Brazil's Proposed Oil and Gas Legislation Delays Development of its Sub-Salt Reserves

London, United Kingdom (PressExposure) November 20, 2009 -- Brazil’s large sub-salt discoveries in late 2007 has encouraged the government to propose possible changes to regulations in its oil and natural gas sectors including fiscal regime terms. Proposed changes to the oil and gas regulations in Brazil intend to retain offshore and subsalt oil fields under government control to a large extent and out of the concessionary process. This is clearly indicated by the withholding of many prospective fields during the ninth and tenth licensing rounds. Nonetheless, various political impediments can further delay the development of sub-salt reserves, leading to disruptions in Brazil’s aspirations to become a major producer and exporter of oil and gas globally.

Recent sub-salt discoveries have transformed Brazil into a country with one of the highest potential investment acreages globally. Tupi Field, which was discovered in November 2007, is the largest discovery in North and South & Central Americas since 1970. It has estimated recoverable reserves in the range of 5-8 billion barrels. This discovery of pre-salt layer that extends from the State of Espírito Santo to the State of Santa is considered as one of the most attractive exploration acreages worldwide. It will increase Brazil’s recoverable oil by at least 50%, which will significantly increase the revenues in the country’s oil and gas industry.

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Press Release Submitted On: November 20, 2009 at 4:24 am
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