The Brazilian government will not bow to pressure from states and municipalities to change terms of a mining bill draft that will increase royalties and encourage faster development of reservoirs, a senior official at the mining and energy ministry’s planning department said on Wednesday.
Regional governments, mainly municipalities, want the federal government to set aside 20 percent of proceeds from royalties in a compensation fund. But Paulo Ribeiro de Santana, an official at DPNM, as the department is known, said the request breaches provisions of Brazil’s 1988 Constitution.
Under some of the proposals included in the draft, mining companies will pay the government as much as 4 percent of gorss revenues on royalties, up from a current 2 percent of net revenue. The government expects the bill to be voted on by Oct. 20.