Government launches program to encourage shale gas exploration

On December 30, 2021, President Jair Bolsonaro approved the launch of a program to encourage the exploration and production of oil in unconventional deposits, such as shale gas, which changed the energy scenario in the United States.

The program aims to try to remove obstacles impeding the environmental licensing of the activity, which is accused of causing damage to communities surrounding exploration sites in some American regions and was banned by several Brazilian cities from the mid-2010s.

Unconventional deposits are those found in rocks with low permeability, unlike pre-salt rocks, for example, whose pores ensure the displacement of oil and gas to the pipelines that take them to the platforms.

In non-conventional ones, it is necessary to make fissures in the rock for the deposited material to move, in a process known as hydraulic fracturing, which injects large amounts of water underground at high pressures.

In an order published on the 30th, Bolsonaro approved the CNPE’s resolution that proposes the reduction of the royalty rate charged on these deposits to 5% of the production value; in other oil fields in the country, a 10% royalty rate is generally charged.

The text also authorizes the allocation, as provided by all oil concession contracts, of mandatory research investments, which are equivalent to 1% of the revenue of each project, and determines the opening of notice for qualification to a program called Poço Transparente.

Source: Valor Econômico

To read the full original article, please visit:

https://valor.globo.com/brasil/noticia/2021/12/30/governo-lanca-programa-para-incentivar-exploracao-de-gas-de-xisto.ghtml

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