A day after the Chamber of Deputies cast the vote on the new oil regulatory framework of the pre-salt layer, executives and investors linked to Royal Dutch Shell met with President Michel Temer and gave details of the $10 billion that the multinational intends to invest in the country over the next four years. According to the presidents of Shell and Shell Brasil, Ben van Beurden and André Araújo, respectively, this amount will be primarily earmarked to projects associated with Petrobras in the Brazilian pre-salt.

"This includes the acquisition by Shell of BG group's and Libra block's large portfolio of assets," said Ben van Beurden after the meeting. "Meanwhile, we will also look for new opportunities, like next year's auctions and new auctions of the pre-salt, which may happen after 2018. If there are opportunities, we will examine the possibility of expanding our investments," he added. Royal Dutch Shell operates in more than 140 countries in exploration and production, gas and energy, petrochemicals, renewable energy, and trading and distributing derivatives.

According to André Araújo, the approval of a new regulatory framework of the pre-salt was a big step towards attracting more investment to the country. "It is in the format that has to be and there is nothing to be improved. Now President Temer has just to make a decision and sign it. From now on, we have to examine the trading conditions of the auctions," he told Agência Brasil.

In the press conference, Araújo noted that, even before a very positive scenario, the Shell group has investment ceiling limits. "We will only conceive new projects and create new opportunities, if they are truly competitive so they can be well-positioned within the portfolio and within Shell Group's investment opportunities around the world," said Shell Brasil's president.

The "right move"

For Shell Global CEO Ben van Beurden, the regulatory framework approved by the National Congress is the "right move," because it will create opportunities and conditions for new players in the Brazilian market, opening up job opportunities. "This makes the market even more attractive to Shell because we do not just want to be Petrobras' strategic partner as an operator. We also want to operate in Brazil, with Petrobras as a strategic partner. We will look at new opportunities from renewed interest that will arise from the regulatory framework, because there is still room for more," said the group's global CEO.

According to Beurden, fiscal and regulatory stability will also be critical for future investment decisions. "From what I heard today, I believe we will have this positive framework from now on," he said as he left the meeting with Temer. Beurden reported that today's visit, which was also attended by partner investors from the multinational company, was aimed at granting the request made by Temer at the meeting they had in September. "Today's meeting was useful for our non-Shell investors, which are fund-raisers with trillions of dollars in the portfolio. I cannot speak on behalf of investor groups, but it would surprise me if they left with a not positive impression about Brazil."

Changes in the pre-salt

The new regulatory framework of the pre-salt exempts Petrobras from activities in all exploration blocks, ending Petrobras' compulsory operation in the exploration of the layer. The previous legislation provided that Petrobras would have at least 30% of participation in consortia operating in pre-salt blocks and in the operator's capacity. In the new legislation, the requirement was removed for attracting private capital to the exploration. The Brazilian state-owned company, however, will still have the preference for choosing the blocks in which it intends to operate. But for this it needs the consent of the National Council of Energy Policy (CNPE), in order to serve national interests.

Shortly before attending the meeting with Temer and Shell executives, Finance Minister Henrique Meirelles said that the interest of foreign investors in Brazil is a sign of restored confidence in the Brazilian economy, in the stability of game's rules and of the regulatory framework. According to the minister, the industry already expects the recovery of the oil market in the future.

Petrobras CEO Pedro Parente has declared that the new regulatory framework of the pre-salt has brought advantages for the company and for the country by attracting investors and generating revenues for the states.

According to him, almost half of the resources invested in the fields will go to governments "in very different incomes."