• 4 minutes Ten Years of Plunging Solar Prices
  • 7 minutes Hydrogen Capable Natural Gas Turbines
  • 10 minutes World looks on in horror as Trump flails over pandemic despite claims US leads way
  • 13 minutes Large gas belt discovered in China
  • 2 hours Yale University Epidemiologist Publishes Paper on Major Benefits of Hydroxchloroquine for High-risk Outpatients. Quacksalvers like Fauci should put lives ahead of Politics
  • 53 mins Would bashing China solve all the problems of the United States
  • 1 min COVID 19 May Be Less Deadly Than Flu Study Finds
  • 1 hour Model 3 cheaper to buy than BMW 3 series.
  • 5 hours China to Impose Dictatorship on Hong Kong
  • 2 hours Incompetent "Journalists"
  • 11 mins Can I Sue This Site for If People Post Inaccurate Information?
  • 6 hours Thugs in Trumpistan
  • 1 hour Pompeo's Hong Kong
  • 20 hours Iran's first oil tanker has arrived near Venezuela
  • 24 hours Chicago Threatens To Condemn - Possibly Demolish - Churches Defying Lockdown
  • 21 hours Let’s Try This....
  • 1 day HVDC Cheaper Than Low-carbon Natural Gas
  • 13 hours 60 mph electric mopeds
  • 1 day Oil and Gas After COVID-19

Push-Back from Investors Improves Libra Prospects

Bottom line: In its final rules for the Libra auction scheduled for 21 October, the government of Brazil loosened the mandate to permit the winning bidder to retain 50% of oil produced (after recouping costs), up from 30% as contemplated in previous rules.


Analysis: Just 11 firms registered to bid on the ultra-deep pre-salt Libra reserves on 21 October, and there was a sense that Brazil may have been asking too much for what remains a complicated and expensive venture. Someone in Brazil’s National Petroleum Agency was listening--an excellent sign that as a governing partner Brazil is flexible and cognizant of market forces.


Recommendation: The high signing bonus, roughly $6.8 billion, and limited information about the formation (there is just a single operational well there) mean the proposition is still risky. Still, there are few opportunities of that size and potential quality available today; Brazil may not be Texas, but it’s a safe and politically stable place atop a 10 billion barrel oil field.


There’s another angle here worth watching closely: tanker trading, which will benefit from an increase in oil investment in Brazil. According to Lloyd’s List Intelligence, Brazil is opening up its upstream oil sector to investment of around $237 billion over a five-year period to boost production and refining capacity.




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