Dutch floater specialist SBM Offshore has moved significantly closer to securing its first contracts with Brazil's Petrobras in over four years, following the formal approval of its proposal for two floating production, storage and offloading (FPSO) vessels.

Contract Approval and Bidding Process

Petrobras has formally approved the proposal submitted by SBM Offshore for the contracting of two FPSOs destined for the deepwater Sergipe-Alagoas basin. This approval occurred during the proposal effectiveness evaluation phase. SBM had previously been identified as the low bidder in a Petrobras tender, surpassing competitors Shapoorji Pallonji of India and Modec of Japan. The company's country general manager for Brazil expressed optimism about winning both contracts.

Contract Values and Structure

SBM submitted a full price of $4.11 billion for the FPSO designated SEAP-2 and $4.34 billion for the SEAP-1 FPSO. The contracting strategy involves different formats for each unit. The SEAP-2 FPSO will be ordered under a build-operate-transfer (BOT) format, while the SEAP-1 FPSO is planned under a potential purchase and sale agreement. A key aspect of this strategy is that both units will ultimately be owned by Petrobras.

FPSO Specifications and Production Timeline

The two FPSOs have distinct processing capacities. The SEAP-2 FPSO is designed to process 120,000 barrels per day of oil and 12 million cubic metres per day of natural gas. The SEAP-1 FPSO is slightly smaller, with a capacity of 120,000 barrels per day of oil and 10 million cubic metres per day of gas. The production schedule targets first oil from the SEAP-2 unit in 2030, followed by the SEAP-1 unit in 2031. Under the BOT strategy, SBM would have an operating window of six and a half years for each FPSO.

Deployment Locations and Fields

The FPSOs will be deployed across specific blocks to produce from several pre-salt fields. The SEAP-2 FPSO will be installed to produce from the Budiao, Budiao Noroeste, and Budiao Sudeste fields located in blocks BM-SEAL-4, BM-SEAL-4A, and BM-SEAL-11. The SEAP-1 FPSO will be deployed in blocks BM-SEAL-10 and BM-SEAL-11 to produce from the Agulhinha, Agulhinha Oeste, Cavala, and Palombeta fields.