BRASILIA, Sept 6 - Brazilian President Luiz Inacio Lula da Silva urged his countrymen at a televised address late on Sunday to closely follow congressional discussions of a plan that gives the state more control over one of the world's biggest recent oil finds.
Government officials have estimated there is a minimum of 50 billion barrels in the subsalt fields, which, if tapped, would make Brazil the world's fourth-largest producer of oil.
But critics argue that Lula's aim at asserting greater state control of the oil sector could also make Brazil a victim to the so-called "resource curse."
"I urge each of you to accompany, step by step, the discussion of these laws in Congress, that all of you get informed, reflect about it and put your heart and soul in this debate that is so important for the good of Brazil and Brazilians," Lula said.
Lula is seeking to drum up support from the public to win approval of the new laws, suggesting the prospect of prolonged wrangling in Congress over the proposal will mount as allies diverge over the scope of the laws and governors fight for revenue from the oil windfall.
Lula delivered the package of bills to Congress on Sept. 1 with an urgency message that requires a vote be held within 90 days. Opposition parties are seeking to block the debate in the lower house and even allies, including the Democratic Movement Party, or PMDB, -- the largest party in Congress -- are demanding the urgency clause be removed.
The oil reform is likely to face stiff opposition in Congress, particularly among legislators whose districts currently receive royalties from Brazil's 2.1 million barrels per day of oil production. They stand to lose under Lula's plan to distribute oil revenues more broadly in Brazil to combat poverty and boost the country's development.
Lula, who has presided over an economic boom over the past six and a half years mixing market-friendly policies and ambitious social spending programs, said the subsalt oil brings a "new independence day" for Latin America's largest nation.
"I can summarize the package in two phrases: on one hand, it warrants that the biggest chunk of the windfall will stay in the hands of Brazilians," he said.
"On the other hand, that it impedes that any government spends it in any irresponsible manner," he added.
The package of bills that were sent to Congress includes additional measures to make the state-run oil company Petrobras (PETR4.SA)(PBR.N) the sole operator of new fields with a minimum 30 percent stake in all future projects in the so-called subsalt oil fields.
In addition, approval of the bills would allow the government to create a new state holding company called Petrosal to manage new projects and a new contract system that gives the state a share of the oil.
The government will also have the right to declare any oil region strategic and implement a production-sharing system.
"History has shown that oil wealth is a double-edged sword. When well tapped, it bring progress, but when badly tapped it brings conflicts, waste, environmental damages, an economic mess and privileges for a few," he added.
Government officials have estimated there is a minimum of 50 billion barrels in the subsalt fields, which, if tapped, would make Brazil the world's fourth-largest producer of oil.
But critics argue that Lula's aim at asserting greater state control of the oil sector could also make Brazil a victim to the so-called "resource curse."
"I urge each of you to accompany, step by step, the discussion of these laws in Congress, that all of you get informed, reflect about it and put your heart and soul in this debate that is so important for the good of Brazil and Brazilians," Lula said.
Lula is seeking to drum up support from the public to win approval of the new laws, suggesting the prospect of prolonged wrangling in Congress over the proposal will mount as allies diverge over the scope of the laws and governors fight for revenue from the oil windfall.
Lula delivered the package of bills to Congress on Sept. 1 with an urgency message that requires a vote be held within 90 days. Opposition parties are seeking to block the debate in the lower house and even allies, including the Democratic Movement Party, or PMDB, -- the largest party in Congress -- are demanding the urgency clause be removed.
The oil reform is likely to face stiff opposition in Congress, particularly among legislators whose districts currently receive royalties from Brazil's 2.1 million barrels per day of oil production. They stand to lose under Lula's plan to distribute oil revenues more broadly in Brazil to combat poverty and boost the country's development.
Lula, who has presided over an economic boom over the past six and a half years mixing market-friendly policies and ambitious social spending programs, said the subsalt oil brings a "new independence day" for Latin America's largest nation.
"I can summarize the package in two phrases: on one hand, it warrants that the biggest chunk of the windfall will stay in the hands of Brazilians," he said.
"On the other hand, that it impedes that any government spends it in any irresponsible manner," he added.
The package of bills that were sent to Congress includes additional measures to make the state-run oil company Petrobras (PETR4.SA)(PBR.N) the sole operator of new fields with a minimum 30 percent stake in all future projects in the so-called subsalt oil fields.
In addition, approval of the bills would allow the government to create a new state holding company called Petrosal to manage new projects and a new contract system that gives the state a share of the oil.
The government will also have the right to declare any oil region strategic and implement a production-sharing system.
"History has shown that oil wealth is a double-edged sword. When well tapped, it bring progress, but when badly tapped it brings conflicts, waste, environmental damages, an economic mess and privileges for a few," he added.
