Shell Studying Oil, Gas Areas Up for Bids in Brazil Auctions

RIO DE JANEIRO - Anglo-Dutch oil major Royal Dutch Shell is interested in Brazil's upcoming oil and natural gas concession auctions but has not yet decided whether to participate, Chief Executive Peter Voser said Thursday.

"Shell will study the bid areas and make a technical evaluation before deciding how to participate" in the auctions, Mr. Voser told reporters. The first of three auctions scheduled for this year will be held May 14-15, the first such bid round since 2008.

"Our assumption is that Brazil has significant resources being developed and to be developed," Mr. Voser said, noting that Latin America's largest country will play an important role in the global oil and natural gas map in the future.

In addition to the concession auction, Mr. Voser said that Shell was evaluating assets state-run energy giant Petroleo Brasileiro, or Petrobras, has put up for sale in Brazil and the Gulf of Mexico. Petrobras plans to sell $9.9 billion in assets to fund its $237 billion investment plan through 2017.

"We have a very successful partnership with Petrobras and are interested in further collaboration," Mr. Voser said.

Shell is also carefully watching developments in Venezuela, where the company has a small operation in the Lake Maracaibo region, Mr. Voser said. Venezuela has suffered with political unrest following President Hugo Chavez's death and last weekend's election of his handpicked successor, Nicolas Maduro.

"We take a long-term view on investments in Venezuela," Mr. Voser said, adding that Shell was on the lookout for growth opportunities in the country that is home to the world's largest crude-oil reserves.

Elsewhere, Mr. Voser said, the shale gas revolution in the U.S. could fundamentally change industry in the world's largest economy. "Cheap natural gas feedstock could drive a reindustrialization in the U.S.," Mr. Voser said, bringing previously outsourced manufacturing heavy industry and petrochemicals output back to the U.S.

Shell also expects the U.S. to approve exports of between 50 million and 60 million tons of liquefied natural gas derived from shale gas, Mr. Voser said.


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