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Investor Presentaiton

CHAPTER 2 EXPLORATION AND PRODUCTION OF OIL AND NATURAL GAS IN ESPÍRITO SANTO 39 position among the largest producers of both in- puts, reaching 16.3% of national oil production and 14.9% of national natural gas production. After this period, with the growth of pre-salt pro- duction on the coast of São Paulo and some de- cline in the capixaba production, the state became the third largest national oil producer, very rele- vant position and far ahead of the fourth place. In 2021, for example, despite this decline, the state delivered a very significant contribution to national production, of 7.3% for oil and 4.1% for natural gas. Part of the explanations for the drop in oil and gas production in Espírito Santo can be justified by a hiatus of new discoveries and the implementation of large production projects. In the period 2011 to 2021, even in a scenario of production reduction, we had two great results. The giant Jubarte field continued with increasing production, which had already happened in the previous decade. For the onshore environment, the main highlight was the growth of production from the Cancã field, in the municipality of Lin- hares, northern region of the state. However, the expectation is that production in the state will grow again as early as 2023, both on land and at sea. The basis for this statement lies in promising and recent events in the sector, such as the implementation of at least one large maritime project and better operational performance, such as mature areas such as Parque das Conchas, op- erated by Shell, and several land fields. In summa- ry, the state has attracted the attention of new and traditional oil companies that are projecting their operations in Espírito Santo, including exploratory activities (acquisition of seismic data and drilling of pioneer wells) aiming for new discoveries, such as CNOOC, ExxonMobil and Repsol, in addition to Petrobras itself. These new proj- ects have not yet started the pro- duction of inputs and therefore do not yet appear as important vectors of oil and natural gas pro- duction. In addition to the imple- mentation of the Integrated Proj- ect of Parque das Baleias (100% Petrobras), offshore production begins to gain new momentum with the arrival of operators such as PRIO (Itaipu and Wahoo dis- coveries), BW Energy (Golfinho Center) and 3R Petroleum (Peroá Center). In addition to these, the consolidation of Seacrest's proj- ects at Cricaré and Norte Capix- aba Centers is expected, the lat- ter being acquired by Petrobras. Also, from the onshore explo- ration and production assets of Imetame Energia, Energy Paranã, BGM, ES Óleo & Gás and Capixa- ba Energia, among other compa- nies with Espírito Santo DNA and from other regions of the coun- try, such as Origem, for example. The expectation is that with a greater diversity of players and environments, the production of oil and gas in the state rises in a sustainable way, keeping Espírito Santo in the group of the 3 largest producing states in Brazil. With this, there will be a greater generation of income and employment for capix- abas, contributing to a new phase of development for Espírito Santo. 2.6. Production projection For the projection of oil and nat- production in each producing well in Espírito Santo. ural gas production in Espírito Santo, the use of accounting rules to capture the production trend It is expected that between 2023 focused on the regional supply of and 2027 total oil production will the input was adopted as a meth- have an average annual increase odology. The values were project- of 10.3%, reaching in 2027 a pro- ed until the year 2027, considering duction of 90.0 million barrels of a detailed analysis of the profile of oil. For natural gas, an average an- the supply of hydrocarbons, relat- nual increase of 11.9% is projected ed to the exploration and produc- between 2023 and 2027, reaching tion phases of each field, operator a production of 2.43 billion m³ in and platform. The calculations 2027. The reversal of the downward were performed using algebra- trend in production is expected in ic formulas that reproduced the the transition from 2024 to 2025, means and historical patterns of both for oil and natural gas. 2.6.1. Projection of offshore production in Espírito Santo Offshore production accounts for a majority share of the total vol- ume produced of oil and natural gas in Espírito Santo. The evolu- tion of extraction at sea is respon- sible for most of the state's pro- duction and, for the coming years, it is expected that this configura- tion will not be changed. Between 2023 and 2027, offshore oil pro- duction is expected to record an average annual increase of 10.7%, reaching an output of 87.8 million barrels in 2027. For natural gas, an average annual increase of 12.0% is projected, between 2023 and 2027, reaching a production of 2.41 billion m3, in 2027. Charts 21 and 22 show the re- cent evolution and projection of production at sea until 2027. The decrease in the production of inputs between 2017 and 2022 can be explained by the natural decay of the producing fields at sea, with emphasis on the sharp falls in Parque das Baleias and Parque das Conchas. In addition, during the period there was a low number of new offshore projects in the state and the consequent concentration of future produc- tion in projects that were devel- oped in the past. 10.7% is the expected average annual increase in offshore oil production between 2023 and 2027, reaching 87.8 million barrels 12.0% is the expected average annual increase in offshore natural gas production between 2023 and 2027, reaching 2.43 billion m3
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