History, Exploration & Exploitation of Oil and Gas

The paper deals with three main publications at the beginning of the coming into being of petroleum geology contributed by the Austrian/Bohemian expert Hans Höfer von Heimhalt (1843–1924) in 1877, 1888 (often reprinted and translated in many languages), 1913–1919 in the context of his life and academic career in the Habsburg Monarchy. Trained at the Mining Academy in Leoben (Styria, Austria) and as professor at different mining academies within the Habsburg Empire and integrated in the thought collective of the Imperial Geological Survey in Vienna, Höfer’s interest started with a local perspective on petroleum not in Europe but in North America after the Austrian Trade Ministry mandated his visit to the World Exhibition in Philadelphia 1876. There he encountered the new approaches in petroleum findings in the USA and published his first book about petroleum in North America (1877) in which he established his thesis about the causes of the origin and formation of petroleum, the anticlinal theory at the basis of his regional insight. Höfer’s further books on petroleum represent the change from local surface indications to systematically applied petrology, sedimentology and stratigraphy to the search for hydrocarbon accumulations. Modern exploration methods and a worldwide mapping of all oil-known occurrences showed the global interest in this matter and the opening of doors to modern universal geochemical methods of exploration and the close connection between theory and practice, field geology and experiments.

This paper brings to light a still poorly known history, which demonstrates the technological and intellectual momentum of the geology of the State of São Paulo, before the creation of Petrobras. Although the results regarding the presence of oil in significant amounts were disappointing, relevant geological results were achieved, as well as technical advances. The initial steps of oil exploration in the State of São Paulo were linked to private entrepreneurs, and date back to the year of 1872. Exploration and research attempts took place in the hinterland localities of Morro do Bofete and Águas de São Pedro, through geological studies performed by naturalists, engineers and geologists. In the 1920s, surveys were performed by the Geographical and Geological Commission of São Paulo (CGG), in cooperation with the Brazilian Geological and Mineralogical Survey (SGMB). A special subdivision was created within the CGG in 1927, and the North American petroleum geologist Chester Wesley Washburne (1883–1971) was hired in 1928. The set of documentation used includes private and official letters, besides other types of historical documents, in custody of the Historical Archives of the State Geological Institute of São Paulo.

Oil geology as a scientific field has developed in parallel with the start of oil exploration in Brazil at the end of the 1930s. This chapter analyzes some features of this process. It focuses on different aspects of the activities of the National Petroleum Council (CNP in Portuguese). In Brazil, the development of this scientific field was supported by a State agency, networks of scientists, private companies, and universities—both Brazilian and foreign. This suggests that there were political, economic, and ideological interests at stake in the production of new scientific knowledge. The political context of scientific production, the networks through which this production circulates, and the purposes for which it is used are crucial to the understanding of a creole science. A term coined by environmental historian Stuart McCook creole science encompasses both the impact other spheres have in the production of scientific knowledge and the on-the-ground experience of this production. It also considers the intersections of nature, scientific discoveries, politics, economics, and nationalism. Such reflections are essential for an analysis of the development of the Brazilian field of oil geology. Here we will analyze a previously unreleased collection of documents of the CNP. The studies, exchanges, and breakthroughs made by both Brazilian and foreign scientists reveal these interactions and contribute to a broader understanding of the field.

Warren G. Harding’s presidential administration in the early 1920s is best remembered for the scandal surrounding Teapot Dome oil field in Wyoming, the most infamous presidential malfeasance of the early twentieth century. A Presidential Order in 1915 named Teapot Dome a Naval Petroleum Reserve. The advantages of petroleum over coal for naval fuel had proved irresistible, and the crude reserves were meant to provide a secure wartime supply. Harding chose Senator Albert B. Fall as his Secretary of Interior. Fall wrangled Teapot Dome away from the Navy Department, and then leased the field in 1922 to independent oil titan Harry Sinclair in a non-competitive deal. Senate hearings followed, Fall resigned, and Harding died suddenly a few months afterward. Investigators determined that Fall had received about $400,000 in “loans” from Sinclair. He was convicted and imprisoned for bribery. Sinclair was jailed for contempt, the leases were invalidated by the Supreme Court, and Teapot was returned to the Navy. Teapot is an asymmetrical anticline on the southwestern flank of the Powder River Basin. Its key producing zones are Cretaceous sandstones and shales, and there is substantial undeveloped potential for primary and enhanced oil recovery, as well as infill and horizontal drilling targets. In 2015, the field was acquired by Stranded Oil Resources in a public process. Transfer to a new, private operator after 100 years as a Naval Petroleum Reserve represents another exciting chapter in the history of America’s most notorious oil field.

