Oil has been discovered at Brazil’s massive Tupi sub-salt field in the Santos Basin, according to operator Petrobras and its partners.

Petrobras said it has found light oil in the step-out appraisal well in the field at a depth of 2,131m, 270km off the coast of Rio de Janeiro, Brazil.

The company said it estimates light oil production of 5 billion to 8 billion barrels in the new well, which is known as Tupi OW.

The oilfield is part of Brazil’s massive offshore subsalt area. Oil and gas production from the first module of the Tupi development is expected by the end of 2010, according to BG Group.

Petrobras holds a 65% stake in Tupi, BG Group has a 25% stake and Galp has the remaining 10%.