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Oil auctions in Brazil this year could attract investments of up to US$6bn, breathing new life into a sector hammered by corruption and the country's worst-ever recession, according to the ABESPetro industry association.
ABESPetro president José Firmo highlighted a new law that ends the pre-salt monopoly of state-run firm Petrobras, the relaxation of local content rules and the creation of an auction calendar as reasons for investor optimism.
"We need to bring back investment because exploration and production activity has been drastically reduced, affecting all parts of the supply chain and leading to huge job losses," Firmo said.
He added that expected new investments would allow the local sector to make a full recovery within three years.
Firmo's comments were part of a report published by ABESPetro in conjunction with consultancy firm Accenture.
The Brazilian government has said it will stage four oil and gas tenders this year. An auction of marginal areas is due to be held in May followed by a second pre-salt round in June or July, according to hydrocarbons regulator ANP. The country's 14th licensing round and a third pre-salt auction are scheduled for the second half of the year.
The auction plans come as international oil prices emerge from a three-year slump.
Brent crude futures were trading at US$51.70/b on Monday, up from a 12-year nadir of US$28/b in January last year. Prices peaked at more than US$110/b in June 2014.
The improved outlook has prompted Petrobras to predict capital investment of US$19bn this year, up from US$14.5bn in 2016.