23rd World Gas Conference

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23rd World Gas Conference

  1. 1. PETROBRAS 23rd World Gas Conference Amsterdam Brazilian Oil and Gas Perspectives A National Oil Company Approach José Sérgio Gabrielli de Azevedo CEO and President 9th June 2006 1
  2. 2. PETROBRAS The presentation may contain forecasts about future events. Such forecasts merely reflect the expectations of the Company's management. Such terms as "anticipate", "believe", "expect", "forecast", "intend", "plan", "project", "seek", "should", along with similar or analogous expressions, are used to identify such forecasts. These predictions evidently involve risks and uncertainties, whether foreseen or not by the Company. Therefore, the future results of operations may differ from current expectations, and readers must not base their expectations exclusively on the information presented herein. The Company is not obliged to update the presentation/such forecasts in light of new information or future developments. Cautionary Statement for US investors The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation, such as oil and gas resources, that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. 2
  3. 3. PETROBRAS Petrobras: Overview 3
  4. 4. PETROBRAS Petrobras Overview: Petrobras 2015 – Mission and Vision Mission Vision 2015 Operate in a safe and profitable Petrobras will be an manner in the oil, gas and integrated energy company energy industry in Brazil and with a strong presence in abroad, with social and the international market environmental responsibility, and as a leading force in providing products and Latin America, focusing on services that meet clients’ profitability and social and needs and that contribute to the environmental development of Brazil and the responsibility. countries in which it operates. 4
  5. 5. PETROBRAS Petrobras in the World – Activities in 24 countries United Kingdom. New York USA Houston Turkey Tokyo Iran Beijing Lybia Mexico Trinidad & Tobago Nigeria Venezuela Colombia Equatorial Guinea Tanzania Singapore Ecuador BRAZIL Angola Mozambique Peru Bolivia Rio de HEAD OFFICE Paragay Janeiro Uruguay REPRESENTATIVE OFFICE Chile REFINING Argentina TRADING EXPLORATION AND PRODUCTION 5
  6. 6. PETROBRAS Company Overview An integrated energy company with US$ 74 billion in gross revenue (2005 US GAAP) Exploration • Proven Reserves: 11.8 billion boe (SEC 2005) and Production • Oil and Gas Production: 2.22 million boed (2005) Refining, • 16 Refineries • Capacity: 2,114 thousand bpd Transport and Marketing • Pipelines: 18,854 miles • Vessels (own fleet): 50 • 6,933 service stations (34% share in the Brazilian Distribution market), 746 in Argentina and 105 in Bolivia Natural Gas • Sales of Natural Gas: 1.83 bcf/day • Ethene Production: 460,000 tons/year Petrochemicals • Styrene Production: 250,000 tons/year • Polystyrene Production: 120,000 tons/year Operational data includes Petrobras Energia 6
  7. 7. PETROBRAS (1) 2005 figures not available yet. Publicly traded peer comparison (2) Oil and Gas Production (3) Proforma for acquisition of Burlington Resources Proven reserves (SEC - billion boe) – Dec. 2005 Oil and gas production (million boe) - 2005 ExxonMobil 22,4 ExxonMobil 921 563 Lukoil* 20,1 BP 912 543 Petrochina* 18,5 Shell 764 505 Petrochina 823 187 BP 17,6 Total 592 291 Yukos* 13,0 Chevron 609 259 Chevron Texaco 12,1 ConocoPhillips (3) 507 342 11,8 7th Petrobras 643 118 Petrobras Eni 406 228 8th Shell 11,5 Yukos (1) (2) 624 Total 11,1 Lukoil (1) (2) 