In 1953, the creation of Petrobras contributed not just for the Brazilian oil policy and economy, but also for the creation of a department focused on the research and exploration of oil in the Brazilian territory. Created in 1955, the Department of Exploration—DEPEX was divided in and performed by local districts situated in basins with oil potential, all directly subordinate to the Chief Superintendent, the North American geologist Walter Karl Link (1902–1982). It is necessary to point out the importance of the investments of Petrobras, and mainly of the Department of Exploration, in the laboratories of paleontology, stratigraphy, and subsequently in sedimentology. In the 1950s, the first Paleontology Laboratories were situated in Belém (Pará State), Ponta Grossa (Paraná State) and Salvador (Bahia State), and incorporated by these districts. Huge advances in scientific and technical expertise related specifically to micropaleontology were achieved. Professionals of the company performed their activities during this period, in particular the Brazilian paleontologist Frederico Waldemar Lange (1911–1988), who started developing the first studies on microfossils in 1955, mainly chitinozoans. From 1958 onward, we also have in the lab in Belém, the Danish Johannes Christian Troelsen (1913–?) and the German geologist and micropaleontologist Karl Krömmelbein (1920–1979), who continued their researches on foraminifera from the coastal basins in the north and in the northeast. The activities of the professionals continued to expand, contributing significantly for oil field research. Since the beginning, Petrobras invests in the qualification of his own labor force with courses and internships abroad. As two specific examples, we have the advanced course in micropaleontology, offered by the “Centro de Aperfeiçoamento e Pesquisas de Petróleo”—CENAP/Petrobras (Improvement and Oil Research Center), in 1961—with 6 months of duration, and the internship in micropaleontology (foraminifera and nannofossils, in oil companies abroad), in 1968. Thus, this summary confirms the first steps of the paleontological researches, highlighting the technic and scientific improvements of micropaleontology in the Brazilian development of oil exploration.

After World War II, the geological community in Germany was left in disarray. Most geoscience institutes, survey offices and museums had been damaged or destroyed. Geology, however, was in possession of crucial expertise for rebuilding the stricken country, which now was administrated by foreign military governments in four occupation areas. There were two nuclei for the revival of a German geological survey, the former Reichsamt für Bodenforschung in the Soviet Sector of Berlin and an important off-shoot of the Reichsamt, the Department of Petroleum Geology within the British occupation area in Celle near Hannover. It seemed only natural to assume that—once matters had settled down—Berlin would again play a vital role as a major centre of geology in years to come. Consequently, both offices cooperated, exchanging publications and geological information. Over the next couple of years, however, cooperation became progressively difficult. Berlin colleagues reported increasing political pressure and several had to answer for their naïve assumption that they still were part of a common all-German geological “family”. Having sent information on petroleum to western colleagues, they found themselves charged with espionage and treason, facing imprisonment and potentially worse. At the same time, communist propaganda endeavoured to discredit western geologists as fascist–capitalist agents.

For many decades, the way to find oil was resulted from a tactile approach and some luck. In the early twentieth century, Brazil started building its National Approach regarding oil and gas. The country nationalized petroleum before even finding it with the creation in 1938 of the National Petroleum Council (Conselho Nacional do Petróleo). After numerous attempts, oil in Brazil was only found in 1939 in the state of Bahia. In 1953, the Brazilian National Oil Company, Petrobras, was created, kicking off a new period in the formation of domestic expertise and technology development, and state-led exploratory efforts. After important (although always insufficient) investments in the search of onshore oil fields, from 1968, Brazil turns to the seas and begins new exploratory cycles focused on the offshore oil research. The international oil prices had begun to escalate, leading to the shocks of the 1970s and the opening of new exploratory frontiers worldwide. The first offshore discovery was registered in a well drilled in shallow waters in the field Guaricema, Sergipe-Alagoas Basin. Nevertheless, Brazil’s real offshore adventure started from the mid-1970s with the first drilling in the Southeastern Campos Basin. From shallow to ultra-deepwaters, the Brazilian NOC, born with the initial mission to build a major national refining industry, gradually transformed itself into a vertically integrated company and then into a major offshore operator. The process of industrialization and modernization of Petrobras will be discussed in this chapter book, with focus on history, technology, policy, and luck from the 1970s oil crisis up to the 2000s pre-salt discoveries. Consistent state efforts put Brazil on the Global Oil Map and allowed the country to develop a reputation as an attractive place for foreign investment.

This chapter gives an historical overview of the university–industry linkages in the Brazilian oil industry as an outcome of changes in the local science and technology (S&T) policy. Starting from the 1950s and up to 2014, we briefly outline the major changes that took place in the S&T policy and how they have affected the relationship between the Brazilian state-controlled oil company, Petrobras, and universities. We characterize these changes in two phases according to the main type of links involved in the Petrobras–university relationship. In phase 1, the most important link was human resources training. In phase 2, there was a reorientation of these links towards research collaboration, although the training of human resources remained important.