Eight Gas Tankers to Cost US$536 Million

Eight gas tankers to be built by the Promar Ceará shipyard will cost R$940 million (US$536 million), an average of R$117 million (US$67 million) per vessel. The local content of the vessels will be 70% and they will have a capacity of 12,000 cubic meters.
The shipyard was officially declared winner of the bidding on April 16. The contract has not yet been signed pending on issues involving freeing up the area for construction of the vessels.

EBN to Receive 20 New Vessels

Petrobras is set to launch the second stage of a vessel acquisition program (EBN program - Brazilian Shipping Company program) by the end of June. The bidding will contract for 20 new vessels, including gas tankers, Panamax vessels and bulk carriers.
The bidding process will be the same as the previous one, with the vessels being produced in Brazil and charter contracts of up to 15 years. The local content is expected to be between 70% and 80%.

Promef Ship Heads to Sea

The launching ceremony for the first ship of the Transpetro Fleet Modernization and Expansion Program (Promef) now depends only on President Lula’s schedule.
The ship is the first to be delivered by the Atlântico Sul Shipyard (EAS) and is already standing in the shipyard’s dry dock. EAS is currently working on assembling the ship’s accommodations.
The ship – a Suezmax type – is part of a package of orders from Transpetro to EAS. Currently, the shipyard has a portfolio of 22 oil ships as well as the hull for P- 55.

Eisa Gets US$480 Million

Transpetro and the BNDES development bank have signed a R$856 million (US$481 million) financing contract with the Eisa shipyard to construct four Panamax tankers. These are being purchased during the first stage of the Fleet Modernization and Expansion Program (Promef).
With the release of the funding, the first ship will be delivered by the end of 2012. The other three ships will be delivered during 2013. Each Panamax tanker will have a gross weight of 70,000 kg and will have cargo capacity of 500,000 barrel. Building the ships will have a local content of 65%.

STX to Build Shipyard in Suape

Korean-owned STX Europe announced construction of a new shipyard in Porto de Suape, Pernambuco. The industrial plant will require investment of some R$630 million (US$352 million) and is expected to be completed in 2013. The unit will be built on a 100-hectare plot of land.
Recently, STX signed a partnership deal with PJMR to construct Promar Ceará shipyard at Porto de Mucuripe, in Fortaleza (Ceará), which will build offshore vessels. PJMR is already a partner in the Atlântico Sul and STX Brasil shipyards.

Portuguese Shipyard to Build a Base in Suape

Portuguese-owned MPG shipyard announced construction of a base in Pernambuco for offshore modules and equipment, along with wind power projects. The company expects to invest R$252 million (US$141 million) in the project, to be built on 33.5-hectare plot.

ANP Bidding for Petrobras Grants

ANP has issued international requests for proposals to contract a firm to identify the potential volumes in three federally-owned areas in the pre-salt region, in the Santos Basin. The objective is to certify a minimum volume of 5 billion barrels of oil equivalent (BOE) that will be earmarked to Petrobras, as specified in one of the proposed laws for the new pre-salt regulatory environment currently being considered by the Senate. The Bids must be delivered by May 27.

The areas that have been defined are close to the blocks that have already been granted in the pre-salt region. ANP will supply the winning company with all of the geological, geophysical, and engineering data for the region under consideration.

Sinopec in Pará-Maranhão

Petrobras and Sinopec will sign a partnership agreement for the BM-PAMA-3 and BM-PAMA-8 blocks in the Pará-Maranhão Basin that run alongside the equator. These blocks were acquired in the 3rd and 5th ANP bidding rounds. The agreement to be included in Brasilia will also involve a term of strategic cooperation between the two oil companies.
The commercial basis of the Sinopec farm-in in the marine areas of Pará-Maranhão is still under negotiation and will be closed by the end of the week. The percentage participation to be ceded by Petrobras will be below 50% and could be fixed at 20%. The two blocks are in the deep waters of the Pará-Maranhão Basin.

