En Español

Very usefull links


News links




Dow Jones

Oil price



Views and News





Brazil plans two subsalt auctions in 2017, and three 2018 - Mines & Energy Ministry

Brazil will hold two tenders for subsalt oil exploration this year in the first auctions of such offshore layers since 2013, Brazil's oil secretary Marcio Felix told Reuters in an exclusive interview on Thursday.

Petroleumworld.com 01 20 2017

Brazil plans to hold two subsalt oil auctions in 2017, putting new exploration areas up for bidding in November for what should be the "most competitive" round of the year, Oil Secretary Marcio Felix said in an interview on Thursday.

The auctions, an effort to lure foreign investment in a sector that for much of the past decade has been the object of protectionist policies in Brazil, will be the first since 2013 for the offshore region known as the subsalt, where giant discoveries were made starting about a decade ago.

The first auction, expected in the first half of this year, will offer areas next to existing discoveries already in development, Felix said. The November auction will be for fresh exploration areas and should generate more government revenue than the first, though the exact areas have not been decided yet.

The auctions will be the first since Brazilian state-run oil company Petrobras was freed from having to be the operator for all new projects in the subsalt.

Besides Petrobras, the opportunity to buy into new areas in one of the world's most exciting deep-sea oil areas should attract offshore majors such as Anglo-Dutch Shell, France's Total, and Norway's Statoil, Felix said.

Shell said in a statement that it was studying whether to participate in this year's oil auctions, adding that the terms would be an important factor. Total and Statoil did not immediately respond to a request for comment.

Reduced investments by companies hampered by low oil prices should not be a problem, Felix said, describing the subsalt as the Olympics of offshore exploration. "If you're an athlete you're not going to miss the Olympics," he said.

Before plans of the second subsalt auction were confirmed, Brazil estimated it would generate up to 4.5 billion reais ($1.41 billion) this year from the first subsalt auction and two other auctions for more marginal and mature onshore and offshore areas.

The two subsalt auctions in 2017 represent a major shift in Brazil's oil politics. With the country in its worst recession on record, the center-right government hopes to attract foreign investment and reinvigorate oil exploration in a region long stifled by nationalist energy policies and the financial woes of Petrobras.

Felix said Brazil would hold three oil auctions in 2018, including a subsalt one. To give companies greater long-term clarity, he said he expected to release a calendar by year-end outlining oil auctions for the next five years.

Local content rules should be simplified by the time auctions are held in 2018, Felix said, adding that new rules would be based on "incentives and not punishments."

One potential change under consideration is to allow companies to gain credits for exporting oil equipment from Brazil or from investing in factories in Brazil. Such credits, Felix said, could be used to offset purchases of equipment from overseas. ($1 = 3.1997 reais)

Story by Leonardo Goy and Stephen Eisenhammer from Reuters; Editing by Lisa Von Ahn and Richard Chang.

We invite all our readers to share with us
their views and comments about this article
Write to editor@petroleumworld.com

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels


Contact: editor@petroleumworld.com,

Editor & Publisher:P.Ohep F. /Producer - Publisher:P.Ohep F./
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2016, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2016, Petroleumworld   / Elio Ohep Fitzgerald- All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.