On Oct.1, Brazil's National Petroleum Agency (Agência Nacional do Petróleo, ANP) said that 11 companies were registered and qualified to bid for pre-salt licenses at the upcoming Santos basin auction. The ultra-deepwater Libra field is estimated to hold recoverable reserves of between 8 and 12 billion bbl of crude oil, about 230km (140mi) off the coast of Rio de Janiero.
Bids for the concession must be submitted on Oct. 21. ANP's schedule indicates that contracts will be signed in November.
The ANP had previously approved eight firms, predominantly national oil companies. Three Chinese companies include: CNOOC Ltd., China National Petroleum Corp. (CNPC), and China Petroleum & Chemical Corp.(Sinopec), the latter through its Repsol Sinopec joint venture with Spain's Repsol.
Rounding out the first eight firms are: Malaysia's Petroliam Nasional Bhd (Petronas), Japan's Mitsui & Co., India's ONGC Videsh Ltd., Royal Dutch Shell PLC, and state-run Petroleo Brasileiro (Petrobras), which is obligated to take a 30% stake in Libra and operate the project.
The three companies added to the approved bidders list this week are: France's Total SA, Colombia's Ecopetrol SA, and the Brazilian unit of Portugal's Galp Energia SGPS SA (Petrogal). Sinopec holds a stake in Petrogal.
Companies approved to participate will form as many as three bidding groups to compete in the auction, says the ANP.
ANP also estimates that the winning bidders will spend nearly US$200 billion to develop the deepwater pre-salt Libra field over the 35-year life of the concession contract. The winning consortium will also pay a signing bonus of about US$7.5 billion (exchange rate: 1US$ = 2 R$).
The Libra block is in sector SS-AUP of the Santos basin, and covers 1547.76sq km.
Several major operators, including Exxon Mobil Corp., BP PLC, and Chevron Corp., declined to participate in the Libra auction, which will include new production-sharing agreements. The new PSC has local content requirements set by project phase:
The newly created Pré-Sal Petróleo S.A (PPSA) will manage the PSA and negotiate marketing agreements for the sale of the Federal Government’s share of the hydrocarbon production.
Image: Libra block offered in the Brazilian First Pre-Salt Round 2013. Source: PetroView®
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