February 21, 2018 / 11:55 PM / 8 months ago

Brazil to decide in first half on Total's Amazon river basin drilling

BRASILIA (Reuters) - Brazil environmental agency Ibama will decide on French oil firm Total’s application to drill in the environmentally sensitive Amazon river basin before the end of May, and possibly as soon as the end of March, an agency official told Reuters on Wednesday.

Ibama last August ordered Total to provide information missing from its application for an environmental license to explore for oil in the Foz do Amazonas basin, warning that it was the oil company’s last chance to provide necessary details before the application is scrapped.

The agency received Total’s response at the end of January and has four months to evaluate the new report and issue a ruling, said Antonio Celso Junqueira Borges, the general coordinator for oil and gas licensing.

But Ibama could rule more quickly, Borges said.

“Total filed its supplement to its studies at the end of January, it’s in analysis,” he said.

“(The timeline for finishing the analysis) is the end of March, but could be delayed a bit more than that.”

He declined to comment on the chances of the application to explore being approved.

“All of the blocks offered in the 11th round are in environmentally sensitive areas. In many regions the modeling indicates that if there was an oil spill, it would reach the coast,” Borges said.

“Beyond that it’s a sensitive region, there are lots of fisherman and a great biodiversity, so it demands greater control and care,” he said.

Officials at Ibama said pre-salt areas in recent auctions, thought to contain vast amounts of oil, were unlikely to face the same problem because of their greater distance from the coast.

The analysis of Total’s application in Foz do Amazonas, once complete, must then pass through a series of approvals with the ultimate decision to be issued by the president of Ibama.

Total did not respond to request for comment.

The firm, leading a group of partners including BP Plc and Petroleo Brasileiro SA, won five blocks in Brazil’s 11th auction of oil blocks held in 2013. As the operator, Total is responsible for applying for environmental licenses.

Total is the farthest along in the application process for Foz do Amazonas basin blocks awarded in 2013, with BP and Queiroz Galvão Exploration and Production (QGEP) in earlier stages of applying for licenses with Ibama for separate blocks they won in region, according to the agency.

Reporting by Jake Spring; Editing by James Dalgleish

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