This month Brazil broke historical records for the distribution of royalties and special participation referring to the national production of oil and natural gas.

In the case of royalties, paid monthly, R$ 3.3 billion will be distributed in May, referring to March production. This is an increase of 18% compared to April 2021 and 150% compared to May 2020.

Regarding the special participation, calculated quarterly, R$ 9.135 billion were distributed, related to the production of the first quarter of 2021. This is an increase of 69% in relation to the previous quarter.

The states that received the most special participation in the first quarter were Rio de Janeiro, with R$ 2.89 billion (66% more than the previous quarter); São Paulo, with R$ 414 million (increase of 109%); and Espírito Santo, with R$ 362 million (68% more).

See presentation by the ANP on the topic at:https://www.gov.br/anp/pt-br/canais_atendimento/imprensa/noticias-comunicados/arquivos/2021/maio/pe1t21-royalties.pdf

What are royalties and special participation

Royalties are a financial compensation due to the Union, the states, the DF and the beneficiary municipalities for companies that produce oil and natural gas in Brazilian territory: a remuneration to society for the exploitation of these non-renewable resources. The royalties are levied on the production value of the oil and / or natural gas producing field and are collected monthly by the concessionaires by means of payments made to the National Treasury Secretariat (STN) until the last day of the month following that in which the production. STN passes on royalties to beneficiaries.

The special participation is an extraordinary financial compensation owed by concessionaires for the exploration and production of oil or natural gas for fields with a high volume of production. In order to determine the special participation, progressive rates, which vary according to the location of the mine, the number of years of production and the respective volume of quarterly production inspected, are applied to the net revenue from the quarterly production of each field.

More information at:https://www.gov.br/anp/pt-br/assuntos/royalties-e-outras-participacoes