Petrobras (NYSE: PBR) has identified the presence of hydrocarbons in the Morpho exploratory well (1-BRSA-1405-APS), located in Block FZA-M-59, in deep waters off the coast of Amapá.
The well is part of the Foz do Amazonas sedimentary basin, one of the five basins that make up Brazil’s Equatorial Margin, a frontier extending along the country’s northern and northeastern coastline.
The Morpho well is located approximately 175 kilometers off the coast of Amapá, at a water depth of 2,886 meters.
Petrobras is the operator of Block FZA-M-59 and holds a 100% working interest in the area. The block was acquired by Petrobras in 2013 during Brazil’s 11th Round of Bidding under the concession regime.
Petrobras President Magda Chambriard commented:
“Our optimism regarding the Brazilian Equatorial Margin is confirmed today. This first discovery off the coast of Amapá is the result of Petrobras’ dedication and expertise. The company is committed to replenishing oil reserves and ensuring the country’s energy security.”
Petrobras’ official statement clarified that the identification of hydrocarbons does not yet establish the size or commercial viability of a potential accumulation. Additional technical evaluation and testing will be carried out before the company can determine the significance of the discovery.
Similarities with the Guyana Oil Boom
The characteristics of the discovery are similar to those of the oil recently found in the Guyana-Suriname Basin.
The discovery in 2019 transformed Guyana from a country with no oil production into the 20th-largest oil producer in the world, ahead of countries such as Colombia, the United Kingdom, and Malaysia. In comparison with Brazil, this represents approximately one-quarter of Brazilian production, with 900 thousand barrels per day versus 3.95 million barrels per day for Brazil as a whole.
The Stabroek Block, the main block in Guyana, is operated by ExxonMobil, Hess Corporation, and China’s CNOOC. The oil is classified as high quality and is predominantly light and sweet crude, with low sulfur content. Exploration has taken place in deep waters, reaching depths of up to 3,000 meters, and in ultra-deep waters, reaching depths of up to 6,200 meters, with production operated through several FPSOs (floating production, storage and offloading vessels).
These operations share several similarities with the deepwater operations of Brazil’s pre-salt in the Santos Basin, where wells operate at depths of up to 7,700 meters. Petrobras has developed significant expertise in this type of operation and benefits from cost and margin advantages.
From a business perspective, these deepwater operations provide Petrobras with significant cost advantages. Petrobras, for instance, has a lifting cost of US$4.45 per barrel of oil equivalent (boe). By comparison, the global average is around US$27.11 per boe.
According to Hess Corporation (NYSE: HES), which holds a 30% stake in the consortium operated by ExxonMobil (NYSE: XOM) in Guyana, lifting costs in the country were around US$6.73 per boe, showing very similar characteristics to the operations in Brazil.
From this perspective, the Equatorial Margin, which extends along Brazil’s entire northern coast up to the border with French Guiana, represents a major opportunity for Brazil and Petrobras to expand oil exploration and development.
This optimism is shared by Petrobras and policymakers in Brasília, with analysts claiming that Brazil will account for 60% of new non-OPEC oil supply by 2028.
Petrobras’ 2030 Strategy
The discovery also fits into Petrobras’ broader exploration and production strategy.
Under its 2026–2030 Business Plan, Petrobras expects to invest US$109 billion over five years, including US$69.2 billion in Exploration and Production projects in its target implementation portfolio. The plan allocates approximately US$7.1 billion specifically to exploration, with the Equatorial Margin identified alongside areas in southern and southeastern Brazil and international assets in countries including Colombia and São Tomé and Príncipe.
These strategic initiatives have already led to significant discoveries and investments, with a focus on expanding production in existing fields, such as the Campos Basin, as well as in Colombia through a partnership with Ecopetrol, and through new deepwater exploration contracts in the African country of São Tomé and Príncipe.
This new discovery further cements Brazil’s pivotal role in the future of South American oil exploration and provides a new horizon for Petrobras.
The company’s strategy therefore combines continued investment in its highly productive pre-salt portfolio with exploration aimed at replacing reserves and extending Brazil’s production horizon, bringing the company to another level of production and international presence.
Petrobras’ 2026 Discovery Streak
2026 has been a year of major announcements surrounding oil discoveries and investment.
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