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Largest Oil Discovery in 30 Years?!?

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April 14, 2008 – Comments (4) | RELATED TICKERS: PBR

I'm surprised that this news hasn't received more press: Brazil may have new supergiant oil find.  Petrobras announced today that it may have found the world's largest oil discovery in 30 years off of the coast of Brazil. The new deepwater field, called Carioca, could contain as much as 33 billion barrels of oil equivalent. To put this in perspective, the Tupi offshore field was huge news when Petrobras announced its discovery last year. If reports of the size of the Carioca field are accurate, it would be five times the size of Tupi. For some reason, the Tupi find seemed like it received more press than this one.  Huh.  Shares of Petrobras soared today, up over 8%.

In addition to being great news for PBR, this discovery is also likely very bullish for deepwater drillers given the tight supply of rigs, particularly ones that are capible of doing deepwater drilling, and perhaps even bullish for the Brazillian economy in general.

In other news, Oil finishes at another record - $111.76

Deej

Long PBR

4 Comments – Post Your Own

#1) On April 14, 2008 at 5:20 PM, ATWDLimited (< 20) wrote:

Yup, if you want to get in on this find, buy RIG, they are the ones providing the the rigs, and of corse PBR. Its been in the news, just over shadowed by other things, although it is a super investment.

In fact, the oil reserve is probably there because of the astroid that hit the earth 65 million years ago adn wipped out the dinasaurs, there was massive seismic activity and it does not surprise me to much. in fact Pangea was breaking apart right there so it probably caused the shelf to collapse with the organic material, or happened when the continents drifted apart, wether way it is there for the taking. 

Btw, look for Canada's oil Tar sands or the US shale reserves, they are larger than Brazils and all the Saudis oil. 

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#2) On April 14, 2008 at 5:42 PM, WillSurfForFood (70.92) wrote:

Ah that explains why all my oil service stocks are up today.

ATWDLimited Writes:

" Btw, look for Canada's oil Tar sands or the US shale reserves, they are larger than Brazils and all the Saudis oil."

Although I invest in Canadian oil sands companies I think that statement is quite misleading. It is paying too much attention to the gross energy and not the net energy in the oil sands. It is very costly in dollars energy (natural gas) water and other environmental issues to extract. The size of the pipe to the oil is as important as the size of the reserve.  I think the best analogy about the oil sands I've read goes something like this: "If you had one hundred million dollars but could only access 100 thousand a year are you rich?. Sort of."

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#3) On April 14, 2008 at 6:04 PM, ATWDLimited (< 20) wrote:

True, the oil is not totaly usable or attainable, but check this out

How much oil is in ANWR?Coastal Plain of ANWR

Geologists agree that the Coastal Plain has the nation's best geologic prospects for major new onshore oil discoveries. According to the Department of Interior's 1987 resource evaluation of ANWR's Coastal Plain, there is a 95% chance that a 'super field' with 500 million barrels would be discovered. DOI also estimates that there exists a mean of 3.5 billion barrels, and a 5% chance that a large Prudhoe Bay type discovery would be made.

High potential. The high potential for significant discoveries of oil and gas in ANWR has long been recognized. Early explorers of the region at the turn of the century, found oil seeps and oil-stained sands. However, since ANWR was established in 1960, exploration in the region has been restricted to surface geological investigations, aeromagnetic surveys, and two winter seismic surveys (in 1983-84 and 1984-85). No exploratory drilling has been accomplished in the area except for one well commenced in the winter of 1984-85 on Kaktovik Inupiat Corporation and Arctic Slope Regional Corporation lands southeast of Kaktovik on the Coastal Plain.

Location to big finds. Although little oil and gas exploration has taken place in ANWR, the Coastal Plain is believed to have economically recoverable oil resources. The Coastal Plain lies between two known major discovery areas. About 65 miles to the west of the Coastal Plain, the Prudhoe Bay, Lisburne, Endicott, Milne Point, and Kuparuk oil fields are currently in production. Approximately 1.5 million barrels of oil a day are produced from these fields, representing 25% of our domestic production. To the east of the Coastal Plain, major discoveries have been made in Canada, near the Mackenzie River Delta and in the Beaufort Sea.

U.S. Geological Survey - 1980. In 1980, the U.S. Geological Survey estimated the Coastal Plain could contain up to 17 billion barrels of oil and 34 trillion cubic feet of natural gas.

U.S. Department of Interior - 1987. After several years of surface geological investigations, aeromagnetic surveys, and two winter seismic surveys (in 1983-84 and 1984-85), the U.S. Department of Interior (DOI), in its April, 1987 report on the oil and gas potential of the Coastal Plain, estimated that there are billions of barrels of oil to be discovered in the area. DOI estimates that "in-place resources" range from 4.8 billion to 29.4 billion barrels of oil. Recoverable oil estimates ranges from 600 million barrels at the low end to 9.2 billion barrels at the high end. They also reported identifying 26 separate oil and gas prospects in the Coastal Plain that could each contain "super giant" fields (500 million barrels or more).

U.S. Geological Survey � 1998. The most recent petroleum assessment prepared by the USGS in 1998 (OFR 98-34), increased the estimate for technically recoverable mean crude oil resources. (See Oil in the ANWR? It�s Time to Find Out!)

Only drilling will tell. The geologic indicators are very favorable for the presence of significant oil and gas resources in ANWR, but the limited data means that there is a high level of uncertainty about how much oil and gas may be present. Consequently, current estimates represent the best scientific guesses. However, most geologists agree that the potential is on the order of billions of barrels of recoverable oil and trillions of cubic feet of recoverable gas and that these resources may rival or exceed the initial reserves at Prudhoe Bay. The validity of these estimates can be proved only by drilling exploratory wells. Authorization for exploration must be given by Congress and the President.

In 1996 the North Slope oil fields produced about 1.5 million barrels of oil per day, or approximately 25 percent of the U.S. domestic production. However, Prudhoe Bay, which accounts for over half of North Slope production, began its decline in 1988, and no new fields have yet been discovered with the potential to compensate for that decline.

Maybe, if we all push oil to 15 for a week, they will start drilling, and it will scare people into getting our own oil. 

 

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#4) On April 14, 2008 at 6:10 PM, nuf2bdangrus (< 20) wrote:

Ken Heebner (CGM FOcus fund) has been talking about PBR for years.  A little reading shows that HES had adjacent claims.  I took a small positin in HES at 90, was waiting for a pullback.   Luckily, A larger position in PBR, I was waiting for that one to pullback to the 90's, which it did on the commodities selloff.  OIH would probably be the best play for the drillers.  Bought at 170, almost bought more at 161, sure wish I did!

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