ANP concludes analysis of the exemption request of the Libra consortium

Updated: Wednesday, October 04, 2017, 12:25 PM

The ANP analysis was completed for the Libra Consortium’s request for exemption from compliance with Local Content for the items and sub-items related to the UEP subsite of the Libra Pilot project.

The request was based on the contractual forecast of excessive price, set forth in Clause 25.8 of the Production Sharing Contract (CPP). It also addressed the lack of a supplier capable of meeting the local content commitments of the CPP, as well as the inability of local suppliers to meet the oil extraction schedule by 2020.

The decision of the ANP board was:

1) Rejection of the exemption request for the commitment items prohibited by the Sharing Agreement: Basic Engineering and Detail Engineering;

2) Maintenance of the minimum local content commitments of the CPP for the following identified items:

		Minimum Commitments – CPP
Plants	Field instrumentation	40%
	Filters	80%
	Screw Compressors	70%
Installation and Integration of Modules	Business Management	80%
	Marine means	10%
Anchoring	Pre-installation and hook-up of lines	40%
	Anchoring system	85%

 

3) Approval of the exemption request for the items indicated below:

Hull	Business Management
	Construction and assembly
	Commissioning
	Systems and equipment
	Marine systems
	Materials
Plants	Tanks
	Burners
	Turbine and gas

 

4) Adjustment in the minimum compromise of Local Content for the items in which it was verified that there is no qualification in the justifying cases for granting exemption, indicated below:

		ANP Recommendation
Plants	Business Management	75%
	Construction and assembly	52%
	Systems and equipment	24%
	Pressure vessel	44%
	Valves (up to 24 “)	35%
	Pumps	44%
	Automation system	19%
	Fiscal measurement system	57%
	Electrical system	23%
	Heat exchanger	35%
	Materials	51%
Installation and integration of modules	Construction and assembly	48%
	Commissioning	48%
	Materials	51%

 

5) Rejection of the request to extend the effects of the exemption granted in the global local content, according to the prohibition expressed in clause 25.8.1 of the Production Sharing Contract; and

6) Impossibility of extension of the effects of the authorized adjustment in the global local content, according to the prohibition expressed in clause 25.9.2 of the Production Sharing Contract.

The Board’s decision has already been communicated to the Libra Consortium Operator, and must be submitted to judicial review, as determined by the Federal Regional Court of the First Region in the Declaratory Action of Invalidity proposed by Sinaval.

The request was submitted to the public consultation, open 09/02/2017, in order to collect comments and the public hearing was held on 04/18/2017.