Sector expert talks about the new CNPE 16 Resolution regarding the role of the ANP and the prices of natural gas in Brazil; event to take place at RCGI’s headquarters, in São Paulo

Paulo César Ribeiro Lima, an engineer with extensive experience in the petroleum and natural gas sector, will be at the FAPESP Shell Research Centre for Gas Innovation (RCGI) this coming July 31, from 11:00 a.m. to 12 noon, speaking on “Perspectives for the regulation of natural gas in Brazil”. Ribeiro Lima was a legislative consultant for the Federal Senate and the House of Representatives for 15 years, Professor in the Postgraduate Program in Engineering at the Federal University of Rio de Janeiro (COOPE/RJ), as well as employed by the Petrobras Research Center (CENPES).

Organized by the RCGILex team, coordinated by Professor Hirdan Katarina de Medeiros Costa, the lecture will take place at the RCGI’s headquarters on the first floor of the Mechanical and Naval Engineering Building of USP’s Polytechnic School (Address: Av. Professor Mello Moraes, 2.231, Cidade Universitária, São Paulo). The event is free of charge and open to the general public. To sign up, send an e-mail to rcgi.lex@usp.br.

“I will discuss the CNPE’s Resolution 16, the role of the National Petroleum, Natural Gas, and Biofuels Agency (ANP) in regulating the natural gas sector, and deal with details of the reasons why natural gas prices continue to be so high in Brazil,” says Ribeiro Lima, who will come from Brasília to also participate on the PhD examining board of one of the researchers of the RCGI, in São Paulo.

According to him, the ANP should take a more assertive stance in regulating Brazil’s natural gas sector. “The Agency approves the plan for field exploration without taking the economic use of natural gas into consideration. In other countries, this would be inadmissible. The reinjection of natural gas has been growing considerably in Brazil. And reinjected natural gas pays no royalties, as though it doesn’t exist. In the end, that jeopardizes the Government since, in the sharing contracts, for example, part of the petroleum and natural gas extracted belongs to the Government,” he states.

New market – As Ribeiro Lima sees it, Resolution 16, recently edited by the National Energy Policy Council (CNPE) with guidelines for implementing the New Natural Gas Market, is a step in the right direction. But the market, on its own, will not resolve the problems of the price of natural gas, as is affirmed by officials of the Federal Government.

“A good example: we sell to NTS and to TAG, two natural gas transporters that belong to Petrobras. TAG was sold for US$ 8.6 billion. Of that amount, more than US$ 20 million were borrowed from banks. That is: the companies will have to pay that money to the banks. When submitting their cost sheets, they will argue that they will need to make payments towards the US$ 8.6 billion and to pay the banks. That means: there is no possibility of reducing transportation tariffs on natural gas in Brazil.”

Privilege – The event is part of a series of presentations and workshops carried out for nearly two years by the team working with the RCGILex – a set of digital editorial products used to gather and analyze the legal and regulatory standards applied to the Brazilian natural gas sector, and developed within the scope of the RCGI’s Project 21.

“One of the RCGILex objectives is to bring in outside experts to give presentations and workshops that enrich the content of our publications. We stimulate constant dialogue and interaction between the market and academia. Paulo César is a specialist with immense experience in the petroleum and natural gas sector, and enjoys great prestige in the market. It is a privilege to be able to have him come to be with us,” states Professor Hirdan Katarina de Medeiros Costa.