ANP – 05/09/2024 10h38
With contract signings up until the end of August, the total has risen to 426 blocks, the largest number of areas in the exploration phase since 1998.
With the signing of the majority of contracts associated with the 4th Cycle of the Permanent Concession Offer, the exploration phase now accounts for 426 blocks under contract.
The signing of 177 contracts by the end of August 2024 represents a 70% increase in the number of blocks compared to May 2024, the month before the start of contract signings, when there were 251 blocks under contract. Since the establishment of the ANP in 1998, this is the largest number of areas in the exploration phase.
The signing of contracts linked to the 4th Cycle of the Permanent Offer highlights the Potiguar onshore basin, which now has 151 blocks under contract. Another positive development is the 41 contracts signed in the Pelotas basin. As a result, the Pelotas basin is now the offshore basin with the largest number of blocks under contract, all stemming from the 4th Cycle of the Permanent Offer.
The forecast of R$ 18.3 billion in investments for the exploration phase up to 2027 will be increased, considering the exploratory campaigns associated with the new contracts.
This scenario reinforces the importance of continuing the offering of areas under the concession regime and the significant impact of ANP-regulated activities on the country’s economy. On the other hand, it highlights the growing challenges related to the monitoring and supervision of activities outlined in the work plans associated with exploration and production (E&P) contracts in the exploration phase.
More information on the exploration phase can be found in the Dynamic Exploration Phase Panel, the Dynamic Forecast of Activities and Investments in the Exploration Phase Panel, and the 2023 Annual Exploration Report.
Exploration Phase and Dynamics of E&P Contracts
E&P (Exploration and Production) contracts are divided into two phases. The first is the exploration phase, during which companies carry out studies and activities (such as seismic surveys, well drilling, etc.) to identify the presence of oil and gas and, if found, to assess whether the discoveries are commercially viable. During this phase, the areas are referred to as exploratory blocks.
At the end of this phase, the company must decide whether to return the block to the ANP or submit a declaration of commerciality and retain a development area (marking the start of the second phase, the production phase). Upon declaring commerciality, the company may choose to retain only part of the exploratory block, transforming it into a development area. In this case, the remaining portion of the block is returned to the ANP. After the Development Plan is approved by the ANP, the development area is officially designated as a field.
Source: ANP / BR8
