TTE - Brazil oilfield auction - Shell and Total win as most stay home

After a failed attempt at selling large, pre-sal oil blocks in 2019, Brazil cut prices by 80%+ and found buyers for two key blocks today. Having cut the signing bonus at Sepia from $5.5b to $1.3b, and cut the minimum production share from 28% to 15%, a consortium of Total (NYSE:TTE), Petronas, and Qatar Energy submitted the winning bid today, offering to share 37% of production with the Government, and beating out a solo proposal from Petrobras (NYSE:PBR) At Atapu, the signing bonus was cut form $3.3b to $0.7b and minimum production share from 26% to 6%, where a consortium of Total, Shell (NYSE:RDS.A), and Petrobras submitted the only bid, offering to pay the Government 32% of production. Perhaps more interesting than the bids, was the lack of interest - given the bids came in well above minimum productions splits, the return profile at the minimum was likely very compelling

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Brazil oilfield auction - Shell and Total win as most stay home