Brazil: Concession would be the best model for auctions

In the last year, Petrobras held two major auctions for pre-salt oil exploration: the onerous assignment and the 6th Production Sharing Bidding Round, both of which occurred in the Rio de Janeiro, Brazil. With regard to the transfer, however, only two of the four blocks were rounded up by the state itself and other companies did not give their offers – as expected.

Despite the revenue forecast of R$ 106.5 billion, the R$ 69.96 billion earned represent the highest value raised in the world in a oil sector auction. Still, for the president of the Center Adriano Pires, the auctions proved again that the sharing model is not ideal for the Brazilian economy and pre-salt, and rather the concession model – adopted, according to it, within a logic rather than economic.

Pires pointed out that the concession is simpler and allows better supervision, in addition to being the preferred model of the most Developed. Still, he believes that an in-depth study of how would this change be made, since the concession method would probably come accompanied by a political clash between states because of the distribution of resources.


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