Colombia’s Ecopetrol wins oil concession in Brazil

RIO DE JANEIRO, BRAZIL – Colombia’s Ecopetrol won one of the 92 concessions to explore and produce oil and natural gas in Brazil’s offshore waters that were auctioned this Thursday by the National Petroleum Agency (ANP, regulator).

Ecopetrol obtained a block in the Santos basin, located off the coast of São Paulo (southeast), in consortium with the Anglo-Dutch multinational Shell, whose participation is 70% compared to the 30% of the Colombian firm.

The Santos marine basin contains the oldest hydrocarbon production areas in Brazil.

Shell and Ecopetrol obtained block S-M-1709 for a value of R$6.5 million (US$1.2 million).

In Thursday’s auction, only 5 of the 92 concessions offered by ANP for the exploration and production of oil and natural gas were awarded. They were in 11 sectors located in four of the country’s maritime basins: Campos, Pelotas, Potiguar, and Santos.

Total proceeds were R$37.1 million (US$7 million) for these 5 licenses.

This 17th Brazilian Oil Concession Auction was scheduled for last year but was postponed due to the Covid-19 pandemic.

Nine companies registered: the multinationals Chevron, Shell, and Total; Brazil’s Petrobras (state-owned) and 3R Petroleum; Colombia’s Ecopetrol; the U.S. company Murphy; Australia’s Karoon; and Germany’s Wintershall.

However, the result has been disappointing. Only 5 of the 92 blocks were bid for, some of which were close to sensitive marine ecosystems, which generated protests from environmental groups at the doors of the Rio de Janeiro hotel where the controversial bidding was held.

The main concern of the environmentalists was focused on some of the areas offered in Potiguar (northeast) and Pelotas (south), near which there are rich marine biomes that serve for the reproduction of fish important for fishing through which endangered animals such as the blue whale pass.