Petroleo Brasileiro SA sat out an oil licensing round in Brazil for the first time ever as the beleaguered state-run oil giant struggles to reduce the industry’s biggest debt load.
The country’s National Petroleum Agency sold only 37 of the 266 onshore and offshore blocks it offered in the worst turnout in more than a decade. International majors who operate in Brazil, including Statoil ASA, Royal Dutch Shell Plc and Total SA, didn’t submit any bids.
The 17 companies that won licenses are mainly Brazilian oil startups and mid-sized explorers who bid for onshore tracts, including QGEP Participacoes SA and Parnaiba Gas Natural, both based in Rio de Janeiro. The six foreign winners include Santiago-based Geopark Ltd. and French utility Engie, formerly known asGDF Suez, which partnered with Parnaiba Gas Natural. QGEP was the only bidder for offshore areas, winning two blocks in the Sergipe-Alagoas basin.
The auction took place amid a slump in crude prices and a national political crisis as Petrobras, the country’s dominant producer, grapples with cash constraints. While producers have traditionally preferred to join Petrobras as minority partners to limit risk, the company is balking at new financial commitments, according to Jotavio Gomes, an oil consultant and former geophysicist at the state-run firm.
Brazil Energy Insight 
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