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Petrobras Halts Activities at FPSO Cidade de Santos: What This Means for the Oil and Gas Sector
Last Saturday, October 26, Petrobras temporarily suspended operations at FPSO Cidade de Santos, a floating oil and gas production and storage unit. The suspension comes at a critical time, as the unit was returned by Enauta to Modec in July. Thus, Petrobras scheduled this shutdown to carry out inspections and repairs, seeking to ensure both the safety and efficiency of the operation.
Recent History: Frequent Shutdowns and Scheduled Maintenance
This year, FPSO Cidade de Santos has already had several interruptions. From March to June, it was stopped for 97 days. In July, there was another interruption lasting three days, followed by two in August that totaled seven days, and another in September that lasted three days. This data was released by the National Agency of Petroleum, Natural Gas and Biofuels (ANP), which monitors all operations and shutdowns, reinforcing Petrobras' transparency in its activities.
Termination of the Contract by Enauta and Its Implications
Enauta had initially acquired the FPSO Cidade de Santos to expand its operations. However, in July, the company surprised the market by terminating the contract with Modec. Although it did not explain the reasons, Enauta reported that it is in contact with Petrobras to discuss the impacts on the Uruguá and Tambaú fields, which are connected to the Mexilhão gas pipeline, crucial for the flow of natural gas via Route 1.
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Financial Impact: Reimbursement and Costs of Cancelled Contract
After the termination, Enauta recovered half of the amount paid as an advance, approximately US$ 7,2 million. The total contract was worth US$ 48,5 million, including an additional US$ 10 million with Petrobras for the Uruguá and Tambaú fields. In addition, the contract included an adjustment linked to the price of the Brent, which could add up to $25 million to the value, depending on oil market conditions.
Current Production of the Uruguá and Tambaú Fields
At the time of the termination, the Uruguá and Tambaú fields were in production. The Uruguá field produced approximately 2 barrels of oil per day, while Tambaú, focused on natural gas, generated approximately 126 cubic meters per day. These fields are strategic, as they are part of the Santos Basin and connect to the Mexilhão gas pipeline, which is essential for Petrobras and for the country's gas supply.
Challenges and Perspectives for the Oil and Gas Sector
The shutdown of FPSO Cidade de Santos operations highlights the challenges facing the offshore sector in Brazil. Scheduled shutdowns are vital for safety, but they affect the supply of oil and gas. The termination of Enauta also highlights the contractual risks and uncertainties in the sector. Therefore, Petrobras needs strategic planning to ensure that it meets its goals in a scenario of high demand for oil and natural gas, making the continuity of operations crucial for Brazil and its economy.
Gov Lula is submissive to Minister Marina Silva, whose idolatry for environmentalism demonstrates her brutal ignorance of Brazil's economic agenda.
And what does the Marina or the Federal Government have to do with this case of Urugua-Tambau and the FPSO Cidade de Santos?
The FPSO Cidade de Santos should have been hospitalized a long time ago. It is not if it is now stopped. From 2018 to 2021, it was stopped for 3 YEARS and MODEC paid daily fines for not delivering the contracted oil.
The Tambaú and Urugua fields are marginal and produce almost nothing. They are of no importance to Petrobras, as the article points out. The biggest loss is borne by Enauta.
Did Petrobras stop the FPSO or was it a planned shutdown by Modec? What was planned and executed? Were there any accidents, any unplanned revenue loss?
I didn't see anything in the article that referred to MMA.