Petrobras’ Proven Reserves in 2012

Petrobras’ Proven Reserves in 2012

Petrobras announces its proved oil and natural gas reserves, assessed at the end of 2012 according to the criteria of the National Petroleum, Natural Gas and Biofuels Agency – ANP, Society of Petroleum Engineers – SPE and Securities and Exchange Commission – SEC.

Petrobras’ Proven Reserves in 2012
According to ANP/SPE criteria:
On December 31st, 2012 proved oil and natural gas reserves reached 16.440 billion barrels of oil equivalent (boe), an increase of 0.2% from last year, distributed as shown:

Proven Reserves – SPE Volume (billion boe) %
Brazil 15.729 96
International 0.711 4

Total 16.440 100

In 2012, 0.914 billion boe were appropriated to Proven Reserves, while 885 million boe were produced, resulting in an increase of 0.028 billion boe compared to 2011 reserves (16.412 billion boe). The increase in Petrobras’ reserves stems from the incorporation of new areas discovered in Brazil and in the Gulf of Mexico and the management of reservoirs in fields in Brazil and abroad.

Proven Reserves Breakdown – SPE Volume (billion boe)
A) Proven Reserves in December / 2011 16.412
B) Cumulative Production in 2012 (0.885)
C) Appropriation of Proven Reserves in 2012 0.914
D) Annual Variation (B + C) 0.028
E) Proven Reserves in December / 2012 (A + D) 16.440

According to SPE criteria, for each barrel of oil equivalent extracted in 2012, 1.03 barrels of oil equivalent were appropriated, resulting in a reserve replacement ratio of 103.3%. The Reserves-to-Production Ratio (R/P) was 18.6 years.

According to SEC criteria:
On December 31st, 2012 proven reserves reached 12.884 billion boe, representing an increase of 0.1% from the previous year, distributed as shown:

Proven Reserves – SEC Volume (billion boe) %
Brazil 12.263 95
International 0.621 5
Total 12.884 100

In 2012, 0.896 billion boe were appropriated to Proven Reserves and 884 million boe were produced, resulting in an increase of 0.011 billion boe compared to 2011 reserves (12.873 billion boe).

Proven Reserves Breakdown – SEC Volume (billion boe)
A) Proven Reserves in December / 2011 12.873
B) Cumulative Production in 2012 (0.884)
C) Appropriation of Proven Reserves in 2012 0.896
D) Annual Variation (B + C) 0.012
E) Proven Reserves in December / 2012 (A + D) 12.884

According to SEC criteria, for each barrel of oil equivalent extracted in 2012, 1.01 barrels of oil equivalent were appropriated, resulting in a reserve replacement ratio of 101%. The Reserves-to-Production Ratio (R/P) was 14.6 years.

In addition to the volumes mentioned above, Petrobras has the right to produce up to 5 billion boe, acquired in 2010 with the Transfer of Rights Agreement, in pre-salt areas, which are not booked as proven reserves.

Proven Reserves in Brazil

According to ANP/SPE criteria:
On December 31st, 2012 proved oil and natural gas reserves in fields under Petrobras’ concession in Brazil, according to ANP/SEC criteria, reached 15.729 billion boe, representing an increase of 0.1% from 2011.

Proven Reserves – SPE Volume : %
Oil + Condensate (billion bbl) 13.284 : 84
Natural Gas (billion m3) 388.746 : 16
Oil Equivalent (billion boe) 15.729 : 100

In 2012, 0.838 billion boe were appropriated to Proven Reserves, compared to a cumulative production of 0.815 billion boe, as shown in the following table:

Proven Reserves Breakdown – SPE Volume (billion boe)
A) Proven Reserves in December / 2011 15.706
B) 2012 Production (0.815)
C) Appropriation of Proven Reserves in 2012 0.838
D) Annual Variation (B + C) 0.023
E) Proven Reserves in December / 2012 (A + D) 15.729

For each barrel of oil equivalent extracted in 2012, 1.03 barrels of oil equivalent were appropriated, resulting in a Reserve Replacement Ratio of 102.8%. The Reserves-to-Production Ratio (R/P) was 19.3 years.

The main Proven Reserves incorporations in 2012 were:

• ongoing success of exploratory activities in the post-salt in different Brazilian basins:

– incorporation of volumes related to new discoveries close to the existing infrastructure of the Golfinho field, in Espírito Santo Basin; Marlim Sul field, in Campos Basin; and Araçás, Cexis, Fazenda Panelas and Taquipe fields, in Recôncavo Basin;

– declaration of commerciality in the following fields: Tartaruga Verde and Tartaruga Mestiça in Campos Basin; Baúna and Piracaba in Santos Basin; and Piranema Sul and Arapaçu in Sergipe-Alagoas Basin.

