Global Processing

Spain''s Repsol to invest $1.5B in Brazil

July 2, 2008
The Associated Press is reporting that Spain''s top oil company, Repsol YPF SA, plans to invest as much as $2 billion to develop vast crude reserves recently discovered at Brazil''s deep-water Carioca oil field.

Repsol spokeswoman Begonia Elices gave no specific timeframe for the investment of between $1.5 billion and $2 billion, noting that Brazil must first complete studies gauging the size of the Carioca find.

Repsol and Britain''s BG Group have minority stakes in the field off Rio de Janeiro''s coast. Brazil''s state oil company Petroleo Brasiliero SA is the lead oil company exploring Carioca, and a Petrobras spokesman declined to comment.

Brazil''s top oil regulator in April announced that the Carioca field could contain as many as 33 billion barrels of crude. If proven, the find would be Brazil''s largest, and the third-largest in the world.

Petrobras CEO Sergio Gabrielli tried to cool speculation at the time, saying formal studies were still needed and that early estimates should be available by July.

Brazil has announced huge fossil-fuel finds in recent months, including the 8-billion barrel Tupi field in November and the blockbuster Jupiter natural gas field in February. Brazil already has proven oil reserves of 11.8 billion barrels, according to the U.S. Energy Department. Tupi and Jupiter alone could turn Brazil into a major oil and gas exporter and lead to it join OPEC, industry experts have said.

The finds are driving investment as world oil prices soar, making expensive deep-water drilling more affordable.