Petrobras, Partners Sign $3.4B Deal for 8 Platforms

Petrobras with its partners (BG, Galp Energia, and Repsol), and through its Tupi-BV and Guará-BV affiliates, has signed two contracts worth a total of $3.46 billion with the Brazilian outfit Engevix Engenharia S.A. for the construction of eight hulls for the platforms to be used in the first phase of production development for the pre-salt area in the Santos Basin.

These units are part of the new strategy for the construction of production units, being designed viewing to simplify projects and standardize equipments. Producing identical hulls in series will accelerate the construction phase, and will allow economies of scale and cost minimization.

Each platform, all of which FPSOs (floating, production, storage and offloading units), will have the capacity to process up to 150,000 barrels of oil and 6 million cubic meters of gas per day. All units are expected to start operating by 2017 and aims to reach the production targets set in Petrobras' Business Plan for the pre-salt area. The expectation is that these platforms will add about 900,000 barrels of oil per day to domestic production when operating at maximum capacity.

The hulls will be built at the Rio Grande Naval Pole (state of Rio Grande do Sul), with local content expected to reach around 70%. The first steel shipments will be made in January, and hull construction will start in March. The first two hulls will be delivered in 2013, while the others in 2014 and 2015.

Of the eight units, six will be operated by the consortium formed for Block BM-S-11, in which the Tupi and Iracema areas are located. The two others will be operated by the consortium formed for Block BM-S-9, where the Guará and Carioca fields are located.

The Block BM-S-11 consortium is operated by Petrobras (65%), in partnership with BG E&P Brasil Ltda. (25%), and Galp Energia (10%). The Block BM-S-9 consortium, meanwhile, is operated by Petrobras (45%), in partnership with BG E&P Brasil Ltda. (30%), and Repsol Brasil S.A. (25%).

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