Exxon Mobil: To Relinquish Block In Brazil's Oil-Rich Santos Basin
April 27 2012 - 04:01PM
Dow Jones News
Exxon Mobil Corp. (XOM) said Friday it is abandoning its only
exploration effort in the Santos Basin, epicenter of Brazil's
offshore oil boom.
Texas-based Exxon and its partners Hess Corp. (HES) and Petroleo
Brasileiro S.A. (PBR) "have agreed to relinquish" the BS-M-22 block
in Brazil's Santos Basin, spokesman Pat McGinn told Dow Jones
Newswires. The block was Exxon's only asset in a basin that is home
to some of the largest oil discoveries in recent memory.
Exxon, which is celebrating 100 years in the South American
country this year, "will continue to look for new business
opportunities in Brazil," McGinn said.
McGinn said the local regulator, Agencia Nacional do Petroleo,
or ANP, was notified in the first week of April.
The BS-M-22 block, located in the thick of Brazil's burgeoning
offshore oil activity, proved a hard nut to crack for Exxon and its
partners, underscoring the difficulty of developing Brazil's
massive offshore reserves, most of which lie beneath deeply buried,
thick layers of salt.
Two wells drilled there, Azulao-1 and Sabia-1, struck oil, but
another well, dubbed Guarani, turned out to be dry. A typical
deep-water well in the area can cost tens of millions of dollars,
and Deutsche Bank once estimated that the Guarani well cost about
$150 million.
Last October, Exxon and its partners had sought to bring in a
new partner into the block to share the risk of drilling a new well
there, offering a 25% stake. A brochure for the stake said that the
prospect was estimated to contain up to 1.5 billion barrels of
recoverable oil.
Block BM-S-22 is located about 350 kilometers south of Rio de
Janeiro.
Exxon, the world's largest publicly traded oil company, has a
40% interest in the block. Hess has 40% and Petrobras 20%. Exxon is
the block's operator.
-By Angel Gonzalez, Dow Jones Newswires; 713-547-9214;
angel.gonzalez@dowjones.com
Exxon Mobil (NYSE:XOM)
Historical Stock Chart
From Feb 2024 to Mar 2024
Exxon Mobil (NYSE:XOM)
Historical Stock Chart
From Mar 2023 to Mar 2024