CHAPTER 17 BRAZIL E&P OVERVIEW: PRE-SALT DEVELOPMENTS AND LEGAL FRAMEWORK

• Jurisdiction: Derecho Internacional

International Mining and Oil & Gas Law, Development, and Investment
(Apr 2011)
CHAPTER 17
BRAZIL E&P OVERVIEW: PRE-SALT DEVELOPMENTS AND LEGAL FRAMEWORK
Bruno Triani Belchior
Tauil & Chequer Advogados
Rio de Janeiro

BRUNO TRIANI BELCHIOR is with the firm of Tauil & Chequer associated with Mayer Brown, in Rio de Janeiro. He focuses his practice on advising domestic and foreign oil and gas companies in Brazil and West Africa. He handles the analysis, review, and negotiation of upstream and downstream contracts. He also advises oil and gas service companies in Brazil and abroad, as well as companies involved in M&A and project development. He has worked on major transactions and projects involving SK Energy, Sonangol E&P, Ecopetrol, Petrobras, ONGC, Ecopetrol, Vale, Paramount Energy Trust, Occidental Oil and Gas Corporation, Maersk Oil, and the Ministry of Petroleum of Angola. He has authored articles on oil and gas development and is a member of the Association of International Petroleum Negotiators (AIPN), Brazilian Institute of Energy Law (IBDE), and Britcham.

MAYER • BROWN TAUIL & CHEQUER

Brazil E&P Overview

Pre-Salt Developments and Legal Framework

Bruno Triani Belchior

Rio: + 5521 2127 4205

+ 5521 9358 4741

BBelchior@mayerbrown.com

Summary

• Brazil Oil & Gas Timeline

• Brazil E&P Regimes

• Concession Regime

• PSA Regime

• Commercial Opportunities

Brazil Oil and Gas Timeline

Brazil E&P Regimes

• Granting of E&P Rights / Acquisition of Petroleum Rights:

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Concession Regime

Concession Regime

Petroleum Law

— Main Characteristics:

• Bid tender required for E&P activities

• Concessionaires retain ownership of 100% oil produced

• Concession Contract with the National Petroleum Agency (ANP)

• Payment of Royalties

• Bid Rounds

— Qualification (technical, legal and financial) is required for national and foreign companies

— The judgment is made in accordance with a formula established in the Tender Protocol. As a general rule, the criteria observes the following proportion:

20%	•	Local Content
40%	•	Signature Bonus
40%	•	Minimum Offered Exploratory Program

"The bidding process shall be carried out in a transparent and public manner" Round 9 Tender Protocol Model

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• Bid Rounds Results

Total of 10 Bid Rounds until 2008

BID ROUNDS	1st 1999	2nd 2000	3rd 2001	4th 2002	5th 2003	6th 2004	7th 2005	9th 2007	10th 2008
Blocks Offered	27	23	53	54	908	913	1134	271	130
Qualified Companies	38	44	42	29	12	24	44	67	40
- National Qualified Companies	3

...