Lula asked to take Brazil oil bill off fast-track

Wed Sep 2, 2009 6:04pm EDT
BRASILIA, Sept 2 (Reuters) - Congressional leaders in Brazil urged President Luiz Inacio Lula da Silva on Wednesday to take his proposed oil legislation off a fast-track and allow more time for debate.
Lula presented on Monday a proposal that would increase state control over oil reserves, create a federal fund to finance health and education spending, and make state-run energy company Petrobras (PBR.N)(PETR4.SA) the sole operator of massive, new oil reserves.
It would also create a new state agency administrate oil contracts. [ID:nN31334035]
Michel Temer, head of the Chamber of Deputies, the lower house of Congress, told Lula party leaders even from his own coalition opposed fast-track, which obliges both houses of Congress to vote on the proposal within 45 days.
Lula will discuss the matter on Thursday with congressional leaders of his 11-party coalition, Temer said.
The president could withdraw the fast-track request if Congress agrees to a reasonable timeline and to maintaining the spirit of the proposal, a member of Lula's cabinet said on condition of anonymity.
The proposal has a fair chance of winning approval but the government needs to move quickly, analysts said.
If the overhaul is not approved by June 2010, the country could get side-tracked by the World Cup soccer tournament and campaigning for the October 2010 presidential election.
Lula also hopes the proposal, which could make Brazil one of the world's top 10 oil exporters, will benefit his chosen presidential candidate, chief of staff Dilma Rousseff, who helped draft it.
(Reporting by Natuza Nery; writing by Raymond Colitt, editing by Alan Elsner