Brazil greenlights oil drilling in sensitive Amazon region

Brazilian President Luiz Inacio Lula da Silva speaks during an event at Planalto presidential palace in Brasilia, Brazil, Friday, Aug. 1, 2025. (AP Photo/Eraldo Peres)

Petrobras said Monday it had received a licence to drill for oil near the mouth of the Amazon River, enraging environmentalists who said the move would undermine Brazil’s hosting of UN climate talks next month.

Plans to expand oil exploration in Brazil, already the world’s eighth largest producer, are backed by President Luiz Inacio Lula da Silva, who insists oil revenues will help fund Brazil’s climate transition.

Critics accuse him of a contradictory stance as he urges world leaders to step up in the fight against climate change ahead of COP30 talks in the Amazon city of Belem from Nov 10-21.

Petrobras was granted a licence to drill in the Foz de Amazonas region after a five-year battle for permission to explore the area.

Brazil’s environmental agency Ibama said it had given the go-ahead after “a rigorous environmental licensing process.”

However, Brazil’s Climate Observatory NGO said civil society organizations would go to court to fight the decision.

“The government is sabotaging the leadership it should have at COP30,” Suely Araujo, a former president of Ibama and coordinator of the Climate Observatory NGO, told AFP.

“How can our diplomats advocate for the shift away from fossil fuels ...when the country is intensifying fossil fuel exploration and production?”

Opening the door

Araujo, who denied French oil giant Total a drilling license in nearby blocks in 2018, said granting the license had opened the door for other permits in the same region.

Foz de Amazonas is part of a promising new offshore oil frontier, with nearby Guyana emerging as a major oil producer in less than a decade following large offshore discoveries.

Petrobras said it would immediately start drilling an exploratory well at Block 59, an offshore site 500 kilometres (310 miles) from the mouth of the Amazon River.

Environmentalists have raised alarm about drilling for oil 160 kilometers off the coast of the world’s largest tropical rainforest, which is home to several Indigenous communities.

Petrobras has said its models show that an oil spill at the offshore site “would not be likely to reach the coast” and there would be “no direct impact” on Indigenous communities.

“We hope to obtain excellent results from this research and prove the existence of oil in the Brazilian portion of this new global energy frontier,” said Magda Chambriard, president of Petrobras, in a statement.

Brazil meets most of its energy needs through renewables and exports more than half of its oil, so emissions from new oil production won’t add to its own greenhouse gas tally, but will still be released globally.

“Authorising new oil licenses in the Amazon is not just a historic mistake — it’s doubling down on a model that has already failed,” said Ilan Zugman of the advocacy group 350.org

- Risk of ‘massive biodiversity loss’ -

Ibama denied Petrobras an exploration license in 2023, citing inadequate plans to protect wildlife in case of an oil spill.

As Petrobras appealed, pressure rose from Lula, who said earlier this year that Ibama was a government agency acting as if it was “against the government.”

In February, an Ibama technical opinion seen by AFP said the recommendation remained to “deny the environmental license,” citing the risk of “massive biodiversity loss in a highly sensitive marine ecosystem.”

Ibama’s technical staff noted that drilling conditions were very challenging in the Foz de Amazonas basin, which is prone to intense storms and strong ocean currents.

However, in May, Ibama president Rodrigo Agostinho overruled the opinion and allowed Petrobras to go ahead with an oil spill accident response drill that was considered the last step before the license is granted.

In September, Ibama approved the pre-operational environmental assessment, despite Petrobras failing to demonstrate it can “reliably protect fauna in the event of an oil spill.”

The federal public prosecutor’s office has also raised the alarm over the process, and filed a lawsuit Thursday to force Petrobras to conduct a new oil spill drill before the license was issued, due to failures in its wildlife rescue plan.