Less Local Content for Pre-salt Bids

ANP is analyzing the possibility of stipulating a lower local content index for areas to be put out for bid in the new pre-salt frontier. However, the agency has not yet defined a new index and is talking with the industry about the matter.
At present, Petrobras production platforms are being built with a minimum local content index of between 60% and 70%. However, the oil company has already announced that it intends to increase this to 75% in future bidding.

Only Six Dry Wells In The Pre-salt Region

The exploratory success of the oil companies that are operating in the pre-salt zone in Brazil –between the Espirito Santo and Santa Catarina states – is around 90% according to data from ANP. In total, 61 wells have been drilled in the region in the last six years.

Aurizônia Negotiates Farm-Out

Aurizônia will no longer be responsible for the operation of blocks and fields in Brazil. After an agreement negotiated with UTC, the oil company is negotiating a partial farm-out with Nord Oil for block SEAL-T-418, located in the state of Sergipe, near the Carmópolis field.
The deal calls for the transfer of the operations of the block and is linked to the results of the fracturing of a well drilled in the area. The operation is part of the group’s business strategy to give up the role of operator, maintaining only shares in E&P assets.

16 Wells in Tupi

Petrobras is planning to drill up to 16 wells in the Tupi prospect of the BM-S-11 block of the Santos Basin.This will be completed by the end of the year, when the exploration program scheduled for the region expires. Up to know, the oil company has already drilled six wells in the area.

Aker Takes 40 Pre-Salt WCTs

Aker Solution signed a contract for US$300 million to supply 40 wet Christmas trees (WCT) for the Guará and Iara prospects in the BM-S-9 and BM-S-11 blocks, in the pre-salt cluster of the Santos basin. The contract covers the engineering and manufacture of vertical Christmas trees to operate in waters up to 2,500m deep, underwater multiplex control systems, and 17 complete sets of tools.

Delivery is scheduled over the next four years. The Guará prospect (BM-S-9) will get 14 Christmas trees and Iara (BM-S-11), 26 trees. The contract will be managed, projected and executed by the Aker Solutions factory in Curitiba (Paraná), with the support of Aberdeen, in the United Kingdom, for the underwater control systems. Delivery of the first WCT is expected at the end of 2011.

Wahoo Has 300 Million Barrels

On April 6, Anadarko announced a preliminary estimate of 300 million barrels in reserves for the Wahoo prospect, in the pre-salt layer of block BM-C-30 in the Campos Basin. The company has finished a production test on the well, which produced 7,000 barrels per day of oil and 4 million cubic meters of natural gas.

Record Exports of Petroleum

Petrobras exported 22.7 million barrels of oil during the month of March, an average of 733,000 barrels per day. This is a new record for the company, exceeding the last record for the company by 113,000 barrels per day.
The principal destination for exports continues to be the United States, which accounts for 32% of the total? India (22%), China (20%), Europe (18%), and Japan and Canada (both with 4%) make up the remaining list of principal buyers.

Maersk in at BM-C-34

Maersk Oil purchased a 20% stake in the BM-C-34 block of the Campos Basin from Devon Energy. The divestiture is part of the American oil company’s strategy to sell all of its deep-water assets in the Gulf of Mexico and Brazil.
With the conclusion of this transaction, British oil company BP becomes the operator of the area. It has a 30% interest also recently acquired from Devon. Petrobras owns the remaining 50%.

Earthworks For Premium I

In April, Petrobras received commercial proposals for the earthworks of the Premium I refinery. The plant will be located in the state of Maranhão. At least 10 companies are competing for the contract. Petrobras expects that the earthworks for the refinery will begin this year.
Premium I, planned to be the largest refinery in Latin America, will have a capacity to process 600,000 bpd and will require investments totalling R$35 billion (US$20 billion).

Coke Processing at Suape

Oxbow Carbon Minerals LLC of the U.S. signed two agreements with Petrobras for the constructing a coke processing unit in Porto de Suape, Pernambuco. The oil sub-product will be produced at the Abreu e Lima refinery (RAL).

