RIO DE JANEIRO—Brazil’s oil and gas regulator (ANP) recently released pre-tender protocol for the 14th licensing round. The tender for the upcoming bid, which is scheduled for Sept. 27 in Rio de Janeiro, represents another chapter of the new face of Brazil’s oil industry designed by the government in which energy policies must have a more business-oriented status.
“Brazil’s oil and gas industry is experiencing the greatest opening process in its history. After having a five-year period without oil licensing rounds and lesser investors’ confidence, Brazil is resuming its importance in the world scenario with new E&P offers. Brazil has nine licensing rounds scheduled by 2019,” ANP general-director Décio Oddone told SEN.
This new sense of optimism comes with the celebration of the 20th anniversary of the ANP’s activities. The agency, which was created after Brazil’s oil industry opened following decades of Petrobras’ monopoly in the country, has carried out 18 licensing rounds, which helped to put Brazil among the most important countries for the world’s oil industry.
The institution, which is responsible for organizing the oil and gas auctions, inspecting companies and establishing and promoting geological studies on Brazil’s sedimentary basins, is based in Rio de Janeiro.
Oddone took office in December 2016. He was chosen by Brazil’s president, Michel Temer, because of his pro-market profile. With several years as a member of Petrobras’ board, he also worked in higher position in the private sector, before taking office as ANP general director.
He said that new rules were already approved by Brazil’s Energy Policy Council to create simpler rules, stimulate medium and small oil companies to take part in the upcoming bids and attract private investment firms, establishing lower minimum liquid asset requirements for non-operators companies.
“For the 14th round, the rules of the concession regime were simplified, with innovative procedures such as the adoption of the single exploration phase, possibility of extending the exploitation phase for technical reasons, different taxation for new frontier areas and mature basins with greater risks among other measures to reduce entry costs and simplify the contract,” he said.
“Our duty is to regulate, advise and guide, so that the consumer and society benefit and the economic agents are free to act, creating jobs and income. All decisions are taken by the board, following technical criteria, and made available on ANP’s website,” Oddone said.
To him, as Brazil’s government is creating a calendar for upcoming auctions, ANP will have more subsidies for the studying of the country’s geological environment for investments. “When the companies know more about our geology, the chances of obtaining success are higher and the operators will be more ambitious. The more predictability, the more attractive the auctions will be,” he said.
Despite all the exploratory success of the presalt activities, which accounts for nearly 50% of Brazil’s output in less than one decade, Oddone stressed that it is important for the world’s industry to know that Brazil can offer opportunities in other areas. “Undoubtedly, the presalt areas have become very relevant within Brazil’s output, and they will increase their importance with the upcoming auctions.
“However, Brazil is not only presalt,” he added. “We are working to offer opportunities in many other Brazilian sedimentary basins with high potential for oil and gas production.”
ANP is also responsible for recommending the areas to be auctioned in Brazil. For the upcoming rounds, Brazil’s government has established goals to decentralize E&P activities, providing better knowledge of other sedimentary basins in the country. Santos and Campos basins, located in the Southeast coast, account for nearly 80% of Brazil’s output.
“We also intend to decentralize exploratory investments and develop the small oil companies and strengthen the presence of national and foreign companies in Brazil, stimulating the demand for goods and local services as well as the creation of jobs and wealth. Therefore, we are going to offer different basins for every type of investment,” he said.
According to ANP data, roughly 1.7 million sq km (656,374 sq miles) of areas for E&P operations were offered for auctions over the last 20 years. Currently, the largest South American country produces roughly 2.1 MMboe/d.
—Brunno Braga
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