Brazil to Hold First Pre-Salt Oil Block Auction in 2011 - Minister

RIO DE JANEIRO (Dow Jones Newswires), Jan. 3, 2011

Brazil will hold its first auction of pre-salt oil and gas blocks this year under the new production-sharing regime approved recently by congress, Mines and Energy Minister Edison Lobao said Monday.

Brazil will also hold an 11th round auction of concessions for non pre-salt oil blocks, Lobao said during a ceremony in Brasilia in which he took office as minister in the new government of President Dilma Rousseff. This will be the first oil block auction to be held in Brazil since 2008.

The first pre-salt auction is expected to include some of the reserves discovered in Brazil's massive Libra field, which have been estimated by Brazil's Oil Regulatory Agency ANP as holding recoverable reserves of between 3.7 billion and 15 billion barrels of oil equivalent.

An ANP spokesman said final approval for the auctions is still required from the country's National Energy Policy Commission, or CNPE. However, the ANP already has everything ready for the 11th round and the intention is also to proceed with the pre-salt round this year, he said.

ANP President Harold Lima said in early December that the 11th round is expected to include areas in the equatorial margin region, which runs from Bahia in northeast Brazil to Amazonas in Brazil's far north. This would include onshore, shallow water and deep water blocks, but wouldn't include pre-salt blocks.

Copyright (c) 2010 Dow Jones & Company, Inc.

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