Brazil’s state-run oil company, Petroleo Brasileiro (Petrobras), has discovered oil in a subsalt area of the Santos Basin, offshore of Brazil, it was revealed in a securities filing by the company on Tuesday.

The new oil discovery is expected to contain about four billion barrels of crude and natural gas equivalent, reported Reuters.

The oil was found at a depth of 2,266 metres (7,434 feet), located about 235km (146 miles) off the coast of the state of Rio de Janeiro, and measured at 26 degrees on the American Petroleum Institute (API) scale.

As per the API scale, 26 degrees is a medium grade of crude that can be refined easily, making it more valuable than Petrobras’s other major heavy oil production wells.

The company found the oil in the area that was secured as part of a September 2010 oil-for-stock swap with the Brazilian Government, in a $70bn sale of stock to the government and private investors.

"The new oil discovery is expected to contain about four billion barrels of crude and natural gas equivalent, reported Reuters."

Petrobras, which operates the well, drilled it using the Cerrado drill-ship owned by Brazil’s Schahin Group; other partners in the project include BG Group and Portugal’s Galp Energia SGPS.

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By GlobalData

In February 2013, the company announced that its floating production storage and offloading (FPSO) unit, Cidade de São Vicente, commenced production at the Sapinhoá Norte early production system (SPA).

Located in block BM-S-9 in the pre-salt of the Santos Basin in Brazil, the SPA started production through exploratory well 3-BRSA-788-SPS (3-SPS-69).

The Santos Basin is spread across 352,260km² (136,010 sq mi) offshore bear trap pre-salt basin and includes major oil fields, such as Tupi and Jupiter.

Image: Map of the Santos Basin oil producing region off the coast of Brazil. Photo courtesy of Mmm.