Driving forces behind open acreage resource allocation systems for petroleum upstream activities: a comparative assessment between Brazil, Colombia, India and Uruguay

Abstract

ABSTRACT Facing flattening international oil prices in the next years (due to a combination of changing industry fundamentals, pandemics effects and the challenges of the global low-carbon energy transition), oil frontier countries are reviewing their petroleum exploration and production fiscal systems to increase their attractiveness to private investment. This article analyses certain open resource allocation systems by comparing the recently launched Brazilian offering to similar systems already existing in Colombia, India and Uruguay. The comparison focuses on four driving forces behind the adoption of open resource allocation systems: energy security, local economic development, government take and the so-called green paradox (reflecting the race to monetize petroleum reserves ahead of stricter climate change international regulations). Findings show that each of the analysed countries has its own target for designing a permanent offering, although the same driving forces can be found in more than one of the countries.