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Brazilian state-run energy giant Petrobras (PBR) is drilling two wells for the country's National Petroleum Agency, Petrobras Chief Executive Jose Sergio Gabrielli said Tuesday.

Gabrielli was quoted as saying by the local Estado news agency that the two wells were made to help better delineate so-called subsalt oil reserves that will be ceded to Petrobras from the government as part of a capital infusion. Gabrielli didn't disclose the locations of the drilling.

"The price of the oil that is going to define the process and value of the Petrobras capital injection is going to come out of these areas," he said.

The subsalt finds were made under a thick layer of salt in the Santos Basin off the coast of Sao Paulo and Rio de Janeiro states. The oil lies under more than 2,000 meters of water and a further 5,000 meters under sand, rock and a shifting layer of salt.

The ANP, the country's top oil and natural gas regulatory, hired Petrobras to do the drilling in September. The use of two Petrobras drilling rigs was also cited by the agency as a motive for extending several exploration concessions.

-By Jeff Fick, Dow Jones Newswires; 55-21-2586-6085; jeff.fick@dowjones.com