Auction approval for Transfer of Rights surplus rescheduled for April

03/20/2019

The meeting of the CNPE that will approve the rules and the auction of the Transfer of Rights surplus will be rescheduled  for the first week of April and no longer in March, as initially foreseen by the MME. According to the secretary of Petroleum, Natural Gas and Biofuels, Márcio Felix, who announced the change, the bid round is maintained for October 28, despite the postponement.

The government continues to work on defining the rules, such as bonuses and percentage of oil, and discussing the issue with the agents involved, including foreign oil companies that hold assets under the sharing regime. Next week, Felix will meet with DEA, Wintershall, Ecopetrol and PetroRio to discuss the matter.

According to Márcio Felix, the surplus auction is held for October 28.

The tendency is that the payment of the signature bonuses will be made in cash. After approval of the process by CNPE and publication of the resolution, Petrobras will have 30 days to exercise the preemptive rights of the areas offered (Atapu, Búzios, Itapu and Sepia).

MME, ANP and Petrobras have been discussing the terms of access to the production data of the projects by companies interested in disputing the bidding areas in the surplus auction. The model adopted must follow the rules established in the Petrobras divestment program. All coordination of the process of access to production data will be done by the ANP.

The winning companies will have to reimburse Petrobras. The payment of the compensation is part of the partnership agreement – name given by the MME to the unitization process of the Transfer of Rights assignment. In return, they will acquire a part of the assets and the production.

The percentage of participation of each company in the projects will be defined based on the excess volumes in relation to the original volumes of the Transfer of Rights assignment. Petrobras and the winning companies will have to sign an agreement to establish the unification of the operation.

The Transfer of Rights agreement was signed with Petrobras in 2010. At the time, the oil company was granted the right to produce up to 5 billion boe in the areas of Florim, Franco, Guará, Iara, Tupi and Nordeste Tupi, in the Santos cluster. The value of the equivalent oil barrel was estimated, at the time, at US $ 8.51, which generated a disbursement of US $ 42.5 billion by the oil company.

Petrobras is negotiating with the government the terms of the contract review, and it is already agreed that the oil company will have to be repaid. The exploratory work carried out in the region resulted in the discovery of ten fields: Itapu, Búzios, Sul de Sapinhoá, Norte de Berbigão, Sul de Berbigão, Norte de Sururu, Sul de Sururu, Atapu, Sul de Lula and Sepia.

In addition to the surplus auction, the government will hold the 6th round of production sharing on November 1, and the 16th round of concessions, which has not yet been set.

Source: Brazil Energy Magazine

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