The Atlanta project is scheduled to start production by the end of this year after facing several delays relating to flow assurance and associated costs, says a GlobalData report.
Entitled ‘Brazil Atlanta Project Panorama – Oil and Gas Upstream Analysis Report‘, the report states that initial production is expected to start from the two wells that have been drilled and equipped. Located in Brazil’s Santos Basin, the project is planned to be developed using a floating production storage and offloading vessel (FPSO). It is also expected to share the cost of the FPSO with the Olivia field, located nearby and operated by the same consortium from 2020.
The project’s remaining net present value (NPV), calculated on the assumption of cost sharing of the FPSO, is estimated to be $85m. Good productivity of the project’s wells is also a contributing factor towards its positive valuation.
However, the report highlights that the development of the Olivia field is uncertain as just a single well has been drilled since 1993, giving rise to speculation that the Atlanta project might have to bear the entire cost of the FPSO, which would translate into a negative net present value for the project.
Brazil’s Atlanta project is estimated to produce 20,000bpd of heavy oil with the option to increase production up to 30,000bpd by drilling another well.
A five-year contract was awarded to Teekay Offshore to provide the Petrojarl 1 FPSO at $50m per annum. A three-year crude oil sales agreement was signed with Shell Western Supply and Trading Ltd. in October 2015.