Petrobras Says Gulf Spills Hampers Brazil Production

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Petrobras, Brazil's state-run oil company, said the 2010 Gulf of Mexico oil spill, the largest oil spill in U.S. history, has hampered oil production in Brazil as regulators there force the company to shut-down equipment for maintenance and safety inspections.

Petrobras CFO Almir Barbassa told investors that the company is being forced to shut down equipment with increased frequency and in situations that are much less critical than before, Bloomberg News reported. Earlier this week, the company said its production grew by just 2% in the first half of this year, its slowest output gain since 2007, according to Bloomberg.

Petrobras (PBR) will spend $224.7 billion over the next five years, by far the largest total of any of the world's major oil producers, in an effort to boost daily output above 6 million barrels by 2020.

The company is banking on production from pre-salt fields such as Lula and Libra to make up for dwindling production at fields in Brazil's Campos Basin, which currently accounts for 85% of the country's oil output. Brazil's pre-salt fields are believed to hold 50 billion barrels of reserves.

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