Brazil’s state-owned Petrobras plans to invest $102 billion between 2024-2028 under its new strategic plan, up 31% compared to its 2023-2027 plan, aiming to achieve production of 3.2 MMboe/d by the end of the five-year period.

“Petrobras looks to continue boosting oil and gas production to generate value for its business, while creating value … with a focus on capital discipline,” Petrobras’ CEO Jean Paul Prates said Nov. 27 during the company’s webcast to present its strategic plans. “Controlling debt is one of our priorities.”

Higher capex is mostly related to new projects, including potential acquisitions and assets in the divestment process and investment portfolio, as well as cost inflation, which impacted the entire supply chain, Petrobras revealed in a press release and complimentary presentation related to the roll-out of its plan.

Of the capex, approximately $91 billion relates to projects under implementation, while $11 billion relates to projects under assessment, which are subject to additional financial feasibility studies before contracting and execution begin.

Petrobras is forecasting an average Brent price of $75/bbl during 2024-2028 and expects funding for its investment program will come from after tax cash generations as well as judicial deposits.

Petrobras’ exploration and production (E&P) segment will absorb 72% of the total $102 billion in capex, followed by refining, transportation and marketing (16%), gas and low carbon energies (9%) and corporate (3%).

E&P leads capex allocation

During the 2024-2028 strategic plan period, approximately $73 billion will be allocated to E&P activities, of which 67% is earmarked for the prolific presalt, which “has a major economic and environmental competitive advantage, with the production of better-quality oil and lower emissions of greenhouse gases,” the company said.

Petrobras will continue with exploration efforts, with a planned capex of $7.5 billion to drill around 50 wells in areas where the company has exploration rights in acquired blocks. The main aim is to replace reserves in new exploration frontiers. In the Equatorial margin, capex will be $3.1 billion and include the drilling of 16 wells, followed by the Southeast basins ($3.1 billion, 25 wells) and other countries ($1.3 billion, nine wells).

“We will stay focused on the diversification of our portfolio and on the challenge of replacing reserves, with lower emissions, for a just energy transition,” Petrobras revealed in its plan presentation.

Petrobras has an eye on boosting production to 3.2 MMboe/d by the end of 2028, up from around 2.88 MMboe/d in the third quarter 2023. Petrobras expects production to average 2.8 MMboe/d in 2024 and 2025 amid natural field declines, with the ramp up slated to start in 2026.

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The rise in production will come from the start of 14 new FPSO units, 10 of which have already been contracted. Petrobras said in its release that a “new generation of platforms is being built, more modern, more technological, more efficient and with lower emissions.”

The main basins expected to contribute to higher production by 2028 include the Campos Basin and the Santos Basin. In the Campos Basin, approximately 40% of Petrobras’ production in 2028 will come from the presalt. In the Santos Basin, approximately 99% of Petrobras’ production in 2028 will come from the presalt.

Refining and corporate round out capex allocation

Petrobras looks to invest $17 billion in refining, transportation and marketing, with a focus “on better use of refining and logistics assets and higher energy efficiency, with the aim of expanding diesel production capacity and gradually increasing the supply of products for the low-carbon market,” the company said in its release.

Another $9 billion will be invested on gas and low-carbon energies and $3 billion on corporate, Petrobras said.