Rousseff Position on Oil Royalties: Daily

By Ben Tavener, Senior Contributing Reporter

RIO DE JANEIRO, BRAZIL – Brazil’s political leaders are divided on President Dilma Rousseff’s new stance on how states share oil royalties. Last week her comments, which favored oil-producing states and warned against reneging on contracts that had already been signed, received a hostile reception from nearly 4,000 mayors gathered in Brasília.

The president warned not to meddle in past contracts, but instead to “fight for distribution rights from today onwards,” comments which were met by booing.

However, many parliamentarians have now rallied round President Rousseff and her position that contracts that have already been signed regarding royalties should be honored – particularly, unsurprisingly, those from the major oil-producing states of Rio de Janeiro, São Paulo and Espírito Santo.

Federal Deputy Chico Alencar, representing Rio state, was just one of many who defended the president, saying the moment was right for changing the distribution of royalties for future contracts:

“With the prospect of pre-salt, the current model has to be readjusted to these new realities, but ensuring the rights of producers,” he said, noting that producer states suffer the impact of exploration.

Others praised ROusseff for defending the constitution, adding that oil-producing states have invested heavily to get to where they are – in terms of infrastructure, sanitation and environment controls.

However a protest staged on Wednesday in the Chamber of Deputies, including members of the National Confederation of Municipalities, which called for royalties to be split more equally, showed that there are many others who feel just as passionately that Brazil should benefit from its natural resources as a whole.

Read more (in Portuguese).

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