Social movements and unions are agitating for the cancellation of the auction of blocks for the exploration and production of petroleum and natural gas, slated for December 18 in Rio de Janeiro.

The current exploration model is one of the neoliberal legacies left in the federal government. In 1997, the National Congress approved Law 9,478, at the behest of the Fernando Henrique Cardoso government. It broke the state monopoly on the exploration and production of petroleum, capitalizing Petrobras with private funds (the privatization was partial—30 percent of the shares were sold on Wall Street), and permitting transnational corporations to exploit gas and petroleum in Brazil.

Since then the federal government has put 711 land and sea-based oil blocks out to auction, of a total of 3,383 available for tender. There are 72 private economic groups operating within the country, partaking in the exploration and production of gas and oil, half of which are transnationals, such as Shell (Dutch-British) and Repsol (Spanish).

Created during the Cardoso administration, the National Petroleum Agency (ANP) is charged with holding the auctions, even in zones classified as probable reserves (*). Because of this the petroleum and gas in the subsalt beds (†) are not wholly owned by the Brazilian people. Nearly 25 percent of the proven reserves in the subsalt, auctioned at ridiculous prices, are now owned by private companies—some even by foreign-owned businesses.

According to ANP estimates, reserves in the subsalt zone total at least 50 billion barrels of oil and gas; they could even reach 80 billion barrels. Known reserves in Brazil total 14 billion barrels of oil and gas. Today, world oil production is 85 million barrels per day.

The discovery of petroleum in the subsalt zone could situate Brazil as the owner of the third-largest oil reserve in the world, behind only Saudi Arabia and Canada (‡)  And combined with the reserves of Venezuela, Ecuador, and Bolivian, would strengthen South America's position with respect to the economic powers of the northern hemisphere.

Six countries control more than 80 percent of the world supply of gas and petroleum: Saudi Arabia, Iran, Kuwait, Russia, Venezuela, and Iraq. With the exception of Saudi Arabia and Kuwait, all have political problems with the US, which perpetually imperils the world supply.

Petroleum and natural gas constitute over 50 percent of the global energy grid. Nonetheless, world reserves have started to show signs of exhaustion. Structural changes in the energy grid take at least 20 years to take effect, which will prolong humanity's dependence on this important natural resource.

The war over the world's oil is truly governed by the maxim, "anything goes." Multinational corporations manipulate the media, corrupt governments, and use military force (such as the invasion of Iraq and the reactivation of the United States' Navy's Fourth Fleet in Latin America) to maintain control over energy sources.

The petroleum and natural gas discoveries in the subsalt zone represent a huge challenge: deciding how, for whom, and at what rate to explore and produce the immense oil reserves, which could profoundly transform the economy and the course of national development.

President Lula has defended the idea that riches be invested in education and helping the Brazilian people free themselves from poverty. Thus it is imperative that we debate and approve a new petroleum law to replace the "regulatory framework" of the Cardoso era and establish a new federal agreement. The point of departure must be a fair distribution between states and municipalities of the taxes and royalties collected on oil development (currently, 62 percent of the country's oil income is divided among merely 9 Rio de Janeiro municipalities).

In order to guarantee that the bounty from the subsalt fields benefits the Brazilian people, and does not simply become a source of profits for private businesses, national or foreign, signatures are being collected in order to present a Popular Initiative Bill to the National Congress that would consolidate a state monopoly over the petroleum sector, secure the termination of exploration concessions in the reserves, ensure that the riches are used for social benefit, and strengthen Petrobras as a truly public enterprise.

1,300,000 signatures are necessary to initiate such a bill, according to the constitution. Thus the participation of the whole population is fundamental. Models to sign and more information can be obtained on the internet at: www.presal.org.br (Translation by Max Ajl).

- Frei Betto is a writer and the autor of the "Calendar of Power," among other books. This article originally appeared in America Latina en Movimiento here:

-Max Ajl is a freelance journalist living in Brooklyn, and has written on Latin America for the Guardian, NACLA, and the New Statesman. He can be reached at max.ajl at gmail.com.

(*) Translator's note: oil reserves are classified in a tripartite scheme: proved, probable, and possible. A probable reserve is a reserve that oil companies have at least a 50 percent confidence level of being recoverable. Profit levels on off-shore probable reserves, under the low, Cardoso-level royalties and taxes will be astronomical.

(†) Subsalt: a gigantic coastal petroleum and gas reserve, off the status of Santa Catarina and Espirito Santo, situated beneath an enormous salt sheet some two thousand meter thick—thus buried some 5 to 7 thousand meters deep and very difficult to extract.

 (‡) Translator's note: even if Brazil could certify all 80 billion barrels, certainly Venezuela would still remain far ahead—some estimates put Venezuelan super-heavy oil reserves at well upwards of 200 billion barrels.