Brazil: Final Tender Protocol And Concession Agreement For ANP Round 11 Now Available

On March 11, 2013, Brazil's oil and gas regulatory authority, ANP, made available on its website the final Tender Protocol and the final version of the Concession Agreement for ANP Round 11, reflecting certain changes requested by the industry during public consultations and other clarifications.

Below are the next steps for ANP Round 11, which have now been ratified by the Final Tender Protocol:

TENDER PROTOCOL

Among the amendments introduced by ANP to the Tender Protocol, we believe that the following are worthy of special attention:

• Inclusion of 117 Blocks – Following approval by the Brazilian Energy Policy Council ("CNPE") on February 28, 2013, ANP included in the Tender Protocol 117 additional blocks located in the Espírito Santo (deep water), Pernambuco-Paraíba (deep water), Tucano Sul (onshore), and Foz do Amazonas (shallow and deep water) basins.
• Qualification documents may be submitted after "Expression of Interest" – ANP clarified that it is not necessary to submit all qualification documents in order to have access to the data package and evaluate the opportunities. The deadline for submitting required qualification documents and the Expression of Interest is March 26, 2013.
• Exchange rate and restatement index for investments in US$ to be evidenced in the technical qualification – Amounts in U.S. dollars invested in exploration activities in the past five (5) years to be communicated for purposes of technical qualification must be converted at the average exchange rate of the year that the investments were made (the "Ptax-sale" rate). All investments must be restated by the IGPM index that accrued through January 2013.
• Operator "A" with a 5-year minimum experience as operator – Companies willing to qualify as operator "A" can inform activities as operators that occurred in the past five (5) years.
• Corporate structure signed by the Accredited Representative – The description of the corporate structure must be signed by the company's Accredited Representative and must detail all direct and indirect control, including any holding companies or individuals that control or are controlled by the company, as well as indicate their respective equity ownership (including shares or quotas with voting rights) of such controllers or controlled entities.

To access the Portuguese version of the Tender Protocol, please click here. For your convenience, please click here for a redline version that compares the Draft Tender Protocol to its final form.

CONCESSION AGREEMENT

Please find below a list of material adjustments made by ANP to the final terms of the Concession Agreement:

• Local Content - ANP has included the lack of Brazilian suppliers as an event of waiver of the local content commitment.
• Development Plan – In response to industry requests, ANP has excluded Clause 10.2 of the Concession Agreement, which allowed ANP to participate in the technical meetings for preparation of the Development Plan. This item had been included in the Concession Agreements for previous rounds.
• Assignment – For the assignment proceeding, ANP has increased from thirty (30) to fortyfive (45) days the term for providing evidence of the filing of the consortium agreement with the competent commercial registry.

To access the Portuguese version of the Concession Agreement, please click here. For your convenience, please click here for a redline version that compares the Draft Concession Agreement and its final form.

Save the Date: Technical-Environmental Seminar and the Legal-Fiscal Seminar

On March 18-19, 2013, ANP will hold Technical-Environmental Seminar and Legal-Fiscal Seminar in Rio de Janeiro at the Windsor Atlântica Hotel (Av. Atlântica 1020, Copacabana). Registrations are open. To register, individuals must fill out an online form that can be found at:

http://www.brasil-rounds.gov.br/round11/portugues_r11/seminarios.asp

ANP has indicated that seats for the seminars will be allotted on a first-come basis, the online preregistration serving only to process registrations more quickly and therefore timely starts on the day of the events.

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