Brazil plans incentives for platform construction

Feb. 4, 2003
The new Brazilian government plans to offer low-priced credit, subsidies, and other incentives to allow local contractors to bid competitively on offshore oil platforms and other Petrobras projects.

By an OGJ correspondent

Rio de Janeiro, Feb. 4 -- The new Brazilian government plans to offer low-priced credit, subsidies, and other incentives to allow local contractors to bid competitively on offshore oil platforms and other Petrobras projects both offshore and on land, said Dilma Rousseff, the new mines and energy minister.

"This government is interested in strengthening the national industry. We need to develop an industrial policy, such as in the US and France, that implement policies of governmental purchase," Rousseff said, during a recent press conference.

"Petrobras, the largest industrial complex in Brazil, has a 'double' function: of a state owned company that cooperates to meet the needs of the nation, and the role of a private company, which must be profitable and efficient," she said.

Platforms
During the presidential campaign, President Luiz Inácio Lula da Silva said he wanted all of Petrobras' offshore platforms to be built in Brazil, to generate jobs and revenues. But that proposal has triggered controversy as to whether there are enough Brazilian shipyards with sufficient technological capacity to build all of the platforms needed.

Wagner Victer, Rio de Janeiro's state energy and petroleum secretary, said some shipyards are closed and others have idle capacity. Victer also pointed out that some equipment, such as generators and gas compressors, are produced in only in three or four countries and can represent up to 20% of the cost of a platform.

According to market specialists, Petrobras is considering at least six tenders valued at $3 billion for building platforms this year. All of those platforms are to be installed in Campos basin, offshore Rio de Janeiro state, responsible for around 80% of the country's crude production.

Price policies
Roussef said reduction of Brazil's high interest rates, which amounted to 25% at yearend, and improved financing conditions are necessary to promote construction of platforms in Brazil.

"There will be a definition of price policies for oil products, but this does not mean direct intervention in the prices set by Petrobras," she said (OGJ Online, Oct. 04, 2002).

Meanwhile, Petrobras last month announced the second postponement to February from January for bids to be submitted for semisubmersible production platforms P-51 and P-52. The contracting process for P-51, to be installed in 1,240 m of water, and P-52, in 1,800 m, started last September. The platforms will be used to develop, respectively, Marlim Sul and Roncador fields in the Campos basin located offshore Rio de Janeiro state.

Each platform will follow a three-stage construction program. The final date for bids was postponed to February in response to formal requests by potential bidders seeking technical and managerial clarifications, explained Petrobras.

Petrobras also is mulling contracting a platform for Jubarte field off Espirito Santo state where the company recently made a commercial oil discovery.