(Bloomberg) — Petrobras plans to reduce natural gas reinjection where it can in response to the government’s efforts to boost supplies of the fuel, the the head of the state-controlled oil company said Wednesday.
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A decree published Tuesday allows Brazil’s oil regulator, known as the ANP, to set the amount of natural gas that oil producers reinject into reservoirs. More than 90% of Brazil’s oil and gas production is at offshore fields, where the pipeline infrastructure to transport gas to shore can cost billions of dollars.
Chief Executive Officer Magda Chambriard said that some of Petrobras’s platforms aren’t designed to handle gas shipments, which limits how much Petrobras can curb its reinjection into reservoirs. The Rio de Janeiro-based company will have to make a “course correction” and it is looking into using upcoming platforms at the giant Buzios offshore field to create a gas hub, she told reporters in Brasilia.
“We can’t have oil projects with associated gas offshore that don’t address the possibility of transporting gas to the coast,” said Chambriard.
President Luiz Inacio Lula da Silva’s push for more and cheaper natural gas is generating concern that Brazil is turning to interventionist policies in a move that could discourage investments by oil majors. Despite that, Petrobras’s chief said the company will do all it can to improve natural gas supply at affordable prices to reinvigorate industrial activity.
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