• 4 minutes Tariffs to derail $83.7 Billion Chinese Investment in West Virginia
  • 9 minutes Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 17 minutes Kaplan Says Rising Oil Prices Won't Hurt US Economy
  • 1 hour Saudi Arabia turns to solar
  • 5 hours Battle for Oil Port: East Libya Forces In Full Control At Ras Lanuf
  • 21 hours Kaplan Says Rising Oil Prices Won't Hurt US Economy
  • 15 hours Could oil demand collapse rapidly? Yup, sure could.
  • 10 hours Corruption On The Top: Netanyahu's Wife Charged With Misuse of Public Funds for Meals
  • 3 hours Russia's Energy Minister says Oil Prices Balanced at $75, so Wants to Increase OPEC + Russia Oil by 1.5 mbpd
  • 16 hours Gazprom Exports to EU Hit Record
  • 16 hours OPEC Meeting Could End Without Decision - Irony Note Added from OPEC Children's Book
  • 5 hours Saudi Arabia plans to physically cut off Qatar by moat, nuclear waste and military base
  • 12 hours U.S. Withdraws From U.N. Human Rights Council
  • 20 hours China’s Plastic Waste Ban Will Leave 111 Million Tons of Trash With Nowhere To Go
  • 14 hours What If Canada Had Wind and Not Oilsands?
  • 14 hours "The Gasoline Car Is a Car With a Future"
  • 1 day EVs Could Help Coal Demand
  • 9 hours EU Confirms Trade Retaliation Measures vs. U.S. To Take Effect on June 22
  • 15 hours Sell out now or hold on?
Permian Discount Could Rise To $20 Per Barrel

Permian Discount Could Rise To $20 Per Barrel

Midstream constraints plaguing Permian drillers…

Why There Won’t Be An OPEC For Battery Metals

Why There Won’t Be An OPEC For Battery Metals

A very dynamic market, quickly…

Brazil’s Oil Cargo Tender Falls Through With No Bids

Oil rig

Brazil received no bids in the first tender for a total 1.63 million barrels of crude extracted from the prolific pre-salt zone, Reuters reports. The state received the oil as payment from operators of fields in the zone and planned to sell it on under three-year contracts. However, interest was lacking, with only Shell registering as a bidder.

Reuters reports that the first cargo auctioned by the state came from three fields in the pre-salt zone, including Libra, Lula, and Sapinhoa. All three are operated by consortia including Big Oil majors such as Shell in Sapinhoa, Lula and Libra, and Total in Libra.

Overall oil production in the pre-salt zone averages 1.4 million barrels, making up more than half of Brazil’s total, averaging 2.6 million bpd. Production from the pre-salt layers is expected to jump to 5 million bpd by 2026.

The lack of interest in the tender was likely a result of changes approved by parliament last week. Under the changes, companies can no longer sell crude at prices lower than those set in a reference range by the energy industry regulator, ANP.

The contracts offered would have obliged the successful bidder to buy Brazil’s total production share from the three fields for three years. The production sharing condition is part of the contracts Brazil awards for the development of pre-salt deposits.

Related: EV Sales To Triple By 2020

Meanwhile, Brazil has scheduled two pre-salt tenders for this year and next, with this year’s to take place on June 7. So far, 16 companies have qualified to take part in the bidding round—a record number.

The country’s energy regulator ANP will offer four blocks in this round: two in the Campos Basin, and two in the Santos Basin. The watchdog has estimated it could attract more than US$900 million in signing bonuses. However, if nobody is buying the crude Brazil receives as payment for the fields, this particular condition might have to be reconsidered.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

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