Brazil Opposition Parties Threaten to Challenge Pre-Salt Rules

By Fabiola Moura
Aug. 30 (Bloomberg) -- Three of Brazil’s opposition parties said they may challenge President Luiz Inacio Lula da Silva’s plan for exploring the biggest oil find in the Americas since 1976.
Lula is turning proposed regulations for development of the so-called pre-salt area into electoral “hoopla,” according to a statement signed by Sergio Guerra, president of the Social Democratic Party, known as PSDB; Roberto Freire, president of Brazil’s Popular Socialist Party, known as PPS; and Rodrigo Maia, president of the Democrats, a party known as DEM.
While Lula sees approval of the rules as a “mere formality,” the opposition parties “will be able to question the need and convenience of altering today’s law,” according to the statement, published on the parties’ Web sites.
The government is scheduled to release details tomorrow in Brasilia of the proposed regulations, which require congressional approval.
The pre-salt area runs 800 kilometers (500 miles) along the coast and includes the Tupi and Carioca fields, where crude is trapped under salt as much as 5,000 meters below the seabed. About 62 percent of the region has yet to be opened up to oil and gas exploration.
Petroleo Brasileiro SA, Brazil’s state-controlled oil company, discovered the Tupi field, with estimated reserves of as much as 8 billion barrels of oil, about three years ago. The find is the largest oil discovery in the Western Hemisphere since that of Mexico’s Cantarell more than three decades ago.