Specialists say production sharing system may limit Petrobras’s investments

Criado em 04/10/13 16h21 e atualizado em 04/10/13 16h22
Por Alana Gandra Edição:s Fonte:Agência Brasil

Rio de Janeiro – A change in legislation has shifted the system for pre-salt oil exploration from the concession model to a production sharing system. According to professor Bruno Leonardo Barth Sobral, this change may limit the scope of the Petrobras’s investment plan. Barth Sobral is a professor at the National Law School of the Federal University of Rio de Janeiro (UFRJ), who specializes in petroleum economics.

The first pre-salt auction is scheduled for October 21. It covers the Libra Field reserve on the Santos Basin (São Paulo), estimated at 8-12 billion barrels of oil. Since it is an ambitious investment plan worth as much as $236.7 billion from 2013 to 2017, the restraint of these resources forces Petrobras to make certain choices. “A decreased funding capability for this quite ambitious plan makes it difficult [for the company] to determine its priorities. We can see this from the limit that [Petrobras] is setting to enhance the oil refining process, for example.”

Sobral said that Petrobras delayed its investment plan for this segment in order to keep making progress with what the state-run company has chosen as its priority: oil exploration, with emphasis on pre-salt oil. Professor Sobral also noted that the choices that the company will have to make can bring problems to the country, as these resources are crucial to addressing other production issues.

In his opinion, the shift to the sharing system gives the State more control over the pre-salt exploration process. “You limit, to a certain extent, the very logic of the market through the pre-salt. And since these resources are considerably richer than what was previously predicted, this sort of thing is crucial for social purposes – to be able to allot resources to other types of investment."

The whole problem is based on the immense value of the pre-salt resources, he stressed. Since these are strategic resources, the conclusion reached is that the outcomes cannot depend on market logic. The state should be given more control.

Marilda Rosado de Sá Ribeiro, a professor at the Law School of the State University of Rio de Janeiro, who specializes in petroleum law and was head of the National Agency for Petroleum, Natural Gas and Biofuels (“ANP”), also believes that the change in legislation has made in impact on Petrobras, which had to reformulate its plans. These, however, are not short-term measures, since the Libra auction is all that lies ahead in the short term. "[Petrobras] will be able to make an adjustment based on the predictions made.”

Ribeiro noted, however, that for production sharing contracts as a whole, Petrobras will have to work as an operator with 30%, even in areas in which its technical staff thinks that certain geological and economic requirements cannot be met. She sees no benefits in the production sharing system for the company. “I think it's a type of contract that has been used in countries that haven’t yet solved social issues, problems with transparency and the distribution of resources.” She said that Russia, for example, stopped signing production sharing agreements twenty years ago. And in standard-setting countries, like Norway, a licensing system is used, “which corresponds to our concession model here in Brazil.”

Editors: Marcos Chagas / Olga Bardawil
Translators: Mayra Borges / Fabrício Ferreira