Politicians likely to reverse law that gave Petrobras offshore privileges

Politicians likely to reverse law that gave Petrobras offshore privileges

San Francisco: Petrobras will, in all likelihood, be stripped of its privileged position regarding the development of potentially valuable subsalt oil resources offshore Brazil, say expert analysts.

Since 2010 a legislative decree has ensured the state-run oil giant must be involved in any projects at the offshore Subsalt Polygon, either as the main operator or as a participant with a minimum 30% stake.

That law was backed by currently under-fire national president Dilma Rousseff, whose star has lost its shine since the eruption of the Petrobras corruption scandal.

Now it seems likely, according to political insiders, that Brazil’s Senate and its Chamber of Deputies will vote to reverse that 2010 law opening the Brazilian offshore to other players such as Exxon and BP.

The Subsalt Polygon covers most of the Campos and Santos Basins east and south of Rio de Janeiro. It is estimated to have a potential 50 to 100 billion barrels of oil and equivalent natural gas beneath the seabed under a layer of mineral salts.

Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.

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