ANP publishes resolution on the access to waterway terminals

On July 12, 2022, the National Agency of Petroleum, Natural Gas and Biofuels (“ANP”)  published ANP Resolution No. 881/2022, which regulates the provisions of Law No. 9,478/1997 (“Oil Law”), establishing conditions for the access to existing or to be built waterway terminals for the movement of oil, oil products, natural gas products, and biofuels, revising ANP Ordinance 251/2000. 

Within the main aspects of the new Resolution, a noteworthy inclusion is the owner’s pre-emption right to use the totality of the terminal’s maximum handling capacity for the first ten (10) years, counted from the issuance of the first authorization to operate the facility. After this period, the ANP will evaluate, every five (5) years, the terminal owners’ preference status.  

The new Resolution also extinguishes the impossibility of contracting the capacity of a terminal by a single user, allowing this to occur, provided that the operator makes a public offer of the available capacity and that other parties do not show interest in its use. 

Furthermore, the Resolution establishes rules aiming the deverticalization of the sector by making provisions for the need to separate the activities of production, importation, and distribution of products from those to be carried out by the terminal operator. As a result, the rule that was previously valid only for Petrobras will apply to the other entities operating in the sector in an isometric manner. 

Among other aspects, the new rules also impose that terminal operator must keep permanently updated on their website the terminal’s maximum handling capacity and its calculation report, among other elements related to the terminal’s operation.  

To access ANP Resolution No. 881/2022, click here. 

Resolution that regulates the delivery of technical data from exploration and production activities approved

On July 13, 2022, ANP published Resolution No. 880/2022, which provides for the delivery, evaluation, content and form of technical data for exploration, development and production of oil and natural gas. 

According to the ANP, the recently published Resolution aimed to combine and consolidate the provisions of six (6) regulatory acts that specify the requirements for the delivery of technical data to the ANP. The measure is the result of the ANP’s efforts to standardize and homogenize technical data requirements.  

Click here to read ANP Resolution No. 880/2022 in full. 

Resolution that establishes procedures for incident reporting approved

On July 26, 2022, the Collegiate Board of the ANP approved ANP Resolution 882/2022. The Resolution essentially addresses (i) the deadlines and procedures to be adopted for reporting incidents that occur in activities regulated by the ANP; and (ii) the content and submission of detailed incident investigation reports (“RDI”) by operators of oil and natural gas exploration and production agreements, as well as by companies authorized to carry out activities related to the oil, natural gas and biofuels industry. 

The new Resolution aims to revise ANP Resolution 44/2009 in order to modernize the rule, finding more parity with international concepts, as well as standardizing the procedure among industry segments and simplifying the approach to the topic. 

To access ANP Resolution No. 882/2022, click here.

UPCOMING PUBLIC CONSULTATIONS AND HEARINGS

Listamos abaixo as consultas públicas publicadas pela ANP e cujos prazos para contribuição ainda estão em aberto:

RELEVANT DECISIONS

ANP approves first proposal for the execution of local content Conduct Adjustment Term

On July 14, 2022, the Collegiate Board of the ANP approved the first proposal to execute a Conduct Adjustment Term (“TAC”) under the terms of ANP Resolution 848/2021. The approved TAC only involves blocks and fields operated exclusively by Petrobras, which have not complied with the local content clause in terminated oil exploration and production contracts or contracts with exploration or production phases ended.   

Under the terms of the proposal approved, an amount of BRL 855,064,652.34 (updated until Dec/2021) will be invested by Petrobras in goods and services of the domestic industry, with certified local content. According to the information disclosed by the ANP, the total value of the investments that will be made by Petrobras exceeds the amount of the fines that would be applied for the non-compliance with the local content that occurred.   

For further information, click here.

Upstream Opportunities

Petrobras announces non-binding phase of UEGA sale

As announced on July 12, 2022, Petrobras began the non-binding phase for the sale of its entire 18.8% interest in the company UEG Araucária S.A. (“UEGA”). 

UEGA is a company established between Copel Group and Petrobras, consisting of a natural gas power plant (combined cycle, with two gas turbines and one steam turbine), located in Araucária-PR, near the Bolivia-Brazil gas pipeline (GASBOL). 

