Shell, Exxon win blocks in Brazil's pre-salt oil auction
Oil majors Royal Dutch Shell and Exxon Mobil won blocks in Brazil's coveted pre-salt oil region in an auction on Friday (October 27).
Oil majors Royal Dutch Shell and Exxon Mobil won blocks in Brazil's coveted pre-salt oil region in an auction on Friday (October 27).
Shell was part of consortia that won two of the four blocks on offer in the first part of an eight block auction.
Oil in the region is trapped under thousands of feet of salt beneath the ocean floor of Brazil's deep Atlantic waters.
The quality of reserves and the reforms have made Brazil an important target for oil majors, even though they have had less appetite for capital-intensive mega projects since crude prices crashed in 2014.
Brazil has big hopes for the volume of oil the companies can pump from the blocks. Brazilian oil output could double to more than 5 million barrels per day (bpd) by 2027, compared with the 2.6 million bpd produced in August, regulator ANP said on Thursday.
Shell has said it is confident it can pump from the pre-salt fields at below $40 a barrel.
Exxon Mobil set the stage for its bids in this round in September, when the U.S. oil major won 10 blocks near the pre-salt in another auction.
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