614 5th Oil Production ConocoPhillips 9,4 Statoil (2) 427 ENI 6,8 Repsol-YPF 194 222 Statoil 4,3 Sinopec 279 37 Sinopec* 3,8 0 200 400 600 800 1.000 1.200 1.400 1.600 Repsol 3,3 Oil Gas Reserve life (years) – Dec. 2005 Refining capacity (thousand bpd) - 2004 Lukoil* 32,7 XOM 6.343 Yukos* 20,8 RDS 4.026 Petrochina* 19,6 Sinopec 2.998 ExxonMobil 15,1 BP 2.747 Petrobras 14,6 TOT 2.708 ConocoPhillips 14,2 5th COP 2.275 Chevron Texaco 13,1 PetroChina 2.202 Sinopec 12,3 CVX 2.195 Total 12,2 12,2 Petrobras Yukos 2.114 1.223 9th BP ENI 11,5 Repsol 1.175 Statoil 10,1 Lukoil 1.139 ENI** 524 Shell 9,0 Statoil 296 Repsol 8,0 Source: Evaluate Energy and Company Reports 7
  8. 8. PETROBRAS Oil Production in Brazil 2.000 Oil and NGL Natural Gas 1.500 million boe 1.000 3 d p b 0 1 500 - 1954 1958 1962 1966 1970 1974 1978 1982 1986 1990 1994 1998 2002 7 6 4 3 G Source: Petrobras 8
  9. 9. PETROBRAS E&P Brazil - Domestic production units • Domestic production will grow at an average of 6.4% per year • 15 new projects until 2010 Roncador Roncador Roncador Roncador P-55 P-55 2,400 Albacora Leste Albacora Leste P-52 P-52 Frade 180,000 bpd 180,000 bpd Frade P-50 P-50 180,000 bpd 180,000 bpd 100,000 bpd 2010 2010 100,000 bpd 180,000 bpd 180,000 bpd 2007 2007 2009 2009 April 2006 April 2006 Cidade de Vitória Cidade de Vitória 2,300 Thousand boed 2,200 Jubarte Jubarte (Golfinho Mod. 2) (Golfinho Mod. 2) Phase 1 Phase 1 100,000 bpd 100,000 bpd 2,200 Jubarte Jubarte P-34 P-34 2007 Phase 2 Phase 2 2007 60,000 bpd 60,000 bpd 2,100 P-57 P-57 September 180,000 bpd 180,000 bpd 2,000 September 2006 2006 2,000 2010 2010 Marlim Leste Marlim Leste P-53 P-53 Golfinho Golfinho Rio de janeiro 180,000 bpd 180,000 bpd Rio de janeiro FPSO Mod. 3 FPSO Mod. 3 1,910 Espadarte Espadarte 2008 2008 100,000 bpd 1,800 Piranema 100,000 bpd Piranema 100,000 bpd 100,000 bpd 2010 20,000 bpd 2010 20,000 bpd 2007 2007 October October Marlim Sul Albacora Marlim Sul Albacora 2006 2006 Roncador Roncador Module 2 Extension 1,684 Module 2 Extension 1,600 P-54 P-54 P-51 100,000 bpd FPSO Capixaba FPSO Capixaba P-51 100,000 bpd 180,000 bpd 180,000 bpd 180,000 bpd 2010 2010 Golfinho Mod. 1 Golfinho Mod. 1 180,000 bpd 2007 2007 2008 100,000 bpd 100,000 bpd 2008 May 2006 May 2006 1,400 2005 2006 2007 2008 2009 2010 9
  10. 10. PETROBRAS Upstream Portfolio at Home 2005 Reserves Ceará & Ceará & • Proven Reserves of 14.9 Potiguar Potiguar billion boe (SPE) • Reserve life (SPE) = 19.7 Solimões & Amazonas Sergipe & Sergipe & years Alagoas Alagoas Recôncavo Recôncavo 11% 89% Espírito Santo, Espírito Santo, Campos & Santos Campos & Santos Brazil International • 10.6 billion boe (SEC) 2005 Production • 1.969 million boed • 1.684 million bpd oil 10
  11. 11. PETROBRAS Recent Acquisitions United States (Gulf of Mexico) • Petrobras America successfully tendered for 10 blocks in the US sector of the Gulf of Mexico; • This year’s estimated capital expenditures are US$ 305 millions, and by 2010, US$ 1.5 billion. Angola • Petrobras has recently obtained a stake in 4 Angolan exploratory blocks and will be operator in 3. • The company has now interests in six blocks, including a production one (6,500 bpd). • Petrobras aims at increasing its exploratory projects portfolio in Angola, one of the most competitive countries in the oil industry. Turkey •Petrobras presented the winning bid for two deepwater blocks in the Black Sea; • The company will sign a 50-50 partnership with the Turkish oil company (TPAO) for the exploration and production of the blocks. Equatorial Guinea • Petrobras acquired a 50% participating interest in a deepwater block • The company has the option of becoming operator in the case of a commercial discovery 11
