Brazil is amending its concession regime to boost investment in its oil sector. The Brazilian government has allowed oil regulator ANP to extend the rights of state-owned oil group Petrobras to operate some of its oldest fields and to review the regulations for oilfields "unitisation".
Petrobras lost its oil monopoly in 1998 and received 27-year exploration and production concessions instead. However, a 2010 law strengthened government control over offshore oil discoveries in the Santos and Campos basin off the Brazilian coast, forcing unitisations between areas with different regulations, royalties and tax systems. Petrobras was required to lead and make minimum investments in the areas governed by new rules, which is becoming increasingly difficult for the heavily-endebted group and has led to stalling the development of about 20 areas.
The extension of the concessions would secure Petrobras' rights to key fields for a longer period and could free up to US$120bn in investments.
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