Rio de Janeiro, May 16 (IANS/EFE) A two-day Brazilian oil and natural gas auction has received strong demand from companies based in Brazil, Colombia, Portugal, France, Britain and other countries, with bid prices far exceeding the regulator’s expectations.
The winning companies Tuesday secured blocks with bids up to 800 percent higher than the minimum prices demanded by the National Petroleum Agency, or ANP.
“The initial results surpassed expectations, even in deep-water blocks near the mouth of the Amazon River,” Brazilian Mines and Energy Minister Edison Lobao said, referring to demand for areas that were not expected to generate much interest.
Among the companies awarded concessions on the first day of the two-day 11th Licensing Round, Brazil’s first in five years, were Brazilian state-controlled energy giant Petrobras, Portugal’s Galp and Petrogal, Colombia’s Ecopetrol, France’s Total, Britain’s BP, Norway’s Statoil and Anglo-Australian BHP Billiton.
The 289 blocks on offer through Wednesday (123 of them onshore and 166 offshore) are located in 11 sedimentary basins nationwide and cover a combined area of 155,800 sq. km.
According to a partial tally by the ANP, bids totaling 2.7 billion reais ($1.35 billion) were accepted for the first 85 concessions awarded Tuesday, exceeding the goal of 2 billion reais (roughly $1 billion) set by agency director Magda Chambriard.
The value of the bids accepted thus far has already surpassed the previous record of 2.1 billion reais from a 2007 auction.
The ANP director said the results show oil companies remain interested in investing in Brazil after a five-year auction drought and despite recent state intervention in the oil sector.
The ANP had not held an auction of oil and natural gas blocks since a 2009 regulatory overhaul to guarantee the government a larger share in the profits from the pre-salt region, a recently discovered, ultra-deep offshore region that could transform Brazil into a major oil exporter.
No blocks in the pre-salt – nor other areas of the Campos, Santos and Espirito Santo offshore basins, where 90 percent of Brazil’s oil is produced – were on offer in this licensing round, raising doubts about how successful it would be.
–IANS/EFE
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