Brazil’s Bolsonaro seeks $30bn oil boon

Bloomberg

President-elect Jair Bolsonaro is pursuing the sale of Brazil’s deep-sea treasure-trove of oil, but just weeks after his election he’s facing the same political obstacles as his two predecessors.
While Bolsonaro’s transition team argues the sale could net some $30 billion to help plug fiscal deficits, a squabble over how to divvy up the spoils between various states and municipalities is threatening to thwart the plan even before he takes office.
Senate chief Eunicio Oliveira put on hold a key bill authorising the tender, dealing a blow to Bolsonaro’s hopes that a path would soon be clear for oil majors to bid for the fields.
At stake is a portion of the country’s so-called pre-salt crude reserves buried deep beneath the Atlantic Ocean’s seabed, which state-controlled Petroleo Brasileiro SA has shown are commercially viable. Exxon Mobil Corp and Royal Dutch Shell Plc have expressed interest in the deposits, which are estimated to hold more crude than Norway’s proven reserves.
Bolsonaro, a former army captain, won a highly polarised election contest in October on pledges to unwind big-government policies from years of leftist rule and to sell energy assets to shore up
public finances.
“The auction would bring valuable resources to Brazil and to the government, and help on the fiscal deficit,” Bolsonaro adviser Luciano de Castro said in an interview. But pushing ahead with the sale is proving to be a daunting task, as the president-elect’s team needs to negotiate with dozens of political parties and states with different agendas.

‘TRANSFER OF RIGHTS’
The legislation that stalled in the Senate would remove from Petrobras the exclusive rights to operate in the so-called “transfer of rights” area. That’s a controversial proposition in a country where nationalism and oil tend to go hand in hand. Bolsonaro himself has defended the state’s control of the country’s
resources in the past.