10 January 2013

BRASIL / ENERGY : 5 Year Oil Auction Drought Ends In May; No Energy Rationing Promised.


     After 5 years...Brasil will again hold auctions for 172 offshore and onshore oil exploration blocks.
     Auctions were held-up until the royalties issue was decided by the legislature and President Rousseff.
       Energy Minister Edison Labao has rejected rumors of possible energy rationing...even as Brasil suffers thru record summer heat and the NE's worst drought in 50 years with reservoirs needed for hydropower at their lowest level in a decade...forcing the importation of expensive LNG gas.
    Brasilia relies on hydro resources for 67% of its power.
    In 2001...Brasil suffered a severe energy shortage that reduced GDP by 1%...and caused massive blackouts.
    Despite the energy challenge...President Rousseff...a former energy minister...reduced electric rates for 2013 by 20%...to stimulate consumer spending.