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OPPORTUNITIES AND RISKS IN BRAZILIAN OIL & GAS By Rafael Lourenço Manager, Oil & Gas Working Group May 16, 2012.

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Presentation on theme: "OPPORTUNITIES AND RISKS IN BRAZILIAN OIL & GAS By Rafael Lourenço Manager, Oil & Gas Working Group May 16, 2012."— Presentation transcript:

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2 OPPORTUNITIES AND RISKS IN BRAZILIAN OIL & GAS By Rafael Lourenço Manager, Oil & Gas Working Group May 16, 2012

3 Operates under the administrative aegis of the U.S. Chamber of Commerce Brazil Section of the council managed by the Brazilian National Confederation of Industry (Confederação Nacional da Indústria – CNI) Informal advisor to Strategic Energy Dialogue (MME-DOE) Support to U.S.-Brazil CEO Forum Oil & Gas Working Group based in Rio de Janeiro Private sector organization, founded in 1976 and focused on promoting the free flow of trade and investment between Brazil and the United States U.S. Section of the council represents major U.S. companies invested in Brazil

4 BRAZIL COUNCIL LEADERSHIP Greg Page Chairman, U.S. Section CEO, Cargill Robson Andrade Chairman, Brazil Section President, National Confederation of Industry Apple

5 Opportunities - Exploration & Production Pre-Salt – most attractive with option to operate concession 11 th bidding round for shallow water and onshore concessions – expedite launch of next round

6 Risks - Exploration & Production Legal risk – Chevron case Labor risk – obtaining qualified workers in country; moving technical workers in and out of country Importation risk – REPETRO interpretation; delays in importation of emergency parts Local content risks – need for greater standardization of local content in auctions; investment in education should count

7 Opportunities – Natural Gas Complex Explosive growth in domestic demand medium-long term Easily exploited hydro running out Gas currently burned at wellhead US know-how and its own significant development in this market makes Brazil-U.S. cooperation attractive option Nuclear on hold

8 Risks – Natural Gas Complex Legal & Regulatory structure does not yet value reliability of thermal Requirement that companies guarantee gas availability in auctions big source of risk Regional auctions would allow for testing of models with greater thermal participation

9 Opportunities – Maritime Support Large coming gap in supply of local maritime support vessels and services Reason: local players over leveraged and over capacity Significant opportunity for investment in local shipyard and offshore operations base

10 Opportunities – Repair 2-3 years from now Brazilian offshore fleet will begin to require repairs. No domestic shipyards available. Current solution is to take to Caribbean or Argentina – significant opportunity for experienced foreign players with capital to invest in Brazil

11 Rafael Lourenço Manager, Oil & Gas Working Group Brazil-U.S. Business Council Tel: Cel: THANK YOU


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