Sabrina Valle

HOUSTON, Texas (Reuters) – Equinor SA Exxon Mobil The first steps have been taken by Corp (NYSE) to increase an $8 billion offshore oil field, according to the Norwegian oil producer.

According to the company, they want to increase future production at the Bacalhau oilfield, Equinor’s biggest project outside of Norway, with over 1 billion barrels oil.

According to three sources close to the discussion, a second drilling rig as well as a floating production platform is being considered for next-phase.

Exxon could get its first barrel from Bacalhau in Brazil. This is a key growth opportunity and an additional source of oil from low carbon operations. From the venture’s 220,000 barrel-per-day (bpd), production vessel, first oil will be available in 2024.

Equinor is the operator of the field. Exxon sent questions to Equinor. Equinor said that the company plans to drill a new appraisal bore in the Bacalhau area next year to “better understand the reserve base for Phase II development.”

Partners are working on a proposal to award a contract for the second drilling rig. According to a spokesperson, pre-drilling phase 1 wells will begin during the third quarter. Equinor declined to comment on the plans for a new FPSO and pipeline.

INVESTMENTS MAY DOUBLE

Responding to Reuters’ questions, the spokesperson stated that Bacalhau was a global competitive project and had a break of even $35 in a key region.

According to two sources close to the discussions, the potential for doubling the investment in the second phase is possible if exploration work proves successful.

According to two people, one issue to resolve is whether enough oil will be produced by the field to warrant a second floating platform or FPSO and a gas pipe to get it to shore.

Exxon and Equinor could tie back to the subsea if there are no other platforms, according to two people. The first FPSO would connect to wells, and the gas would then be reinjected into the reservoir.

Japan’s Modec Inc is currently building the first FPSO. According to a presentation, it was created to reduce greenhouse gas emissions intensity by 65%.

DIETING TO COME OUT

For the Phase 1 Campaign, the Partners signed a contract worth $380 Million over four years with Seadrill Ltd.

Bacalhau was Brazil’s pre-salt mine that wasn’t developed by the state-controlled Petroleo Brasileiro SA. Its discovery occurred in 2012, and it was sold to repay its debt. Exxon also holds 40%. Equinor has a 40% interest. Petrogal Brasil holds a 20% stake.

Equinor says that Seadrill will drill Bacalhaus first six out of 19 wells approved by the company’s West Saturn rig. Exxon also used this rig for its offshore Brazil blocks. However, it has not been successful in exploration.