Brazil Govt Approves Basic Text of Exploration Bill

BRASILIA (Dow Jones), Mar. 3, 2010

Brazil's lower house in a voice vote late Tuesday approved the basic text of a bill aimed at capitalizing state-controlled oil company Petrobras (PBR) for exploration of the country's offshore subsalt oil reserves.

The bill would cede an initial five billion barrels of government-owned subsalt oil to Petrobras, allowing the company to make a subsequent share issue.

The bill is one of four key pieces of legislation crafted by the government to reform oil-sector rules and expedite production in the wake of the discovery of the subsalt oil in late 2007.

Lawmakers on Tuesday said they would vote on possible amendments to the bill Wednesday.

The bill must receive approval from Brazil's Senate in a vote expected for later this year.

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