Equatorial Margin

Get to know the Brazilian Equatorial Margin and the licensing requested from the Brazilian Institute of Environment and Renewable Natural Resources (IBAMA)

What is the Brazilian Equatorial Margin?

The Brazilian Equatorial Margin is probably Brazil’s new energy frontier, which covers five offshore basins, stretching from the state of Amapá to the state of Rio Grande do Norte. This region is an extension of basins on the coast of Guyana and Suriname, where 24 companies already operate and 60 discoveries have been made, with an estimated volume of 11 billion barrels.

What is the purpose of the licensing?

The activity under licensing in block FZA-M-59 refers of the verification of the presence of offshore petroleum (about 175 kilometers off the coast of Amapá), by drilling a single well, for just five months. Only after drilling this well will the potential of the asset and the existence and profile of any deposit be confirmed.

If the commercial viability of any petroleum found in the exploration block is confirmed, a new environmental licensing issued by IBAMA will be required to allow Block FZA-M-59 to become a producing field, with the consequent implementation of the activities necessary to produce petroleum.

Is the well located in the Amazon or in the Mouth of the Amazon River?

The ANP calls the basin where the block was bid “Bacia do Foz do Amazonas” (Foz do Amazonas Basin, in English). The intended offshore exploration drilling will be performed more than 500 kilometers from the Mouth of the Amazon River (similar to the distance separating the cities of São Paulo and Rio de Janeiro), at an ocean depth of over 2,800 meters. There is no record of proximate conservation units or indigenous land in this area, nor is it close to rivers, lakes, flood plains and coral reef systems.

Does Petrobras intend to carry out drilling activities on the mouth of the Amazon river?

No. The block is located in deep waters in the sea of Amapá, 160 kilometers from the coast of the state and more than 500 kilometers northwest of the mouth of the Amazon River (similar to the distance separating the cities of São Paulo and Rio de Janeiro), at an ocean depth of over 2,800 meters.

Why develop the Brazilian Equatorial Margin?

Exploring petroleum in the Brazilian Equatorial Margin will inaugurate an important energy frontier in Brazil, which will develop in an integrated manner together with other energy sources, contributing to a fair, safe and sustainable energy transition.

New energy frontiers, such as the Brazilian Equatorial Margin, are essential to ensure the national energy security and sovereignty, as despite declining, the global demand for petroleum remains crucial in all scenarios aligned with the Paris Agreement. Even amid accelerated energy transition scenarios, the demand for petroleum in Brazil and neighboring regions is growing – it will see a peak in 2030 and be greater in 2050 that it was in 2021.

In this sense, it is essentially important to invest in petroleum production activities that are more efficient and with fewer emissions, such as those developed by Petrobras, through its decarbonization technologies that recognize the Company as one of the most efficient worldwide.

Moreover, Petrobras’ socio-environmental responsibility in the regions where it operates will ensure the increase of knowledge of the region and the adoption of appropriate conservation and environmental management measures.

In the event of spills, is there a risk of the petroleum to reach the coast?

Committed to rigorous analyses, Petrobras utilized the most modern techniques and systems to model and design possible dispersion of oil at sea, following the Term of Reference requirements issued by IBAMA. We designed two models (2015 and 2022), both of which approved by the Institute, with the results showing that a spill would not be likely to reach the coast. Additionally, IBAMA issued a technical report stating that Petrobras’ plan to respond to such an emergency is robust. On February 15, 2023, the Institute’s technical team stated that “the conceptual emergency plan for drilling activities of Block FZA-M-59 is in line with the requests made by the technical team. It also demonstrates that it has tooling options, previous communication/liaison with countries that might be potentially affected and technical response options that are adequate to the foreseen accidental scenarios.”

Are the oil spill trajectory studies conducted by Petrobras outdated?

No. The company updated the oil model (the mathematical model employed to study the movement of ocean currents and winds) in late 2022, incorporating computational advances made in recent years, such as the update of simulation programs and new data on ocean currents and winds not available at the time of preparation of the model then included in the licensing process. The updated study proved the previous results, confirming the assumptions adopted to carry out the process, and was approved by IBAMA.

How long would Petrobras take to send aid to the local fauna in the event of a spill?

All models designed for block FZA-M-59 do not indicate that an oil spill would reach the Brazilian coast. Nevertheless, the structure proposed by Petrobras provides for actions to respond to fauna-related incidents on the Brazilian coast, including monitoring and veterinary care.

The rescue time by ship is 12 hours to the Oiapoque base and 24 hours to Belém. If necessary, aircraft can be used to reduce the rescue time by 4-6 hours to Belém. In any case, the rescue time is shorter than 24 hours, as established by the Best Practices Manual.

