Petrobras to cut another ten drill rigs from their portfolio in 2016

Petrobras to cut another ten drill rigs from their portfolio  in 2016

The portfolio of Petrobras drill rigs should be reduced to 35 units in 2016 due to the negotiations with the drilling companies to reduce daily fees and court costs. The projection is from the E & P division at Petrobras , down from  100 units under contract 4 years ago and  45 units through August this year.

The reduction of the fleet – ensured by early cancellation of some charter contracts, at no cost to Petrobras, and by placing some units on stand-by – at lower rates, will affect contracts with Transocean, Ensco, Etesco, Paragon, Diamond , Seadrill and Noble. Petrobras has already signed with the first two and follows in final stages of negotiation with Etesco and Paragon. The committee also deals with Seadrill, Petroserv, Helix, Diamond and Ocean Rig, main terms of the new agreements.

Aside from the significant cut in the number of units, the signing of the first contract of additives resulting from the negotiations with the drilling companies are stuck in the legal dept. of Petrobras and will not occur in September as originally planned by the company. The new date estimated by the E & P has moved to mid-October. Do not be surprised if the outcome finish is moved to November.

The projection of the market has logical support, although the need for cost reduction by Petrobras is urgent. After the legal department gives its opinion to the negotiations, the proceedings shall be referred for evaluation by the Petrobras Performance Committee to then be submitted to the Board.

Under the terms of some of the agreements, the reduction in daily rates begin to take effect as from October 1, by signing the amendment in September. The discounts secured by Petrobras range from US $ 40,000 /U$ 60,000 / day, and the savings projection exceeds millions of dollars / month.

The slowness of the process at Petrobras’ legal department is directly linked to the problems arising from the Lava Jato investigations. After the corruption scandals, the legal department has accumulated great deal of work, and analysis began to follow a much more judicious ritual.

In addition to increased demand for advice, there is a clear fear among technicians, managers and executives to sign and endorse new company documents. Internal and external view is that compliance procedures slowed the company’s routine even more.