Brazil's 16th bidding round: What's on offer?

Brazil will hold its 16th bidding round on October 10, with 36 blocks on offer in five offshore basins.

The auction is seen not only as an opportunity for operators to expand their footprint in the country's most prolific areas, the Campos and Santos basins, but also as a door to enter new frontier regions, such as the Pernambuco-Paraíba and Jacuípe basins.

BNamericas takes a look at the areas being offered in the tender:

Campos basin: A total of 13 blocks (C-M-477, C-M-541, C-M-659, C-M-479, C-M-545, C-M-661, C-M-715, C-M-713, C-M-757, C-M-795, C-M-825, C-M-845, C-M-847) totaling 12,004km2 in three sectors is being offered in this basin. The region counts with a lot of infrastructure since it was the first in Brazil to begin offshore exploration, in 1950. The blocks on offer are located in the south of the basin in water depth of 2,500m to 3,500m and are covered by 2D seismic data. According to regulator ANP, these blocks have the potential for discoveries in pre-salt structures. Royalties for the areas amount to 10% and minimum signature bonuses range from 8.98mn reais to 1.375bn reais, the most expensive of the tender.

Camamu-Almada basin: The four blocks on offer (CAL-M-126, CAL-M-252, CAL-M-316, CAL-M-376) total 2,986km2 in the north of the basin, with water depth from 3,000m to 3,5000m. Minimum signature bonuses vary between 2.36mn reais and 3.3mn reais, while royalties are fixed at 7.5% for each area.

Jacuípe basin: Companies will have the opportunity to bid for three blocks (JA-M-26, JA-M-43, JA-M-45) in this new frontier basin, totaling 2,006km2. Blocks in the basin were offered in Brazil's 13th bidding round in 2015 but did not garner interest. So far, the region has never had confirmation of oil reserves but ANP believes it has similarities with other producing basins such as Sergipe-Alagoas and Camamu-Almada. For the 16th tender, the blocks on offer are in areas with water depth from 3,000m to 3,5000m and have minimum signature bonuses of between 1.7mn reais and 2.6mn reais. Blocks in the basin will have the lowest royalties in the tender at 5%.

Pernambuco-Paraíba basin: This new-frontier basin will have five blocks on offer (PEPB-M-731, PEPB-M-787, PEPB-M-843, PEPB-M-898, PEPB-M-900) covering 3,809km2 in water depth of between 1,000km and 3,500km. According to ANP, this is the basin with the least geological data and is the only area in the country where no offshore well has been drilled. Blocks in the basin will have the lowest royalties in the tender at 5%. Signature bonuses are also the smallest of the auction, ranging from 1.596mn reais to 2.469mn reais.

Santos basin: A total of 11 blocks (S-M-766, S-M-881, S-M-883, S-M-88, S-M-887, S-M-889, S-M-1006, S-M-100, S-M-1494, S-M-1496, S-M-1500) covering 8,495 km2 are being offered in the northern part of the basin, near the border with the Campos basin. Santos is currently the Brazilian basin with the highest production and ANP believes the blocks have the potential for pre-salt discoveries. The areas on offer are located in water depth of between 2,500m and 3,000m and will be subject to 10% royalties, with minimum signature bonuses ranging from 13.5mn reais to 372mn reais.