CNPE Approves Financial and Technical Parameters for Upcoming Pre-Salt Bid Round
CNPE RESOLUTION No. 5/2013
Brazil′s energy policy council, CNPE, published today CNPE
Resolution No. 5, establishing the financial and technical
parameters for the first bid-round for Brazil′s offshore
pre-salt areas.
Important issues include:
Signature bonus
The signature bonus to be paid to the Government was fixed at R$15
billion (approximately US$7.5 billion).
Government take
The calculation of the percentage of oil destined for the
Government must consider the signature bonus, development in
individualized production modules, and the cash flow during the
contract.
The minimum percentage of the government take to be offered is
40%, assuming a price per barrel of oil of US$105.00.
Petrobras′ minimum participation
Petrobras′ minimum mandatory participation will be
30%.
Cost oil calculation and limit
Only expenses incurred by contractor from the performance of the
activities under the production sharing contract and approved by
the operating committee, having as a reference expenses typically
incurred in such activities and according to oil industry best
practices, can be defined as cost oil.
The contractor may recover the cost oil on a monthly basis,
limited to 50% of the gross value of production in the first two
years of production and 30% in following years. Costs exceeding
such limits will be carried over to subsequent years with no
restatement.
Local content
The minimum local content percentage is defined at:
(i) 37% for the Exploration Phase;
(ii) 15% for the Long Duration Test in the Exploration
Phase - these amounts will not be computed in the calculation
of the local content percentage for the Exploration Phase;
(iii) 55% for modules of the Development Stage that commence
production by 2021; and
(iv) 59% for modules of the Development Stage that commence
production in 2022 and thereafter.
Local content percentages for items and sub-items of basic and
detail engineering cannot be revised and, in the event they are
exceeded, the additional percentage may be transferred to
subsequent modules, multiplied by two.
The full text of CNPE Resolution No. 5/2013, as published in the
Brazilian Official Gazette, is available here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
