Brazil unlocks Petrobras 'pre-salt' oil fields

The pre-salt fields hold potentially huge amounts of oil, but reaching it is technically challenging and eye-wateringly expensive.

Brazil unlocks Petrobras 'pre-salt' oil fields

World Bulletin / News Desk

Brazil's Congress voted Wednesday to allow state oil company Petrobras to sell off its massive "pre-salt" oil fields, opening the door for the struggling company to raise much-needed cash.

After weeks of opposition maneuvers to block the legislation in the lower house, lawmakers pushed it through in a late-night session by voting down two amendments proposed by the leftist Workers' Party, 251 to 22.

The bill -- which had already passed the lower house in October and the Senate in February -- will now undergo a technical analysis, then be sent to President Michel Temer.

The center-right president is expected to sign it.

Petrobras, which is reeling from a multi-billion dollar corruption scandal and depressed oil prices, announced last year it would start selling off the fields, its prize assets.

It said it needed the money to get its books back in order.

Petrobras is too short on cash to develop all the fields, which were discovered in 2007 at a depth of some five kilometers (three miles).

Last month the company announced it was cutting investments by 25 percent for the period 2017 to 2021.

Brazilian law initially gave Petrobras exclusive rights to the pre-salt fields and set the company's minimum stake at 30 percent.

Petrobras has already begun selling off stakes, starting with a $2.5-billion deal with Norway's Statoil.

Foreign firms will also now be able to participate independently in upcoming auctions for more of the Atlantic Ocean blocks.

Petrobras has been battered by revelations that corrupt executives, contractors and politicians bilked the company out of billions of dollars over the course of a decade.

The politically explosive scandal contributed to the downfall of president Dilma Rousseff of the Workers' Party, which led Brazil from 2003 until her impeachment in August.

Now in the opposition, the party accuses the new government of surrendering the nation's oil resources to foreigners and the private sector.


Last Mod: 10 Kasım 2016, 19:34
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