Brazil is well on its way to becoming the largest supplier of offshore oil worldwide, with 1.3 million barrels per day in 2025, according to World Oil, citing a report by GlobalData.
This will mean that Brazil’s share in the global offshore oil production will be 23 percent. The United States will come in second place with 655 000 bpd offshore oil production by 2025, which is 11 percent of the global total.
GlobalData senior oil & gas analyst Effuah Allyne stated that while Saudi Arabia is the dominant producer of liquids globally, mainly from existing projects, Brazil leads condensate and crude production from upcoming/new developments.
Alleyne said that Brazil’s pre-salt layer has been prolific in the Santos Basin, which has resulted in a strong portfolio of offshore projects. These projects have demonstrated robust economics such as development breakeven oil price averages of US$40/barrel and have contributed significantly to South America’s trend to surpass North America’s offshore production by 2030.
Brazil is one of the most popular oil exploration destinations worldwide due to its low-cost reserves. Analysts estimate that some Brazilian offshore projects can make a profit at $35 per barrel. This is likely to drop further to $30 per barrel in future.
Brazil’s pre-salt zone is still a desirable investment destination, despite the push for energy transition and the destruction that the pandemic caused to the industry. One large-scale project within the Santos Basin received its final investment decision and an expansion was approved.
Brazil’s National Petroleum Agency (ANP) predicted earlier this year that oil production and exploration could be worth $13 billion.
Schreiner Parker, Rystad Energy’s Senior Vice President and Head for Latin America, wrote that “Exploration activity and more importantly expenditure are picking up,” in Rystad’s June regional newsletter.
Parker stated that 1 billion barrels (boe) worth of oil equivalent (oil equivalent) were found in the region last year. Mexico and Brazil accounted for more than 90% of these volumes.
