Market openness to make Brazil’s oil industry more competitive

Décio Oddone, director-general at Brazil’s National Agency for Oil, Natural Gas, and Biofuels (ANP), said today (Feb. 20) that holding auction in the pre-salt area to attract investment from major corporations is not enough to make the oil industry successful in the country.

During an ANP-held seminar in Rio de Janeiro, he told journalists the market should be more open, competitive, and diversified—not just for upstream (exploration and production) and downstream (refinement, distribution, and marketing) for oil, but also for natural gas.

Décio Oddone - Fabio Rodrigues Pozzebom/Agência Brasil

ANP has worked to make strides since last year to implement these changes, Oddone said. “Having a diversified regulatory environment is key. This includes having companies active in mature fields off-shore, on-shore, and in shallow waters, not to mention a natural gas market more open and competitive.”

For this reason, he went on to say, the agency this year will focus on regulations concerning the provision of by-products—natural gas included—a sector where norms are excessive.

Key areas

Oddone pointed out that the agency had given Petrobras a deadline last year for the state-control oil giant to outline its plans for mature fields in shallow waters or on land, as these are areas that demand significant investment. “They have replied with a proposal, and now we’re identifying the plans they want to keep.”

Oddone said that ANP is still studying the response from Petrobras, adding that it should be concluded “as quickly as possible, because it’s a matter of national interest, which includes investment, employment, and royalties for states and municipalities,” he said.

To his judgment, Petrobras should return the blocks it is no longer interested in to ANP as promptly as it can, so the agency can sell them as permanent offer, thus boosting the country’s oil industry, attracting more companies and investment to the sector.