Technip-Odebrecht JV gets $1 billion Petrobras contract

A joint venture formed by Technip (50%) and Odebrecht Oil & Gas (OOG, 50%) has received a letter of award from Petróleo Brasileiro S.A. (Petrobras) for the charter and operation, during a fixed period of five years, of two identical flexible pipeline installation vessels for a value of approximately $1 billion, with a mutual option to extend for a further five years.

Characterized by their high pipelay tension capacity of 550 tonnes, the twin vessels will be employed principally to install umbilical and flexible flowlines and risers to connect subsea wells to floating production units in waters up to over 2,500 m deep offshore Brazil, including in the pre-salt area. The provision of installation engineering services is included in a JV´s scope.

Technip and OOG have formed a JV project team which will manage the construction of the vessels at the Daewoo Shipbuilding and Marine Engineering shipyard in the South Korea where OOG is currently completing the construction of the third and the fourth of four drilling units. Subsequently, vessel operations and the provision of marine management and engineering services during the charter phase will be handled by the JV in Rio de Janeiro.

Jorge Luiz Mitidieri, Executive VP of OOG, stated “OOG was the only national company pre-qualified to participate in the bid and this award further strengthens and consolidates OOG´s presence in the Subsea market where we have invested heavily in capacity and skills since our decision to enter the segment in 2009. Our proven track record in the construction and operation of offshore drilling assets and our partnership with Technip are key to the success of the project and we believe will provide significant potential to leverage synergies in the management and operation of the vessels and mitigate risks during project execution. This opportunity was also an important indication that our client Petrobras trust in our expertise and capability to deliver and serve.”

Frédéric Delormel, Executive Vice President and COO Subsea of Technip, declared “Technip has relentlessly maintained a leading presence in subsea production development offshore Brazil since 1977 and we are extremely pleased to be at the forefront of this new phase of Petrobras development into deeper and more challenging waters. Odebrecht has a similar tradition, coupled with a solid track record in the recent and ongoing delivery of deepwater drilling units with DSME. We fully expect that this robust partnership and the distinguishing characteristics of these new assets will enable the cost effective supply of high local content flexible and umbilical subsea productions solutions to Petrobras for decades to come.”

November18, 2011