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
Important issues include:
The signature bonus to be paid to the Government was fixed at R$15 billion (approximately US$7.5 billion).
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.
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.
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