Brazil is the nation where cultures converge in a riot of colours, sounds and tastes However apart from its tourist attractions, Brazil’s Oil and Gas sector is a prominent one and worth exploring from a business or investment perspective.
Brazil is a top producer of oil and gas
Brazil is projected to play an important role in the world’s oil and gas production by the year 2020. The country is identified as one of the leading providers of oil and gas for the future. In 2014, Brazil climbed 2 to 3 spots in the market, leveling itself with the top oil producing countries, including Iran and other Middle Eastern heavyweights.
For the last 10 years, Brazil’s oil production has been steadily increasing. From 1.75 million of oil barrels per day in the early 2000s, the country has seen exponential growth with up to 2.75 million oil barrels being produced per day by 2014. By the year 2020, Brazil is expected to produce 3.0 million barrels of natural oil per day, which will place the nation among top-notchers like the US and Saudi Arabia.
In addition to this, country data shows that the recent discoveries of pre-salt, a mineral known to hype the production of oil, has made its way into the realm of science. The discovery of this resource in Brazil guarantees the nation’s progress in the oil and gas sector in the coming years.
Most Brazil reserves are offshore
In data collected as of 2015, 96% of the Brazil’s oil and gas has been located in oil and gas rigs located off-shore. These production sites include oil and shale refineries, natural gas processing plants, petrochemical plants and oil and gas reserves along the coasts of Brazil.
Petrobras, an oil production company in Brazil has led the way for abundant production. It is known to contribute 86% of national oil production and 82% of national gas production, making it the dominant oil and gas production company in the country.
Oil refining is vital to keep an accurate account and avoid scarcity. With effective technology, Petrobras has been known to contribute 99% of oil refining capacity to the business. In addition to, this company is the only one to span the vast cycle of oil and gas value chain. From exploration to retail, the company continues to dominate both upstream and downstream segments in the value chain.
Foreign investments are needed for oil and gas exploration in Brazil
Though Brazil has rich natural resources within its land, investments are important to extract these vital minerals for it to contribute to the global market.
A major area of investment is in the area of oil and gas extraction equipment. Country data specifically shows that turbo generators, centrifugal compressors, and flares are some of the equipment needed for production as that is where Brazil lacks. Still, despite this situation, Petrobras has been a field for great opportunities owing to international investments. The crisis has paved a way for foreign suppliers to assist in resource production.
Utilising its efficiency and local talent, Brazil has been joining forces with the biggest oil and gas producers worldwide to fight any shortcomings that arise. The US Government has contributed 130 billion dollars not only in exploration and production but also in infrastructure projects that promote oil production. This amount has been funding production since 2015 and is expected to continue to assist till 2019.
Hence with Brazil being touted as the next big Oil and Gas player, it is a sector that holds promise. Your company’s market research should certainly include the opportunities in the resource extraction process.