Oil, gas output above 3 million barrels per day for second month

Brazil produced more than 3 million barrels of oil and equivalent natural gas a day (boepd) for the second straight month in January, 20 percent more than a year earlier, as the country benefited from the startup of long-delayed production systems.

The 44 companies operating in Brazil together produced an average 3.08 million boepd in the month, Brazilian oil regulator ANP said in a statement.

January output was little changed from December, falling by an average of 19,000 boepd, or 0.6 percent.

State-run Petrobras, remained the dominant producer, with 2.59 million boepd, or 84 percent of Brazilian output in the month, down from 88 percent a year earlier.

Britain’s BG Plc, which owns stakes in several giant offshore fields in the Santos Basin with Petrobras and other partners, was the number 2 producer, with 140,562 boepd in the month, more than double the output of a year earlier.

Meanwhile, Brazil is planning to hold its 13th round auction of oil and natural gas exploration and production rights in the second half of 2015, Eduardo Braga, Mines and Energy Minister said.

The government had planned to hold the auction in early May, but pushed the date back at the recommendation of the ANP. The ANP blamed the delay on recent declines in oil prices as well as financial difficulties faced by state-run oil company Petrobras, which is responsible for 84 percent of Brazilian oil output.

The auction will be for rights to explore and produce oil in areas outside the country’s so-called Subsalt Polygon. In exchange for the rights, companies must pay the government a royalty on each barrel produced and comply with a minimum investment and development plan.

The polygon is home to giant oil resources trapped deep beneath the seabed by a layer of salt. All new development in the polygon must have a minimum 30 percent share for Petrobras, and companies that win rights to an area must give the Brazilian government a share of the oil to sell on its own.

When combined with non-subsalt Campos Basin fields already operating in the polygon, the area is responsible for more than 80 percent of Brazil’s output and most of its major recent discoveries.