Temer urges Congress to approve bill easing oil industry regulation and Petrobras monopoly

Tuesday, October 25th 2016 - 12:20 UTC

Full article 3 comments

The proposed regulatory framework would “create new jobs” and “provide a new boost to investment in the sector,” Temer said at the Rio Oil and Gas conference.

”The financial and administrative problems are being overcome little by little, Petrobras CEO Parente told the Rio conference

President Michel Temer urged Congress on Monday to approve a bill that would ease oil industry regulation and strip state-controlled oil giant Petrobras of some of its privileges in Brazil's most promising oil fields. The proposed regulatory framework would “create new jobs” and “provide a new boost to investment in the sector,” Temer said in an address at the opening of the Rio Oil and Gas conference.

The changes in oil regulations that are being demanded by the domestic industry and foreign investors have been approved by the Senate, but the lower house of Congress has only given partial approval.

Lawmakers in the lower house are expected to vote on four amendments to the bill, the last step before it lands on Temer's desk for his signature, making it a law.

The new regulations would end Petrobras's right to be the sole operator for exploration and production projects in the pre-salt reserves, which are off southeastern Brazil and considered one of the largest oil finds in recent decades.

The bill, however, allows Petrobras to decide whether or not to serve as operator of a field and keeps in place the production-sharing system.

Petrobras CEO Pedro Parente, meanwhile, said the energy giant was in a “recovery phase,” thanks to the restructuring plan implemented in response to the plunge in oil prices and a US$353 million settlement with investment funds that took legal action over the corruption scandal at the company.

“The financial and administrative problems are being overcome little by little, Parente told the conference, acknowledging that ”the most difficult phase“ in implementing the restructuring plan ”starts now” with the launch of new projects.

Petrobras still faces 23 other lawsuits in federal court in New York over the corruption scandal, executives said.

The oil company's business plan, which was unveiled last month, calls for cutting investment by 25% and selling US$19.5 billion in assets to shore up the balance sheet in the wake of the drop in crude prices and the corruption scandal.

Categories: Economy, Energy & Oil, Politics, Brazil.

Tags: Brazil, Michel Temer, Pedro Parente, Petrobras, Rio Oil and Gas conference.

Top Comments

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Jack Bauer
Not going to bother addressing the idiot above, as he is an ignorant, brainwashed 'petista'.
The fact is that since 2007/2008, when the (PT) govt nationalized PB again (in order to be able to control steal from it), it has only gone down the drain. During this period the company's market value dropped by more than 80%. Today it is just another, small oil company, without the necessary capital to invest in all the potential oil wells, so unless PB had the money to be at least, a 30% co-investor, no new wells could be drilled. This obligation has been done away with, which means that new oil wells can be explored with PB participation, allowing the country to benefit from larger daily output, increasing royalties on oil that would otherwise stay in the ground for another 20 years. But of course, as the initiative to do this, disobliging PB to invest in every single well, or alternatively, not be explored at all, was not the PT's, they are against it. Same as the PEC 241 (putting a cap on public spending), which in the end, besides being an essential measure, simply means that the govt cannot spend what it doesn't have....something the PT has always ignored, as their mission was and is only to ruin the country and be the sole party in power...exactly like VZ and Maduro.
Oct 28th, 2016 - 04:53 pm 0
:o))
No matter what happens, the monopoly of PB in all sorts of scandals can NEVER be stopped!
Nov 03rd, 2016 - 02:42 pm 0
Brasileiro
Traitors able to approve this law goes against the interests of the Brazilian people. However, I sincerely hope that investors expect the 2019 auctions, because we have a new president. And, sure, he will not approve the breaking of the monopoly of Petrobrás in the pre-salt.

https://www.youtube.com/watch?v=U4W9AdbK0Aw
Oct 25th, 2016 - 01:46 pm -2

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