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Brazil to Hold O&G Exploration Round by May, or Earlier

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BRASILIA - Brazil's President Dilma Rousseff on Thursday signed off on plans to hold a new oil and gas exploration licensing round, which will probably be held by May, or earlier if possible, Mines and Energy Minister Edison Lobao told reporters.

The minister said this 11th round, the first license auction to be held since 2008, will include some 164 blocks, of which half are offshore and half are onshore.

Oil companies have said they are running out of areas to explore for oil in Brazil, with concessions from the 10th round in 2008 starting to expire. Industry officials have warned that new exploration in Brazil will dry up by 2015 if new bid rounds are not held.

The first round of licenses for the so-called subsalt region, where massive oil reserves have been discovered in recent years, is on track to be held in November, he said. The subsalt round will be held under a new set of rules which determine a larger role for the government and oil company Petroleo Brasileiro SA.

An auction of exploration licenses to hunt for shale gas could take place this year, probably in December, the official said.

Separately, the eighth round of licensing, suspended in November 2006, has been formally canceled because of legal issues, Mr. Lobao said. The eighth round auction included a number of blocks in the subsalt region; the oil regulator, the ANP, had already started to refund participation fees and bid bonds related to the auction.

Matthew Cowley contributed to this article

Copyright (c) 2012 Dow Jones & Company, Inc.


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