ExxonMobil wants to split bonus of the Transfer of Rights auction

July 5, 2019

ExxonMobil is claiming that the signing bonus for the surplus auction of the Transfer of Rights areas will be paid twice, a first installment with the signature of the production sharing contract, which is scheduled for March next year, and another in the signature of the co-participation contracts, scheduled for 2021. The auction is scheduled by the ANP for November 6.

“Considering the relevance of the Co-participation Agreement so that contractors are entitled to receive their share of production, it is important that part of the signature bonus be paid only when signing the Co-participation Agreement,” says the company in a contribution sent to ANP in the public consultation on the auction.

The ANP will hold a public hearing this Friday to discuss contributions to the competition. In addition to ExxonMobil and CNOCC, Petrobras, Shell, Total, Petrogal, Firjan, IBP, Abimaq and Deutsche Bank also contributed to the tender offer for the Transfer of Rights surplus and draft contracts. The contributions are a good indication of the oil companies that may enter in the bidding.

Conditioning the signature of the co-participation agreement for the payment of the signature bonus is not only a concern of ExxonMobil. China’s CNOOC has requested that the agency determine that payment of the bonus will be made 15 days after the signing of the agreement. Understanding that this can reduce the impact of the signing bonus payment on the delay in the co-participation agreement.

The auction will offer four fields: Búzios (the largest of them), Sepia, Atapu, Itapu, with individual bonuses varying from R $ 68 billion to R $ 1.8 billion – projects of different sizes, which may allow companies to enter with profiles and financial capacities. Together the areas represent investments of R $ 106 billion.

In share auctions, the bonus per area is fixed and the companies compete by offering the percentage that the Union will be entitled to in the production of oil, after the cost abatements – the so-called profit-oil. The minimum percentages approved by the CNPE vary from 19.82% to 27.65%.

Source: epbr

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