Brazil Releases Tender, Contract Details for Oil Concession Auction

RIO DE JANEIRO - Brazil's National Petroleum Agency on Tuesday published the final tender and concession contract details for the keenly awaited auction of new oil and natural gas concessions set for May 14-15.

The so-called 11th bidding round will put 289 oil and natural gas exploration blocks up for sale, Brazil's first such auction since December 2008.

The fresh round of bidding is expected to generate a surge in activity across Brazil's oil industry, which was running out of areas to explore in the absence of concession auctions. Oil companies had warned that exploration could dry up as soon as 2015 without new awards of exploration acreage.

The 11th round auction is the first of several sales of exploration acreage set to take place in Brazil this year, including the first sale of subsalt exploration acreage under new production-sharing agreements. Billions of barrels of oil have been discovered in the subsalt region, where oil and natural gas were found trapped deep beneath the ocean floor under a thick layer of salt.

Unconventional oil and natural gas concessions, the same type of shale and tight gas acreage that sparked an oil-industry revolution in the U.S., are also expected to be sold this year.

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

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