GE Oil and Gas said on Tuesday that it has signed a subsea wellhead production contract worth USD 1.1 billion with Petrobras, as the Brazilian company fortifies its sub-salt offshore infrastructure.
It is GE’s biggest wellhead contract in history in terms of the number of wellheads, the company said.
The deal involves the delivery of 380 subsea wellhead systems and installation tools. Petrobras plans to install them in various oil and gas fields in Brazil, including the sub-salt region. The equipment will be produced at the GE plant in São Paulo.
More than 1,200 GE wellhead systems and 180 subsea Christmas trees have been produced and installed in Brazil. The company has expanded its facility in São Paulo and is further investing to expand its flexible line plant in Niterói to serve the sub-salt fields. In June, GE completed the expansion of its plant in Rio de Janeiro.
“GE is clearly spearheading the expansion of the oil services sector in Brazil, and is clearly looking to gain a strong footprint in the market, especially ahead of a fresh round of licenses that are due to be awarded in the coming couple of years,” said Marina Petroleka, head of energy and infrastructure research at Business Monitor International. “We believe that the oil field services will be the main winners from the new round of auctions (when they get under way), mainly given the scarcity of services companies in the domestic market. We see specialized firms with the capacity to deliver high spec solutions as particularly well placed.”
Petrobras also began receiving bids earlier this month from shipyards interested in building 28 offshore oil platforms, the Latin American Herald Tribune reported.
Most of the platforms will be used to develop the nation’s pre-salt region. Seven of them will be drill ships and 21 will be either drill ships, semisubmersible, or monocolumn platforms.
Contract terms will require the new platforms to be ready between next year and 2017. Petrobras plans to purchase eight of the platforms and charter out the remaining 20 from operators who will build them in Brazil. The bidding process will be divided into three sections, the first of which will involve the construction of seven rigs for use in water depths of more than 3000 m.