For further information, click here.

Petrobras extends the deadline for participation in the sales process of its refining assets

On July 15, 2022, Petrobras announced that it has extended the deadlines for participation in the sale processes of the Abreu e Lima Refinery (RNEST), in Pernambuco; the Presidente Getúlio Vargas Refinery (REPAR), in Paraná; and the Alberto Pasqualini Refinery (REFAP), in Rio Grande do Sul, as well as the logistics assets integrated to these refineries. As a result, potential buyers had until July 29, 2022 to express their interest in participating in the sales processes, and must sign the Confidentiality Agreement and the Statement of Compliance by August 12, 2022. 

For further information, click here.

Public Notice and contracts for Open Acreage –  Production Sharing, published

On July 28, 2022, the ANP announced the publication of the Tender Protocol and the contract models for the Open Acreage, under the Production Sharing regime, for the granting of contracts for exploration and production of oil and natural gas. The blocks offered in this system are permanently available to the enrolled regulated agents, that can express interest and submit offer in due course.  

With the publication of the Tender Protocol, the ANP can start evaluating the applications of the bidders interested in participating in the Open Acreage – Production Sharing and follow up on the procedures applicable to the effective bidding for the areas on offer.   

As informed by the ANP, six (6) of the eleven (11) blocks on offer (Ágata, Água Marinha, Esmeralda, Jade, Turmalina and Tupinambá) in the Santos Basin were planned to be offered in the 7th and 8th production sharing bidding rounds, which never took place. The others did not receive offers in previous Production Sharing Bidding Rounds held by the ANP, as follows: Itaimbezinho (4th Production Sharing Bidding Round, Campos Basin), Norte de Brava (6th Production Sharing Bidding Round, Campos Basin), Bumerangue, Cruzeiro do Sul and Sudoeste de Sagitário (6th Production Sharing Bidding Round, Santos Basin). It is important to note that, exercising its right under Law 12,351/2010 and Decree 9,041/2017, Petrobras has expressed interest in acting as operator, with mandatory 30% interest in the Água Marinha and Norte de Brava Blocks. The other blocks will be bid on with no indication of mandatory interest by Petrobras. 

To access the full content of the documents, click here. 

Public bidding opportunities with Petrobras

Below are the main contracting opportunities made available by Petrobras so far, through the Petronect platform (click here to access):

* Dates are expressed here as DD/MM/YYYY
** Please note that the deadlines in the table above are constantly changing, so the information herein corresponds to deadlines disclosed at the time of publication of this newsletter. 

Read in full on Petronect platform

ANP and Petrobras execute agreement and contract regarding oil and gas production by SIX

On July 1, 2022, the ANP and Petrobras executed the agreement for the collection of royalties related to the production of oil and gas at the Shale Industrialization Unit (SIX), located in São Mateus do Sul/PR, and operated by Petrobras, as well as the concession contract for the exploration and production of oil and natural gas from shale.  

The agreement was concluded, resolving in a consensual manner the pending issues related to the collection of royalties and to the regulatory regime related to shale mining activities, and also provides for the payment of around BRL 600 million by Petrobras, in addition to the formalization of a concession contract with a 5% royalty rate. 

The execution of the royalty collection agreement and the execution of the concession contract will have great socioeconomic impact on the region, both in relation to the distribution of the royalty amounts to the beneficiaries, and in the continuity of the production activities in the concession area.   

For further information, click here.

ANP publishes notice to intensify monitoring of the A S10 diesel oil market

On July 1, 2022, the ANP published the fuel supply “alert” No. 02/2022/SDL/ANP, aiming to intensify the monitoring of imports of diesel oil A S10. This alert aims to provide an intensification of the monitoring of diesel A S10 imports, in view of the current global geopolitical situation. 

The fuel supply alert No. 01/2022/SDL/ANP, published on March 22, 2022, had already requested to the fuel producers listed therein to begin to inform the ANP daily of their own stocks and contracted imports of gasoline A, diesel oil A S 10, diesel oil A S 500, aviation kerosene (QAV) and LPG.  

