Estaleiro Atlântico Sul to build seven drillships in Brazil

Brazilian shipyard Estaleiro Atlântico Sul (EAS) will build the first seven of a total of 28 new offshore drilling rigs required by Petrobras for its long-term drilling program, with priority given to the pre-salt wells. The new rigs are expected to come into operation in 2015.

The remaining 21 rigs will also produced in Brazil.

Estaleiro Atlântico Sul shipyard (EAS), located in the state of Pernambuco, which licenses technology from Korea's Samsung Heavy Industries, makes use of licensed technology from Samsung Heavy Industries.came in with a final price of $4.6 billion for seven drillships. Slated to start operating in 2015, each drillship's final price was set at $662 million

Under an arrangement approved by the Petrobras board last week, a charter contract will be signed with Sete Brazil S.A. (Sete BR), which will place the construction contract with  the shipyard.

Sete BR is a company formed by the Fundo de Investimentos em Participações - FIP Sondas, which is managed by the Caixa Econômica Federal (CEF), owns 90% of the company, and will have market investors as shareholders, including Brazilian pension funds and investment banks. Petrobras will hold a 10% stake in the new company.

Sete BR will allow companies with experienced in operating rigs for Petrobras to be partners and co-owners of the drilling vessels. The daily charter rate has already been defined and, when added to the current average operation rate, totals $430,000 to $475,000 per day, in line, says Petrobras with the most competitive rates practiced on the international market.

To finance rig construction, Sete BR will use  its own capital, on capital provided by partners, and on resources derived from long-term funding granted by the National Development Bank (BNDES), which will fund the portion related to the Brazilian goods and service content for the construction of each rig. Additionally, there will be resources coming from the export development agencies of the countries that provide imported content for the vessels and from commercial banks. The EAS shipyard will provide a performance guarantee and Sete BR will provide a credit guarantee. Both these guarantees will be backed  by Brazil's Shipbuilding Guarantee Fund (FGCN).

February 13, 2011