Clashes as Brazil Auctions Oil Licenses
TEHRAN (Tasnim) - Amid clashes between union workers and police, Brazil prepared Monday to auction oil production licenses in its giant Libra offshore field.
More than 1,000 police were drafted to ward off protests outside the Rio hotel hosting the auction as 11 companies -- including two Chinese giants -- bid to bag a slice of a multibillion dollar cake.
Analysts say the field holds potential reserves of up to 12 billion barrels, or nearly a million barrels a day for five years, according to Brazil's National Petroleum Agency.
To put that into context, Brazil currently has 15.3 billion barrels of proven reserves, the second-largest in South America after Venezuela, AFP reported.
A further spinoff could come in the form of a doubling of Brazilian gas reserves, currently 459.3 billion cubic meters.
The reserves are what are known as pre-salt -- that is, they lie beneath a layer of salt deep below the Atlantic Ocean.
With Libra hosting the equivalent of around three years worth of ever rising Chinese consumption, China's state firms are seeking to work alongside Brazilian state giant Petrobras.
China National Petroleum Corporation (CNPC), the world's second biggest oil company by market capitalization, and China National Offshore Oil Corporation (CNOOC) are at the forefront of the battle.
Also in the hunt, which was due to get under way from 1600 GMT, are fellow big-hitters Anglo-Dutch Shell, France's Total and Spain's Repsol. US giants are sitting the sale out.
Completing the line up were Petronas of Malaysia, Japan's Mitsui & Co, Portugal's Petrogal, Colombia's Ecopetrol and ONGC Videsh of India.
Buried under layers of salt, the deposits cover 149,000 square kilometers (58,000 square miles) and Libra lies 183 kilometers (112 miles) off the coast.
Currently, Brazil produces two million barrels a day but hopes to boost output to 4.3 million a day by 2020, thanks in large part to the pre-salt reserves.