The series of management improvement measures – some might just call it cost-cutting – adopted by Petrobras over the last two years is starting to show some real rewards.
The Brazilian major revealed that its Logistics Infrastructure Optimization Program (Infralog) should generate approximately R$1.8 billion ($719 million) in savings from the time it was created in November 2012 until the end of this year.
By the end of 2013 the program had already cut costs by around R$800 million. With an overall target set by Petrobras to save R$4 billion ($1.6 billion) in four years (from November 2012 to December 2016), Infralog covers logistics throughout Brazil, encompassing oil and gas exploration, production, and transportation, as well as refining, distribution and sale of products.
On the upstream side, for example, Petrobras has opted to use existing ports and airports rather than building new support bases for its ship and helicopter operations. In addition, the use of buoys – simpler to build and operate – has replaced projects to build terminals for petroleum transfer operations.
The company’s other structuring programs are the Operating Cost Optimization Program (Procop), the Well Cost Reduction Program (PRC-Poço), the Operational Efficiency Improvement Program (Proef), the Divestment Program (Prodesin), and the Subsea Installations Cost Reduction Plan (PRC-Sub).
More information on progress with these other focus areas will be released during the course of 2015.
Exxon Mobil Corp. and offshore Guyana partners continue their success with their 13th discovery on the Stabroek Block and fifth discovery in the Turbot area.
The rig count fell for the past four months and production growth in the Permian Basin and other key shale basins have slowed as oil prices fell and many independent shale companies cut spending.
The new policy focuses on incentivizing increased investment and production.