(Updates with more background)

By Bernd Radowitz

OF DOW JONES NEWSWIRES

JEDDAH, Saudi Arabia -(Dow Jones)- Recent Brazilian oil discoveries may all be connected and form one big oil field, Brazil's Mines and Energy Minister Edison Lobao told Dow Jones Newswires in an interview Saturday.

"There is a connection between them. It could be one big field. That's not absolutely proven, but there are signs that it could be one big field," Lobao said, when asked whether the Carioca, Guara and Bem-Te-Vi finds could form one massive oil field.

Haroldo Lima, the head of Brazil's oil agency ANP, in April had sent shock waves through the oil world saying that the area around the Carioca find by Brazil's state-run oil giant Petroleo Brasileiro SA (PBR), or Petrobras (NYSE:PBR) , could contain reserves of 33 billion barrels in oil equivalent. Petrobras (NYSE:PBR) has a 45% operating stake in Brazil's BM-S-9 oil block, with BG Group PLC (LSE:BG) . (BG.LN) holding another 30%, and Spain's Repsol YPF SA (NYSE:REP) (REP) with 25%.

Lobao didn't directly confirm Lima's estimate but said he "hopes" that reserves around Carioca "are more than that."

Petrobras (NYSE:PBR) last week said it struck oil in a second well in the BM-S-9 block, called Guara, after having announced the Carioca find last year. The company also said it found oil at Bem-Te-Vi in the adjacent BM-S-8 block, where Petrobras (NYSE:PBR) is the lead operator with a 66% stake, while Royal Dutch Shell PLC (NYSE:RDSA) ( RDSA) holds 20% and Portugal's Galp Energia has a 14% stake.

Also, Exxon Mobil Corp. (NYSE:XOM) (XOM) plans to drill a well this year at the BM-S-22 block, which is adjacent to Guara. Geologists have told Dow Jones Newswires that the two blocks may be linked. Exxon (NYSE:XOM) has an 80% operating stake in BM-S-22, while Hess Corp. (NYSE:HES) (HES) holds the remaining 20%.

The minister added that it is possible that Carioca, Guara and Bem-Te-Vi are connected to the nearby Tupi field. Petrobras (NYSE:PBR) last year said it estimates recoverable reserves at Tupi of up to 8 billion barrels of oil equivalent.

The company plans to start a long-term production test at Tupi next year with initial production of 30,000 barrels a day that will ramp up to 100,000 barrels a day from late 2010. Eventually, Tupi could pump 1 million barrels a day, the company said.

Loboa said he thinks Carioca could start producing in about five to six years, and that the new Brazilian oil discoveries "without doubt will contribute to push oil prices down."

"Those are very elevated reservoirs," he said.

The Brazilian minister added that Brazil is also helping to push oil prices down by rationalizing its energy use and by intensifying its biodiesel and ethanol program. That should help the Latin American country to have more oil left over for export, Lobao said.

Lobao was speaking in Jeddah where he is attending a major oil producing and consuming nations meeting hosted by Saudi Arabia to address the issue of surging oil prices.

-By Bernd Radowitz, Dow Jones Newswires; +34 618-526-915; bernd.radowitz@ dowjones.com

Exxon Mobil Corp. (NYSE:XOM) (XOM) plans to drill a well this year at the BM-S-22 block, which is adjacent to Guara. Exxon (NYSE:XOM) has a 40% operating stake in BM-S-22, while Hess Corp. (NYSE:HES) (HES) holds 40% and Petroleo Brasileiro, or Petrobras (NYSE:PBR) , holds the remaining 20%.

(In "UPDATE: Brazil Min: New Brazil Oil Finds May Be One Big Field," published at 1755 GMT Saturday, the percentage of stake holdings attributed to Exxon (NYSE:XOM) and Hess were incorrect).

    (END) Dow Jones Newswires   06-21-08 1410   Copyright (c) 2008 Dow Jones & Company, Inc.