Brazil's government aim in having a shared production regime for its
sub-salt oil reserves is to maximize oil revenue, the Estado News
Agency reported Wednesday.
"Shared production contracts allow the best appropriation of
oil resources for the government," Haroldo Lima, president of Brazil's
oil regulator, ANP, told a congressional commission on economic
development.
Brazil's sub-salt area has estimated reserves of between 5 billion and 8 billion barrels of oil.
Lima said the situation most like Brazil was in Russia where
areas with the largest amount of oil used the shared production regime,
and areas with the lowest amounts used the concession system.
Under proposed new laws for the sub-salt area, a production
sharing model would be used, in which the government would own the oil
but pay the oil companies that extract it with part of sales proceeds.
Under Brazil's current system, oil companies buy concessions in an auction and own the rights to the oil they produce.
Lima said the shared production regime also gave government
more control over output, so that it could program the development of
its domestic industrial capacity to meet [oil production] demands.