  12. 12. PETROBRAS Downstream Strategies • Domestic oil production will exceed throughput; • In 2010 oil products sales will be equal to throughput; • Increase of the domestic oil participation in throughput, reaching 91% in 2010. 2,300 2,250 High operational flexibility Thousand boed 2,050 Low operational flexibility 1,895 1,850 1,712 1,869 1,650 1,596 1,450 Brazilian Self-sufficiency 1,250 1,271 1,050 2000 2001 2002 2003 2004 2005 2010 Oil Production Oil Products Sales Throughput 12
  13. 13. PETROBRAS Gas and Power 13
  14. 14. PETROBRAS Brazilian Energy Matrix Development Natural gas participation in the Brazilian energy matrix rose from 5.4%, in 2000, to 9.3% in 2005, inspite of low thermal electric use 100% 90% 5.4% 6.5% 7.5% 7.7% 8.9% 9.3% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2000 2001 2002 2003 2004 2005 Oil and Oil products Biomass Hydro Natural Gas Coal Nuclear Source: MME (2005: preliminar) 14
  15. 15. PETROBRAS Gas & Power - Brazil Current Situation • High potential for growth in gas demand: • Gas represents only 9% of the Brazilian energy matrix • 80% of total power generation is hydro • Residential-industrial- thermal consumption are likely to increase • Installed capacity of thermoelectric and cogeneration plants will be 4,857 MW in 2010 • Energy investments: US$ 1.3 billion slated primarily for conclusion of projects already underway 15
  16. 16. PETROBRAS Natural Gas Market in Brazil 2010 (99.3) 4000 3,506.8 487,4 MMcfd / (Million m3/day) 3000 (40.9) 1.380,8 2000 (37.9) (30.7) 1,444.4 1,338.4 1,084.3 190,7 226,0 1000 162,5 808,7 875,8 1.638,6 692,2 229,6 339,0 342,6 0 2003 2004 2005** BP 2006/10* Thermoeletric Industrial Other (*) Considers the total supplying capacity, including bi-fuel conversion, contingency demand managing and isolated system in the North region. In the previous plan only the forecasted shipping of the thermo-electric demand was contemplated. (**) Source: ABEGAS Note: does not include Petrobras direct consumption 16
  17. 17. PETROBRAS Natural Gas Production in Brazil (million m3/day) 50 Associated Non associated . 45 p.y % 10,7 40 7,5 10,9 9,4 10,4 35 6,3 7,8 30 7,0 25 7,8 8,0 7,5 37,3 20 6,1 34,9 3,3 4,0 5,3 33,3 32,8 3,4 30,4 30,1 15 0,2 2,2 2,5 2,2 2,7 3,1 25,5 0,4 21,7 10 0,3 18,9 17,7 15,7 16,3 14,7 14,7 16,1 15,8 14,3 13,4 14,1 13,8 12,9 14 10,7 5 0 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 Increasing non-associated natural gas participation in production. 17
  18. 18. PETROBRAS 2005 Natural Gas Proven Reserves and Production Natural Gas Reserves Natural Gas Production • Total Petrobras: 420.2 billion m3 • Total Petrobras: 59,816 thous. m3/day • Brazil: 296.9 billion m3 • Brazil: 43,532 thous. m3/day • International: 123.3 billion m3 • International: 16,284 thous. m3/day •Bolivia: 84.1 billion m3 • Bolivia: 7,753 mil thous. m3/day International International 9,3% 14,3% Brazil 70,7% Brazil 72,8% Bolivia 20,0% Bolivia 13,0% Bolivia to Brazil 18
  19. 19. PETROBRAS Gas Pipelines New investments will reduce the country’s dependence on imported gas. Business Plan 2006-10 US$ 56.4 billion 60% US$ 34.1 billion 6,7 US$ 11.4 billion 2% 2.1 6.7 2% 20% 4% 12% E&P Downstream G&E Petrochemical Distribution Corporate • Production in Southeast will raise from the current 15.8 million to 40 million m3 per day in 2008. • Demand Flexibilization Construction • Refineries, Distributors and flex- Current Under evaluation fuel thermoelectric plants ( LNG, GASBOL diesel and alcohol) 19
