Demonstrators were met with rubber bullets and tear gas as they protested the auction of the Libra oil field to foreign corporations.
As the auction of Libra, a deepwater oil field in Brazil, closed to applause, there were also sounds of rubber bullets and teargas.
About 300 demonstrators calling for the nationalization of Brazil’s oil industry clashed with police outside the luxury beach-side hotel where the bidding took place, with security officials firing tear gas and rubber bullets into the crowd.
The exclusive Barra de Tijuca beachside suburb of Rio de Janeiro, home to the rich and famous, became a scene of terror as protesters and residents ran from rubber bullets and canisters of tear gas drifting across the beach.
Leading up to the auction, there had been criticism about the complex process of the auction, where many U.S. oil companies failed to make a bid. Adriano Pires, one of Brazil’s top energy analysts, called for new rules, calling current rules “very interventionist” and that “the auction was a disappointment even before it began because of the lack of interest.”
The auction was won by the only bidder – a consortium of Brazil’s state-controlled oil company Petrobras (which got 40 percent), Shell (which got 20 percent), France’s Total (20 percent) and Chinese state companies CNPC and CNOOC (10 percent each). The deal is expected bring in profits of $15 billion in the next five years.
Despite Petrobras retaining 40 percent of the oil field, union workers from the Unified Federation of Oil Workers (FUP) expressed their dismay over the proceedings. In a statement, the FUP spokesman said, “Before the auction the country was 100 percent owner of the biggest oil field yet discovered in the world. Now the Brazilian people are 60 percent poorer.”
The selling off of Libra to international oil companies was highly contested in the courts by environmentalists, unions like the FUP and socialist groups. There were 26 legal cases filed against the Libra auction — all failed.
Preparing for possible protests, the police positioned two lines of troops holding riot shields inside the hotel to protect government officials attending the auction. Despite this show of force, the auction was interrupted by a few hundred masked protesters, sheltered behind corrugated iron sheets, waving red flags and advancing gingerly while throwing rocks. Army sharpshooters repeatedly stepped forward to fire rubber bullets and teargas canisters.
Residents complained about the police tactics and excessive force. Many bathers and surfers suffered from tear gas drifting over the beach.
One rubber bullet narrowly missed Barra resident Pedro de Lucca, 25, who was walking his dog. A woman was trapped behind a tree in the crossfire. The young woman cried and ran from the solder-lined beach, shouting down a mobile phone: “I’m trapped in this business.”
Although FUP workers insist they will continue to protest against Petrobas, government officials are delighted with the first state-run auction.
Brazilian President Dilma Rousseff released a statement defending the auction, which she said “would raise $450 billion over the next 35 years. Eighty-five per cent of the all the income to be produced in the Libra field will belong to the Brazilian state and Petrobras. This is very different to privatization.”