On April 27, 2017, the National Energy Policy Council ("CNPE") published Resolution No. 9/2017 ("Resolution"), which establishes the technical and economic parameters for the offered areas relative to the 3rd Pre-Salt Bid Round under the Production Sharing Regime (“3rd Pre-Salt Round”), as well as formally authorizes the National Agency of Petroleum, Natural Gas and Biofuels ("ANP") to carry out the bidding process.

As per the agreed terms in the CNPE’s 1st Extraordinary Meeting in 2017, the Resolution confirmed the four offered areas for the 3rd Pre-Salt Round: (i) Pau Brasil; (ii) Peroba e (iii) Alto de Cabo Frio - Oeste, in Santos Basin; and (iv) Alto de Cabo Frio - Central, in Santos and Campos Basins.

The CNPE defined the minimum percentage of the Union’s profit oil for each area as (i) 14,40% for Pau Brasil Area, (ii) 13,89% for Peroba Area, (iii) 22,87% for Alto de Cabo Frio – Oeste Area, and  (iv) 21,38% for Alto de Cabo Frio – Central Area.

According to the Resolution, the signing bonus due to the Union will consist of:

i. BRL1,500,000,000.00 (one billion and five hundred million reais) for Pau Brasil Area;

ii. BRL2,000,000,000.00 (two billion reais) for Peroba Area;

iii. BRL350,000,000.00 (three hundred and fifty million reais) for Alto de Cabo Frio – Oeste Area; and

iv. BRL500.000.000,00 (five hundred million reais) for Alto de Cabo Frio – Central Area.

In addition, the CNPE established the general rules on the expenses that will be recognized as cost oil, based on the best practices of the oil industry and the typical costs of the activity.

Lastly, it is important to mention that, by means of this Resolution, Petrobras was notified to confirm to the Union, within a maximum period of thirty days, the preferential rights to be the Operator in each of the offered areas.

For more information in relation to this legal update, please contact EnergypartnersTC@mayerbrown.com.

Observations in this update about Brazilian law are by Tauil & Chequer Advogados and are not intended to provide legal advice. Any entity considering the possibility of a transaction must seek advice tailored to its particular circumstances.