Unitization In Brazil

The unitization in Brazil follows the basic principles of unitizations in the international oil and gas industry. In terms of specific regulations, it is adapted to the Brazilian regime which today involves concession, production sharing and the onerous assignment to Petrobras.

The unitization as in any other country applies to the situations that a reservoir extends the boundaries of a contracted block. The goal is to regulate the participation of the parties form the different contracted blocks or between the parties from one block and the Government in case the reservoir extends to an area not yet granted to an oil company. The concept is that the parties would be entitled to a fair interest of the reservoir considering the original participation in the blocks involved in the unitization. The main goal is to prevent predatory field production and optimize costs and results.