Majors in the mix for Brazil’s next pre-salt auction

15 May 2018, Week 19, Issue 713

ExxonMobil, Royal Dutch Shell and BP are on a list of 16 companies that have registered to bid in Brazil’s fourth pre-salt bid round on June 7.

Brazil’s oil regulator, the National Agency of Petroleum (ANP), said it was a record turnout for an auction of highly-coveted pre-salt acreage. The bid round will also see the debut of two companies without exploration and production contracts in Brazil – Germany’s DEA Deutsche Erdoel and Malaysia’s Petronas Carigali. 

The other companies on the list are: Chevron (US), CNODC (China), CNOOC (China), Ecopetrol (Colombia), Petrogal (Portugal), Petrobras (Brazil), QGEP (Brazil), QPI (Qatar), Repsol (Spain), Statoil (Norway) and Total (France). 

Four areas within the Campos and Santos Basins – Itaimbezinho, Tres Marias, Dois Irmaos and Uirapuru – will be offered in this round with combined fixed signing bonuses of 3.2 billion reais (US$931 million). 

State-run Petrobras has exercised its priority rights to acquire a 30% participating interest as operator in three of the four areas that are under the hammer in the June pre-salt round. These are the Dois Irmaos, Tres Marias and Uirapuru areas. 

As with previous pre-salt bid rounds, the signing bonuses are fixed, with rivals competing over the amount of profit oil that they offer the Brazilian state. 

For the Tres Marias area in the Santos Basin, where Petrobras will be operator with a 30% stake, the winning bidder must pay a 100 million reais (US$29 million) signature bonus and commit to a minimum profit oil percentage of 8.32%. 

Also in the Santos Basin, the terms for the Uirapuru area dictate a minimum profit oil allocation of 22.18% plus a signature bonus of 2.65 billion reais (US$770 million). Petrobras will also operate this asset with a 30% stake. 

In the Dois Irmaos area in the Campos Basin, with Petrobras again taking a 30% stake an operatorship, the minimum profit oil percentage is 16.43%. The signature bonus is 400 million reais (US$117 million). 

Itaimbezinho in the Campos Basin is the one area that Petrobras has not sought to be operator. The minimum profit oil allocation for this asset is 7.07% and the signature bonus 50 million reais (US$15 million). 

The Saturno area in the Campos basin was included in the preliminary tender protocol published by the ANP in January. But it has now been removed from the fourth bid round following a decision by the Energy Ministry. 

The ministry decreed that Saturno should be unitised with the adjacent S-M-534 and S-M-645 blocks and offered in the 5th pre-salt bid round that is due to be held before the end of this year.

The Titan, Pau Brasil and Tartaruga Verde areas will also be offered in the fifth round.

Edited by

Ryan Stevenson

Managing Editor

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