final investment decision for the development of the Bacalhau field offshore Brazil.
The development of the field located in the Santos Basin will cost around $8 billion.
Arne Sigve Nylund, Equinor’s executive vice president for Projects, Drilling, and Procurement said: "This is an exciting day. Bacalhau is the first greenfield development by an international operator in the pre-salt area and will create great value for Brazil, Equinor, and partners. Good cooperation with partners, Brazilian authorities, and suppliers has resulted in an investment decision for the Bacalhau field."
“Bacalhau is a globally competitive project with a break-even below USD 35 in a key energy region. Estimated recoverable reserves for the first phase are more than one billion barrels of oil,” says Nylund.
The development plan was approved by the Brazilian National Agency of Petroleum, Natural Gas and Biofuels (ANP) in March 2021.
It includes 19 subsea wells that will be tied back to an FPSO to be supplied by MODEC. First oil production is planned for 2024.
The field is located 185 km from the coast of the municipality of Ilhabela/SP, in the state of São Paulo, in water depths of 2050 meters.
“Bacalhau is an important step towards the realization of our strategic ambition to deepen our presence in Brazil. It is also an important project for the country, as it represents significant investments, ripple effects in the supply chain, and local job creation,” says Veronica Coelho, Equinor’s country manager in Brazil.
The Bacalhau field spreads across two licenses, BM-S-8 and Norte de Carcará. The FPSO at the field will be one of the largest FPSOs in Brazil with a production capacity of 220,000 barrels per day and two million barrels in storage capacity. The stabilized oil will be offloaded to shuttle tankers and the gas from Phase 1 will be re-injected in the reservoir.
The FPSO contractor MODEC will operate the FPSO for the first year. After that, Equinor plans to operate the facilities until the end of the license period.
Partners in Bacalhau are Equinor 40% (operator), ExxonMobil 40%, Petrogal Brasil 20% and Pré-sal Petróleo SA (Government Company, PSA Manager).