Shell is betting that Brazil will allow exploration in the area off the mouth of the Amazon

Shell, the second largest producer of Petroleum of Brazil, expects the Government to authorize oil exploration in the Equatorial Margin, an oceanic region that includes the controversial part located in front of the mouth of the Amazon River, to define their investments in the country.

“If the Government decides to open the Equatorial Margin and authorize the exploration of a new oil frontier in the country, we will analyze future concession auctions to make investment decisions.”stated 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 in the Equatorial Margin, all in areas distant from the mouth of the Amazon, but admitted that its projects in the region are paralyzed while waiting for the Government to give clear signals on whether or not it will open the new frontier.

The Equatorial Margin comprises a wide region of the Atlantic Ocean off the coast of the northern states of Brazil, neighboring areas where Guyana and Suriname have already discovered deposits with reserves of up to 13 billion barrels of crude oil.

Brazil estimates that this new horizon can contain up to 14,000 million barrels of oil, but the exploitation of the region has generated an intense debate due to the environmental vulnerability of the area closest to the mouth, where there are important chains of reefs and mangroves. .

The state-owned Petrobras, which has already received licenses to explore areas of the Equatorial Margin furthest from the mouth of the Amazon, hopes that the environmental regulator will review the decision that denied it authorization to drill a well in the most vulnerable area, despite the fact that located 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, opening it will generate a great opportunity for the country. “It is only necessary to observe the reserves already discovered in Guyana and Suriname and that geologists consider extend to Brazil,” Da Costa assured.

The executive added that to determine whether or not there are reserves in the region and calculate their economic viability, it is necessary to drill, which depends on the environmental license.

“Brazil has already demonstrated that it is capable of operating with great safety in very deep waters. “It currently extracts 3 million daily oil from the pre-salt (another horizon in its oceanic region) without accidents,” 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 accelerate its energy transition because this process is slow and has to be carried out with energy security.

“All scenarios indicate that the world will still need hydrocarbons for many years. Shell estimates peak production will still extend into the late 2030s″, he stated.

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

“Hydrocarbons will still be necessary for decades and it is not incongruous to continue investing in basins where there is competitiveness, and Brazil is one of them,” he sentenced.