Petrobras Postpones 28 Rig Tenders to '09

RIO DE JANEIRO (Dow Jones Newswires), November 18, 2008

Brazilian state oil company Petrobras has postponed construction tenders for 28 deep-sea drilling rigs to 2009, the Estado News Agency reported Tuesday.

The rigs were to be tendered exclusively to Brazilian construction companies this year.

"There are no longer the conditions to issue the tender this year," said Jose Jorge de Moraes Jr., general manager for new business at the company's exploration and production department.

However, Moraes sees an upside to the current global economic crisis, in that it may lead to lower prices for rigs in the short term. This would allow Petrobras to cut its oil exploration and production costs in the sub-salt layer off Brazil's southeastern coast.

According to Moraes, the current price of oil at around $60 a barrel is an impediment to developing the sub-salt layer, and this area is one of Petrobras' priorities.

Moraes also said Tuesday that Petrobras plans to return to drilling in the Jupiter, Iara and Azulao (formerly Ogum) blocks in 2009. Azulao is operated by ExxonMobil near the Tupi block in the Santos Basin, off the coast of Sao Paulo state.

It was hoped to have 14 rigs drilling in the blocks in 2012 and produce 1 million barrels a day in 2015, said Moraes.

Copyright (c) 2008 Dow Jones & Company, Inc.


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