Spotlight: Brazil’s next oil and gas rounds

Brazil’s oil and gas watchdog ANP will hold two open acreage rounds on Wednesday: the second production sharing and fourth concession tenders.  On offer will be several offshore and onshore blocks, in addition to an area with marginal accumulations (i.e., inactive areas where there has been no production or where output has been interrupted due to lack of economic interest).  Aldren Vernersbach, an economist, consultant and researcher specializing in oil, gas and energy, the highlights of the production-sharing auction are the large Esmeralda and Tupinambá blocks in the Santos basin, and Turmalina in the Campos basin. 

Regarding the concession round, Vernersbach said that the onshore assets on offer usually attract small and medium-sized companies, potentially generating greater regional development. “Both rounds promote more constant investment in the upstream, generating demand in the sector’s supply chain and dynamism throughout the national economy,” the consultant told BNamericas. Marcelo de Assis, upstream director at Wood Mackenzie, recalled that Petrobras will not participate in the production-sharing round.  “Expectations for the rounds are low, but we could be in for some positive surprises,” he told BNamericas. 

In an interview published by BNamericas in October, Petrobras’ E&P director Joelson Mendes, said that the state-run firm’s current portfolio already comprises a large number of assets.  “And I can’t extrapolate and embrace the world because there will be a deadline for exploration and minimum investment commitments,” he said.  Mahatma Santos, director of the local strategic petroleum studies think tank Ineep, thinks there is a scenario of uncertainty regarding the results of the auctions. 

Firstly, due to the environmental and social sensitivity of the areas on offer, especially on land, just after the UN’s COP 28 climate conference; secondly, due to the fact that some blocks have already been offered in previous auctions without being sold; and thirdly, because of the absence of Petrobras, which is the main expert on pre-salt exploration and production.  “It’s unlikely that there will be robust discoveries in the pre-salt areas by other companies,” Santos told BNamericas.   Here is an overview of the upcoming oil and gas auctions: 

– 2nd open acreage production-sharing round

The following blocks in the pre-salt polygon will be on offer: Cruzeiro do SulEsmeralda, Jade and Tupinambá in the Santos basin, and Turmalina in the Campos basin. Six companies are qualified and therefore able to submit bids on the day of the public session: BP EnergyChevronQatar EnergyPetronasShell and TotalEnergies

– 4th open acreage concession round

On offer will be the Japiim marginal accumulation area and 33 areas with exploration blocks in nine sedimentary basins: Amazonas, Espírito SantoParanáPelotasPotiguarRecôncavo, Santos, Sergipe-Alagoas and Tucano.  A total of 21 companies have submitted declarations of interest and bid guarantees for these areas. There are also 87 companies registered to take part in the concession round that are able to submit bids.  However, those who have not submitted declarations of interest accompanied by bid guarantees will only be able to submit bids in consortium with companies that have declared an interest.