The National Energy Policy Council ("CNPE") approved yesterday, during its 1st Extraordinary Meeting held in 2017, the 3rd Pre-Salt Bid Round under the Production Sharing Regime (“3rd Pre-Salt Round”), which is expected to take place in November 2017.

Four prospects located in the Campos and Santos basins will be offered in the 3rd Pre-Salt Round: Pau Brasil, Peroba, Alto de Cabo Frio-Oeste and Alto de Cabo Frio-Central.

The CNPE also defined the minimum local requirements to be required for the 3rd Pre-Salt Round, as follows: (i) exploration phase – minimum global requirement of 18% as; and (ii) development phase – 25% for the well construction, 40% for the collection and offloading system, and 25% for production facilities.

Also, the CNPE approved in its 1st Extraordinary Meeting the multi-annual agenda for the bid rounds of exploratory blocks under the concession and production sharing regimes, estimating 10 bid rounds from 2017 to 2019.

The agenda is an answer to the players in the industry, aiming at creating a more predictable scenario for investments and to promote the intensification of the activities in the sector.

The matters approved by the Council will now be submitted for the approval of the Presidency.

Another Legal Update with further details on the CNPE 1st Extraordinary Meeting will be released in the next couple of days.

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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.

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