The board of the National Petroleum Agency (ANP) approved a resolution that will reduce the collection of royalties for small and medium-sized oil companies operating in the country. With the new standard, the new percentages charged will be 5% for small companies and 7.5% for medium companies. As is to be expected, the measure is only applicable to concession contracts and should mainly benefit producers in onshore fields.
According to the most recent survey by the ANP, Brazil currently has 19 small production companies operating 38 fields. The five medium sized oil companies mapped by the agency have 60 fields in production. In addition, there are currently 15 fields of small and medium-sized companies that are out of operation. The regulatory agency believes that these assets may come into operation from the royalty reduction approved today.
Reducing the royalty rate for small and medium oil companies is an old request of independent oil companies. The matter began to gain strength and agility in June of last year, when the National Energy Policy Council (CNPE) approved a resolution that determined that the ANP should evaluate the adoption of measures aimed at reducing royalties to up to 5% in fields granted to smaller companies.