Three world leading oil firms to sit out bidding for Brazil oil reserve

Three of the world's leading oil companies, Exxon Mobil, BP and BG, have decided not to take part in the upcoming international bidding for rights to explore Brazil's deep-water Libra oil reserve, Brazil's National Petroleum Agency (ANP) said Thursday.

ANP Director General Magda Chambriard told the press that the three companies alleged specific, internal motives for not participating in the Oct. 21 bidding, but "reaffirmed their interest in Brazil."

At least 12 companies have already confirmed their intention to bid, but that figure may increase as the ANP concludes its confirmation process.

The agency is expecting as many as 40 companies to take part.

The Libra bidding will be the first to take place under the country's new production regime, which calls for Brazil's state- run oil and gas giant Petrobras to partner in all the consortiums with a minimum 30 percent stake, and to operate the oil reserve blocks.

The consortium that wins the bidding will be required to pay a bonus of 15 billion reals (6.8 billion U.S. dollars) to the Brazilian government in advance.

Libra, located in the Santos Basin, off Brazil's southeastern coast, is the largest deep-water oilfield discovered to date in Brazil, and is estimated to hold 8 billion to 12 billion barrels of oil, doubling the country's oil reserves. When fully operational, it is expected to produce 1 million barrels of oil per day.

Following recent revelations of U.S. spying on Brazil, especially on Petrobras, there was speculation that the bidding may be postponed or that U.S companies may be barred from taking part in the process, on suspicions the U.S. oil sector may have benefited from compromised classified information.

Brazil, however, said it would go ahead with the bidding as planned.