Originally Brazil was known as a biofuel producer thanks to the sugarcane ethanol, which is used as fuel for most of its transportation service. However as late as 2007, the discovery of the Tupi field about 200 miles off the coast of Rio in the Atlantic Ocean changed all that. The field has now been renamed to Lula and is expected to contain about 6.5 billion barrels of oil. Apart from the Lula field, it is estimated that Brazil has another 36 billion barrels of oil located 2000 feet below sea level off its coast and most of it is light and easy to refine.
However the challenge lies in the layer of salt that exists above the oil. The layer of salt is severely thick and possesses a major set of challenges. Since the salt is immediately above a layer of rock, it has caused the underlying rock to become unstable. As a result, when drilling through it, the rock gets broken into smaller pieces, which interfere with the circulating mud. All this can cause major drilling disasters that can have monumental economic and environmental effects.
Oil exploration off the coast of Brazil is an eventuality however it is expected to be delayed until the constraints and challenges are ironed out.
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