Last week, ANP’s board approved the inclusion of 173 blocks and one marginal accumulation area (Juruá, in the Solimões Basin) for Permanent Offer, a bidding model with a continuous offer of a portfolio of areas for exploration and production of oil and natural gas. Of the 173 new blocks, 149 were already under study and recently received environmental viability approval, with the other 24 being offered and not picked up during the 16th Bidding Round on October 10.
The new version of the Permanent Offer Tender is subject to public consultation as of November 29, 2019, followed by a public hearing on February 2, 2020. The current version, published in May 2019, covers 600 exploratory risk blocks and 14 areas with marginal accumulations. However, in September of this year, the 1st Permanent Offer cycle took place, during which 33 blocks and 12 areas with marginal accumulations were scooped up. Thus, the new announcement will offer 740 blocks (567 from the previous announcement and 173 new ones) and three areas with marginal accumulations (two from the previous offer and the Juruá area, which was returned to ANP by Petrobras).
In addition to the technical and economic parameters for the included blocks and areas, the tender draft submitted for consultation also updates the parameters for the blocks and areas that were already included in the previous version, especially in relation to the methodology for defining royalty rates. For areas located in new frontier and mature basins, a reduction was suggested considering the geological risk and the expected production of the sectors, while a minimum royalty rate of 5% was proposed for areas with marginal accumulations. For areas outside the Campos and Santos Basin pre-salt polygon as well as those classified as high potential basins, the royalty rate of 10% was maintained.
The draft also includes some technical improvements resulting from the experience with the 1st Cycle of the Permanent Offer and other bidding rounds held this year, as well as contributions from ANP technicians, as well as changes to the wording to make the rules clearer and more objective.
Permanent Offer consists of the continuous offer of returned fields (or those in the process of being returned) and unsold or returned exploratory blocks from previous rounds. Thus, companies, especially those not yet operating in Brazil, have the opportunity to study these areas without the time constraints of traditional rounds.