After the publication of the fuel supply alert No. 02, the producers listed therein (the same ones that were already listed in the fuel supply alert No. 01/2022/SDL/ANP) will also have to report to the ANP, by means of a specific form, a series of information in relation to the already contracted imports of A S10 diesel oil that have not yet been nationalized. 

Further information can be found on the fuel supply alert page.

ANP releases consolidated oil and gas production data for May

On July 6, 2022, the ANP published the Monthly Newsletter of Oil and Natural Gas Production with the consolidated data of the national production for the month of May. Approximately 2.879 MMbbl/d (million barrels per day) of oil and 132 MMm3/d (million cubic meters per day) of natural gas were produced, totaling 3.707 MMboe/d (million barrels of oil equivalent per day).   

The information can also be accessed, interactively, in the Dynamic Dashboards of Oil and Natural Gas Production. To see the Newsletter, click here. 

CONFAZ and RFB publish Sinief Adjustment ANP No. 26/2022 to address tax obligations related to the processing of natural gas

On July 06, 2022, the National Council of Treasury Policy (CONFAZ) and the Special Department of the Brazilian Federal Revenue Office published Sinief Adjustment No. 26/2022, which amended Sinief Adjustment No. 01/2021, improving the treatment applicable to the Tax on Operations Related to the Circulation of Merchandise (“ICMS”) taxpayers for compliance with tax obligations related to the processing of natural gas. 

Among the many changes implemented by the Resolution, the following can be highlighted: 

The extension of the invoice issuance deadline (from the 3rd to the 4th business day of the month following the shipment), in accordance with cases in which the orderer requires the industrialization of goods, with the supply of unprocessed natural gas acquired from a supplier who carries out direct delivery to the industrializer, and in the case of outputs of processed natural gas to be moved from the Natural Gas Processing Unit (“NGPU”) by pipeline, without the provision of transportation services;

1. the elimination of the requirement that additional industrialization return invoices shall be issued in a “proportional” manner in cases in which it is not possible to reference all the invoices required by the rule in a single return invoice (clause thirteen, paragraph 3);
2. the possibility of symbolic transfers between establishments of the same taxpayer, located in the same State, prior to the shipment of unprocessed natural gas for industrialization, or to enable mutual transactions with third parties;
3. regulation regarding the mutual operation of processed natural gas intended to match the quantities injected in the pipelines connected to the NGPU with the quantities effectively allocated to a given agent by the industrializer, in which case the industrializer will be responsible for controlling the quantity borrowed between the ordering parties and the industrializer-user itself;
4. the extension of the differentiated treatment to natural gas suppliers and traders, that must also be licensed by their respective federal units.

ANP updates the list of Local Content certification bodies

On July 07, 2022, the ANP updated the list of local content certification bodies that are allowed to issue local content certificates. 

To check the list, click here.

ANP holds public hearing on biomethane

On July 8, 2022, the ANP held a public hearing regarding the amendment of ANP Resolution No. 685, dated June 29, 2017, which establishes the specification of biomethane from landfills and sewage treatment plants.    

The aim of the draft resolution is to gather contributions regarding compliance, by biomethane producers with ANP Resolution No. 685/2017, in relation to the methodology of analysis of halides, which are compounds that are harmful to health and/or can, among others, damage energy production equipment, vehicle engines and that need to be removed in the biomethane production process.  

For further information, click here.  

To access in full of public hearing No. 12/2022, click here.

ANP held public hearing on the adoption of preventive measures in relation to diesel A S-10 inventories

On July 12, 2022, the ANP held a public hearing on two proposed resolutions concerning fuel stocks, especially A S-10 diesel oil.   

Aiming to act in a preventive manner in case there is a disruption in international import logistic flows, the ANP verified the need to regulate the formation of A S-10 diesel oil stocks in volumes higher than those already established in ANP Resolution No. 45, dated November 22, 2013.  

Two draft resolutions had to be structured:  

• The first to amend ANP Resolution No. 53, dated December 2, 2015, in order to allow the ANP to determine the maintenance of stock volumes of liquid fuels, LPG and aviation fuels at levels higher than those established in specific ANP regulations on the topic, when an emergency supply situation is declared; and  

• The second aims to establish the procedures for stockpiling A S-10 diesel oil, in the second half of 2022, in accordance with the fuel supply statement “alert”.  

