Brazilian president aims to eradicate poverty with oil billions

Brazilian president Luiz Inacio Lula da Silva today vowed to pump billions of petrodollars into the war on poverty in the wake of one of the world’s biggest oil discoveries this decade.

He claimed that new legislation he is planning would allow profits to be used to “take care of” education and poverty once and for all.
Brazil has been celebrating an unexpected oil boom since November 2007, when state-controlled energy company Petrobras discovered the Tupi oilfield off Brazil’s southeast coast.

Tupi, estimated to contain around 8bn barrels of oil, was the biggest discovery in the Americas in more than 30 years. Following the discovery president Lula declared: “God is Brazilian”.

His regional rival, Venezuelan president Hugo Chavez, joked the Brazilian president should be renamed “Sheikh Lula”.

The Tupi field is part of the so-called “pre-salt” band, an 800km strip containing a series of vast deep-water oil reservoirs which could hold as much as 150bn barrels of oil.

The discovery of the region led Brazil to suspend the auctioning of all offshore oil blocks pending new legislation, intended to give the government a larger slice of profits. Lula is expected to create a “social fund”, designed to channel oil profits into poverty-reduction initiatives, and should hand greater control of “strategic” oilfields to the government.

The Guardian