House Votes amendments to project that reduces participation of Petrobras in the pre-salt

The project will expand the participation of private capital.
18/10/2016 10h53 - Updated 18/10/2016 10h53
Photo: reproduction

The full House of Representatives meets today (18), a partir das 10h30, to vote on the amendments to the Bill 4567/16, that exempts Petrobras to be the operator of all the pre-salt exploration blocks in the production sharing regime. The basic text of the proposal was approved on 5 of October, with 292 votes in favor, 101 against and one abstention.

The bill is authored by Senator José Serra licensed (PSDB-SP), Current Foreign Minister, and should follow to sanction President Michel Temer is not be amended to modify the substance of the matter.

The current legislation provides for Petrobras' participation in all exploration blocks auctioned consortia in the pre-salt area with a minimum of 30% and the operator of. The project will expand the participation of private capital in the region. The Brazilian company, However, You will still have the choice to choose the blocks you want to act as operator, provided that with the approval of the National Energy Policy Council (CNPE), taking into account the national interests.

Among the amendments to be examined at the meeting on Tuesday is that you want to make it clear in the text that not only strategic areas will be operated by foreign companies, maintaining the strategic considered under Petrobras control.

investments

For the president of the state, Pedro Parente, if the project comes to the end of Petrobras' compulsory participation in the pre-salt is sanctioned, the new rules will attract "significant investments for growth and for generating wealth and employment". According to him, with the change, the requirement currently in place will result in the option of the best choice for the Brazilian oil.

"This is a huge benefit for the company to live a time of financial constraint. If we are required to participate in all fields, we will not have resources. That would make the exploitation of these fields would take a much longer time ", Parente said in an interview at the Presidential Palace, after meeting with the president, Michel Temer, in late September.

A study of FIRJAN (Industry Federation of the State of Rio de Janeiro) It points out that the pre-salt reserves represent a potential investment of US $ 420 billion by 2030 for development of note region, near US $ 390 billion in royalties and special participations and generating over 1 million jobs.

The federation believes that the project that eases the subsalt operating rules is "a milestone for the country". According to the entity, new legislation, besides attracting investments, You can boost the oil and gas market, considered crucial for economic and social development of Brazil, with increased jobs and income.

According Firjan, these gains could be even greater taking into account the direct and indirect effects of increased oil activity. "The return on investment in the oil and gas market will also stimulate a virtuous circle in suppliers belt. With the growth of orders, these companies will become a more efficient supply chain and competitive, developing the capacity required to meet even the international market ", highlights the Firjan.

Critical of the current model, Professor of the Federal University of Rio de Janeiro (UFRJ) and founding director of the Brazilian Infrastructure Center, Adriano Pires, He believes that the change in the sharing of law will only bring advantages. "Win Petrobras, it ceases to be mandatory to participate in all auctions, take 30% and be the only operator, further on the financial situation in which it is; wins the Brazilian government, with the changes, You can already do auctions from next year, no longer need to wait for the recovery of Petrobras; gain states and municipalities, since re-do auction means in the medium term increase in royalty revenues and short-term return to generate jobs and investment. "

according to Pires, relax the current law does not mean handing the country's wealth to the large foreign oil. "Talk to, with the change of law, the country will be delivering their wealth in the sector to international capital is a big nonsense, one populism fifth category. We well know what happened in the Petrobras oil sector in the past ", criticism, referring to the resource gaps revealed by Operation Lava Jato.

Executive Director of the Association of Industries of Machinery and Equipment (Abimaq), Alberto Machado Neto, It points out that not just receive money from royalties and signature bonuses without developing the internal market for goods and services.

"Royalties and end, without a development policy of local industry, the country will end saucer in hand. But of course the view that the government would be delivering our natural resources to foreign capital with the approval of law is a myopic view ", highlights the teacher in an interview to Brazil. "Even if oil sale, especially in sharing scheme, the Brazilian state receives a share of the revenue and oil - some of this oil is in the country. And that's not entreguismo: It is generating resources, market, or wealth for the country ", full.