 To learn more about the measures adopted by the ANP in relation to diesel A S-10 stocks, click here.

ANP holds public hearing on changes to diesel fuel specifications

On July 15, 2022, Public Hearing No. 11/2022 was concluded, concerning the draft resolution that determines the new national specifications for S10 and S500 diesel oils for road use as well as the quality control measures, among other determinations.  

The new Resolution will rectify ANP Resolution No. 50/2013 in relation to the ANP’s role in promoting regulatory quality improvement. The draft is aligned with Resolution No. 16/2018 of the Brazilian National Council for Energy Policy (CNPE), which provided for the ANP to improve the quality specifications for biodiesel and diesel oils A and B.   

To learn more about the submitted proposals and other details of the public hearing, click here.  

To access the recording of public hearing No. 11/2022, click here.

Power and Renewables

MME establishes guidelines for A-5 and A-6 New Energy auctions

On July 13, 2022, the Ministry of Mines and Energy (“MME”) published Ordinance No. 047/2022, establishing Guidelines for the Auctions for Purchase of Electricity Resulted from New Energy Generation Projects, named New Energy Auctions “A-5” and “A-6”, of 2022. Auction “A-5” will take place before Auction “A-6”, considering that a potential unsuccessful purchase of the first auction will not be contracted at the Auction “A-6”. Both are expected to be held sequentially on September 16, 2022.

It is important to highlight that, on July 20, 2022, the MME made publicly available the Digital Statement System (“DDIG”)  including the “Statement on the Needs to Purchase Electricity” and the document “Electricity Purchase Agreement”, of the Distribution Agent. According to the auction rules, such documentation should have been sent by the Distributor by July 29, 2022.

Read in full

Legal Framework for GD vetoes are overruled

On July 14, 2022, the House of Representatives voted and overruled the veto of two relevant provisions of Law No. 14,300/2022 (Legal Framework for Distributed Microgeneration and Minigeneration – “GD”).

Following the subsequent return into effectiveness of paragraph 3 of Art. 11 of the Law, it will be possible to divide the power generation facilities into smaller units in order to fit the power limits for micro or mini-GD, in the case of floating generation units installed on a natural or artificial water surface of water reservoirs, dams, and lakes.

Also, following the return into effectiveness of the sole paragraph of Art. 28 of the Law, distributed minigeneration projects will be considered as projects of electricity generation infrastructure for:

1. classification into the Special Tax Incentive Framework for the Development of Infrastructure (“REIDI”);
2. investment through the Equity Investment Fund on Infrastructure (“FIP-IE”) and Investment Fund for Participation in the Intensive Economic Production in Research, Development, and Innovation (“FIP-PD&I”); and
3. issuance of Infrastructure Debentures.

According to procedures established in paragraph 5 of Article 66 of the Federal Constitution and the Common Rules of the National Congress, the next step is the promulgation of rejected vetoes, so that the vetted texts be rewritten into Law No. 14,300/2022.

Until this moment, no promulgation has been carried out

Read in full – Veto No. 9/2022

MME opens Public Consultation on the opening of the free market

The Ministry of Mines and Energy published on July 26, 2022, Ordinance No. 672/GM/MME, opening Public Consultation No. 131/2022 and announcing an ordinance draft on the reduction of the charge limit for the contracting of electricity by consumers in the free market. Interested parties can submit contributions by August 25, 2022.

Check out our client alert here for a more detailed theme analysis.

NEWS

CNPE approves resolution on the Recovery Plan for the Regularization Reservoirs of Hydroelectric Power Plants in Brazil

At a meeting on July 11, 2022, the Brazilian National Council for Energy Policy (“CNPE”) approved a resolution on the Recovery Plan for the Regularization Reservoirs of Hydroelectric Power Plants in Brazil (“PRR”), as determined by the Law for privatization of Eletrobras, Law No. 14,182/2021. The measure is still pending approval from the President of Brazil.

As announced by the CNPE, the Plan will contribute to the structuring of measures concerning the “recovery plan for the regularization reservoirs of hydroelectric power plants in Brazil, subject to a multisectoral evaluation that favors both the national energy supply, and the preservation of water uses. Among the expected goals is the gradual recovery of the storage levels of the reservoirs of the Brazilian hydroelectric plants”.

