Rio de Janeiro : Brazil on Wednesday announced its largest oil discovery in nearly three years in its vast deepwater fields, boosting the South American nation's potential as a major energy producer.
The estimated 4.5 billion barrel find, if confirmed, could rival some of the world's largest discoveries in recent years such as those in Kazakhstan and Iraq and will likely draw further oil company attention to Brazil's offshore waters.
"It seems to be one of the wells with greatest potential ever drilled in the country," Haroldo Lima, director general of Brazil's ANP energy regulator that announced the discovery, said.
The ANP hired Petrobras to drill the 2-ANP-1-RJS will in the Santos Basin, which is also home to the 5-8 billion barrel Tupi find. It found a column of 272 metres of oil in the area 195 kilometres from the coast of Brazil in the Santos Basin.
The oil is likely to be used in an oil-for-shares capitalisation in which state oil company Petrobras will give the government shares in exchange for rights to develop five billion barrels of offshore reserves.
Brazil has became a new frontier for global oil exploration since its 2007 discovery of the massive Tupi field in the offshore subsalt cluster, drawing the attention of global energy giants.
Environmental dangers associated with offshore drilling face growing scrutiny after BP's massive spill in the Gulf of Mexico. Still, analysts expect increased global reliance on offshore reserves.
President Luiz Inacio Lula da Silva has described the massive subsalt reserves as "a gift from God" and last year launched a legislative overhaul that would boost state control over the sector and make Petrobras the sole operator of new projects.
