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Proposal Changes Pre-Salt Exploration Rules and Aims to Increase Competition in Oil Block Auctions. Petrobras Would Lose Right Guaranteed by Law Since 2010; Text Goes for New Analysis.
Last Tuesday, the 10th, an important Bill (PL) that changes the rules of oil exploration in Brazil took another step in Congress. The Senate Infrastructure Commission (CI) approved PL 3.178/2019, which removes Petrobras’s preferential right in the auctions of oil blocks under the production sharing regime in the pre-salt. The proposal will still be analyzed by the Economic Affairs Commission (CAE).
The project, originally presented by former senator José Serra (PSDB), is reported by senator Marcos Rogério (PL-RO) and promotes a significant change in the regulatory framework of national oil exploration.
According to the reporter, the intention is to make the environment more attractive for new investments and correct distortions that limit competitiveness in the government-run bids.
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Petrobras May Lose Prominence in Pre-Salt Exploration
Since 2010, Petrobras has held, by law, the preferential right to act with at least 30% in exploration consortia under the sharing regime, in addition to being the operator of the auctioned blocks even without presenting the best financial proposal.
With the new proposal, this provision would be revoked, opening up space for greater competition in oil block auctions and allowing private companies direct access to the fields.
The measure, according to supporters of the text, could generate greater public revenue, accelerate the development of less attractive areas in the current model, and foster job and income generation.
“If the change from sharing regime to concession enables the use of these ‘stranded’ blocks, everyone benefits: the Union, states, workers, and companies. It is about transforming buried oil into actual wealth,” stated Marcos Rogério.
CNPE Will Have Autonomy to Choose Between Sharing and Concession
Another central point of the Bill is the transfer of responsibility to define the exploration regime – sharing or concession – to the National Council for Energy Policy (CNPE).
The body, with technical support from the National Agency for Oil, Natural Gas, and Biofuels (ANP), will be able to analyze on a case-by-case basis the most advantageous model for the country, considering technical, geological, and social return criteria.
This flexibility is seen as strategic to unlock areas that have yet to be explored, such as those located in the so-called Equatorial Margin, a region with high energy potential.
During the voting, Senator Marcos Pontes (PL-SP) also expressed support for the project, highlighting that Brazil has cutting-edge technologies to ensure the environmental safety of exploration.
“Every time this issue is mentioned, there are numerous environmental concerns, but we have technologies, some of the best in the world, to explore this oil and bring wealth to the country. This project improves what has been done so that we can share the wealth of oil more equitably,” he declared.
According to him, the text represents a modernization of the legislation and strengthens Brazil’s energy sovereignty by allowing the Union to choose the most profitable and efficient method of exploration for each oil block.
Expected Impact on Upcoming Oil Block Auctions
With the change on the horizon, industry experts believe that the next oil block auctions may become more competitive, attracting international companies that previously avoided Brazil due to Petrobras’s restrictive rules.
The last rounds under the sharing regime indeed recorded low participation, which raised an alert in the government and Congress about the need to revise the model.
For Senator Marcos Rogério, modernizing the legal framework is an essential step to unlock the sector and ensure that the country’s natural resources translate into concrete benefits for the population.
“The last rounds of production sharing have seen low participation. The legal change can boost competitiveness and ensure better results for the country,” he concluded.
Source: Agência Senado
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