Brazil to Stay Out of OPEC to Make the Most of Increased Production

RIO DE JANEIRO, BRAZIL – (Bloomberg) Brazil expects to be among the top-five energy exporters by 2030, and is tapping private investment to boost output, according to energy and mines minister Bento Albuquerque. It’s also working on making rules more favorable for investors in upcoming bids for oil and natural gas licenses.

“The idea is just to increase our production and to participate more in the international oil and gas market,” he said in an interview in New Delhi. “But this is not a plan for Brazil to join OPEC or any other association or group of oil and gas producers. We don’t want restrictions, we want to increase our production.”

With Brazil’s output set to significantly expand in the next few years as more of its offshore reserves are drilled, speculation has swirled over whether it will become part of OPEC. While President Jair Bolsonaro last year welcomed an informal invitation to join the group, the head of the country’s state-controlled energy company dismissed the idea.

Brazil is open to having discussions with members of the Organization of Petroleum Exporting Countries on energy-related issues, Albuquerque said. He expects to visit Saudi Arabia, OPEC’s biggest producer, later this year.

The Latin American country is seeking feedback from global oil majors to improve participation in upcoming bids. It wants to increase the share of output from companies other than state-controlled Petrobras.

“Petrobras has a lot of oil and lot of areas to exploit, but it doesn’t have enough funds to prospect all these areas,” Albuquerque said. “There’s a limit for Petrobras. For that reason, we want to make it attractive for others to come and make the investment.”

Albuquerque’s other comments:

• Brazil sees room for increasing energy exports to India, one of the fastest growing consumers of oil.
• The country has proposed that Indian companies set up refineries in Brazil and participate in Petrobras’ sale of some of its plants.
• Brazil is considering opening up its nuclear industry to private companies, it plans to complete its third atomic power plant by 2025 and wants to build six more.
• State-owned Industrias Nucleares do Brasil, or INB, will resume uranium mining at Caetité in Bahia state next month after a hiatus of five years.