Lula Starts Up P-50 FPSO, Hails Oil Self-Sufficiency

Brazil's President Luiz Inacio Lula da Silva started operations on Friday of federal energy company Petrobras' (NYSE: PBR) P-50 floating, production, storage, and offloading unit (FPSO) on the Albacora Leste field in the Campos basin, marking the country's attainment of self-sufficiency in oil production, Petrobras said in a statement.

When it reaches its full production capacity of 180,000 barrels a day (b/d) the P-50 will render the self-sufficiency process sustainable, the statement said.

The P-50 will also be able to compress six million cubic meters of natural gas a day and to store 1.6 million barrels of oil. It is 337 meters long and 55m tall, equivalent to an 18-story building.

The unit results from the conversion of the hull of the Felipe Camarao vessel, which belonged to Petrobras' fleet, into an FPSO production unit. The Jurong shipyard in Singapore carried out the conversion.

The P-50's total cost was US$634mn and construction generated 4,000 direct and 12,000 indirect jobs in Brazil.

Albacora Leste is located 120km from the coast of Rio de Janeiro state, occupying a 141sq km area, where the depth varies from 800 to 2,000m.

Three other platforms are scheduled to go into production in 2006: the P-34, extracting 60,000b/d in the Jubarte field in the Espirito Santo basin; the SSP-300, producing 20,000b/d in the Piranema field in Sergipe; and the 100,000b/d FPSO Capixaba in the Golfinho field, also in Espirito Santo.

These platforms will allow Petrobras to reach an average daily production of 1.9Mb/d in 2006, surpassing the country's consumption of 1.8Mb/d, the statement said.

In 2010, Petrobras is expected to produce 2.3 million barrels a day (Mb/d), compared to a consumption of 2Mb/d, meaning the country could become a net exporter.

Petrobras noted the importance of achieving oil self-sufficiency at a time when global oil supplies are tight and prices have risen above US$70 a barrel.

"With self-sufficiency Petrobras, which never allows there to be a lack of fuel in the country, even at moments of global supply crises, will be virtually immune to possible international supply collapses," the statement said.

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