• 2 days PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 2 days Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 2 days Syrian Rebels Relinquish Control Of Major Gas Field
  • 2 days Schlumberger Warns Of Moderating Investment In North America
  • 2 days Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 2 days Energy Regulators Look To Guard Grid From Cyberattacks
  • 2 days Mexico Says OPEC Has Not Approached It For Deal Extension
  • 2 days New Video Game Targets Oil Infrastructure
  • 2 days Shell Restarts Bonny Light Exports
  • 2 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 3 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 3 days British Utility Companies Brace For Major Reforms
  • 3 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 3 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 3 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 3 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 3 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 3 days Rosneft Signs $400M Deal With Kurdistan
  • 3 days Kinder Morgan Warns About Trans Mountain Delays
  • 4 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 4 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 4 days Russia, Saudis Team Up To Boost Fracking Tech
  • 4 days Conflicting News Spurs Doubt On Aramco IPO
  • 4 days Exxon Starts Production At New Refinery In Texas
  • 4 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 5 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 5 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 5 days China To Take 5% Of Rosneft’s Output In New Deal
  • 5 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 5 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 5 days VW Fails To Secure Critical Commodity For EVs
  • 5 days Enbridge Pipeline Expansion Finally Approved
  • 5 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 5 days OPEC Oil Deal Compliance Falls To 86%
  • 6 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 6 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 6 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 6 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 6 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 6 days Aramco Says No Plans To Shelve IPO
Alt Text

Is The War On Coal Really Over?

Even if the EPA manages…

Alt Text

Canada’s Pipeline Industry Takes Another Hit

Canada’s struggling oil industry has…

Brazil’s Pre-Salt Auction Goes to Shell-Total Consortium

Brazil’s Pre-Salt Auction Goes to Shell-Total Consortium

A consortium led by Anglo-Dutch oil major Shell, France’s Total and PetroChina and its sister company Cnooc, won the bid for Brazil’s Libra deep-water oilfield in a landmark auction on Monday, 21 October.

Shell and Total will each have a 20% stake in Libra, with the two Chinese companies holding a 10% stake each and the rest held by Brazil’s state-run Petrobras.

A 41.65% cut of “profit oil” from Libra will go to the government, which it will then be able to sell on its own, in line with the minimum requirements for the auction.

Related article: Brazil could Mark a Change in Strategy for Chinese Oil Companies

As Oilprice.com reported earlier in its premium newsletter, Oil & Energy Insider, Chinese involvement in a consortium for Libra was inevitable, though the expectation was that China would be the dominant force in the auction. The fact that Shell and Total will each have a 20% stake is promising for the Brazilian government and efforts to attract more private investment.  

“This is a turning point between the past and the future,” said Edison Lobão, Brazil’s oil minister, in a speech before the auction. “With the discovery of the pre-salt fields we will more than double our certified oil reserves in Brazil.”

It wasn’t a tough win since this was the only consortium bidding, but it was a hard-won day for the government, which had to deal with protests that turned into clashes with security forces outside the auction venue. Security forces used tear gas and rubber bullets to disperse protesters. At least six people were injured in the incident.

Unions said the auction of Libra represented the “fire sale” of Brazil’s natural riches to “foreign capital”.   

Libra is estimated to hold between 8 billion and 12 billion barrels of oil.

Related article: 40,000 Petrobras Employees Strike over Upcoming Libra Oilfield Auction

Petrobras is in deep debt largely because of government policy that has forced the company to continue borrowing to cover investments while it cannot recoup costs due to the fact that it is not allowed to charge its own consumers world prices. Brazil desperately needs new oil finds to come online, and the first step is the Libra auction—providing that the government indeed introduces measures that would help Petrobras actually finance its side of the deal, according to experts at Southern Pulse.

With a $6.8 billion mandatory signing bonus and costly exploration and development in the forecast, most analysts suspect it could take nearly 20 years before the winner of the October auction starts making a profit, Southern Pulse said.

By. Joao Peixe of Oilprice.com




Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News