Beginning in 2007, Brazil discovered enormous “pre-salt” oil reserves. The pre-salt is estimated to contain 50 billion barrels worth of crude, with optimists putting that number at up to 100 billion (US Foreign Commercial Service Office in Brazil). The discovery has generated a lot of excitement over how the energy game will change both internationally and domestically for Brazil.
Curently, the oil fields are pumping up to 2.5 million barrels of oil per day and is estimated to swell to between 4.5 and 6 million barrels per day by 2020, launching Brazil from the eleventh largest oil-producing country, to one of the top five (The next oil giant?). A barrel is equivalent to 42 American gallons. To get a better perspective of what these numbers mean for Brazil, I will compare it to America’s investment in the Apollo space program, which cost us $200 billion in today’s dollars and was worth a few percent of our GDP. Brazil’s investment in the pre-salt reserves will cost around $1 trillion and comprise half of their 2010 GDP (Filling up the Future).
Though the prospects of such a discovery certainly signal that Brazil has hit the jackpot, extraction and development will not be easy, cheap, or fast. The reserves are located in the South Atlantic off the shores of the Sao Paulo, Rio de Janeiro, and Espirito Santos states.
More specifically, the oil is tucked beneath a bed of salt up to 7,000 meters below the Atlantic’s surface, the most formidable depth for which the industry must engineer methods of extraction. Petrobras explains in the following video (Pré-Sal) the technological feats extraction in the pre-salt reserve entails:
According to the video, the complicated technical logistics call for huge sums of investment, in the order of hundreds of millions of dollars a year, and expertise in order for extraction to be as productive as expected.