There is growing optimism in Brazil about investor interest ahead of three big licensing events scheduled to take place in the country soon.

The Brazilian hydrocarbons regulator (ANP) this week published a list of the 17 companies registered and qualified to take place in the country’s 16^th round of E&P concessions, due to take place on 10 October.

The licensing round offers a choice of 36 blocks in five different basins, with the 17 companies qualifying — BP, Chevron, China National Offshore Oil Corporation, Ecopetrol, Equinor, ExxonMobil, Karoon, Petrobras, Qatar Petroleum International, Repsol, Shell, Total, Enauta, Murphy Oil, Petrogal Brasil, Petronas and Wintershall Dea.

Brazil is also scheduled to stage two competitive bidding processes in October, offering production-sharing rights in the pre-salt province.

The ANP on 6 November will auction production rights for billions of barrels of low-risk pre-salt oil deemed surplus to a 2010 transfer of rights (ToR) agreement with Petrobras, including prolific Santos basin fields such as Buzios and Atau.

The following day, Brazil will offer production-sharing rights on five more areas in what will be the country's 6th pre-salt round — Aram, Bumerangue, Cruzeiro do Sul, Sagitario Southwest and Brava North.

There were some concerns that Brazil might overstretch oil companies by offering so much acreage in such a short time, especially as there was an element of uncertainty about rules on compensating Petrobras for investments already sunk into fields such as Buzios.

Congressional wrangling about the earmarking of revenues from the pre-salt auctions was also serving to increase speculation about a possible delay.

The Brazilian government and the ANP have since worked at fleshing out the rule on compensation and congress has too made progress toward an agreed formula for divvying up revenues.

Senators agreed that 3% of the revenue from the ToR surplus will go to oil producing states, in addition to the 15% share that both states and municipal governments will get from an auction expected to raise 100 billion Brazilian reais ($25 billion).

The measure has gone back to the lower house for approval and also needs some financial aspects to be approved by the federal audit court (TCU), meaning it is still possible the government will be forced to delay.

Brazil's secretary for oil and gas, Renata Isfer, gave a newspaper interview this week and expressed confidence that the rounds will go ahead.

“A few months ago, I thought that it might be better to delay one of the rounds but things have moved on so well that I no longer think that delay is necessary or desirable," ANP director general Decio Oddone told Upstream during a recent roadshow visit to the UK.

"Interest in the rounds is very strong and comes from a diverse pool of different players."

Oddone was among those predicting that the recent drone attacks on oil infrastructure in Saudi Arabia could boost interest in the rounds, due to the low geopolitical risks in the country.

“The events in Saudi Arabia are likely to increase interest in Brazilian assets as Petrobras moves ahead with its divestment programme,” said Giovani Loss, a Brazilian lawyer known for his involvement in high-profile merger and acquisition deals.

Petrobras is currently moving ahead with a major downsizing of its dominant position in the Brazilian refining sector.

In contrast, the company has exercised preferential bidding rights to secure a 30% operating stake in three of the areas on offer in the 6th pre-salt round.

Minimum bids on these five areas amount to 7.85 billion reais, adding to the expected bonanza from the ToR sale.

Another pointer toward growing interest in Brazilian assets came earlier this month when the country held a successful first round using the new open door or “permanent” licensing mechanism.

Weekly

High hopes of success for Brazil licensing trio