PBR Petroleo Brasileiro ADR

RIO DE JANEIRO—Oil major Shell is planning to continue investing heavily in Brazil as part of a bid to double its global deep water production by the early 2020s.

Shell plans to invest $10 billion in the South American nation over the next five years, Wael Sawan, the company's executive vice president for deep water, said in an interview this week. That would come on top of the more than $30 billion in capital the company says it has deployed in Brazil, where it operates 5,500 energy stations and acquired a large number of oil-and-gas assets earlier this year via its takeover of BG Group PLC.

"We are by far the largest foreign investor," Mr. Sawan said. "Every single year we will be investing around $2 billion."

Foreign oil firms have been eyeing Brazil with renewed interest in recent months since the impeachment of President Dilma Rousseff opened the door for an administration widely seen as more friendly to investors. The new president, Michel Temer, is pushing legislation aimed at encouraging investment in the oil sector as part of broader effort to dig Brazil out of its worst recession in at least a century.

Shell held a series of investor presentations in Brazil this week. Chief Executive Ben van Beurden met with Mr. Temer in Brasí lia on Thursday.

"We continue to be encouraged by what we hear, at the government level, at the ministerial level, what we read in the press, what we have in our meetings with government officials," Mr. Sawan said. "The fundamental view that foreign investment is good for the country, and specifically in the oil and gas sector…gives us confidence that we are welcome here."

Shell's roughly $50 billion acquisition of BG was driven in large part by its assets off the Brazilian coast. Mr. Sawan said these and other assets in Brazil should produce 400,000 barrels of oil per day in coming years, accounting for much of the 900,000 barrels per day of oil that Shell aims to produce in deep water starting around 2020.

Deep water output last year amounted to 450,000 barrels.

Company executives say Shell's 103-year presence in Brazil makes them comfortable with the country's often-challenging investment environment.

Shell was one of only a few foreign oil firms that bid on a massive offshore oil deposit named Libra that Brazil auctioned off in 2013, snapping up a 20% stake. That auction attracted relatively little interest from private companies because of rules obliging Brazilian state-run oil firm Petró leo Brasileiro SA to operate the oil field.

Brazil's Congress voted in October to ease restrictions on foreign investment on such oil fields, known as the pre-salt.

Write to Paul Kiernan at paul.kiernan@wsj.com

(END) Dow Jones Newswires

November 10, 2016 14:15 ET (19:15 GMT)

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