  20. 20. PETROBRAS Expected Production Growth Southeast Natural Gas Supply Expansion •Two new fields in Espírito Santo •Increase of supply from Marlim field •Expansion of production in Merluza field 80 Roncador Frade BS-500 (P-54) 2010 Urucu 2009 69.6 70 Natural gas 2007 Mexilhão sales Golfinho Marlim Leste 2007 Mod 2 (P-53) 2009 61.5 60 Golfinho Mod 1 2007 2008 54.3 2006 58.3 59.0 50 Manati 50.8 Roncador NG non associated NG associated Barracuda (P-43) 2006 (P-55) Caratinga (P-48) 2010 43.0 40 Jubarte Phase 2 Roncador (P-57) 31.4 (P-52) 2010 Golfinho 30 26.5 2007 RJS-409 Espadarte (FPSO 3) Marlim Sul Albacora 2010 2007 Mod 2 Piranema Extension 20 Peroá-Cangoa Albacora 2006 Peroá-Cangoa (P-51) 2008 2010 Phase 2 (PPER) Leste Jubarte – 2007 (P-50) Pase 1 10 (P-34) 2006 0 2005 2006 2007 2008 2009 2010 20
  21. 21. PETROBRAS Espírito Santo and Campos Basin: 2006-2008 Cacimbas Peroá/Cangoa Golfinho + ESS-164 Canapu Esp. Santo Basin Actual: 1,3 MM m3/dia 2008: 18 MM m3/dia Parque das Baleias + 16,7 MM m3/dia ESS-130 120 km Bacia de Campos Roncador Cabiúnas Actual: 13,5 MM m3/dia 2008: 19,5 MM m3/dia Namorado + 6 MM m3/dia 120 km 21
  22. 22. PETROBRAS Santos Basin: 2006-2008 Caraguatatuba BS-500 2, 5 21 MEXILHÃO MM TAMBAÚ 5k m3 m URUGUA /d Merluza Lagosta SPS-25 SPS-44 Santos Basin Actual: 1,0 MM m3/dia 2008: 2,5 MM m3/dia + 1,5 MM m3/dia 22
  23. 23. PETROBRAS Flexible LNG Project Facilitates the adjustment of the offer to the market’s characteristic: Flexible Offer (with guarantee) to the thermoelectric plants. More efficient than Diesel in the thermo plants; Mitigates the risk of failing to supply the gas due to abnormalities; Diversifies the sources of imported gas; Projects under evaluation: Purchase or freight of floating storage and regasification units (FSRU); Maritime terminal in Pecém (Ceará) - 6 MM m³/day (estimate Jul/2008 ± 3 months) Maritime terminal in the Guanabara Bay (Rio de Janeiro)– 12/14 MM m³/day (estimate Jul/2008 ± 3 months) FSRU Floating Storage and Regasification Unit 23
  24. 24. PETROBRAS Situation in Bolivia • As a consequence to the measures adopted by the Bolivian Government, Petrobras will act to: • Protect its interests through negotiations by all legal means; • Suspend all new investments in Bolivia as well as those related to the Bolivia-Brazil Gas Pipeline (GASBOL); • Immediately initiate studies to diversify supply sources, including LNG regasefication project(s); Natural Gas Offer - Million m3/day Substitution of additional imports from Bolivia 120 11.0 100 11.0 4.0 80 30.0 30.0 30.0 60 30.0 30.0 30.0 40 61.5 69.6 54.3 20 43.0 26.5 31.4 0 2005 2006 2007 2008 2009 2010 Domestic Production Imports from Bolivia as of existing GSA National Production Increase or LNG 24
  25. 25. PETROBRAS Gas exports from Bolivia (MM m3/dia) 30,0 28,0 26,0 24,0 22,0 20,0 Volume LUMEN [MMm 3/día] 18,0 16,0 VO (MMm3/day) 14,0 12,0 10,0 8,0 6,0 4,0 2,0 0,0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 TIEMPO [AÑOS] Exports to Argentina (MMm3/day) EXPORTACIÓN ARGENTINA [MMm3/día] EXPORTACIÓNto Brazil (MMm3/day) Exports BRASIL [MMm3/día] Source: YPFB 25
  26. 26. PETROBRAS Gas Purchase: contractual structure Bolivia Brazil YPFB - PETROBRAS BOLIVIA/OTHER PRODUCERS - YPFB - PETROBRAS Shared Risk Contract Back-to-back contracts GSA contract (exploratory and production concession) (gas sales) (gas exports) Bolivian Legislation Bolivian Legislation Forum: Santa Cruz Forum: Santa Cruz Court of Arbitration: International Court of Arbitration: International Chamber of Commerce (ICC) Chamber of Commerce (ICC) Forum: New York Court of Arbitration: American Arbitration Association Investment Protection Treaty between Bolivia and the Netherlands ICSID (International Center for Settlement of Investments Disputes) 26
