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Home Amid the pandemic and oil crisis, independent producers ask for suspension of royalty payments

Amid the pandemic and oil crisis, independent producers ask for suspension of royalty payments

27 March 2020 to 10: 12
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Amid the pandemic and oil crisis, independent producers ask for suspension of royalty payments
Amid the pandemic and oil crisis, independent producers ask for suspension of royalty payments

Producers want a minimum purchase price for domestic oil and a relaxation of the rule that limits the burning of natural gas to 3% during oil production.

The suspension of royalty payments to the government and articulation with Petrobras to review the discounts on the purchase of oil on land are among the requests issued by the Independent Oil and Natural Gas Producers (Abpip) to the federal government. Oil crisis and pandemic makes Petrobras hibernate platforms, reduce investments and take other emergency measures

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Independent Oil and Natural Gas Producers sent a letter to the Ministry of Mines and Energy (MME) in which they asked for 15 measures “in the very short term” to face the crisis in the sector.

According to the entity, with the drop in commodity prices on the international market, the discounts could make entire fields unfeasible, "potentially leading to the closure of activities with loss of jobs and collection of royalties".

The association also requests the extension or suspension for 6 months of the deadline for fulfilling the commitments agreed in the concession contract with the Agency National Petroleum, Natural Gas and Biofuels (ANP).

Abpip (Independent Oil and Natural Gas Producers), whose associates operate predominantly in the Northeast and together produce around 10 barrels a day on land, says that the actions are necessary to reduce the difficulties of the population that lives in the vicinity of the operations, helping to guarantee jobs and minimize the impact on the “fragile micro economies” of the region.

Another measure would be the flexibility of the period of six months, stipulated by the ANP, of the obligation to produce in inactive fields. "Maintaining the requirement at this time could mean returning the fields to the ANP, which will effectively contribute to further delaying their return to production".

Producers want the stipulation of a minimum price for the purchase of national oil and the relaxation of the rule that limits the burning of natural gas to 3% during oil production.

The Independent Oil and Natural Gas Producers, also requests that the ANP maintain the area of ​​Coordination of Land Areas (CAT) of the ANP, and immediately appoint a holder to continue the work that had been fully exercising its objective, of promoting business in the land areas.

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