On July 1, 2020, the National Council of Energy Policy ("CNPE") published Resolution No. 04/2020 ("Resolution"), which provides for the royalty reduction and stimulus to small or medium-sized companies in the oil and natural gas exploration, development and production activities.
In support of the National Energy Policy, the Resolution
establishes that the National Agency of Petroleum, Natural Gas and
Biofuels ("ANP") assess the application of measures for a
royalty reduction of up to 5%, pursuant to article 47, paragraph 1,
of Law No. 9,478/1997 ("Petroleum Law") for fields
awarded to companies classified as small or medium-sized in
accordance with ANP criteria.
The Resolution also recommends that the ANP continue studying, and
eventually implementing, incentives for exploration, development
and production (i) by small or medium-sized companies and (ii) in
relation to hydrocarbon accumulations or fields with marginal
economics.
Originally published 8 July 2020.
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