Mero 2 pre-salt development of Brazil

February 28, 2019
Facebooklinkedin

Japanese Modec and Netherlands-based SBM Offshore, two of the largest floater companies have gone head-to-head in a Petrobras tender for the supply of a large floating production, storage and offloading (FPSO) vessel for the Mero 2 pre-salt development off the Brazilian coast.

The Mero field is an ultra-deepwater oilfield situated approximately 180km offshore Rio de Janeiro in the Libra block in the pre-salt area of the Santos basin.  The Mero field is owned by the Libra consortium, which is led by Petrobras (40%) and includes Shell (20%), Total (20%), CNPC (10%) and CNOOC Limited (10%). However, Petrobras is the operator of the Libra Consortium.

Modec and SBM Offshore submitted commercial offers on 14 February 2019 in a competition marked by interest among the vast majority of invited players, although it had been widely expected that Malaysia’s MISC would join the race.

According to industry sources MISC was due to submit a proposal for the Mero 2 FPSO to compete against Modec and SBM, but the company was seeking a new extension in the bidding date, which was not granted by Petrobras. Last year, MISC bid for the Buzios 5 FPSO but was disqualified by Petrobras on technical grounds.

With the tender process now limited to just two players, Petrobras hopes prices for the Mero 2 FPSO, which will have a daily processing capacity of 180,000 barrels of oil and 12 million cubic metres of natural gas, comes within its budget requirements.

The contract, covering over 22 years of operation, is expected to be awarded by the end of the year to have to unit on stream by late 2022 whilst first oil from the Mero field is expected to be achieved by 2021.

Mero 2 will feature local content requirements of 40% for engineering, machinery and equipment, as well as construction, integration and assembly. This of course means part of the work will be carried out in Brazil.

It is understood that SBM is looking at offering its highly advanced Fast4Ward FPSO concept design for Mero 2. SBM is also said to be closing in on an order for a third floater hull under its innovative design. The unit would have potential application in the pre-salt province in case SBM is awarded the Mero 2 contract.

Modec, the floater specialist, is also said to have presented a competitive offer for Mero 2 in a contentious attempt to build up its dominating presence in the Brazilian market.

With 10 FPSOs operating in Brazil — including nine with Petrobras and one with Shell, and two more under construction for the Mero 1 and Sepia pre-salt developments Modec is believed to be a top contender for the large vessel.

 

Website design by Gravitas London