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Samsung, Hyundai, Daewoo prepare for Petrobras oil platform tender -sources

01/28/2021 | 10:14am EDT

RIO DE JANEIRO, Jan 28 (Reuters) - Three consortia including Asian shipyards are preparing to compete to build Brazilian state-controlled oil firm Petrobras' first two in-house platforms in more than seven years, according to four people familiar with the tender.

Samsung Heavy Industries Co, Daewoo Heavy Industries & Machinery Ltd, and Hyundai Heavy Industries Holding Co Ltd have formed separate consortia that are expected to bid after seven months of preparations, the sources said, declining to be named as the information is private.

Offers are due on Monday, Feb. 1. Samsung and Petrobras declined to comment. Daewoo and Hyundai did not immediately respond to requests for comment.

The competition marks Petrobras' comeback as a key customer for Asian shipyards. Similarly sized units have previously cost around $1.7 billion each to build, one of the sources said.

Petrobras, as Petroleo Brasileiro SA is known, requires units each able to produce 180,000 barrels of oil per day and 7.2 cubic meters of gas for its massive Buzios field, the second most productive in the country.

The platforms are effectively massive ships with deep-water production equipment that are vital in some offshore oil basins. They are known as FPSOs, or floating production, storage and offloading units.

The debate on where Petrobras should build its platforms has been a key issue in presidential campaigns over the past two decades in Brazil.

Construction of the hull is labor-intensive, leading past administrations to create domestic-content rules. Those were eased after a corruption scandal, although the exact percentage of local content will only be known once a winner is selected.

Brazil's biggest-ever corruption investigation - known as Car Wash - exposed multi billion-dollar bribe payments from Petrobras suppliers aimed at securing contracts, including for platform construction in Brazil and in Asia.

Buried in debt, Petrobras spent more than seven years only leasing its platforms, using long-term contracts that can be amortized over 20 years. Dutch-based SBM Offshore NV and Japan's Modec Inc split the biggest contracts. Modec and SBM declined to comment.

Modec and SBM pre-qualified to participate in the latest tender but have dropped out of the competition, preferring the leasing model in which they can use their own engineering instead of Petrobras'.

Ten companies pre-qualified for the tender launched by Petrobras in July 2020.

Hyundai has associated with Keppel and its Brazil-based BrasFELS shipyard for the bid, the sources said. Daewoo has partnered with Saipem, while Samsung is prepared to bid with Toyo and its Brazil-based shipyard EBR, they added.

Keppel and Saipem declined to comment. Toyo did not immediately respond to a request for comment. (Reporting by Sabrina Valle and Marta Nogueira; Editing by Marguerita Choy, Jan Harvey and Bernadette Baum)

ę Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
EURO / BRAZILIAN REAL (EUR/BRL) -1.23% 5.9869 Delayed Quote.-3.63%
HYUNDAI CORPORATION 0.00% 20850 End-of-day quote.30.72%
HYUNDAI HEAVY INDUSTRIES HOLDINGS CO., LTD. -1.93% 71000 End-of-day quote.25.22%
HYUNDAI MOTOR COMPANY -1.25% 236500 End-of-day quote.23.18%
KEPPEL CORPORATION LIMITED -0.58% 5.1 End-of-day quote.-5.20%
KOREA SHIPBUILDING & OFFSHORE ENGINEERING CO., LTD. -2.55% 134000 End-of-day quote.23.50%
LONDON BRENT OIL -1.08% 73 Delayed Quote.43.56%
MODEC, INC. -0.76% 2206 End-of-day quote.17.78%
PETRÓLEO BRASILEIRO S.A. - PETROBRAS 0.38% 29.14 End-of-day quote.2.82%
SAIPEM S.P.A. -1.88% 2.194 Delayed Quote.1.41%
SAMSUNG ELECTRONICS CO., LTD. -1.10% 80900 End-of-day quote.-0.12%
SAMSUNG HEAVY INDUSTRIES CO., LTD. -1.15% 6900 End-of-day quote.-1.99%
SBM HOLDINGS LTD 8.43% 4.5 End-of-day quote.25.00%
SBM OFFSHORE N.V -2.06% 13.535 Real-time Quote.-11.21%
TOYO CORPORATION -0.36% 1115 End-of-day quote.-4.37%
TOYO ENGINEERING CORPORATION -1.40% 706 End-of-day quote.73.89%
TOYO INK GROUP 0.00% 2.11 End-of-day quote.24.85%
WTI -0.77% 70.978 Delayed Quote.50.22%
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