The maintenance of the auctions of the Permanent Supply Cycle of the National Agency of Petroleum, Natural Gas and Biofuels (ANP) and studies on the reduction of royalties for onshore and shallow water fields and on the easing of Petrobras' preemptive rights were some of the measures cited by the Ministry of Mines and Energy to mitigate the crisis caused by Covid-19. The announcement was made during the virtual meeting of the Superior Council of Representatives Firjan with the CIRJ Board of Directors, on 04/28.

The video conference was attended by the President of the Republic, Jair Bolsonaro, and Ministers Bento Albuquerque (Mines and Energy), Paulo Guedes (Economy), Tarcísio de Freitas (Infrastructure), Braga Netto (Civil House) and the presidents of the Central Bank , Roberto Campos Neto, and Caixa Econômica Federal, Pedro Duarte Guimarães. More than 400 businessmen followed the meeting by videoconference, led by the president of Firjan, Eduardo Eugenio Gouvêa Vieira.

Entrepreneur Raul Sanson, vice president of Firjan, asked Admiral Bento Albuquerque about the local market as a job driver in this value chain that is so strategic in the composition of Brazil's GDP and, especially, in Rio de Janeiro. “Bearing in mind that the country is today one of the major world producers of Oil and Gas, with competitive extraction costs mainly in the pre-salt, and that it has an industrial base of goods and services aimed at this market - duly constituted with technical staff qualified workers and available labor for immediate expansion of activities - how does the government intend to act decisively in the oil chain to enable Brazil to take advantage of this opportunity and generate jobs and income? ”asked Sanson.

Supply and production 

According to Albuquerque, the first measure adopted by the Ministry was to preserve the health of the market, in order to guarantee supply and production. According to him, the meetings of the Crisis Committee of the Ministry itself, created in mid-March, have been interacting with all public agencies operating in this market, together with companies and other agents. “To preserve the health of the market, we have to think about what has emerged in recent years and last year, which were small and medium-sized operating companies. That is our priority. It is in this sense that we are working within the National Energy Policy Council, with the possibility, for example, of reducing royalties for fields on land and shallow water and making Petrobras' preemptive rights more flexible, ”he said, for whom the city of Rio is the P&G capital of Brazil. The state is the largest national producer of oil and gas, with about 75% of the total in the country.

The Minister of Mines and Energy also mentioned passing non-strategic areas to the ANP's Permanent Offer cycles, which opened last year. “We maintained the auction from the second cycle to the second half, due to the various expressions of interest in these areas. And we also maintained for the second half of 2021 the auction of the surplus of the transfer of interest for the fields of Sépia and Atapu. What is the new? It is to make these fields even more attractive, reducing uncertainties and negotiating financial compensation for Petrobras, for operating these fields. An auction that will bring a lot of investment in the pre-salt area ”, he said.

Petrobras reduced its production at the beginning of the crisis by 200 thousand barrels per day. But in the face of great productivity and the quality of oil extracted, Albuquerque announced that the company is already resuming its normal production, maintaining its level of exports. “Petrobras is also exporting more maritime bunker (marine fuel oil) due to its quality, with less sulfur. We have to continue investing in it and working towards it ”, he highlighted.

The Minister of Mines and Energy drew attention to the “Shock of Cheap Energy” program, through natural gas, which has become a great opportunity due to the availability of energy and its price reduction. “It is already being renegotiated by Petrobras at 10%, 20% cheaper than last year. We are discussing with Bolivia the supply of natural gas; and we are working with the National Congress, and there you have a fundamental role for the improvement of the Legal Framework for Natural Gas. This market will be fundamental for our resumption with projected investments of billions of reais, mainly for the state of Rio ”.

Market is still competitive 

According to Eduardo Eugenio, due to the pre-salt, the P&G market in Rio de Janeiro continues to be competitive, even with the drop in the price of the barrel, whose value will be exceeded as soon as there is a balance between supply and demand. “Our price of pre-salt oil, considering the lifting cost (extraction costs) is still positive. And, even with CAPEX (investment costs), when Brent returns to normal, it will be very interesting, since several areas in the world will not be suitable and attractive like Brazil ”, evaluated the president of Firjan.