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Petrobras (PBR) to Develop Fourth Mero FPSO in Offshore Brazil
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Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) signed a letter of intent with SMB Offshore for contracting a floating production, storage and offloading unit (“FPSO”) for the Mero-4 oilfield development offshore Brazil.
Discovered in 2010, the Mero field is a giant deep-water oil field development in the pre-salt Santos Basin. This will be the fourth FPSO to be installed in the Mero field, which will be a replica of the previous three FPSOs contracted for the Brazilian pre-salt.
The Mero field is part of the Libra block, which is currently being developed by a consortium of energy companies. Petrobras is the operator, with a 40% ownership interest in the block. The remaining partners include TotalEnergies (TTE - Free Report) , Royal Dutch Shell Plc , each having a 20% interest in the field, while China National Petroleum Corporation — the parent of PetroChina Company Limited — and CNOOC Limited own the rest.
Mero-4 FPSO will have a production capacity of 180,000 barrels of oil per day (bopd) and will be used to process 12 million cubic meters of gas per day. Production is expected to begin in 2025. Beside this, it will have a water injection capacity of 250,000 barrels per day and a minimum crude storage capacity of 1.4 million barrels.
Since 2017, the 50,000-bopd Pioneiro de Libra FPSO has been operating at the Mero field and is a primary source of information for the Libra consortium to enhance the development and productivity of the field, reservoir and wells. Mero-4 indicates that the Libra consortium is working together in an integral manner to simplify and make the processes more efficient.
Offshore equipment and services provider SBM Offshore will design and construct the platform with the help of its industry-leading Fast4Ward program, which includes the company’s new build multi-purpose floater hull combined with standardized topsides modules. The Fast4Ward program continues to satisfy the customer needs to develop large-scale and complex FPSOs to provide cost-efficient and low-emission intensity solutions.
Petrobras’ development plan involves the interconnection of 15 wells to the FPSO. This includes eight oil producers, six water and gas injectors, and one convertible well (from producer to gas injector) to be connected to the FPSO through rigid subsea production and injection pipelines, and flexible service lines.
Petrobras intends to complete the Mero-4 FPSO in 2024. Notably, the chartering and service contracts will run for 22.5 years from the final acceptance of the platform.
Company Profile & Price Performance
Petrobras is the largest integrated energy firm in Brazil and one of the biggest firms in Latin America. Its activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks. It comprises refining, processing, trading and transportation of oil and oil products, natural gas, and other fluid hydrocarbons beside other energy-related operations.
Shares of the company have outperformed the industry in the past three months. Its stock has gained 19% against the industry’s 13.6% decline.
Image: Bigstock
Petrobras (PBR) to Develop Fourth Mero FPSO in Offshore Brazil
Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) signed a letter of intent with SMB Offshore for contracting a floating production, storage and offloading unit (“FPSO”) for the Mero-4 oilfield development offshore Brazil.
Discovered in 2010, the Mero field is a giant deep-water oil field development in the pre-salt Santos Basin. This will be the fourth FPSO to be installed in the Mero field, which will be a replica of the previous three FPSOs contracted for the Brazilian pre-salt.
The Mero field is part of the Libra block, which is currently being developed by a consortium of energy companies. Petrobras is the operator, with a 40% ownership interest in the block. The remaining partners include TotalEnergies (TTE - Free Report) , Royal Dutch Shell Plc , each having a 20% interest in the field, while China National Petroleum Corporation — the parent of PetroChina Company Limited — and CNOOC Limited own the rest.
Mero-4 FPSO will have a production capacity of 180,000 barrels of oil per day (bopd) and will be used to process 12 million cubic meters of gas per day. Production is expected to begin in 2025. Beside this, it will have a water injection capacity of 250,000 barrels per day and a minimum crude storage capacity of 1.4 million barrels.
Since 2017, the 50,000-bopd Pioneiro de Libra FPSO has been operating at the Mero field and is a primary source of information for the Libra consortium to enhance the development and productivity of the field, reservoir and wells. Mero-4 indicates that the Libra consortium is working together in an integral manner to simplify and make the processes more efficient.
Offshore equipment and services provider SBM Offshore will design and construct the platform with the help of its industry-leading Fast4Ward program, which includes the company’s new build multi-purpose floater hull combined with standardized topsides modules. The Fast4Ward program continues to satisfy the customer needs to develop large-scale and complex FPSOs to provide cost-efficient and low-emission intensity solutions.
Petrobras’ development plan involves the interconnection of 15 wells to the FPSO. This includes eight oil producers, six water and gas injectors, and one convertible well (from producer to gas injector) to be connected to the FPSO through rigid subsea production and injection pipelines, and flexible service lines.
Petrobras intends to complete the Mero-4 FPSO in 2024. Notably, the chartering and service contracts will run for 22.5 years from the final acceptance of the platform.
Company Profile & Price Performance
Petrobras is the largest integrated energy firm in Brazil and one of the biggest firms in Latin America. Its activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks. It comprises refining, processing, trading and transportation of oil and oil products, natural gas, and other fluid hydrocarbons beside other energy-related operations.
Shares of the company have outperformed the industry in the past three months. Its stock has gained 19% against the industry’s 13.6% decline.
Image Source: Zacks Investment Research
Zacks Rank
The company currently sports a Zack Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.