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One of the most controversial operations involving the Brazilian pre-salt, the privatization of Campo de Albacora Leste, has been the target of criticism and questions regarding its legality and economic impacts.
The recent privatization of the Albacora Leste field, one of the main pre-salt reservoirs in Brazil, is generating controversy and being the target of criticism. Francismar Cunha, PhD in Geography from the Federal University of Espírito Santo (UFES), recently published an article in which he explains why the sale of this field represents a real challenge to the interests of Petrobras and the Brazilian State, in addition to setting a dangerous precedent in oil industry national.
Privatization sets a precedent for companies to operate in the pre-salt without following current legislation
According to the specialist's study, the private company Prio will become the first oil company to explore the pre-salt through the so-called concession regime, even without having the legal qualifications to do so.
This can be seen as a “shortcut” for private companies to access the pre-salt layer, which is currently restricted by law. This opening of precedent is considered dangerous and questions the legislation in force on the subject.
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The article titled “The contradictions of the fourth phase of the oil industry in Brazil: The case of the privatization of the Albacora Leste field and Prio's access to the pre-salt layer” points out that this is not the first time that the privatization of the field has been the subject of complaints.
The Oil Workers Union of Espírito Santo (Sindipetro-ES) had already pointed out that the sale of 90% of the block for US$ 1,658 billion, completed in 2023, was an unfavorable deal for Petrobras, considering the potential of the block.
In addition, Cunha points out that the sale of the Albacora Leste field appears to violate the law of the Sharing regime, which regulates post-2010 pre-salt contracts.
According to this legislation, any oil company that wants to explore the pre-salt must undergo a qualification process by the National Petroleum Agency (ANP) and participate in the bidding rounds under the Sharing regime.
However, this requirement did not occur in the case of the sale to Prio.
The privatization of the Albacora Leste field allowed Prio to explore and produce in the pre-salt without proper qualification, operating under the Concession regime.
This goes against the modality foreseen for the exploration of the fields in the pre-salt polygon, which should be the Sharing, to protect the national interests of exploration.
Sale of the Albacora Leste field goes against the law of the Sharing regime and harms Petrobras and the Brazilian State
Faced with this scenario, Francismar Cunha argues that the sale of the field should be reviewed, as it seems to be based on “abusive interpretations or even the denial of current regulations”.
He argues that this operation accelerates the dismemberment of Petrobras and allows the dubious entry of new agents in the Brazilian oil industry, especially in the pre-salt.
To understand the legal complexity created by this privatization, it is important to understand the two formats provided for by law for oil exploration in Brazil: the Concession Regime and the Sharing Regime.
While the first attributes to the company the risk of investing in a block and whether or not to find oil or natural gas, the second involves the State receiving a part of the future production of the companies interested in the consortium.
In the specific case of the pre-salt layer, where the risks are lower, the law determines that the exploration modality is the Sharing, aiming to preserve the national interests.
However, the sale of the Albacora Leste field allowed Prio to explore under the Concession regime, disregarding the Sharing requirement.
This discussion promises to continue in the legal and political spheres, as it involves sensitive issues regarding the exploitation of natural resources and the participation of private companies in strategic areas of the country.
It remains to wait for the unfolding of this controversy and see if there will be a review in the privatization of the Albacora Leste field, as suggested by the Geography specialist.
