Upstart HRT Oil & Gas (HRT) plans to drill 65 exploration wells and bring 52 wells into production by the end of 2014 at a cost of $3.14 billion. Work has already begun on wells in the Solimões Basin and offshore Namibia. Net potential resources at the two sites were recently estimated at 7.9 billion barrels of oil equivalent (boe).
"Our dream is to reach production of 1.0 MMb/d by 2020," HRT chief executive officer (CEO) Marcio Mello told E&P. He added that this figure would include production from areas in the Solimões Basin in Amazonas, Brazil, and blocks offshore Namibia, West Africa.
Mello has been a strong supporter of the OTC Brasil conference, which he believes is a significant event. "HRT is a young deepwater company, but very soon we will be a major player offshore Brazil. Also, we are part of the petroleum community, and it is a privilege to receive OTC in our country."
According to Mello, some of the highlights of OTC Brasil will extend beyond Brazil's offshore.
"The main points will be related to the sub-salt reservoirs and installations," he said, emphasizing the session in exploration and correlation with West Africa and Brazil. Mello hopes first-time visitors to Brazil will come away with the impression that Brazil is an attractive market. "Visitors will be surprised with the fantastic potential and market for deepwater technology in Brazil."
As a young geologist, Mello started his career in the Amazon, where he saw natural gas seeping from the ground. He has a deep knowledge of Solimões Basin geology as well as of Namibian offshore basins.
After working for 24 years for Petrobras as a geochemist, he changed direction from a service provider to an oil and gas manager. According to Mello, the time was right for this move when an economic crisis brought asset values down; high-potential assets were on offer.
"In July 2009, an opportunity came up to acquire certain blocks in the onshore Solimões Basin (Amazon) and to start an oil and gas company. After a successful private placement to obtain the initial capital of around $280 million, the company was started," he explained.
The first purchase included 51% of 21 blocks in the Solimões Basin, followed a few months later by acquiring an asset offshore Namibia.
"In October 2010, HRT went to the market and obtained an additional $1.5 billion to execute a five-year business plan," Mello said. Today, after completing two years of existence, HRT is a group of companies with a market value around $5 billion."
Asked about the difficulties of installing infrastructure to transport the company's production from the Amazon, Mello explained that Brazilian law requires that Petrobras rent idle capacity in its pipelines to private companies. Several pipelines cross the Amazon near Mello’s concession.
A bigger consideration than getting production to market is getting rigs in and out, he added.
"Everything that we take to the site, we have to take back out. To reduce the impact on the forest, rigs have to be separated into more than 500 pieces and flown by helicopter to drilling sites. Every time a rig moves to a new place, that process starts again," he explained.
Mello thinks HRT's operations in Brazil can be done responsibly and with little disruption to indigenous people, unlike operations in other parts of the Amazon, such as Peru, where local groups have protested against gas drilling, or in Ecuador, where oil production sparked a long-running legal battle.
This is in part because Petrobras operations historically have had a relatively small ecological impact, Mello continued, and because HRT has partnered with a local conservation group to help fund forest protection and create jobs in the area.
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