Statoil’s pre-salt deal will boost role of IOCs in Brazil

Brazil’s state-owned oil firm Petrobras agreed to sell its 66% stake in exploration block BM-S-8 to Statoil last week for $2.5 billion. The deal is important because it marks the first time Brazil has allowed a company other than Petrobras to take a controlling stake and operate a block in its pre-salt acreage.

BM-S-8 lies in Brazil’s highly prolific offshore Santos Basin – the country’s largest formation of its kind, which sprawls over 35 million hectares in an area roughly the size of Germany. Statoil already has stakes in several blocks in Brazil’s Campos and Espírito Santo basins. The pre-salt formations extend from Brazil to West Africa and are so called because they lie below a 2,000 metre-deep layer of salt, which itself is 5,000 metres below the Atlantic Ocean.