Brazilian Congress passes bill allowing large auction of pre-salt oil fields

Source: Xinhua| 2019-09-27 17:27:54|Editor: xuxin
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RIO DE JANEIRO, Sept. 26 (Xinhua) -- The Brazilian Congress passed a constitutional amendment bill on Thursday, authorizing the government to hold a large auction for the concession of large pre-salt oil exploration areas.

"The approval of this measure is essential for Brazil's development," said Davi Alcolumbre, president of the Senate.

The auction, which is expected to be held in November, will help the government garner 106.5 billion Brazilian reais (25.6 billion U.S. dollars) by signing bonuses.

A third of the money is going to be paid to the state-run oil and gas giant Petrobras, and the rest will be divided among the federal, state and municipal governments, although there has not been a consensus on the shares to be distributed to each level.

Brazil's pre-salt oil reserves are located in ultra-deep waters off the coast. The discovery of those reserves, made by Petrobras in 2006, turned the country into one of the largest in pre-salt oil reserves in the world.

Production in the pre-salt areas kicked off a decade ago in Brazil. Prior to 2016, Petrobras was the operator in all consortiums exploring pre-salt fields. Since then, other companies have also joined in.