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Brazil Plans Oil Bidding Round as Petrobras Production Declines

Brazil will look to auction oil exploration licenses by mid-2015, following three bidding rounds last year, as the South American country seeks to reverse a decline in crude output and stoke economic growth.

The government hasn’t set a date or decided whether to offer ultra-deep fields in the so-called pre-salt area, Oil Secretary Marco Antonio Almeida said.

“It could happen this year, it could be pre-salt or not, it could be marginal fields,” Almeida told reporters in Rio de Janeiro today. “We haven’t made any decision yet.”

Brazil ended a five-year auction drought last year with sales including the Libra field in an area estimated to hold more than 50 billion barrels and lying dozens of miles off Rio’s coast. The plan follows an output drop at state-run Petroleo Brasileiro SA (PETR4) to the lowest level since 2009.

Petrobras, as the Rio-based oil company is known, produces about 94 percent of Brazil’s oil and is required to operate new concessions in the pre-salt area.

Brazil’s Energy Ministry and the National Council for Energy Policy are responsible for setting the dates for oil auctions, the petroleum regulator know as ANP said in an e-mailed reply to questions.

To contact the reporter on this story: Rodrigo Orihuela in Rio de Janeiro at rorihuela@bloomberg.net

To contact the editors responsible for this story: James Attwood at jattwood3@bloomberg.net Carlos Caminada

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