Introduction:
Over the past 25 years, by exploiting its vast natural resources and huge labor pool and by taking advantage of large and well-developed agricultural, mining, manufacturing and service sectors, Brazil has become Latin America’s leading economic power, rapidly expanding its presence in global markets. The national oil company, Petróleo Brasileiro or Petrobras, was created in 1953. The monopoly enjoyed by Petrobras ended in 1997 with the constitutional change that liberalized the oil and gas sector, partially privatized Petrobras and opened the oil and gas sector to private and foreign competition.
More recently, the discovery of several potentially huge fields in the “pre-salt” layer of the deepwater offshore, beginning in late 1997 in the Santos basin and since then extending into the neighboring Campos and Espiritu Santo basins, has opened a new frontier, bringing both tremendous opportunities and daunting challenges. These pre-salt discoveries have triggered a reassessment of the Brazilian regulatory model and a restructuring of the Government’s role in the industry, bringing uncertainty for investors seeking to efficiently exploit the opportunities.
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