Permanent Offer

First permanent bid auction consolidates new bidding model in oil and gas industry

T&B Petroleum/Press Office ANP
11/09/2019 02:30
First permanent bid auction consolidates new bidding model in oil and gas industry Imagem: T&B Petroleum Visualizações: 4746 (0) (0) (0) (0)

The ANP held today (10/9) at Windsor Guanabara, in downtown Rio, the public session of the 1st Cycle of the Permanent Offer, which was attended by the Minister of Mines and Energy, Bento Albuquerque, ANP directors and other authorities.

 

Thirty-three blocks were sold in the Sergipe-Alagoas, Parnaíba, Potiguar and Recôncavo basins and 12 areas with marginal accumulations in the Potiguar, Sergipe-Alagoas, Recôncavo and Espírito Santo basins.

 

For exploratory blocks, the total bonus collected was R$ 15.32 million (average goodwill of 61.48%) and there is a forecast of R$ 309.8 million in investments. For areas with marginal accumulations, the total bonus was R$ 6.98 million (goodwill of 2,221.78%), with a forecast of R$ 10.5 million in investments.

 

The first auction of the Permanent Offer brought the consolidation of this new bidding model, which permanently offers a portfolio of blocks and areas with marginal accumulations for oil and natural gas exploration and production. Thus, companies, especially those not yet in Brazil, have the opportunity to study these areas without the time limitations that traditional rounds provide.

 

“A process that began with a small business expression of interest in an area with marginal accumulation in the Recôncavo ends with 45 blocks and contracted areas,” said ANP Director-General Décio Oddone.

 

“We currently have a stock of 301 exploration contracts in Brazil, and today there were 33 new exploration block contracts - more than 11% of what we have contracted. Of course we can not compare in size with the pre-salt, for example. But if we look at the number of areas, in the auctions we made from 2017 to now, there were 72 blocks; Only today we contracted 33 blocks and 12 areas with marginal accumulations. It is absolutely symbolic. It is the first auction in 20 years in which Petrobras is not present and was an extraordinary success. This is effectively the replacement of monopoly by an industry. New areas, new players and a dynamic industry, without dependence on Petrobras, ”he added.

 

The result will allow the revitalization of mature areas with marginal accumulations, and stimulate exploration in the land segment, generating employment and income in different regions of the country.

 

See the blocks and areas awarded in the public session: (link) 

Exploratory Blocks 

Sergipe-Alagoas Basin 

Parnaíba Basin 

Potiguar Basin 

Recôncavo Basin

 

What is the Permanent Offer 

The process of Permanent Offering of areas for exploration and production of oil and natural gas provides for the continuous supply of fields and blocks returned (or in process of return), as well as exploratory blocks offered in previous rounds and not sold.

 

In this mode, registered bidders may submit a declaration of interest for any blocks or areas provided for in the notice, accompanied by a bid guarantee.

 

The main difference from the other rounds is that a Permanent Bid cycle only starts when the Special Bidding Commission (CEL) approves a declaration of interest, accompanied by the bid guarantee, for one or more blocks / areas on offer, presented by one of the registered companies.

 

What are the cycles 

As set forth in the Notice, the Permanent Offer cycles correspond to the holding of the public offer presentation sessions for one or more sectors that had a declaration of interest. These cycles begin with the disclosure of their schedule, upon approval by CEL of one or more declarations of interest, accompanied by a guarantee of offer, presented by registered companies.

 

With the opening of the cycle, the following deadlines begin: 

- Within 30 days, companies not yet enrolled in the Permanent Offer may apply for membership;

 

- Within 70 days, the companies already registered may submit a declaration of interest, with guarantee of offer, to the sector that originated the cycle or any other sector contained in the Notice;

 

- Within 90 days, the ANP holds the public session, in which all blocks and areas with marginal accumulations of the sectors that received a declaration of interest are offered.

 

On the day of the public session, the registered companies may bid for blocks and areas with marginal accumulations in the bidding sectors in the Open Permanent Offer cycle.

 

In the case of exploratory blocks, the offers are composed of signature bonuses (equal to or greater than the minimum bonus determined in the announcement) and Minimum Exploratory Program (PEM), containing the activities that companies undertake to perform during the exploratory phase (such as drilling). wells and seismic production, for example).

 

If there is more than one offer for the same block, the company or consortium that reaches the highest score wins, with the signing bonus weighing 80% and PEM 20%.

 

For areas with marginal accumulations, the only criteria for determining the winners is the signature bonus offered, which must also be equal to or greater than the minimum determined in the notice.

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