• rise in proven reserves in the pre-salt due to an increase in well drilling activities and positive responses from production systems in operation both in the Campos and Santos Basins. Of this total, 56% came from the Lula/Cernambi and Sapinhoá concessions, where Petrobras is the operator and registers volumes proportional to its stake in these concessions: 65% and 45%, respectively.

In the last 10 years, Proven Reserves in Brazil rose by 43%, from 11.008 to 15,729 billion boe, with reserves replacement ratios above 100% every year.

According to SEC criteria:
On December 31st, 2012 proved oil and natural gas reserves in fields under Petrobras’ concession in Brazil, according to SEC criteria, reached 12.263 billion barrels of oil equivalent (boe), representing the maintenance of 2011 proven reserves.

Proved Reserves – SEC Criteria Volume : %
Oil + Condensate (billion bbl) 10.539 : 86
Natural Gas (billion m3) 274.101 : 14
Oil Equivalent (billion boe) 12.263 : 100

In 2012, 0.822 billion boe were appropriated to Proven Reserves, compared to a cumulative production of 0.815 billion boe, as shown below:

Proven Reserves Breakdown – SEC Criteria Volume (billion boe)
A) Proven Reserves in December / 2011 12.256
B) Cumulative Production in 2012 (0.815)
C) Appropriation of Proven Reserves in 2012 0.822
D) Annual Variation (B + C) 0.007
E) Proven Reserves in December / 2012 (A + D) 12.263

For each barrel of oil equivalent extracted in 2012, 1.01 barrels of oil equivalent were appropriated, resulting in a Reserve Replacement Ratio of 100.9%. The Reserves-to-Production (R/P) ratio was 15 years.

The main differences between SEC and ANP/SPE estimates stem from differences in oil pricing, concession terms and other technical aspects.

International Proven Reserves
According to SPE criteria:
On December 31st, 2012 Petrobras’ proved oil and natural gas reserves abroad, according to SPE criteria, reached 0.711 billion barrels of oil equivalent (boe), a 0.8% increase from 2011.

Proven Reserves – SPE Volume : %
Oil + Condensate (billion bbl) 0.492 : 69
Natural Gas (billion m3) 37.176 : 31
Oil Equivalent (billion boe) 0.711 : 100

In 2012, 0.076 billion boe were appropriated to Proven Reserves, compared to a cumulative production of 0.070 billion boe, as shown below:

Proven Reserves Breakdown – SPE Volume (billion boe)
A) Proven Reserves in December / 2011 0.706
B) Cumulative Production in 2012 (0.070)
C) Appropriation of Proven Reserves in 2012 0.076
D) Annual Variation (B + C) 0.006
E) Proven Reserves in December / 2012 (A + D) 0.711

According to SPE criteria, for each barrel of oil equivalent extracted in 2012, 1.08 barrels of oil equivalent were appropriated, resulting in a reserve replacement ratio of 108%. The Reserves-to-Production Ratio (R/P) was 10.2 years.

In 2012, main Proven Reserves incorporations were:

• Revaluation of the Stones field in deep waters of the Gulf of Mexico;
• Review of the Agbami Development Plan in deep waters of Nigeria;
• Inclusion of volumes associated to the secondary recovery at Akpo field in deep waters of Nigeria.

Note that since 2009 Petrobras does not include the reserves in Bolivia, in compliance with the requirements of Bolivia’s constitution, which prohibits the recording and registration of oil and gas reserves by private companies in the country.

According to SEC criteria:
On December 31st, 2012 Petrobras’ proved oil and natural gas reserves abroad, according to SEC criteria, were 0.621 billion boe, an increase of 0.6% from the previous year.

Proven Reserves – SEC Volume : %
Oil + Condensate (billion bbl) 0.414 : 67
Natural Gas (billion m3) 35.243 : 33
Oil Equivalent (billion boe) 0.621 : 100

In 2012, 0.074 billion boe were appropriated to Proven Reserves, compared to a cumulative production of 0.069 billion boe, as shown below:

Proven Reserves Breakdown – SEC Volume (billion boe)
A) Proven Reserves in December / 2011 0.617
B) Cumulative Production in 2012 (0.069)
C) Appropriation of Proven Reserves in 2012 0.074
D) Annual Variation (B + C) 0.005
E) Proven Reserves in December / 2012 (A + D) 0.621

According to SEC criteria, for each barrel of oil equivalent extracted in 2012, 1.07 barrels of oil equivalent were appropriated, resulting in a reserve replacement ratio of 107%. The Reserves-to-Production Ratio (R/P) was 9 years.

In 2012, main Proven Reserves incorporations were:

• Revaluation of the Chinook field in deep waters of the Gulf of Mexico;

• Review of the Agbami Development Plan in deep waters of Nigeria;

• Inclusion of volumes associated to the secondary recovery at Akpo field in deep waters of Nigeria.

Petrobras clarifies that the hydrocarbon reserve properties belong to their respective National States.

Almir Guilherme Barbassa
CFO and Investor Relations Officer
Petróleo Brasileiro S.A. – Petrobras

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