“Activity is drastically reduced today compared to five years ago, but it will be picking up the next years. Not only are new fields opening, new legislation is also in place and we expect to see many more foreign companies entering the Brazilian market,” says Adhemar Freire, Country Manager Brazil at Norwegian Energy Partners (Norwep).
The first concession bidding round is held in just 3 weeks time. 8 more are scheduled for 2018 and 2019.
“32 oil companies are registered and approved to bid in the first round. This illustrates that the market is no longer solely driven by Petrobras. Even though Petrobras still enjoys an 80 per cent market share, a lot of new companies are entering the market,” says Freire.
His view is supported by the Annual Oil and Gas Market Report (Rystad Energy, 2017), which identifies Brazil as the market with the highest activity level the next four years.
Freire also pointed at relaxed rules for local content. Minimum local content requirements in Brazil are now as follows:
Production Unit 25 %
Well Construction 25 %
Collection and Disposal System 40 %
Exploration 18 %