Oil Nationalism in Latin America

Latin America is endowed with 132 billion barrels of “proven” oil. Venezuela, Brazil, Mexico, and Ecuador have significant reserves and strong state involvement in the exploration and production of oil through their nationalized companies Petr

Brazilian President Luiz Inacio “Lula” da Silva and his mines and energy ministry have devised a stricter tax framework and pushed for more aggressive terms with foreign companies around the country’s new-found offshore oil. The government has put forward a new state-owned company dubbed Petrosal to manage the licensing. This new company will award some exploration and production rights straight to Petrobras without options for foreign firms. Also, by mandate, it will award over half of the shallow-water contracts to Locally-owned Oil Service Companies (LOSCs). In deeper and more challenging waters beyond the capacity of local companies, foreign companies will be invited to bid. Those pledging to incorporate Brazilian “content”