Brazilian government announces round of bidding for exploration of the pre-salt oil area

The National Energy Policy Council approved on Thursday (23), the realization of the 1st round of bidding under sharing scheme in the area of the brazilian ​​pre-salt oil for October. According to the article published on Wednesday, the National Petroleum Agency (ANP) is authorized to conduct the bidding in October 2013. The area will be offered will be Libra, located in the Santos Basin.

The Libra area who was announced discovery in 2010, is located 183 km off the coast of Rio de Janeiro, at a water depth of 1,964 m. The region has about 15 billion barrels of recoverable oil, according to the ANP.
Last week, during the 11th Bid Round of the ANP, were auctioned 142 exploration areas for 30 companies from 12 different countries, for a total of U.S. $ 2.82 billion.

The auction will be the first under the 2010 legislation that increased state control over the reserves in the Campos and Santos basin. The adoption of production sharing regime, replacing the concessions, causes the State to have a part of the physical production in each oil field.
The company pays a bonus to the Union when signing the contract and makes the exploration at their own risk. If they find oil, they get paid in oil by the State. In addition, they will receive another tranche, which is their gain. The rest is for the Union.
In this model, as the Union has ownership of oil, after production they must carry it, refine it, store it or sell it, or the government can even hire companies to do this, paying them, and will receive from them money from the sale.

In the regime of concessions companies are left with all the oil, but pay rates that vary with the volume of production and international oil prices. Ie the Union auctions the rights to explore areas to companies, which pay an initial value, which depends on the risk of the exploration.
In the concession model, the government does not need to have structures for transportation and sale of crude oil, for example, and focuses only on supervising the payment of taxes and other fees.

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Joe Cloud
Dutch, American, Brazilian... lived there for 5 years and owns property in Brazil. Out of the country for a few years now and would like to go back, however current circumstances tell me it's not the right time.

Published by Joe Cloud

Dutch, American, Brazilian... lived there for 5 years and owns property in Brazil. Out of the country for a few years now and would like to go back, however current circumstances tell me it's not the right time.