Brazil’s Superior Court of Justice (STJ) is scheduled to resume, on October 14, 2026, its judgment concerning the legality and conditions applicable to hydraulic fracturing in unconventional oil and gas exploration.
The case, examined under Incident of Assumption of Jurisdiction No. 21 (IAC 21), originated from disputes involving exploration blocks offered by the ANP in 2013.
The Court will consider whether fracking may be used in Brazil and, if permitted, which environmental and regulatory conditions should govern the activity.
Market Impact
The judgment could influence the commercial viability of unconventional oil and gas projects, particularly in onshore basins with shale gas potential.
Greater regulatory clarity may help operators assess exploration risks, financing requirements and project development schedules.
Conversely, restrictive conditions or additional environmental obligations could affect investment assumptions and operational costs.
Legal & Contractual Implications
Companies evaluating unconventional resources should closely monitor the judgment’s implications for environmental assessments, groundwater protection, operational safeguards and licensing requirements.
Exploration and drilling agreements should also address regulatory changes, environmental liability, suspension rights and the allocation of costs arising from additional compliance obligations.
The judgment has not yet established a definitive national framework. Its outcome may nevertheless influence future ANP licensing strategies and investment decisions involving unconventional resources.
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