New Petrobras Participation Rules Now Awaits Presidential Sanction

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Brazil’s Chamber of Deputies concluded on Wednesday the approval of a bill which changes the pre-salt oil exploration rules in the country withdrawing the requirement of a 30 percent participation by state-owned oil giant, Petrobras, on all exploration projects undertaken in the country. The final approval, that came after the rejection of suggestions by delegates from the opposition, however, did not please all representatives.

For Representative Jorge Solla the bill represents a negative impact for Petrobras and for the national economy. “It is a measure of capitulation and goes against all of Petrobras’ achievements in recent history, especially in relation to the pre-salt,” he told the Chambers’ press service, Agencia Camara de Noticias.

According to Solla, maintaining the current Petrobras participation model regime is a way to guarantee the necessary resources for health and education and the generation of jobs in the sector.

Chamber Representative Otavio Leite disagrees with the notion that the country is capitulating to private interests. “We need to unlock the oil sector. Petrobras will continue to have the option to choose, when it deems appropriate, to participate with partners or alone. Petrobras has human capital, information and analytical capacity,” Leite told reporters.

The bill, proposed by current Foreign Affairs Minister, Jose Serra, when he was still a senator seeks to attract more private capital into the sector. The bill was approved in October, but there were a few suggestions that needed to be voted on before the process was finalized. “We want to unburden Petrobras and not require it to participate in all projects; we want to bring the private sectors in so that they may participate in these projects and can therefore generate jobs,” said President Michel Temer in his speech at the opening of last month’s Rio Oil & Gas Conference.

The bill now approved by the Senate and the Chamber waits for presidential sanction to become law.

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