- Title: BRAZIL: Thousands march in Rio against oil bill reform
- Date: 11th November 2011
- Summary: RIO DE JANEIRO, BRAZIL (NOVEMBER 10, 2011) (REUTERS) GENERAL VIEW OF SUGAR LOAF HILLS CABLE CARS IN THE SUGAR LOAF HILLS VARIOUS OF BANNER PROTESTING THE OIL BILL THAT WAS HUNG AT THE SUGAR LOAF HILLS GENERAL VIEW OF BEACH FRONT AVENUE IN COPACABANA BEACH VARIOUS OF BANNER PROTESTING THE OIL BILL HUNG IN BUILDING GENERAL VIEW OF CROWD OF DEMONSTRATORS MARCHING TO PROTEST AGAINST THE OIL BILL GENERAL VIEW OF PROTESTERS DEMONSTRATOR WEARING A CLOWN NOSE DEMONSTRATOR MARIA JOSE CUNHA HOLDING BANNER IN PROTEST (SOUNDBITE) (Portuguese) DEMONSTRATOR MARIA JOSE CUNHA, SAYING: "We are claiming our royalties because this is our duty, we must fight. And this is a constant struggle. We have been fighting for a year and now is the time to give our shout of victory." (SOUNDBITE) (Portuguese) DEMONSTRATOR GILSON FREITAS, SAYING: "Most cities do not suffer a direct impact with these facilities, with the oil exploration. So, I think that the cities that do suffer should have a priority in this issue (of receiving royalties)." GENERAL VIEW OF CROWD OF DEMONSTRATORS PROTESTER SHOUTING IN SPEAKER VARIOUS OF RIO DE JANEIRO STATE GOVERNOR SERGIO CABRAL, RIO DE JANEIRO MAYOR EDUARDO PAES AND OFFICIALS ON PICK-UP TRUCK IN MARCH CABRAL ARRIVING IN NEWS CONFERENCE GENERAL VIEW OF CAMERA CREWS AND PHOTOGRAPHERS IN NEWS CONFERENCE GENERAL VIEW OF PAES AND CABRAL IN NEWS CONFERENCE GENERAL VIEW OF NEWS CONFERENCE (SOUNDBITE) (Portuguese) RIO DE JANEIRO STATE GOVERNOR SERGIO CABRAL, SAYING: "Rio de Janeiro is essentially a democratic state, but we will not accept our funds to be taken away from our people -- we won't accept them to seize revenues that were already guaranteed to our people. This is the main point that triggered this beautiful and peaceful demonstration that you saw today." VARIOUS OF DEMONSTRATION
- Embargoed: 26th November 2011 12:00
- Keywords:
- Location: Brazil, Brazil
- Country: Brazil
- Topics: Politics,Energy
- Reuters ID: LVAENQDV64SF1571ARC1STBIZPSC
- Story Text: Thousands of people joined Rio de Janeiro officials on Thursday (November 10) to march against a bill that would cut the Brazilian state's share of oil revenues.
Demonstrators took to the city's downtown area to protest against a plan to distribute oil royalties more widely among feuding states, a small step toward relaunching the development of the country's vast offshore reserves.
Under the bill, the federal government and producer states such as Rio would have to accept a lower cut of oil royalties in order to allow for a broader distribution of oil wealth to non-producer states.
Rio's military police said around 150,000 people gathered in the historic Cinelandia square, where politicians and local artists stepped onto a stage to voice their disapproval.
The rally was organized by the city's officials who have given public workers the afternoon off and have also put up huge banners protesting the change on Rio's iconic Christ the Redeemer statue, the Sugar Loaf hills and a couple of public buildings.
"We are claiming our royalties because this is our duty, we must fight. And this is a constant struggle. We have been fighting for a year and now is the time to give our shout of victory," said demonstrator Maria Jose Cunha.
Demonstrator Gilson Freitas said it was fair for producing cities to continue receiving a greater share of oil royalties.
"Most cities do not suffer a direct impact with these facilities, with the oil exploration. So, I think that the cities that do suffer should have a priority in this issue (of receiving royalties)," he said.
The new legislation sees the federal government's slice of royalties at 20 percent, down from a current 30 percent. Oil-producing states would see their share down to 20 percent from 26.25 percent.
Non-producing states would see their share leap to 20 percent from a current 1.75 percent, eventually reaching 27 percent in 2020.
Rio state governor Sergio Cabral said the bill was unfair and would snatch Rio's wealth.
"Rio de Janeiro is essentially a democratic state, but we will not accept our funds to be taken away from our people -- we won't accept them to seize revenues that were already guaranteed to our people. This is the main point that triggered this beautiful and peaceful demonstration that you saw today," he told reporters.
The plan was approved on the Senate in October and still faces several hurdles that could stall new investments in deep water offshore areas.
The proposal now faces a contentious vote in the lower house of Congress and potentially a slew of law suits by oil-producing states that stand to lose oil incomes.
At stake is the development of some of the world's largest crude reserves held in an area known as the subsalt, a region the size of New York state believed to hold more than 50 billion barrels that could turn Brazil into a major oil exporter.
Rio's leaders have said they could sue to block such legislation, sparking a drawn-out legal battle that could indefinitely halt new bidding rounds in the subsalt and slow output from a region that global markets see as a key source of oil outside OPEC.
Brazil last year created a production-sharing system for future projects in the subsalt region as part of former President Luiz Inacio Lula da Silva's effort to increase government revenues from those oil discoveries, which he dubbed a "gift from God."
A dispute over how to distribute royalties from those future operations slowly evolved into a debate over Brazil's current system of oil royalties, which heavily favors producer states including Rio de Janeiro and Espirito Santo. - Copyright Holder: REUTERS
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