On August 23, 2017, the National Agency of Petroleum, Natural Gas and Biofuels ("ANP"), published the tender protocols for the 2nd and 3rd Bid Rounds for exploratory blocks under the production sharing regime, as well as made available the production sharing contract models.

As previously indicated in our legal update regarding the regulation of Petrobras’ preferential right, ANP was tasked with defining in the final tender protocols the procedures concerning the cases in which Petrobras enforces its “pull out option” and does not join the winning consortium –which only applies in cases where the Federal Government’s profit oil percentage offered by another consortium is higher than the minimum percentage established in the tender protocol. Therefore, according to the final versions of the tender protocols, during the public session, ANP will request Petrobras’ accredited representative to express, within 30 minutes, its decision on joining or not the winning bidder consortium.

Among other changes, the 2nd Bid Round tender protocol expanded the areas on offer for Entorno de Sapinhoá (from 210,690 km2 to 213,987 km2) and Sudoeste de Tartaruga Verde (from 4,934 to 7,617).

For the 3rd Bid Round, ANP extended the exploration phase for the fulfillment of the minimum exploratory program, which will be seven years, instead of six years.

Additional innovations were added to the production sharing model contracts, and we will elaborate further on the relevant changes in our next legal update.