Over 100 professionals will be dedicated to animal protection, including veterinary care. High-speed vessels equipped with air-conditioned containers and animal stabilization apparatus to provide veterinary care have also been made available and are permanently dedicated to the operation. In addition to the vessels, Petrobras has already committed to providing other resources, such as monitoring and air rescue aircraft and fauna reception units.

What is the level of impact of the Foz do Amazonas Basin activities on indigenous communities?

No direct impact. Nevertheless, in compliance with IBAMA’s request, Petrobras changed the routes and altitudes of aircraft at the Airport that already operates in the region and which was approved by the National Civil Aviation Agency (ANAC). The current flight routes have a minimum distance of 13 kilometers from the closest indigenous village. On average, there will be 2 flights a day.

In May 2023, at a Public Hearing, the representative of Conselho de Caciques do Oiapoque – CCPIO (the Oiapoque Board of Native Chiefs) acknowledged that aircraft noises have abated, thanks to talks held with Petrobras to change the route of aircraft.

What is the AAAS? Is the AAAS required for this licensing?

AAAS stands for Environmental Assessment of Sedimentary Areas, that is, the Strategic Environmental Assessment for the Oil and Gas Industry. It is a sectoral planning study whose responsibility is shared between the Ministry of Mines and Energy (MME) and the Ministry of the Environment (MMA). It is not incumbent upon Petrobras to conduct this type of assessment.

In a technical report, IBAMA has already acknowledged that there is no legal basis to demand that the AAAS be carried out as a requirement to issue the drilling license. The agency communicated that “there are no legal instruments to justify the recommendation not to issue environmental licenses for exploration drilling until a strategic environmental assessment is carried out – such as the AAAS.”

Additionally, the Brazilian Federal Supreme Court – STF acknowledged that “the environmental feasibility of a certain project is attested not by the presentation of environmental studies and the Environmental Assessment of Sedimentary Areas (AAAS), but by the environmental licensing procedure, which, based on Law 6,938/1981, specifically and carefully analyses the environmental impacts and risks of the activity to be performed.”

Petrobras is willing to collaborate with the responsible bodies in preparing the AAAS or the regional studies for the production stage.

Why did Petrobras file a request with IBAMA to reconsider the decision to deny the environmental license for drilling a well in block FZA-M-059?

Through the request for reconsideration, Petrobras requests a position from IBAMA as to the improvements presented by the company and, with its validation, the Company expects that a date will be defined for carrying out the Pre-Operational Assessment – APO (on-site emergency simulation), in order to prove in the field its ability to respond to an emergency that might occur during the performance of exploration drilling activities.

Petrobras remains committed to the development of the Brazilian Equatorial Margin. In this sense, the company has been making every effort to obtain the drilling license for block
FZA-M-059, where it is committed to operating safely and with total respect and care for the environment and the region’s population.

What is the structure set up by Petrobras for the drilling of a well?

Petrobras has a unique response structure in Brazil for this project:

12 vessels

– 6 oil containment vessels with a total oil collection capacity of 8,900 m³/day, well above what is required by CONAMA 398, which is 6,400 m³/day;

– Out of the 6 vessels, 2 vessels on standby alongside the rig for immediate oil collection;

– 2 vessels equipped with professionals, air-conditioned container and fauna stabilization equipment;

– 4 vessels for coastal monitoring and fauna rescue.

5 aircraft for monitoring, transport and air rescue;

100 specialized professionals

National framework for coastal protection;

Articulation with countries in the region;

Advanced oil containment systems;

Well leak blocking system (capping);

Dedicated emergency coordination and response structure;

Rehabilitation of animals in the event of a spill.

Petrobras has committed to making available two fauna care bases: one in Belém (already operational), and another in Oiapoque (to be expanded). The company already has more than 100 professionals dedicated to animal protection.

What are the socio-environmental commitments made by Petrobras in the project?

As for the Brazilian Equatorial Margin, our commitment to social responsibility and environmental projects is translated into more than R$60 million that will be invested in
Socio-Environmental Projects until 2027. Since June 2022, Petrobras has been implementing, for example, projects to monitor turtle hatching on beaches in the states of Amapá and Pará, monitoring of coastal and migratory birds in the region, actions to protect biodiversity and environmental education actions, projects to monitor and provide care for the local fauna, waste management, control and monitoring of effluents, and several other actions to protect biodiversity.

The company also extensively mapped sensitive areas in the region, and all environmental monitoring data will be made available on websites for the scientific community, in addition to planning actions for: (i) environmental characterization of ecosystems on the Brazilian Equatorial Margin; (ii) regional characterization project of the Foz do Amazonas, Pará-Maranhão and Barreirinhas Basins; (iii) socio-environmental study of traditional marine extractive communities in coastal mangrove regions, containing the characterization of the population, use and exploration of fishing resources; (iv) mapping of mangroves; and (v) quantification of carbon storage capacity in mangroves.