Brazil's Gross Domestic Product (GDP), i.e. the sum of all the wealth produced by the country, is expecting a boost with the exploration of new oil fields in the pre-salt layer, which in turn will lead to more jobs and quality of life for Brazilians in the future.

“These auctions, in the short, medium and long terms, generate resources at the federal, state and municipal levels. You collaborate with economic growth while creating jobs - it's an event that only brings benefits to the country. It is a shame that we have gone so long without holding auctions," explained Adriano Pires, director of the Brazilian Centre for Infrastructure (CBIE).

According to Pires, who was formerly a director at the National Petroleum, Natural Gas and Biofuels Agency (ANP) and has 30 years' experience in the area, the high potential of pre-salt reserves and the high investment needed to explore the area are both factors that will drive the country's economic growth.

Investments and jobs

ANP Director-General, Décio Oddone, shares the same assessment. He sees a growth opportunity for Brazil in the pre-salt auctions. "With the resumption of [exploration] activities, all areas of the production chain will be positively impacted, with investments and job creation," he said.

In practical terms, the oil auctions mean attracting more investment and raising revenue - both at the municipal and federal levels - and increasing social economic development through economic growth and job creation. ANP estimates point to R$ 100 billion in investments.

More exploration, more development

In the wake of the recovery of the productive sector, the extractive industry - which comprises oil and gas activity - was essential this year. While overall industrial activity fell by 1.1% in Q1, that decline that would have been far more intense were it not for the performance of the extractive industry, which climbed 9.7% compared to the same period of 2016.

“When the company buys a block, it commits to investing billions of dollars in it - exploration requires high investment during all phases [of the concession]," Pires said. "Between the purchase of the block and entry into production, you have investments that will end up creating jobs and influencing GDP growth," he adds.