Brazil's Petrobras, Shell to Look for Joint Drilling Opportunities

(Reuters) — Brazilian state-run company Petrobras and international oil major Shell will work together to identify potential opportunities to explore for and produce crude and natural gas, Petrobras said on Thursday.

Under a memorandum of understanding signed by the companies, Petrobras and Shell will focus on exploration opportunities inside and outside the country's offshore pre-salt fields, a key oil-bearing area off the coast of southeastern Brazil.

"The companies will work together to identify potential upstream business opportunities, sharing experiences and best practices in carbon emissions reduction and socio-environmental initiatives," the Brazilian firm said in a securities filing.

The pre-salt fields were a top priority of President Luiz Inacio Lula da Silva over a decade ago during his first stint as president. The leftist leader often described the offshore oil riches there as key to the country's future development.

More recently, Petrobras has emphasized a shift to more renewable energy projects alongside its core business of pumping oil.

Earlier this week, the Brazilian company announced a deal with Norway's Equinor to evaluate offshore wind power projects.

The five-year partnership between Petrobras and Shell will also include "renewable energy and carbon capture and storage," the statement said, without going into further detail.

Efforts to preserve and restore biodiversity aimed at issuing credits to offset carbon emissions are also being considered, the statement added.

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