Business / Work by Donna Bowater

Brazil oilfield auction attracts bidders and protests

China’s CNOOC and CNPC, Anglo-Dutch giant Royal Dutch Shell and France’s Total joined Brazilian state operator Petrobras in winning production rights to the biggest oilfield in Brazil, which could yield as much as 12bn barrels of oil.

The controversial auction of the Libra site off the coast of Rio de Janeiro was due to take place on Monday afternoon at a five-star hotel amid high security over fears of protests and disturbances.

The field, which was discovered in 2010, could almost double Brazil’s oil reserves and attract more than £100bn investment over 35 years.

Edison Lobão, Brazil’s mines and energy minister, told journalists the winning bidder would have drilling rights to the “biggest area for oil exploration in the world”.

However, as part of the terms of the sale, Brazil’s state-run oil company, Petrobras, would be the sole operator of the field. More than 40pc of the oil recovered would go to the Brazilian state.

The auction has failed to attract interest from the biggest US and British firms with neither Exxon Mobil, Chevron, BP or BG taking part.

Ahead of the auction at 2pm local time, hundreds of troops were in position around the Windsor hotel in Barra da Tijuca, west Rio de Janeiro, to secure the area after protests last week.

The president of Brazil, Dilma Rousseff, was said to have personally instructed the army to deploy more than 1,000 troops.

Among the groups protesting is Rio’s union of oil workers, Sindipetro, who claim the National Petroleum Agency (ANP) is privatising the country’s resources to foreign firms.

Emanuel Cancella, secretary-general of the Rio branch, told Brazilian website G1: “There’s no reason to have this auction and bring in foreign companies for the pre-salt. Petrobras has the best technology for this type of operation.”

Originally published by telegraph.co.uk

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