The Federal Attorney General’s Office reinforced the request to the Court to maintain the current rules for distributing royalties and special participations from oil and gas exploration. The demonstration takes place on the eve of the judgment by the Federal Supreme Court (STF) on the issue.
In a report delivered to the STF, the AGU defends that the Court’s ministers respond to the request of producing states and invalidate the law that, in 2012, changed such division criteria, giving priority to non-producing regions. The rule was suspended in 2013 by an injunction issued by Minister Cármen Lúcia, pending analysis of the case by the STF plenary. After more than a decade, the trial was scheduled for tomorrow.
Today, the distribution of resources favors the Union and the states and municipalities where there is production. As Rio is, by far, the largest national producer — 88% of the oil and 77% of the gas produced in Brazil in 2025 came from fields on the coast of Rio de Janeiro, according to the National Petroleum Agency (ANP) —, the state is the most affected by the discussion.
Legal security
According to the body, which has the status of a ministry in the Lula government, a change in the royalty distribution regime — with retroactive effects, since the law has been suspended since 2013 — goes against the principle of “legal certainty”. In a report delivered to the STF, the AGU also cites the need to avoid the “financial collapse of producing states and municipalities”
The AGU argues that the law enacted in 2012, after the overturn of a presidential veto, is unconstitutional. The body maintains that the Constitution granted producing states and municipalities the right to share in the results or to financial compensation for the exploration of oil and natural gas.
“Right that arises from the territorial condition of the entities and the burden of supporting, in their territory, exploratory activity potentially generating social, economic and environmental impacts”, says the AGU.
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Furthermore, a decision in favor of the change would require a full review of all amounts distributed since 2012, with the recalculation of revenues and financial compensation between the federative entities, says the body.
In this sense, the AGU even presented an estimate made by the National Agency for Petroleum, Natural Gas and Biofuels of amounts that could have to be reimbursed by the Union and the producing States if there is a change in the division of royalties.
According to the document, the total reimbursement, since 2012, by the federal government would be R$57.2 billion, in unadjusted amounts. The estimated reimbursement from producing states would reach R$87.8 billion.
The AGU also made an alternative request, if the STF imposes a possible setback on the producing states and validates the change in the royalty regime: for it to only occur from now on, for subsequent contracts.
The body asks that, if the Court understands the validity of the rule, that producing states and municipalities do not have to refund amounts they received since 2013, when the law was suspended.
As shown The Globe on Sunday, a decision by the Federal Supreme Court on the rules for distributing government taxes on oil and gas production — royalties and special participations (PE) — will define the future of the public accounts of the government of the State of Rio and some city halls in Rio de Janeiro.
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The change could make the functioning of public machines unfeasible, projections show and alert authorities and business entities. According to some calculations, there would be around R$21 billion less per year in public coffers.
