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Petrobras releases highlights on production and sales in 3Q20

22nd October 2020

According to the latest figures released by Petrobras, its operational performance in 3Q20 was exceptionally good, considering the challenging scenario imposed by the COVID-19 pandemic.

 Its oil and gas production in Brazil grew by nine per cent in the first nine months of this year compared to last year. The production of the pre-salt fields increased by 32 per cent, while in the other areas, post-salt, shallow waters and onshore, there was a contraction.

It estimates that the average production in 2020 will reach 2.84 MMboed, of which 2.28 MMbpd of oil, with a variation of 1.5 per cent upwards or downwards, exceeding the upper limit (2.5 per cent) of the targets originally announced for the year (2.7 MMboed and 2.2 MMboed).

Higher than expected production growth did not result in excessive inventories, which would be possible given the significant reduction in global oil demand. On the contrary, Petrobras have been working with lower inventories than in the pre-COVID period thanks to the greater integration between production, refining, logistics and marketing.

During the pandemic focus has been high on protecting the health of employees. Home office, reduction of personnel on board and in industrial plants, continuous cleaning, medical assistance with access to telemedicine and adoption of a massive testing strategy with selection, testing, tracking and quarantining have been the main actions. To date, it has applied more than 270,000 tests, and companies providing services to Petrobras around 110,000, which has allowed it to reduce COVID's transmission rate by identifying many cases of asymptomatic patients.

The contingency scenario for COVID-19 continues to limit the number of personnel aboard the offshore production facilities, leading it to postpone part of the scheduled shutdowns in 4Q20 to the beginning of 2021. However, they were able to carry out maintenance activities, which contributed to increase operational efficiency, operate safely and maintain optimum performance. Another highlight was the success achieved in the inspection campaign for pipelines susceptible to corrosion under tension by CO2 carried out with new technologies and tools, the results of which enabled the operational continuity of gas injection pipelines, reducing production expenses and losses.

The average production of oil, NGL and natural gas in 3Q20 reached 2.95 MMboed, 5.4 per cent above 2Q20. Contributed to this result the growth in production in the Atapu field, with the start-up of the FPSO P-70 and first oil at the end of June, alongside the greater operational efficiency of P-74, P-75, P-76 and P-77, in the Buzios field. The performance of these platforms was supported by the temporary expansion of the oil and gas processing capacity of the units, using spare capacity in power generation and gas compression available until the beginning of gas exports, and by the high production potential of the wells and the reservoir. This enabled the achievement of monthly production records in Búzios, of 615 kbpd of oil and 765 kboed in July and the highest monthly production achieved by a well in Brazil, with the mark of 69.6 kboed from the BUZ-10 well registered in September. In that month, we also had 2 Búzios wells that exceeded the 65 thousand boed mark (BUZ-12 and BUZ-24, respectively with 67.4 and 65.8 kboed). In August, we started the gas flow from P-74.

The Tupi field reached the historic milestone of accumulated production of 2 billion barrels of oil equivalent, 20 years after the signing of the concession contract and 10 years after installing the first definitive production system. It is currently the deep waters field with the highest production worldwide and accounted for 28 per cent of our production in 3Q20. In July, we reached the 150 kbpd production capacity on the P-67 platform, operating in this field. Tupi was also a pioneer in the development of the pre-salt layer and revealed the existence of a new exploratory model, previously unknown in the world.
Petrobras also progressed in the ramp-up of the P-68 platform, in Berbigão and Sururu fields, and P-70, in Atapu field, with the beginning of gas flow from P-70, on October 15, 2020.

Continuing with active portfolio management, concentrating resources on world-class assets in deep and ultra-deep waters, in 3Q20 Petrobras signed a contract to sell all of its stake in three shallow water fields and 37 onshore fields. Additionally, they completed the sale of our entire stake in the Pampo and Enchova clusters (Campos Basin), Lagoa Parda cluster (Espírito Santo Basin) and in the Ponta do Mel and Redonda fields (Potiguar Basin), for US$ 437 million in cash and US$ 650 million in earn-outs that are expected to have a positive impact on the company's cash generation in the coming years. These fields produced 21.9 kbpd in the first six months of 2020, equivalent to 0.9 per cent of our production.

This quarter Petrobras carried out the additional mothballing of the Merluza platform, located in the Santos Basin, totalling 63 platforms in shallow water mothballed since March 2020. It should be noted that the Merluza cluster, composed of the Merluza and Lagosta fields, continues in the process of divestment, as disclosed on March 31, 2020.



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