The Bidding Rounds
Bidding Rounds for Oil and Natural Gas Exploration and Production
Bidding Rounds are auctions through which the Federal Government grants the right to explore and produce oil and natural gas in Brazil. Since 1999, several rounds have been held for exploration blocks and mature fields under the concession regime; for pre-salt fields under the production-sharing regime; Open Acreage cycles, under both the concession and production-sharing regimes; as well as rounds for Transfer of Rights Surplus Volumes, also under the production-sharing regime.
More than 100 companies - both domestic and foreign, of various sizes - have already participated in the auctions. Currently, most of Brazil’s production comes from blocks awarded through ANP auctions.
To keep track of the rounds currently in progress, please click here.
How ANP conducts the bidding rounds
The bidding rounds are prepared by ANP based on guidelines from the National Energy Policy Council (CNPE). It is based on these guidelines that ANP conducts studies and identifies areas with the characteristics determined by CNPE, which, after approving them, authorizes the Agency to hold the bidding rounds.
Following the publication of the CNPE resolution authorizing the round, ANP publishes the preliminary tender protocol and the draft contract, which are subject to public consultation and a public hearing. The preliminary tender protocol contains the schedule of events and mandatory publications, which includes technical, legal, fiscal, and environmental seminars, as well as the disclosure of the blocks areas, among other items. During this phase, a period is opened for companies to express their interest in participating in the round and for the Bidding Round Special Commission (CEL), which determines whether or not to approve the companies’ registration, to review the applications.
This entire process is widely publicized and involves the participation of the public and entities regulated by the ANP.
Public bid presentation sessions are generally held over a single day at an event open to the public and attended by government officials, business representatives, and the press. Registered companies (either individually or as part of a consortium) submit their bids in a sealed envelope placed into a transparent ballot box. They must include a sign-up bonus offer and the Minimum Exploration Program (PEM), in the case of rounds under the concession regime, or the portion of the oil surplus offered to the Federal Government, in the case of rounds under the production-sharing regime. Bids are evaluated immediately, based on the criteria set forth in the tender protocol, and the name of the winning bidder is announced shortly thereafter.
On December 9, 2021, CNPE Resolution No. 27/2021 was published, amending CNPE Resolution No. 17/2017 and establishing the Open Acreage system as the preferred method for offering areas for the exploration and production of oil, natural gas, and other fluid hydrocarbons. In Open Acreage rounds, bidders who have registered and been deemed eligible by the Bidding Round Special Commission (CEL) may submit a declaration of interest for any blocks or areas, provided it is accompanied by a bid guarantee and other documents required in the tender protocol.
Unlike other bidding modalities, in the Open Acreage a public session for the presentation of bids takes place within 120 days after the CEL approves one or more expressions of interest for any blocks or areas on offer. Upon approval, a new Open Acreage Cycle begins, and CEL publishes its schedule.
To learn more about the Open Acreage, please click here.