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Paulo Teixeira

Lawyer and Secretary-General of the Workers' Party, Federal Deputy for São Paulo.

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Why the pre-salt reserves cannot be relegated to the back burner.

The pre-salt layer is one of Brazil's greatest assets and one of its greatest achievements. Nothing could be more logical than continuing to explore it.

It's no coincidence that Marina Silva is already being called a "yo-yo candidate." After defending the criminalization of homophobia and then backtracking, condemning the production of genetically modified organisms and then backtracking, speaking out against agribusiness and then backtracking, the candidate has also retreated regarding oil exploration in the pre-salt layer. It is important that everyone knows the risks of putting the pre-salt on the back burner. As a federal deputy, I was able to delve extensively into the subject back in 2009, when I was the rapporteur for the report "The Challenges of the Pre-Salt," published by the Chamber's Council for Advanced Studies and Technological Evaluation, coordinated by legislative consultant Paulo César Ribeiro Lima. Subsequently, I presented to the Federal Government the proposal to replace the concession system with a production-sharing system, which guaranteed the State the maintenance of ownership of the explored oil and greater control over the pace of production.

This experience allows me to affirm that if the pre-salt oil reserves are not prioritized, there will be no National Education Plan, for example. This important achievement will wither away due to starvation without the necessary revenue from oil royalties. The impact doesn't end there. With the pre-salt reserves ignored or relegated to a secondary position, Brazil will be severely affected in at least seven strategic areas. Let's look at them:

1. Education: Specific legislation has stipulated that 75% of pre-salt royalties destined for the Federal Government must be used exclusively for education. This represents almost R$ 200 billion over the next 10 years, without which a significant portion of the progress foreseen in the National Education Plan will be impossible.

2. Health: The 25% of pre-salt royalties legally allocated to Health allow for the recovery of budgetary losses caused by the end of the CPMF (Provisional Contribution on Financial Transactions).

3. Shipbuilding Industry: The contracts already signed for pre-salt exploration have led to a resurgence of the Brazilian shipbuilding industry in recent years. There are more than 10 shipyards operating at full capacity producing vessels used to transport personnel and cargo between platforms. They will be left without demand.

4. Technology. With the change from a concession regime to a production-sharing regime, which I proposed in the Chamber of Deputies, a minimum of 60% national components was established for pre-salt exploration activities. This helps to boost technology transfer to Brazil, as well as attract more companies and more jobs.

5. Municipalities. After the long negotiation process that culminated in the redistribution of oil royalties among the different states and municipalities, and no longer solely to the locations where extraction takes place, relegating the pre-salt reserves to a secondary position means taking resources away primarily from the municipalities. This could be fatal for many municipalities.

6. Borders. Demobilizing the police structure and other surveillance forces permanently stationed along the Brazilian coast where oil platforms are located means weakening control over our land borders.

7. Environment. No matter how much Brazil invests in alternative energy sources, the main global energy source will continue to be oil, which will have to be produced somewhere. Pre-salt oil reserves imply less environmental impact than the exploration of heavy oil in Venezuela, oil sands in Canada, or shale gas in the United States.

In short, the pre-salt reserves are one of Brazil's greatest assets and one of its greatest achievements. Thanks to the pre-salt reserves, oil production grew by 14,8% in 12 months, reaching a record 2,267 million barrels per day in July. The expectation is that production will reach 5 million barrels per day in 2020, and that its exploration will bring more than R$ 1 trillion to the country over the next three decades.

Its impact will be enormous, not only on the fuel industry, but also on the production of plastics, paints, tires, medicines, and many other petroleum-derived products. Nothing could be more logical than continuing to explore it, always in parallel with the increasing use of alternative energy sources, such as solar and wind power, which are currently expanding rapidly.

* This is an opinion article, the responsibility of the author, and does not reflect the opinion of Brasil 247.