press release

Mobil-led consortium signs deepwater farm-in agreement with Petrobras

The following news release was issued by Mobil Corporation

FAIRFAX, Va., July 20, 1999--Mobil Corporation announced today that its wholly owned subsidiary Mobil Exploracao e Desenvolvimento do Brasil Ltda. has signed final agreements with Petroleo Brasileiro S.A. (Petrobras), the Brazilian national oil company, to participate in the exploration of BES-2 deepwater block in the Espirito Santo Basin offshore Brazil.

Mobil and Petrobras each will have 35-percent interests with Unocal Espirito Santo Ltda. holding the remaining 30-percent of Block BES-2 in the Espirito Santo Basin. Block BES-2 is over one-half million acres in size and is situated in water depths ranging from 1200 to 4500 feet (400 to 1500 meters). The work program in Block BES-2 includes 3-D seismic acquisition followed by exploration drilling. Mobil is the operator on this block.

"We are very pleased to be participating with Petrobras and Unocal in the exploration of Block BES-2," said M. W. Scoggins, President, International Exploration & Producing, Mobil Oil Corporation. "It is a good strategic fit with Mobil's global deepwater program. We are optimistic that the block has the potential for the large discoveries that will be needed to justify our investment."

In 1997, the government of Brazil opened its oil industry to foreign investment. As part of this process, Petrobras was permitted to retain selected offshore and onshore blocks with the remainder returned to the National Petroleum Agency (ANP) for bid rounds. Block BES-2 was one of the blocks retained by Petrobras, which then solicited farm-in partners to help it expedite exploration and potential development of these blocks.

Updated: July 1999