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The small city in the interior of Rio de Janeiro, which was once a reference and world power in oil exploration, is now at risk of ending up and becoming the new “Detroit” in Brazil.
Macaé, located in North Fluminense, has always been a symbol of growth driven by oil exploration. Its economy is strongly linked to the operations of Petrobras and other companies in the sector, with the offshore platforms being an essential driver for job creation and local development.
Recently, concerns have been raised about a possible change in the calculation of royalties of oil by ANP (National Agency of Petroleum, Natural Gas and Biofuels). This change, which aims to equalize the reference values between pre-salt and post-salt, may bring severe economic impacts for the city and the whole Campos Basin.
ANCAPSU
What are oil royalties and how do they work?
Os royalties are amounts paid by oil exploration companies to the government as financial compensation for the extraction of natural resources. These amounts are distributed among the Union, states and municipalities, being a vital source of resources for cities such as Macae, which directly depends on operations in the Campos Basin.
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The calculation of royalties is based on the reference value of a barrel of oil, defined by ANP. Currently, there is a differentiation between oil extracted in areas of post-salt e pre-salt. What is under discussion is the proposal of ANP to unify these values, increasing the cost for companies like Petrobras and directly impacting the viability of mature field revitalization projects.
Macaé's dependence on the oil sector
Macae experienced a true economic and social transformation after the discovery of large oil reserves in Campos Basin. The growth of the city is closely linked to the operation of offshore platforms, being a hub of logistical and technical support for the activities of Petrobras.
The city has become highly dependent on oil exploration, and any instability in the sector directly affects the local economy. Service companies, commerce, infrastructure and even corporate tourism revolve around the oil production chain.
What's happening with oil royalties?
According to statements by Renata Baruzzi in an interview with Agência Eixos, the ANP would be considering a review of the reference prices used for the payment of royalties. The proposal seeks to unify the reference values between the fields of pre-salt e post-salt, which, in practice, would increase the operating cost of offshore platforms in mature fields.
A Petrobras and other companies warned that increasing this tax burden could make it economically unviable to continue exploration in many mature fields da Campos Basin.
Economic consequences for Macaé
If the change is implemented, the Petrobras has already indicated that it may abandon or reduce the operation in several offshore platforms in the region. This decision would bring a series of negative impacts:
- Job Loss: Less activity in the oil sector would result in mass layoffs, both in platforms as in support and service companies in Macae.
- Drop in Royalties Collection: With the reduction in production, the collection of royalties for the municipality would fall drastically.
- Discouragement of Investment: Smaller companies, without the financial strength of Petrobras, could close their activities in the region.
- Deindustrialization and Economic Exodus: The risk of Macae become a new Detroit it's real, with the collapse of the local economy.
Well revitalization and its impact on the sector
The concept of well revitalization consists of extending the useful life of oil wells that have already reached or are close to technical exhaustion. This process involves investments to modernize equipment and continue extracting oil from mature fields.
Petrobras has invested in projects of revitalization na Campos Basin, such as the Marlim, Albacora, Barracuda and Caratinga fields. However, the proposed review in the royalties can compromise these projects, since the profit margin in these operations is narrower.
Technical aspects of the royalty change
Current legislation on royalties is regulated by two main laws:
- Law 9.478 / 1997: Defined the concession and royalty rules for oil exploration in fields in the post-salt.
- Law 12.351 / 2010: Created during the Lula government, it regulates the regime of sharing of production in the pre-salt, with higher royalty rates.
What ANP study now is to apply the reference model of pre-salt also to the post-salt, even for old concessions. This change does not alter the original contract, but increases the value of royalties paid, making it economically unfeasible to maintain several platforms.
Market and expert reactions
The decision of ANP has generated criticism from various sectors. Experts point out that:
- Juridical insecurity: Changing the rules of old contracts harms the legal security of the sector.
- Chain Effect: It does not only affect the Petrobras, but the entire chain of suppliers and services.
- Discouragement of Investments: It complicates the attraction of foreign capital and revitalization projects.
Comparison with Detroit: The warning for Macaé
The comparison of Macae With Detroit is a serious warning. Detroit, in the United States, was the epicenter of the American automobile industry until it suffered an economic collapse as automakers moved away. The city saw entire neighborhoods abandoned, leading to poverty and urban decline.
If the review of the royalties is implemented and results in the abandonment of platforms, Macae runs the risk of following the same path, losing its economic relevance and facing high unemployment rates and company exodus.
The future of Macaé is at stake
The proposal of ANP to review the reference prices of royalties of oil could pose a serious risk to the economy of Macae and of all the North Fluminense. Petrobras and other companies have already expressed concern about the financial and operational impact of the measure, warning of the risk of closure offshore platforms.
To avoid Macae become a Brazilian Detroit, it is essential that authorities rethink this change, seeking a balance between tax collection and maintaining local economic activity. After all, what is more important: collecting more in the short term or ensuring sustainable economic development in the long term?
What do you think? Is increasing oil taxes really the best solution for Brazil?
