Brazilian Onshore Petroleum Potential and Exploration Opportunities

Eliane PetersohnChief Geologist

Outline

3

2

Brazil’s Current State1

4

Onshore’s Current State and Prospectivity

Open Acreage Process

Conclusions

Brazil’s Current State

Area under concession~ 295,000 km2

350 Blocks

392 fields

97 companies

Production(May, 2018)

Oil 2.6 million bbl/dNatural Gas 112 million m3/d

Proven Reserves(Dec, 2017)

Oil 12.8 billion barrelsNatural Gas 370 billion m3

10th largest oil producer in the world and the largest in Latin America

Onshore’s Current State

Onshore New Frontier BasinsArea under concession:

~ 170,000 km2

81 Blocks and 23 fieldsOil production: ~16 thousand bbl/d

Natural gas: ~ 17.6 million m3/d

Onshore Mature BasinsArea under concession

~ 8,500 km2

122 Blocks and 279 fieldsOil Production: ~92 thousand bbl/d

Natural gas: ~ 3.7 million m3/d

Onshore New Frontier Basins

Parnaiba

Parana

SaoFrancisco

Parecis

Amazonas

Solimoes

Solimoes and Parnaiba are the only new frontier producing basins in Brazil

Acre, Amazonas, Parana, Parecis and Sao

Francisco are gas prone basinsNo wells have been drilled in Madre de Dios

Basin

Parnaiba Basin

GaviaoPreto

Gaviao Caboclo Gaviao Branco Norte

GaviaoBranco

Gaviao Vermelho

Gaviao Azul

Gaviao Real

Natural Gas Production:

~6.1 million m3/day (jan/2018)

Area under concession

~76,200 km2

Onshore Mature Basins

Reconcavo, Potiguar,

Sergipe-Alagoas and Espirito Santo

- Advanced exploration stage

- Oil & Gas Infrastructure available

- Excellent opportunity for small and medium-sized

companies

- Recent discoveries

- Remaining Potential

Potiguar

Sergipe-Alagoas

Espirito Santo

Reconcavo

Onshore’s Current State

Goal: maximizing production and recovery

OilGas

108Thousand bbl/d

21Million m³/d

49%

Exploration wells 84%

0

50.000

100.000

150.000

200.000

250.000

Onshore Oil Production

0

20

40

60

80

100

120

140

2012 2013 2014 2015 2016 2017 2018

Energy Police & Regulatory Improvements

- REATE (Revitalization Program for Oil and

Natural Gas Exploration and Production in

Onshore Areas)

- Royalties reduction for onshore basins

- Royalties reduction for the incremental

production in mature fields

- New Local Content Policy

- Open Acreage

Open Acreage

Continuous offer of blocks and mature fields.

Companies can bid on blocks not sold in previous auctions.

Applications can be submitted anytime and not just at designated points.

It gives more flexibility to the industry and it will promote exploration activity in onshore areas where there are more small and medium size companies.

Milestones

November April

2017 2018

1st Wave areas disclosure

• Technical and economic parameters disclosure

• Registration to Open Acreage begins

May July

Tender Protocol and Contract Publications and beginning of the enrolment

148 blocks are available to bid on

September

• 10 blocks were included in the 1st stage of 1st Wave

• CNPE proposed the inclusion of areas within the Pre-salt Polygon in the Open Acreage under production sharing regime

• CNPE approves all onshore blocks in Open Acreage.

20191st Semester

2nd Wave areas disclosure

2nd Wave Technical and economic parameters

disclosure

1st Wave

Area346,035 km²

14Mature

Fields

15Sedimentary

Basins

884Blocks

722 blocks in 9 onshore basins

162 blocks in 6 offshore basins

1st Stage – 1st Wave

1st Stage – 1st Wave

Marginal fields

Reconcavo Basin Potiguar Basin Espirito Santo Basin Sergipe-Alagoas Basin

http://rodadas.anp.gov.br/pt/oferta-permanente/areas-com-acumulacoes-marginais

2nd Wave

1,054Blocks

85 blocks in 7 onshore basins

969 blocks in 3 offshore basins

Technical and economic parameters are under

evaluation

Area 441,400 km²

20Sedimentary

Basins

Open Acreage

All the blocks in all the onshore basins will be

included in the Open Acreage

Geological & Geophysical Program

ANP has invested R$ 1.5 billion in Geological and Geophysical

data acquisition

2007-2018

Conclusions

The Brazilian Government and ANP have been working hard to attract more investments and promote exploration activities in onshore basins.

The Open Acreage process represents one of the most important mechanism to leverage exploration activities in the onshore basins.

Open Acreage aims to make the oil sector more dynamic and to increase

exploration and production activities in the Country.

National Agency of Petroleum, Natural Gas and Biofuels

ANP

Eliane Petersohnepetersohn@anp.gov.br