Read in full

ANEEL extends deadlines to adapt to changes of REN No. 1,000/2021

On July 14, 2022, ANEEL’s Normative Resolution (“REN”) No. 1024/2022 was published, amending Art. 668 of the Rules of Electricity Transmission Systems – REN No. 1,000/2021.

Following the amendment, electricity distribution concessionaires (“Distributors”) will have until September 30, 2022, to adapt their rules regarding proceedings carried out in the event of measurement defects and other irregularities.

In addition, for the development and approval of the budget related to the connection between electricity generation facilities, the Distributors will consider the following deadlines:

1. 120 days for connection of the electricity generation facility, other electricity distributors, import or export electricity agent; and
2. 60 days for consumer units supplied by distributed minigeneration.

These rules apply to cases filed by December 31, 2022.

The rule entered into force on August 01, 2022.

Read in full

MCTI ordinances establish measures for hydrogen studies

On July 15, 2022, the Ministry of Science, Technology, and Innovations (“MCTI”) published Ordinances No. 6,100/2022 and 6,101/2022, both establishing measures to improve hydrogen studies.

Ordinance No. 6,100/2022 establishes the Brazilian Hydrogen Initiative (“IBH2”), aimed at developing, integrating, and reinforcing government measures within the scope of hydrogen and its applications, focused on technological development and promotion of innovation and entrepreneurship.

According to the rule, topics such as hydrogen production from renewable sources, hydrogen storage, hydrogen transport, hydrogen applications in the electricity sector, among others, will be prioritized within the scope of “IBH2”. Strategic programs will be developed to address these topics, such as research and development networks, international cooperation, and hydrogen laboratories.

In parallel, Ordinance No. 6,101/2022 establishes, within the scope of the MCTI, the Brazilian System of Hydrogen Laboratories (“SisH2-MCTI”) as one of the instruments of the Brazilian Hydrogen Initiative (“IBH2”), in favor of technological development, innovation and entrepreneurship.

SisH2-MCTI will consist of a set of laboratories and laboratory networks of open access to the public, focused on research, development, and provision of technological services, entrepreneurship, and hydrogen innovation.

Measures such as these, from other Executive branches, demonstrate that the use of this energy source is crucial and must be studied and developed at a national level. Such measures can potentially encourage the joining of new players in this niche and demonstrate that hydrogen as an energy source must improve.

See full – Administrative Rule 6,100/2022

See full – Administrative Rule 6,101/2022

EPE, WEF and BID publish a document to boost energy investment in Brazil

On July 20, 2022, the Energy Research Company (“EPE”) published a document, jointly drafted with the World Economic Forum (“WEF”) and the Inter-American Development Bank (“IDB”), entitled “Mobilizing Investment for Clean Energy in Brazil – Country Deep Dive”.

The document gathers available investment opportunities, as well as proposals for improving certain aspects of the electrical sector, so that they receive greater investments. The priority areas highlighted in the document are distributed generation, modernization of hydroelectric power and isolated systems.

Read in full

Technical departments at ANEEL issue opinion on ratification of new CCEE Arbitration Convention

On July 21, 2022, Technical Note No. 91/2022–SRM-SMA/ANEEL was issued within the scope of proceeding 48500.003672/2002-61, whereby the Superintendence of Economic Regulation and Market Studies (“SRM/ANEEL”) and the Superintendence of Administrative Mediation, Sectorial Complaints Office, and Public Participation (“SMA/ANEEL”) examined the new Arbitration Convention of the Electric Energy Trading Chamber (“CCEE”).

The Convention was approved at the 68th Extraordinary General Meeting of the CCEE to join the Convention of Electric Energy Trade. Below are some highlights of the new Convention:

• multiple Arbitration Chambers for dispute resolution will be allowed as an alternative to the Arbitration Chamber of Fundação Getúlio Vargas;
• an express provision clarifying that the arbitration proceeding is not mandatory for bilateral conflicts that do not affect third-party rights and, therefore, do not affect CCEE operations;
• an express provision on the carrying out of judicial proceedings by the CCEE for collection of amounts due by agents or non-agents, including penalties;
• requirement for guarantees within the scope of the arbitration proceeding, so that the financial effects of decisions resulted from bilateral conflicts are attached to the parties involved in such arbitration proceeding;
• creation of a court reporter concerning amendments (statements of arbitration awards) in the Arbitration Chambers for case law purposes.

