Oil Crisis Opens Opportunities for Investments in Brazil, Minister Says

RIO DE JANEIRO, BRAZIL – Bento Albuquerque, Minister of Mines and Energy, said the terrorist attack on oil refineries in Saudi Arabia could result in attracting investment to Brazil.

In an interview with TV Brasil, he said that, in addition to opportunities in new petroleum and gas auctions, the country offers a safer environment.

“In the midst of the international crisis we are witnessing, of what happened in Saudi Arabia due to a terrorist attack, conditions for investment in Brazil are much more favorable, not only in relation to our oil field productivity but for the stability of the country, as well as a good business environment,” he said.

On September 14th, a drone bombed Saudi Aramco’s refineries in Abqaiq and Khurais. The action has been claimed by Yemeni Houthis rebels, who have been waging a civil war in the country since 2014.

As a result of the attacks, Saudi Arabia, which is the world’s largest oil producer, even announced the suspension of half of its daily production. This attack had an immediate effect on the price of oil, which rose by more than 18 percent.

Albuquerque reinforced the government’s expectation for the bids for exploration rights, which will take place on November 6th, and will yield tens of billions of reais to the federal treasury with the signing bonus payments.

“We are going to hold three auctions in the oil and gas sector at the end of the year, the most expected being the exploration rights, which will turn our country into one of the five largest oil and gas producers in the world within 20 years.”

In 2010, Petrobras and the Federal Government signed an exploration rights agreement for the state-owned company to explore 5 billion barrels of oil in pre-salt areas for a 40-year period. In exchange, the company paid the government R$74.8 (US18.75) billion in advance.

The volume of oil not covered by the agreement exceeds 5 billion barrels. Since 2013, the government has been negotiating an addendum to the contract, after Petrobras asked for adjustments due to the devaluation of the oil barrel price in the international market.

After an agreement with Petrobras, the government set the amount to be paid as bonus for signing the surplus sale auction at R$106.6 billion, and the amount to be subtracted by  Petrobras at US$9.058 billion, as a negotiation of the addendum to the contract closed with the federal government.

The offshore areas of Atapu, Búzios, Itapu and Sépia, in the Santos Basin, with a total area of 1,385 km² will be auctioned.

Agenda in the USA

Bento Albuquerque is in New York, United States, to attend the 74th General Assembly of the United Nations. Before joining President Jair Bolsonaro’s delegation, which landed this Monday, September 23rd in the city, the minister met with foreign investors.

“I have made some international trips, I was recently in China where I was able to meet with investors, who already have investments in Brazil and intend to increase them, as a result of the good business environment that we managed to build in these eight months, with enough predictability of what will happen in the future, both in the electricity sector and in the oil, gas and biofuels and mining sectors. That’s what I intend to do at breakfast with investors [in the U.S.],” he said.

Source: Agência Brasil

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error