Brazil’s 13th Licensing Round Fails To Attract Oil Majors
Brazil’s 13th licensing round, which offered 266 blocks for the oil companies to bid for, fell significantly short of expectations.
Petrobras, Brazil’s state-run oil company, and traditionally the largest bidder in the previous bid rounds, this year decided not to take part.
The company said it reviewed the offered areas and did not find something that would improve its current assets portfolio. Petrobras further said that the decision not to bid for new areas was also a part of its initiative to reduce costs, and improve profitability.
Oil majors, such as Shell, Exxon, BP, Statoil, Rosneft and CNOOC, who had qualified to take part in the bidding round, also withheld from making any offers at the event hosted by the ANP, Brazil’s oil and gas regulator.
Of almost 40 oil companies that had qualified for the bidding, only 17 actually submitted their bids, 11 of them from Brazil.
Brazil’s hydrocarbons agency offered 84 offshore blocks across six basins. It sold two.
The two offshore blocks sold, located in the Sergipe-Alagoas basin, went to a local oil company, Queiroz Galvão Exploração e Produção (QGEP). The company was the sole bidder for the two blocks.
The four basins that had offers were Potiguar, Parnaíba, Sergipe-Alagoas, and Reconcavo. In total, the ANP collected 121 million Brazilian reais in bids, most of which comes from the above-mentioned QGEP, 99 million reais.
According to O’Globo newspaper, Magda Chambriard, the general director of the ANP, said that the agency did not know what went wrong with the auction.
“We will have to go home and analyze carefully,” she said, adding that the current oil price level, 50% lower when compared to the prices when the previous licensing round was held two years ago, might have been a decisive factor.
She also said that the reason might be that the companies usually seek partnerships with Petrobras, and as mentioned before, Petrobras decided not to participate.
- Offshore Energy Today
- Published on:
- October 8, 2015
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