Petrobras' emergency measure could make oil-producing municipalities go through the roof as of this April. Cities that depend on the collection of royalties from production in the Campos and Santos Basins may have transfers drastically reduced by up to 60%. The trial is scheduled for April 29 at the STF.
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What are Oil royalties? Royalties are an indemnity to the municipality or state, not being applied to any economic activity, but those that are based on the extraction of finite resources in nature. It is the extraction of this type of natural resource and not its possible impacts on the environment and the economy that generate the right to royalties.
In times of a pandemic, this resource will be needed in the fight against the new coronavirus in these regions, especially in the health area.
Unfortunately, the municipalities that live exclusively on oil income did not want to insert new sources of financial resources into their economies. For more than 10 years, they have been warned about this possibility of a market crash. There is not even a sovereign wealth fund to be used in times of crisis.
The price of a barrel, which was once worth US$100, is now worth less than half, close to the cost of pre-salt extraction. Despite this, prices should rise slightly after the US mediates Russia-Saudi Arabia talks at the G20 last week.
The new scenario of oil prices and the crisis caused Petrobras to hibernate 6 oil platforms in the Campos Basin, a direct impact on the economy of the North Fluminense region, consequently on royalties.
The platforms that will have confirmed production stoppages are: Cherne 1 and 2, in the Cherne field; Boyfriend 1 and 2, in the Boyfriend field; Petrobras-09, in the fields of Congro and Corbina; and Garoupa, in the Garoupa field, according to Sindicato dos Petroleiros NF and Reuters.
