Back in May, while watching oil prices recover to just under $60 a barrel, I urged my Foolish friends to consider playing Brazil's deepwater boom even before watching oil prices increase further over the coming months With that in mind, let's check in on Brazil and take stock of the goings on of late.
Probably the most important event was the recent approval by the country's House of Representatives of what is being called a "Petro-Sal." Proposed in late summer by the nation's President Luiz Inacio Lula da Silva, its function would be to oversee exploration and production pacts in the pre-salt. And while the body was approved by a vote of 250 to 67, it still needs to gain the approval of the Brazilian Senate.
The process in the Senate will require the wording used be examined by several standing commissions, rather than by a special one. In an era of resource nationalism, I trust that the new organization will be passed. After all, one of its roles would be to garner more oil and gas revenues for the nation's government.
At the same time, Petrobras
Finally, the National Petroleum Agency -- more commonly referred to as ANP -- Brazil's oil regulator, has announced that it will initiate a new drilling program in a promising area during early December. According to Harold Lima, the Agency's president, the objective of the program is to discover reservoirs, each containing in the vicinity of 2 or 3 billion barrels of oil. The ANP apparently began with about 20 areas, and has subsequently reduced them to two.
One question then becomes the role that such publicly held companies as ExxonMobil
Beyond that, my advice is for Fools with a taste for energy to keep close tabs on Petrobras. With its close ties to the Brazilian government and the changes rapidly occurring in the country, it's difficult to see the company coming out a loser.
Petrobras has been awarded a full five stars by the 145,000 strong Motley Fool CAPS community. Does that ranking include your assessment?
