Brazil considering 2 pre-salt auctions in 2017

Brazil could stage two pre-salt oil auctions this year as it seeks to capitalize on renewed market optimism, according to the mining and energy ministry (MME).

The government has already announced plans for two oil and gas auctions in 2017: the country's second pre-salt tender and its 14th licensing round for post-salt and onshore fields.

The pre-salt auction has been slated for the first half and Round 14 for the second.

In a statement sent to Reuters, MME said the government was "looking into the possibility of bringing forward the third pre-salt licensing round" to this year.

ALSO READ: Brazil pre-salt auction to offer 2Bb at Carcará

Brazil has not auctioned off oil and gas rights since October 2015, when just 37 of 266 blocks were awarded as investors shunned a local industry hit by recession, falling crude prices and a corruption scandal at state-run firm Petrobras.

The Santos basin's Libra field is the only project to have been auctioned under Brazil's production-sharing model for pre-salt fields, located up to 7km below the Atlantic's surface.

At a bid round in October 2013, Petrobras secured a 40% stake in the field alongside Shell (20%), Total (20%), CNPC (10%) and CNOOC (10%).

The government's auction plans come as international oil prices continue to rebound from a two-and-a-half year slump.

Brent crude futures were trading at US$55.91/b on Tuesday, up from a 12-year nadir of US$28/b in January last year.

The improved outlook last week prompted Petrobras to predict capital investment of US$19bn this year, up from US$14.5bn in 2016.

Interest in pre-salt areas is expected to be boosted by new rules that allow foreign and private companies to operate blocks as majority stakeholders.

ALSO READ - OPERATOR SERIES: Brazil's pre-salt makeover