Oct 15, 2019

Oil company is the first international oil company to seek a drilling unit for the development of a large field in Brazil

The attention of major drilling companies will turn to Equinor in the coming weeks. The Norwegian oil company launched a bid to charter a 3,000 m water depth rig for the Carcará development wells campaign in the Santos Basin.

The scope of the deal provides for a contract of up to eight uninterrupted years, which, if exercised, will mark the longest-term contract signed in Brazil since the beginning of the sector crisis. The rig will have to be available to begin operations in 2021 between May and June.

The rig charter has term of four years plus four one-year extension options. As the project foresees the drilling of 18 to 20 wells, the tendency is that the oil company uses at least two extensions.

The bidding is conducted by the Equinor team from Norway. The contract requires the rig to be equipped with a pressure management system (PMS) and dual activity. The deadline for submission of proposals is five weeks.

According to PetróleoToday, no Brazilian company was invited. The assessment is that Brazilian drilling companies would not have rigs available to meet contractual requirements. A few months ago, Equinor launched an RFI to probe companies’ interest and availability, forwarding pre-order specifications to a large number of Brazilian and foreign companies.

Favorite companies include EnscoRowan, Transocean and Norway’s Seadrill and Odfjell.

Milestone among IOCs

The initiative marks the first hiring of a large field development drilling campaign made in Brazil by a foreign company. The size of the operation demonstrates the magnitude of what is to come in the coming years with the demand from IOCs.

Equinor’s rush to hire a rig that will only go into operation in 2021 gives evidence that the Norwegian group has the perception that the drilling market will grow again in the short term. To date, charter rates remain low and units without contract are widely available.

The Carcará development plan foresees the production of the first oil between 2023 and 2024. The complementary phase of the project will be put into production three and a half years later, focusing on the North Carcará area, acquired in the second round of production sharing.

Equinor will conclude this month an exploratory drilling campaign in Carcará with the Seadrill drillship West Saturn. In parallel, the Norwegian oil company is discussing with the market the FEEDs for the project’s FPSO and SURF (subsea risers, umbilicals and flowlines).

In the case of the FPSO, negotiations started with Modec and SBM. The unit will be newbuild, and the hiring model should not be the charter. The production plant is expected to have a capacity of 220,000 b / d of oil.

Carcará was discovered by Petrobras in 2012 and acquired by Equinor in 2016. The Norwegian oil company has a 40% interest in the asset, in partnership with ExxonMobil (40%) and Galp (20%) – same consortium as North Carcará.

Source: Brasil Energia Magazine

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