November 28, 2018 / 8:11 PM / 13 days ago

Brazil's incoming minister says transfer of rights deal difficult to close this year

BRASILIA, Nov 28 (Reuters) - Brazil’s future finance minister, Paulo Guedes, said on Wednesday it was unlikely the state-run oil firm Petroleo Brasileiro and the government would reach a new transfer of rights deal this year because of sharp disagreements over how to split up the revenue of a future offshore oil auction that could raise an estimated 130 billion reais ($33.73 billion).

Guedes said Brazil’s current economic team thinks holding an auction this year would create problems for the incoming government of President-elect Jair Bolsonaro to comply with a government spending cap in 2019. Proceeds from any auction this year would have to be divided with states. That could be against the rules of the cap, which sought to limit growth in government expenses. ($1 = 3.8539 reais) (Reporting by Maria Carolina Marcello, Marcela Ayres and Mateus Maia; writing by Tatiana Bautzer; editing by Jonathan Oatis)

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