SBM Offshore Completes $1.6B FPSO Sepetiba Financing

SBM Offshore Completes $1.6B FPSO Sepetiba Financing
SBM Offshore has announced that it has completed the project financing of the floating production storage and offloading vessel Sepetiba for a total of $1.6 billion.

SBM Offshore has announced that it has completed the project financing of the floating production storage and offloading (FPSO) vessel Sepetiba for a total of $1.6 billion.

The company, which noted that this was the largest project financing in its history, said the funds were secured by a consortium of 13 international banks with insurance cover from Export Credit Agencies (ECA): Nippon Export and Investment Insurance (NEXI) and SACE S.p.A. SBM Offshore also highlighted that China Export & Credit Insurance Corporation (Sinosure) intends to join the transaction by the end of the year and will replace a portion of the commercial banks’ commitments.

The facility is composed of four separate tranches with a 4.3 percent weighted average cost of debt, a fourteen-year post-completion maturity for the ECA covered tranches and a fifteen-year post-completion maturity on the uncovered tranches, SBM Offshore outlined.

FPSO Sepetiba is owned and operated by a special purpose company owned by affiliated companies of SBM Offshore (64.5 percent) and its partners (35.5 percent). The vessel has a processing capacity of up to 180,000 barrels of oil per day, a water injection capacity of 250,000 barrels per day, associated gas treatment capacity of 12 million standard cubic meters per day and a minimum storage capacity of 1.4 million barrels of crude oil, according to SBM Offshore.

The FPSO will be deployed at the Mero field in the Santos Basin offshore Brazil, 111 miles offshore Rio de Janeiro. The Libra block, where the Mero field is situated, is under a production sharing agreement to a consortium comprised of Petrobras, which holds a 40 percent operated interest, Shell Brasil, which has a 20 percent stake, TotalEnergies, which also has a 20 percent stake, CNODC, which a 10 percent interest, and CNOOC Limited, which holds the remaining 10 percent interest. The consortium also has the participation of the state-owned company Pré-Sal Petróleo SA (PPSA), as manager of the production sharing contract.

In July last year, SBM Offshore announced the closure of a $600 million bridge loan facility for the financing of the construction of FPSO Sepetiba. The facility was secured by the special purpose company owning the FPSO and was agreed with a consortium of four international banks.

In December 2019, SBM Offshore revealed that it had entered into a shareholder agreement with Mitsubishi Corporation and Nippon Yusen Kabushiki Kaisha regarding the divestment of a 35.5 percent interest in the special purpose companies related to the lease and operation of FPSO Sepetiba. During the same month, the company announced it had signed contracts with Petrobras for the 22.5 year lease and operation of the FPSO, which was formerly known as Mero 2. The contracts follow the signing of the binding letter of intent, which was announced on June 11, 2019.

SBM Offshore is focused on the design, supply, installation, operation and maintenance of FPSO vessels. As of December 31, 2020, the company employed approximately 4,570 people worldwide, spread over offices in its key markets, operational shore bases and offshore fleet of vessels.

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