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Shell wants to expand its operations in Brazil, targeting the Equatorial Margin, the new Pre-salt, while Petrobras tries to overcome environmental challenges. The decision could define the country's energy future.
While all eyes are on Petrobras, which is fighting to explore new areas, another giant is preparing to take a decisive step.
Shell, an Anglo-Dutch multinational, anxiously awaits a signal from the government to position itself in one of Brazil's biggest economic bets: the exploration of the Equatorial Margin.
According to information from the newspaper Valor Econômico, Shell is already looking at possible operations in the oil areas of the Equatorial Margin, especially in the Foz do Amazonas Basin, located in Amapá.
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The company already has assets in the Potiguar Basin, which is located in Rio Grande do Norte, but the final decision to expand its operations depends on authorization from the federal government.
The expected green light, however, may take some time, as Petrobras is still in the licensing process to drill a crucial well in the mouth of the Amazon, after facing environmental resistance.
According to Cristiano Pinto da Costa, president of Shell in Brazil, the exploration of the Equatorial Margin will be a strategic decision that will impact the country's energy future. However, the environmental issue divides opinions within the government.
The Brazilian Institute of Environment and Renewable Natural Resources (Ibama) initially denied licensing for Petrobras to drill in the region, citing environmental concerns. Even so, the state-owned company appealed the decision and is trying to reverse the veto with new studies.
The environmental dilemma and political pressures
Within the government, the situation is complex. There is a wing that supports Ibama's decision to protect the region, fearing the environmental impacts of possible uncontrolled exploitation.
However, another group argues that Brazil cannot miss the chance to discover the true economic potential of the Equatorial Margin, especially when taking into account projections for the future of the oil production in the country.
According to the Energy Research Company (EPE), national oil production will reach its peak in 2030 and, if new reserves are not explored, the sector could face a significant decline in the following years. To avoid this scenario, many experts believe that the Equatorial Margin could be the “savior” of Brazilian oil production, attracting billion-dollar investments.
Shell's stance: security and energy transition
In a recent interview, Cristiano Costa emphasized that, in addition to economic interests, Shell is committed to environmental issues. “The oil and gas industry has a history of more than 15 years of safe pre-salt exploration. We will continue to follow all Ibama guidelines,” he stated.
This commitment to safety and the environment has been one of the pillars of the company's operations, which also seeks diversify its investments in projects linked to the energy transition.
Among the projects mentioned by Shell is the second generation ethanol, in partnership with Raízen, a joint venture between Shell and Cosan. The plan is to build new plants that transform sugarcane bagasse into fuel, expanding the production capacity of sustainable ethanol in Brazil.
The impact of auctions and the dispute over the future of oil
Another crucial point for Shell's advance in the Equatorial Margin is the regular auctions of oil areas promoted by the government. The president of Shell highlighted that the regularity of these auctions is fundamental for the predictability of investments in the supply chain.
However, the National Petroleum Agency (ANP) recently postponed the public session of the permanent offer of exploration areas, which could impact the industry's investment schedule.
For Shell, delays in the auctions could harm long-term plans. Between the holding of an auction and the start of oil production, the estimated time is seven to ten years, which makes predictability essential for the planning of the sector's giants.
The uncertain future: taxation and new challenges
While closely monitoring the moves of Petrobras and the government, Shell also faces an internal challenge: the high tax burden on the oil sector in Brazil.
For every three barrels of oil extracted in the country, two are used to pay taxes and fees, according to the company's president in Brazil. The executive argues that the industry should be excluded from the “selective tax”, which adds an extra fee on activities considered harmful to the environment.
With this complex scenario, the question remains: How far is the Brazilian government willing to go to balance environmental preservation and economic development? The answer could define not only the future of Petrobras, but also Shell's role in exploring new oil frontiers.
Investing in the energy transition: beyond oil
In parallel with discussions on oil exploration, Shell continues to invest in its energy transition strategy. The company has already announced plans to invest up to US$15 billion in low-carbon solutions by 2025.
The portfolio diversification includes not only second-generation ethanol, but also the development of sustainable aviation fuels, known as SAF (Sustainable Aviation Fuel), which have the potential to decarbonize the aviation sector.
Thus, while Shell awaits the release of licenses to explore the Equatorial Margin, it also positions itself as one of the global leaders in the transition to a low-carbon economy.
And you, do you think Brazil should focus on exploring the Equatorial Margin or prioritize the environmental preservation of this sensitive area? Leave your opinion in the comments!