The investments to install a calcinatory are estimated at R$350 million (US$198 million). The unit will transform green coke into powder. In Brazil, only São Paulo currently has this type of unit and service in Brazil.
Oxbow is the largest distributor of petroleum coke in the world, with annual shipments of nearly 11 million tons. In Suape, production could reach 500,000 tons/year.

Deal for Comperj Coke
Petrobras has contracted with the Techint / Andrade Gutierrez consortium to construct a delayed coking unit at the Rio de Janeiro Petrochemical Complex (Comperj). The contract value was not disclosed by the oil company, but the work is rumored to be around R$1.8 billion (US$1 billion).
Comperj’s first phase calls for a first generation refinery to produce basic petrochemicals. During 2013, the unit will produce 1.3 million tons/year of ethylene and 880,000 tons/year of propylene, processing 200,000 b/d of heavy oil.

Sunoco Acquisition Concluded

On April 1, Braskem announced it purchased the petrochemical division of North American company Sunoco Chemicals. The acquisition – valued at US$350 million – is part of the plan for internationalizing the petrochemical arm of the Odebrecht Group. Its goal is to become one of the five largest petrochemical companies in the world.

When this transaction is concluded, Braskem will hold all the assets of the North American company, which has the capacity to produce 950,000 tons per year of polypropylene at its three industrial units. Together, the plants at La Porte (Texas), Marcus Hook (Pennsylvania) and Neal (West Virginia) account for 13% of the total installed capacity for polypropylene production in the United States.

Petrobras and Sinopec Execute MOU

Petrobras has executed a memorandum of understanding with the Chinese oil company Sinopec and the Chinese EximBank (China Development Bank). The agreement anticipates joint cooperation in several areas of the oil industry, most notably exploration and production, refining, and petrochemicals.

Petrobras will invest US$140 billion

The Board of Directors of Petrobras has revised its portfolio of projects for the 2011-2014 period downward to R$250 billion (US$140 billion). The reduction was based on the 2010-2014 Business Plan.
In the area of E&P, R$153.6 billion (US$85.6 billion) will be invested between 2011 and 2014. The portfolio of projects for E&P includes the construction of platforms for production and drilling, support ships, and investments in infrastructure for transporting production.

For the gas and energy sectors, the goals are the diversification and increased flexibility in the sources of supply of natural gas, in particular the gas associated with production in the pre-salt region. Investment in these sectors will be R$17 billion (US$9.5 billion) during the 2011-2014 period.
The plan also calls for investments in new plants for ethanol and biodiesel, and in infrastructure to carry ethanol production. The investments in biofuels will total R$216 million (US$120 million) between 2011 and 2014.

Brazil and Iran Gas Cooperation

Relations between Brazil and Iran may become even closer in the economic arena, most notably in exchanging of technology in the natural gas sector. Iran holds the second-largest natural gas reserve in the world, estimated at 23 trillion cubic feet. The primary goal for Brazil in this partnership is to learn from the Iranians more efficient forms of exploitation, transportation, and distribution of natural gas.

Petrobras is seeking Partners for the country’s first Alcohol Pipeline
Brazil’s first alcohol pipeline will be built by Petrobras in partnership with selected companies from the private sector. The company seeks, among the major domestic producers of ethanol, viable partners for this pipeline project.

Wärtsilä and Samsung Gas Tanker Ships

Wärtsilä and Samsung Heavy Industries (SHI) have just signed a cooperation agreement to develop gas merchant ships. The intention is to create, in partnership, the next generation of more efficient vessels, with competitive propulsion machines, and satisfying the demands of future environmental standards.

Brazilian Natural Gas Market Grows

In February 2010, Brazil’s natural gas market racked up the highest volume since January 2009. It increased of 13.6% over the previous month, reaching 51.28 million cubic meters per day. This increase was basically due by the thermal consumption of the states of Rio de Janeiro, São Paulo, Mato Grosso do Sul and Minas Gerais, and in the industrial consumption in the States of Rio de Janeiro and Sao Paulo.

Newsletter Sources: Upstream, Global Energy, Brasil Energia, EnergiaHoje, TB Petroleum, TN Petroleo, O Globo, Reuters.