RIO DE JANEIRO, Jan 29 (Reuters) - Brazil’s national development bank in a statement on Sunday said it would no longer vote on a government committee established to ensure local content in contracts for oil and gas.
The move, part of a government effort to ease restrictions that critics say made exploration and production too costly in Brazil, comes as the conservative administration of President Michel Temer seeks to attract more investment in the sector, especially among foreign companies.
The content rules, established by the leftist government that ran Brazil for thirteen years until May 2016, sought to encourage local manufacturers by establishing a minimum amount of domestic supplies and labor in oil and gas contracts.
In the statement, the bank, known as the BNDES, said its vote will now go to Brazil’s planning ministry, the cabinet department to which it reports.
The BNDES, responsible for most of the long term finance available in Brazil for big infrastructure and energy projects, was a key actor in efforts by the previous administration to boost select industries, including the oil and gas sector.
A source familiar with the ongoing changes at the committee told Reuters on Saturday that the country’s oil and gas regulator, known as the ANP, and a government research agency for the sector, known as Finep, would also lose their votes on the committee.
The ANP declined to comment on any changes.
Officials at Finep and Brazil’s energy ministry could not be reached for comment.
Though in line with the government’s stated objective of giving the industry greater access to foreign suppliers and investment, local manufacturers said changes to the committee would leave them largely without voice.
Because of their close ties to the BNDES and other two agencies “we are going to end up losing,” said César Prata, president of the oil and gas committee of the Brazilian Machinery Builders’ Association, or ABIMAQ, an industry group.
He warned that foreign oil producers could “take our oil, pay no taxes and leave nothing for Brazil.”
Brazil’s government last year also eased rules that the previous administration had established to protect the dominant role of state-run Petroleo Brasileiro SA, or Petrobras , in Brazil’s vast offshore oil deposits. (Reporting by Marta Nogueira; Writing by Paulo Prada; Editing by Mary Milliken)