Mines and Energy Minister, Edison Lobao said that Brazil will call global oil firms to propose for concessions in vast, but technically challenging, offshore fields starting from 2010. The country had abandoned the concessions in the so-called pre-salt area as the projected 80 billion barrels of high-quality crude in that new oil frontier lie far below the ocean floor under layers of rock and an unstable salt formation after it was found in 2007.
From then the Brazilian government has been setting up new regulations for those recently found Atlantic fields, which have a vast technical and financial challenge because of the depth and breadth of the salt and the drastic changes in temperature as the oil is brought to the surface.
Lobao said that Brazil cannot perform the Herculean task of developing the reserves on its own.
“We will certainly be holding auctions next year. This means the oil companies can begin to prepare their treasury reserves,” Lobao said.
Brazil sold many concessions to pre-salt fields before that region’s potential was evident and the government has pledged not to amend those contracts.
Petroleo Brasileiro S.A and its partners Exxon Mobil Corporation, BG Group plc, Galp Energia SGPS SA, Repsol YPF, S.A and Royal Dutch Shell plc, will have ample of work over the coming years exploiting these vast deposits. Several oil industry analysts had expected that the government would be in no hurry to draw up new laws regulating the pre-salt fields, since it would be difficult to get controversial legislation passed before 2010, an election year.
Lobao said that he favors strict terms for new firms drilling in the pre-salt region and also advices the creation of a new company totally under the control of the Brazilian government to oversee them.