The Superintendencies forwarded the proceeding for a decision by  a director at ANEEL, deciding for ratification of the new Convention. The proceeding was allocated for director Francisco Bassi.

Technical Note No. 91/2022–SRM-SMA/ANEEL can be found in the proceeding “ANEEL” 48500.003672/2002-61.

ANEEL approves draft of Transmission Auction Notice and refers to TCU examination

At the Board of Directors meeting of July 26, 2022, “ANEEL” approved the draft of Auction Notice No. 2/2022-ANEEL, for the concession of 6 (six) lots of electricity transmission plants located in the states of Espírito Santo, Maranhão, Minas Gerais, Pará, Rio de Janeiro, Rio Grande do Sul, Rondonia and São Paulo.

After the approval, the draft was referred for examination by the Brazilian Federal Audit Court (“TCU”).

In addition, it was determined that the concessionaires that own the facilities in which the auctioned transmission plants will be connected must schedule, at the request of interested parties, and authorize, by November 25, 2022, the visit of interested parties, within the shortest timeframe possible.

The Auction is scheduled to be held on December 16, 2022.

Read in full – ANEEL meeting minutes

ANEEL publishes rule on allocation of guaranteed power output shares for Angra I and II, and Itaipu power plants

On Tuesday, August 02, 2022 ANEEL published REN No. 1,028/2022, improving rules on the allocation of guaranteed power output shares  of Law No. 12,783/2013, of Angra I and II and Itaipu, for Distributors whose annual market is of less than 70 GWh/year and with the calculation of the financial component for electricity distribution permit holders. The rule results from Public Consultation No. 75/2021.

Read in full

ANEEL consolidates rules on “Generation and Trading of electricity”

On August 02, 2022, “ANEEL” published REN Resolutions No. 1,029/2022, No.1,030/2022, No. 1,031/2022, No. 1,032/2022, No. 1,033/2022, No. 1,034/2022, No. 1,035/2022 and No. 1,036/2022, which consolidate the topic “Generation and Trading of Electricity”.

The measure results from Public Consultation No. 17/2022 and Decree No. 10,139/2019, which provides for the revision and consolidation of normative acts inferior to the decree.

The consolidated rules, which can be accessed through the links, address the following topics:

On July 28, 2022, ANEEL published Resolution REN No. 1,027/2022, establishing the requirements and procedures for:

1. extension of concessions for the Use of Public Property;
2. modification of the exploitation framework related to concessions of the hydroelectric plants destined to the Public Service;
3. mapping of the real estate connected to hydroelectric power plant concessions;
4. calculation of the portion of investments connected to reversible assets;
5. calculation methodology of the payment amount for Use of Public Property; and
6. calculation and payment of the Financial Compensation for use of water resources for purposes of generating electricity and of Itaipu Royalties.

Such measure results from Public Consultation No. 12/2022, and Decree No. 10,139/2019, which provide for the review and consolidation of the normative acts inferior to the decree.

Read in full

CONSULTATIONS AND PUBLIC HEARINGS

WHAT’S COMING UP

	September 16, 2022 – New Energy Auctions A-5 and A-6 Notice: ANEEL (to be published) More information here
	September 30, 2022 – Auction for contracting Reserve Capacity, in the form of reserve energy under the terms of Law No. 14,182/2021 Notice: ANEEL (to be published) More information here
	October/2022 – Auction for Supply of Isolated Systems Notice: ANEEL (to be published) More information here
	November/2022 – Auction for Contracting Reserve Capacity in the form of power capacity Notice: ANEEL (to be published) More information here
	December, 2022 – New Energy Auctions A-1 and A-2 Notice: ANEEL (to be published) More information here
	December, 2022 – Transmission Auction No. 2/2022 Notice: ANEEL (to be published) More information here