Oil Makes 10% of Brazil’s GDP, But Country Has to Keep Digging

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The oil sector in Brazil already accounts for approximately 9% of the Brazilian Gross Domestic Product (GDP), and should surpass 10% still this year, or in 2007 at most.

The information was presented Tuesday, November 28, in Rio de Janeiro, by the director general of the National Petroleum, Natural Gas and Bio-fuels Agency (ANP), Haroldo Lima, during the launch of the 8th Round of Tenders for oil and natural gas exploration areas in Brazil, with the presence of the Brazilian minister of Mines and Energy, Silas Rondeau.

According to Lima, in the 1970s, the oil sector accounted for 2.79% of the Brazilian GDP. The director general of ANP also said that from 1998 to 2004, the growth rate of the petroleum industry was 272.18%, with total sales going up from US$ 17.70 billion (38.54 billion reais) to US$ 65.89 billion (143.44 billion reais).

In the period, according to the ANP, the GDP varied 26.56%, rising from around US$ 650 billion (1.4 trillion reais) to about US$ 850 billion (1,8 trillion reais).

Proven oil reserves went up from 6.2 billion barrels in 1995 to 11.8 billion last year. Average petroleum production until September was 1.72 million barrels per day – with reserve/production expected to last for 18.8 years.

In Lima’s assessment, the evolution of the oil and natural gas sector in the country attests to the effectiveness of the current model, adopted in the country after the passing of the Law 9,478, from August 1997, known as the Petroleum Law.

In 1997, Brazil imported approximately 47% of the oil and oil products it consumed; last year, Brazilian reliance on foreign petroleum fell to only 3%.

"This year, Brazil attained self-sufficiency in oil, but in order to maintain it, new discoveries must be made, hence the importance of these tenders," says the director general of ANP.

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