Modec Is The Favorite To Supply Two FPSOs For The Marlim Field

Japanese Contractor Leads Bid to Provide Petrobras with a Pair of FPSOs, Alongside Teekay Offshore and Yinson Holdings for Marlim I and Marlim II

The Japanese contractor Modec is expected to emerge as the leading bidder in a Petrobras tender for a pair of medium-sized floating production, storage, and offloading vessels to operate in the Marlim field in Brazil. Sources reported that Modec submitted bids for Marlim I and Marlim II individually and as a combined package for both FPSOs, at what sources described as a more competitive price.

Canadian Teekay Offshore and Malaysia’s Yinson Holdings also participated in the bidding, but unlike Modec, each float design specialist submitted proposals for the two FPSOs separately.

Industry sources said that Petrobras’s bidding committee is expected to review the technical aspects of all bids in the coming weeks, with commercial pricing expected to be opened at the end of February or early March.

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“The fact that Modec is bidding together for both FPSOs gives them a certain advantage over the competition, as the company likely secured more attractive financing terms to enable greater synergies,” said a source.

With the Marlim contracts carrying zero local content requirements, it is understood that Modec is teaming up with Cosco Shipping Heavy Industries in China, its usual partner, for the conversion of the units.

Despite Teekay bidding alone, the company worked on its proposals in partnership with Brazilian player Ocyan and Singapore’s Sembcorp Marine.

Should they win the contract, sources confirmed that Teekay and Ocyan will formalize a joint venture that already operates two other floaters in Brazil – Cidade de Itajaí and Pioneiro de Libra.

The Marlim tender also marked the first time Yinson has bid for an FPSO contract in Brazil.

The company, which has five units operating in Asia and Africa, selected Keppel Fels in Singapore for conversion but is widely perceived as an underdog in the race.

A partnership between Norway’s Bluewater and Italy’s Saipem was highlighted as a potential competitor but ultimately did not participate, while Netherlands-based SBM Offshore is targeting the FPSO Mero 2, for which Petrobras is expected to receive bids on February 14.

Petrobras is seeking two FPSOs for Marlim to revitalize operations in the old development process of the Campos Basin and replace seven older production platforms installed in the field that process about 78,000 barrels per day of oil and 1.1 million cubic meters per day of natural gas.

The FPSO Marlim I will produce 80,000 bpd and 7 MMcmd, while the FPSO Marlim II will process 70,000 bpd and 4 MMcmd.

Both will be chartered for 25 years and are expected to enter production in 2022 and 2023, respectively.

Petrobras is also expected to receive bids in mid-March for 16 subsea collectors, including 10 for handling production and six to be part of the water injection infrastructure, for use in the Marlim revitalization project.

The two FPSOs will breathe new life into Marlim operations, following Petrobras securing an extension of the contract to continue producing in the field until 2052.

The contract extension will allow Petrobras to produce adequately from the Brava discovery, a pre-salt accumulation discovered a few years ago at greater depths within the Marlim hold.