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ANP has areas up for auction and analysis with estimated volumes of 24 billion barrels, sharing regime, and permanent supply.
The auction of the five pre-salt blocks, with estimated volumes of 18 billion barrels of oil and gas, will be carried out by the ANP this Wednesday (13/12).
With respect to pre-salt area, it is important to highlight that there is a queue for future offers, with another approximately 6 billion barrels in different stages of internal analysis by the federal government. You oil fields in this region they have great exploration potential and continue to arouse the interest of the sector.
Sharing blocks in the permanent offer
Since last year, sharing blocks have entered the permanent offer. Auctions are defined based on prior expressions of interest.
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It will be the second cycle of the permanent sharing offer, together with the 4th of the concession, in which blocks will also be auctioned in the pre-salt areas, Santos oil fields (outside the polygon), Pelotas and onshore areas.
The ANP will offer, this Wednesday (13/12), five blocks in the pre-salt polygon, in the 2nd Cycle of the Permanent Sharing Offer. In parallel, the government is evaluating the inclusion of at least 13 other areas on the OPP menu.
In ten years, 23 areas were auctioned in sharing rounds – considered the auctions of surpluses from the transfer of rights, which included assets with already commercial discoveries.
Today, five blocks will be offered and the government has advanced this year with work to offer another 13 areas in the pre-salt polygon.
Auction of blocks in the pre-salt area
This Wednesday, the following will go up for auction:
- Turmalina (Campos) – located east of the Roncador and Albacora Leste fields, with estimated volumes of oil in place (VOIP) of 2,26 billion barrels, plus potential untested geological sections (upside) of 1,36 billion barrels.
- Jade (Santos) – VOIP estimated at 2,91 billion barrels and upsides of 4,2 billion barrels;
- Cruzeiro do Sul (Santos) – east of the Tupi field, the largest oil producing field in the country, and west of block BM-S-24 (Jupiter); 1,17 billion barrels of condensate and 1,82 billion barrels of oil, with upsides estimated at 3 billion;
- Tupinambá (Santos) – VOIP estimated at 4,2 billion barrels;
- Esmeralda (Santos) – 5,88 billion barrels, which includes the Tupã prospect, in the same block.
The volume of oil in place It is an initial estimate of reserve potential, which is confirmed only through well drilling, production tests and reservoir studies.
Any commercial reserves will also take into account economic aspects, if discoveries are confirmed. O total volume of 18 billion barrels mentioned at the beginning of the text does not take upsides into account.
In the ANP's assessment, Cruzeiro do Sul presents an exploratory risk exclusively associated with upsides, since these are extensions of already drilled prospects. The CO2 content, however, may make commercial use of the reservoir unfeasible. Esmeralda and Jade are considered moderate risks, with relevant volumes, characterizing a high premium, according to geologists' estimates the agency.
Despite Esmeralda's many uncertainties, a well has already been drilled with signs of oil in the area.
The Ágata and Tupinambá blocks, in turn, are on the exploratory and present high exploratory risk to moderate. In the northern portion of Tupinambá, exploratory wells have already been drilled which, even in an unfavorable situation, reported signs of oil.
Unoccupied areas and permanent offer
Os today's auction data They are from the geological summary, published by ANP in 2022.
The Ministry of Mines and Energy already has 11 blocks mapped to take to the National Energy Policy Council (CNPE), including some already known areas of the market, such as Itaimbezinho (Campos Basin) and Ágata (Santos Basin).
Itaimbezinho was included in the permanent offer, but had to be withdrawn this year because the joint statement between the Ministries of Mines and Energy and the Environment had expired.
This step is necessary, due to the absence of the Environmental Sedimentary Area of the Sedimentary Basin (AAAS), a study environmental which would encompass the entire basin and would need to be contracted by the government.
As areas in deep waters of Campo and Santos, the main Brazilian oil province, have not represented a risk in the emission of license for exploratory wells.
Ágata is already part of the permanent offer portfolio. It was not included in today's auction due to lack of market interest.
Completing the MME list: Citrine, Larimar, Onyx, Jaspe, East Sapphire, West Sapphire, Amazonite, Mahogany and Amethyst.
These 11 blocks have potential of 1,73 billion to 3,69 billion barrels of oil in place not scratched, according to the MME.
Sharing regime and areas on the OPP menu
Last week, the ANP also approved the geological and economic studies of two more areas, Ruby and Granada, both located in the Santos Basin. It's the rite: ANP studies, MME approves and sends it to the National Energy Policy Council (CNPE). They are then eligible for inclusion in auctions.
With the inclusion of pre-salt sharing areas in the permanent offer, the government consolidated the on-demand contracting modality as the main form of bidding for exploration blocks in the country. The 6th sharing round, in 2019, negotiated only Aram, one of the five areas offered in the previous model, in which the selection of areas came from the government. The bidding was marked by the absence of international oil companies.
After the low hiring rate of areas in the 17th round of concessions, which negotiated five of the 92 blocks offered, in October 2021, the government then decided to adopt the permanent offer as the only model for contracting areas of exploration.
The assets that would be offered in the 7th and 8th sharing rounds were, therefore, transferred to the menu areas of permanent supply.
Permanent offer and signing bonus
The change is accompanied by a reduction in the entry barrier. From the current permanent offer portfolio, Tupinambá is the asset with the lowest signing bonus (R$ 7 million) and Cruzeiro do Sul is the most expensive (BRL 134 million).
In sharing, the signature bonuses are fixed, as the competition is based on the percentage of profit offered to the Union, in oil and gas produced.
Even without monetary correction, to date the highest bonus value has been far away, at the first auction, in 2013, when the Libra area, in the Santos Basin, was offered. An atypical debut, when the government tendered for an area with oil already discovered.
There were R$15 billion in signing bonuses, paid by Petrobras (40%), Shell (20%), TotalEnergies (20%) and the Chinese CNPC (10%) and CNOOC (10%).
The second auction took place four years later, in 2017.
Since then, the highest amount raised was in the 5th round of sharing, in 2018: R$6,8 billion for four blocks.
This auction was marked by the relaxation of sharing rules and the greater entry of international majors in the pre-salt, with the participation of large companies in the sector, such as BP, Chevron, ExxonMobil, Shell and TotalEnergies.
The values of the bonuses paid in the first sharing auctions contrast with the last round held, in December 2022, when the signature bonuses for the four blocks won in the permanent offer totaled R$916,25 million.
'We are leaving behind the era of billion-dollar bonuses to enter the phase of high production and revenue', stated the then general director of the ANP, Décio Oddone, in 2019, in the 6th round of sharing.
To the consultant and former director of the ANP, Felipe Kury, the smallest participation of the most disruptive in the most recent rounds is also due to the fact that large companies have already formed a portfolio robust exploration in Brazil and are now concentrating their efforts on seeking results.
'Companies already have assets to explore and monetize. Furthermore, the global context does not favor great aggressiveness in auctions. The global situation has changed, there is more risk in the world and this impacts business decisions investment', he assesses.
Source: EPBR
