ONIP Requests Increased Local Purchasing

In response to ONIP's request to increase their volume of purchasing in Brazil, management representatives from Enterprise Oil and Modec held meetings with Brazilian suppliers at ONIP headquarters on August 11 and September 19, to present their procurement plans for the Bijupirá-Salema fields. According to the company corporate relations manager, Patrícia Garcia, Enterprise is quoting several equipment items amounting to approximately US$ 20 million until the end of September in Brazil. The purchases range from umbilical lines to lifeboats and equipment utilized in making up the topside of the FPSO which will be built in the Gulf of Mexico.

Suppliers registered with Petrobrás and ONIP are already being pre-selected to participate in the bidding. Modec purchasing manager Ron Bailey explained that by the end of October the company intended to purchase all the materials for the topside assembly. "We want to buy as much as we can in Brazil and I think Brazilian suppliers are in a position to win a good part of the contracts. I believe Brazilian companies have a better chance to win than European or Asian ones", said Bailey, who spent a week in Rio visiting companies and receiving suppliers interested in clarifications regarding the bidding process.

The Bijupirá-Salema field has proven reserves of 140 million barrels. The company is beginning to drill 15 wells, but will only put them into production starting in mid-2003. "First we drill all the wells and only then we begin operation. In this way, in two months we will reach peak production", Patrícia explains. The project is budgeted at US$ 600 million and up to now the local content ratio is 36%.