FILE PHOTO: A logo of Brazil's state-run Petrobras oil company is seen at their headquarters in Rio de Janeiro, Brazil October 16, 2019. REUTERS/Sergio Moraes

SAO PAULO (Reuters) - Brazil's federal audits court on Wednesday approved a draft contract for a massive transfer of rights oil deal between state-run oil firm Petroleo Brasileiro SA PETR4.SA, better known as Petrobras, and the government.

The highly anticipated auction, which takes place next month, could take in $26 billion from the combined signing bonuses bidders who win exploration and production rights will be obliged to pay the government.