Pros and cons

Political scientist José Luiz Niemeyer says the project has "pros and cons". Graduate engineer and Graduate in International Relations Ibmec / RJ, the teacher points out that the expected changes in the bill give more flexibility to the operating market, production, sale, import and export of oil and oil products.

for Niemeyer, the easing of oil industry business market, this time of crisis in the state, It is positive "because it will attract investment that we can not do because of the excessive indebtedness of Petrobras".

According to the political scientist, the decision will reactivate the oil sector in the country in the medium term, with consequences for the industry chain as a whole. "It seems that now more flexible, us coming months, It will end up being strategic to Petrobras in big business oil, improving export and import segments. It is also positive for the Brazilian economy to the extent that will cause other sectors that are still very backward in the country, in the energy, communications and infrastructure - which could be more modern - can move forward and also grab a share of these resources to come to the country ", highlights, in an interview to Brazil.

While considering the positive change, in relation to technological development, second Niemeyer, Petrobras has reached a level of excellence, which can arouse foreign interest. "The company has technical and technology available. What can happen is the exact opposite: with the entry of foreign capital, multinational companies are likely to have access to this technology our. And it can be harmful in the long run, since it would eventually translate into cheap transfer of technology ", ponders.

reviews

In assessing the emeritus professor at the Institute of Graduate Studies in Engineering from the Federal University of Rio de Janeiro (Coppe / UFRJ), Luiz Pinguelli Rosa, the decision of the House of Representatives consolidates the reduction of Petrobras' role and also involves the decision to promote the disinvestment (sale of assets) the company under the guise of capitalizing the company to reduce the debt of state and return to him the power to re-invest.

"This law is not an isolated thing, it is part of a company emptying process. Petrobras is very important for Brazil and, as sole operator, would foster technological development in the country, promote employment in shipyards, the development of our universities. Already foreign companies, which from now on will come here, They will get the technology in their countries of origin ", criticism.

In evaluating Pinguelli Rosa, who is former president of Eletrobras, there are other solutions to reduce the debt of state. "Just the oil back up a bit that makes it easy. And the pre-salt reserves alone can leverage funding also ", advocates.

The president of the Association of Petrobras Engineers (limited), Felipe Coutinho, It goes beyond the criticism and says that the withdrawal of the company's exclusivity as the subsalt operator is a throwback, that will return the country "a new type of colonial cycle".

"By taking Petrobras this process to be the only pre-salt operator you are also reducing the use of local content obligations, accelerating the auctions and giving multinational companies the condition to seize the oil of the region and, consequently, also increasing exports. And you do not know, historically, no case in the world where you have a country that has developed exporting oil ", ponders.

Strategy Change

according to Coutinho, Petrobras could overcome any difficulties in making investments alone in the pre-salt with the scheduled exploration blocks. "Maintaining the security of property [reserves] by Union and put production since the need of consumption. In short: producing a strategic speed. And for this there is absolutely no need to withdraw from Petrobras the right to be the only operator, further on the grounds that this is necessary to speed up the auction ", He argues the engineer.

The Single Federation of Oil Workers (FUP) also estimates that Petrobras and the country have more to lose than to gain from the change in the sharing scheme of the pre-salt exploration. In an interview to Brazil, the general coordinator of the entity, Jose Maria Rangel, He said the argument of change advocates in the law of that foreign investment will leverage the oil industry and help the company out of the crisis is a fallacy because resources should only start to be applied, indeed, from 2024.

"Every investment in oil and gas in Brazil has minimally a time of maturity of seven years. If the law is approved, suppose we auction in early 2017. These investments will only come to the country 2021. And we're talking about four years to start the process, with the summit going on 2024. It is fallacious to say that private investment is that will leverage the industry. You will not have private investment now. With the relaxation of the law, and the auctions at a higher intensity will only benefit as the inflow of funds via signing bonus payment – which may end up being a pittance ", criticizes Rangel.

Source: Agency Brazil


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