Brazil set out provisional rules Dec. 22 for Pre-sal Petroleo SA (PPSA), the state company managing contracts, to develop the coveted offshore presalt layer to market the government’s share of oil and gas.
Development of presalt, where oil is trapped under a layer of salt beneath the ocean floor, is governed by production-sharing contracts that require companies to give so-called profit oil to the government for sale by PPSA.
But before Dec. 22, no rules had been set to dictate how PPSA sells that output, which is the percentage pledged to the government after factoring in costs.
The decree published Dec. 22 allows PPSA to conclude contracts on behalf of the government with trading agents or sell the oil directly, preferably by auction.
The rules take effect immediately but require congressional approval to become permanent.