New oil auction in sharing regime sees record number of bidders

The sixth round of oil production sharing, slated for November 7, will have a record number of bidding companies—17, one more than the fourth round, when the previous record was set.

Among them are Brazil’s Petrobras and foreign Shell, BP, Chevron, Petronas, ExxonMobil, and Repsol Sinopc.

The sharing rounds determine the firms allowed to explore and produce oil and gas in pre-salt reserves.

In the sixth round, five areas will be up for auction: four in the Santos basin (Aram, Sudoeste de Sagitário, Cruzeiro do Sul, and Bumerangue) and one in the Campos basin (Norte da Brava).

The two coming shared production rounds are expected take place in 2020 (the seventh) and 2021 (eighth).

Unlike the concession regime, in which companies own the extracted oil, in the sharing regime the federal government is the owner, and companies have the right to an oil restitution of exploration costs and a portion of the oil exceeding the exploration costs. Its name derives from the fact that companies share the surplus oil with the government.