  27. 27. PETROBRAS Renewable Energy and New Technologies 27
  28. 28. PETROBRAS Research Center – Natural Gas Main topics Budget: US$ 42 million 19% 27% 9% 7% 19% 19% GTL Cogeneration & Thermoelectric Transportation Industrial Application Hydrogen Automotive Application GTL Main Projects Transportation FT Synthesis: Catalyst Development Marine CNG FT Reactor design ( Fixed Bed) GtS ( Hydrates) GTL Offshore ANG (Adsorbed Natural Gas) GTL Pilot Plant Construction Expert System DME LNG Offshore Regasification Cogeneration & Thermoelectric Hydrogen Fuel Cells ATR (autothermal Reforming) Microturbines Plasma pyrolysis of NG Optimization of Thermal Cycles Fuel Cell application Gas Turbine Development Fueling station Development of a Bus with Fuel Cell Blend of Natural Gas and Hydrogen 28
  29. 29. PETROBRAS Ethanol Market • Ethanol global market is 46.5 Billion Liters (2005) • Ethanol as a Fuel is 30.6 Billion Liters (67% of total ethanol production) • Today the ethanol consumption is 2.6% of gasoline MKT • 10% of ethanol in gasoline will represent 118 Billion Lt Brazil-Japan Ethanol Inc. • Recently, Petrobras incorporated Brazil-Japan Ethanol Inc. • The company will import and distribute Brazilian-produced ethanol in Japan; • Development of technical and commercial solutions for the reliable and long term supply of alcohol in the Japanese market; • Petrobras will break into one of the most complex and important energy markets in the World: • ethanol logistics distribution • fuel distribution sector in Japan. 29
  30. 30. PETROBRAS Biofuel Production • H-Bio: refining process that utilizes vegetable oils as an input, in order to obtain diesel oil • Hydrogenation of a blend of diesel and vegetable oils Hydrogen Diesel Agribusiness Fractions Processed Seeds Oil Farming Crushing Refinery or Diesel or Transerestification Biodiesel Ethanol Distributors or or B2 or B5 Diesel Methanol mixture Stations Glycerin + Others Complementary and not competitive processes 30
  31. 31. PETROBRAS Rio de Janeiro Petrochemical Complex • Investment: US$ 6,5 billion • Expected Annual Production: • 1,3 million tons of Ethane; • 900,000 tons of propane; • 360,000 tons of benzene; Petrochemical • 700,000 tons of p-xylene. • The Complex will add value to São Gonçalo Liquids Complex – Itaboraí 150,000 barrels/day of heavy Outflow Unit oil form the Campos Basin. Basic Fuels Fuels Marlim oil Production Unit 150,000 bbl/d São Gonçalo - Itaboraí Basic Liquids Outflow petrochemicals Unit P-Xylene Intelligence Center Ethylene Propylene Benzene Styrene Ethylene Glycol PTA Phenol Polyethylene Polypropylene Polyethylene 31
  32. 32. PETROBRAS Records in Completion/Production and Exploration Drilling Offshore OTC OTC 1992 2001 Exploration Wells Vs. Maximun Water-Depths by year 32
  33. 33. PETROBRAS QUESTION AND ANSWER SESSION Visit our website: www.petrobras.com.br/ri/english For further information please contact: Petróleo Brasileiro S.A – PETROBRAS Investor Relations Department Raul Adalberto de Campos– Executive Manager E-mail: petroinvest@petrobras.com.br Av. República do Chile, 65 - 22nd floor 20031-912 – Rio de Janeiro, RJ (55-21) 3224-1510 / 3224-9947 33

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