The oil auctions organized in Brazil on Thursday ended in failure, only five of the 92 blocks having found a buyer during these auctions, which were highly criticized by environmentalists. In total, these auctions brought in only 37.14 million reais (about 6.7 million dollars), against more than 2 billion dollars for the previous ones carried out under the same model, in October 2019.
To the relief of conservationists, no offer was finally made for the blocks of the Potiguar bay (northeast), near biodiversity sanctuaries such as the archipelagos of Fernando de Noronha or Atol das Rocas. .
About fifty demonstrators were present in front of the hotel where the auctions took place, in Rio de Janeiro, protesting in particular against the risks for traditional fishing. One of them carried a sign with an iconic AFP photo showing a young boy stuck in an oil slick during an oil spill in October 2019, on the coast of northeastern Brazil.
In the auction room, Shell virtually went it alone, winning the five blocks that received bids, all in Santos Bay (southeast), close to the large pre-salt deposits (pre-sal) which regularly attract the envy of major players in the sector. One of these five blocks will be operated in consortium with the Colombian company Ecopetrol. The Brazilian state-owned company Petrobras, which is usually very active in oil auctions, has not submitted any bids.
Rodolfo Saboia, director of the National Petroleum Agency (ANP), which organized the auction, however considered that the result was “positive”, in a complicated context for the oil sector due to the coronavirus crisis. “We cannot say that it is a failure, we did not expect all the blocks to find takers. These were areas with high exploration risks, to open a new frontier in the oil exploration in Brazil, “he said.
But for Fernanda Delgado, energy researcher at the Getulio Vargas Foundation (FGV), the result was “well below expectations”. “One could imagine that the result would not be very good, but only 5 blocks out of 92, it is really very little. The companies remained in withdrawal, they did not wish to assume environmental risks”, he added. she explained to AFP.
According to this specialist, “the political climate” also weighed on these auctions, with the institutional crisis between the far-right president Jair Bolsonaro and the Supreme Court. In November 2019, auctions of blocks of “pre-salt” deposits had already been disappointing. Presented as “historic” by the government, they had been shunned by foreign majors.
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