Chevron sees Brazil's pre-salt oil as prize asset - executive

Mariano Vela, head of operations of Chevron in Brazil speaks during the 2019 OTC Brasil Conference in Rio de Janeiro
Mariano Vela, head of operations of Chevron in Brazil speaks during the 2019 OTC Brasil Conference in Rio de Janeiro, Brazil October 29, 2019. REUTERS/Sergio Moraes

HOUSTON, Aug 17 (Reuters) - Chevron Corp (CVX.N)is hoping to play a role in Brazil's pre-salt oil discoveries, the U.S. oil major's Brazil chief said on Tuesday at the Offshore Technology Conference (OTC) in Houston.

The "pre-salt chapter" might be the most important development in Chevron's more than century-long presence in Brazil, said country manager Mariano Vela. Chevron has held interests in 11 deep water projects in Brazil's Campos and Santos basins since 2018.

"We want a piece of that," Vela said of the pre-salt area, so called because the oil reservoirs lie beneath salt domes under the seabed.

Brazil's government is organizing a December auction for licenses in two blocks in the pre-salt area. Vela did not directly say whether Chevron plans to bid at the auction.

The same blocks - Sepia and Atapu - were offered in a 2019 auction that stalled. Chevron and others at the time said license fees were too high and there was regulatory uncertainty.

Vela said on Tuesday that incentives have improved since then, which included a 70% reduction in the size of signing bonuses. There still needs to be regulation improvements and financial incentives to make new oil projects in the country more attractive, he said. Fossil fuels must now compete with cleaner sources of energy, he added.

"The window (to invest in oil) is not going to remain open forever," Vela said.

Reporting by Sabrina Valle and Marianna Parraga in Houston; Editing by Andrea Ricci, Cynthia Osterman and Marguerita Choy

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Focused on energy-related sanctions, corruption and money laundering with 20 years of experience covering Latin America's oil and gas industries. Born in Venezuela and based in Houston, she is author of the book "Oro Rojo" about Venezuela's troubled state-run company PDVSA and Mom to three boys.