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Project foresees start of production in 2029 with dedicated FPSO and capacity of up to 50 thousand barrels per day; company seeks partner to enable exploration of Neon field.
Karoon Energy, an Australian oil company with a presence in Brazil, announced that planned investments for the Neon field, located in the Santos Basin, could reach US$1,2 billion in the first phase of development. The final investment decision (FID) is scheduled for mid-2026, while initial oil production is estimated to begin in early 2029.
The project has recently entered the definition phase and involves the installation of a FPSO (floating production, storage and offloading unit). The estimated maximum production rate is 40 thousand to 50 thousand barrels per day, according to the company's press release.
First phase of Neon field targets up to 70 million barrels
Initial development will focus on 60 to 70 million barrels (MMb) de um total de 108 MMb of contingent resources. Four subsea production wells and one well are planned for gas disposal, in addition to the associated underwater infrastructure.
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According to Karoon, a second phase with additional wells may occur in the future, increasing recoverable volumes and extending the Neon field lifespan until the 2040s. The company is also evaluating the feasibility of transforming Neon into a offshore hub, connecting it to features from neighboring fields, such as Goiá, which already has 27 MMb of contingent resources.
Karoon wants partner to share costs
The company plans to attract a partner to share investments in the field. A data room will open in Q2025 XNUMX, with the aim of enabling a farm-down from 30% to 50%, that is, the partial sale of the stake in the asset to another operator in the sector.
Karoon confirmed that There are already interested parties in the project, although formal negotiations have not yet begun. The expectation is that, if economic and market conditions remain favorable, the partnership agreement and the final investment decision will be finalized by the end of 2026.
Initial investment of up to US$10 million begins in 2025
The oil company has adopted a conservative approach to the current volatility in oil prices and uncertainties in the global market. Therefore, the initial investment commitment will be made in a staggered manner, with a contribution between US$7 million and US$10 million over the next six months.
This amount will be used for activities such as:
- Engineering studies for the FPSOs and surface facilities
- Drilling campaign planning
- Layout research and optimizations
- Economic reassessment of the project
At the end of this stage, scheduled for the third quarter of 2025, the company will carry out a new technical and economic analysis before moving on to the next stages of the Neon project.
Total investment in 2025 could reach US$ 25 million
Adding the amounts already spent in 2025 — around $ 1 million in conceptual studies —, Karoon estimates that the total investment in the definition phase of the Neon field throughout this year could reach up to $25M monthly.
If all phases are executed according to schedule, the total costs from project definition to FID could reach $30M monthly.
According to the company, the investment is considered viable with the Brent oil price in the range of US$ 65 per barrel (reference value for 2025). In this scenario, the The first phase of development should pay for itself in approximately two years, from the start of production.
Neon Field may offset decline in production in Baúna
Located in block SM-1037, approximately 75 km northeast of the Baúna field, also operated by Karoon in the Santos Basin, the Neon field is strategic for maintaining the company's production in Brazil.
With the natural decline in production at Baúna, the company expects the Neon project to offset this decline and significantly increase Karoon’s reserves from the FID. Future connection to other fields discovered in the region could also ensure greater operational efficiency and dilution of logistics costs.
FPSO in Brazil: the heart of Karoon’s new offshore strategy
The project foresees a FPSO dedicated exclusively to the Neon field, which indicates an autonomous production model. The choice of this format demonstrates the company's progress in consolidation of own infrastructure in Brazil, moving from an operation dependent on third parties to a more integrated strategy.
The FEED (Front-End Engineering Design) phase, which has already begun, will include technical and economic assessments for the contracting of the FPSO, supplier analysis and offshore logistics study to ensure the viability of the autonomous model.
Caution in the face of oil volatility
Despite optimism about the field's potential, Karoon highlighted that it adopts a cautious stance, especially because of the instability in international oil prices and the need to maintain the company's financial balance.
“We are committed to a disciplined capital allocation strategy, ensuring that each stage of the Neon project is accompanied by detailed technical and financial reviews,” the company said.
