Shell is betting on oil exploration near the Amazon

Shell, the second largest oil producer in Brazil, hopes that the government will approve oil exploration on the equatorial edgeof the oceanic region that includes the controversial part located in front of the mouth of the Amazon River, to define its investments in the country.

“If the government decides to open the equatorial border and approve the exploration of the new oil border in the country, we will analyze it future concession auctions for making investment decisions,” said the president of Shell Brazil, Cristiano Pinto da Costa, in a meeting with journalists in Rio de Janeiro.

The executive added that Shell already has eight concessions on the equatorial edge, all in areas far from the mouth of the Amazon, but admitted that its projects in the region are paralyzed while they wait for the government to give clear signals on whether or not to open a new frontier.

The equatorial rim encompasses a large region of the Atlantic Ocean near the coasts of northern states Brazilneighboring areas where Guyana and Suriname have already discovered deposits with reserves of up to 13,000 million barrels of crude oil.

Brazil estimates that this new horizon may contain up to 14,000 million barrels of oil, but exploitation of the region has sparked intense debate because of the ecological vulnerability of the area closest to the mouth, home to important chains of reefs and mangroves. .

State-owned Petrobras, which has already received licenses to explore the area of ​​the equatorial edge furthest from the mouth of the Amazon, is hoping the environmental regulator will reconsider its decision to deny it permission to drill in the most sensitive area, despite the fact that it is 500 kilometers from the coast.

“Whether or not to open the equatorial margin is one of the most important decisions that Brazil has to make at this moment. In my opinion, the opening will create a great opportunity for the country. It is only necessary to look at the reserves that have already been discovered in Guyana and Suriname and that geologists believe that extend to Brazil,” Da Costa said.

The executive added that to determine whether there are reserves in the region and to calculate their economic profitability, drilling is required, which depends on the environmental permit.

“Brazil has already shown that it is capable of operating with great safety in very deep waters. It is currently producing 3 million oil per day from the pre-salt (another horizon in the ocean region) without accidents,” he said.

He added that the opening of a new horizon is not incompatible with the policy of the government of Luiz Inácio Lula da Silva to speed up its energy transition because that process is slow and must be carried out with energy security.

“All scenarios show that the world will need hydrocarbons for many years to come. Shell estimates that peak production will still extend into the late 2030s,” he said.

According to Da Costa, Brazil, pDue to its competitiveness and low production costs, it may be the last country in the world stop producing oil when the transition ensures that the world no longer needs fossil fuels.

“Hydrocarbons will still be needed for decades and it is not inappropriate to continue to invest in basins where there is competition, and Brazil is one of them,” he said.