More friction: this time it's Brazil

Tuesday, 22 October, 2013

Hot on the heels of yesterday's piece about attacks on Manas subsidiary Z-Explorer in Kyrgyzstan, this week the South American Press reports on Brazil auctioning off 35-year production rights to the giant Atlantic offshore Libra oil area to a consortium led by the state-run oil company Petroleo Brasileiro SA - while heavy security protected the Rio auction from clashes between police and protestors.  The deal:

"Petrobras took 40% of the field, 10 percentage points above the legal minimum. France's Total SA and Anglo-Dutch Royal Dutch Shell Plc will each have 20% while China National Petroleum Corp and China's CNOOC will each have 10%. The companies will give 41.65% of their profit oil - or oil produced after initial investment costs are paid - to the Brazilian government under a new production-sharing contract. That minimum bid established by law was also 41.65%."

Despite this sharing clause, 1,100 Brazilian Army troops uses tear gas to disperse protesting crowds as the deal was struck. "Unions representing oil workers from Petrobras were among those protesting the partial sale of Brazil's oil reserves. They accuse the government of 'selling off' the country's riches." The protests were sufficient to draw the attention of the global press, too - links:

BBC (also has video reporting from the protest)


Al-Jazeera (also has video)

...and a typically insightful take on affairs from that bastion of the free British press, the Daily Mail 

Shortly after thesurge in protest surrounding plans and costs for the 2014 World Cup and the 2016 Olympics, these aren't great times for the Brazilian populace's view of the state's investment priorities.