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OGX to invest US$ 30 billion in offshore oil rigs | |
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Eike Batista’s oil company OGX is planning to invest in 48 offshore oil rigs within the next ten years, with an estimated cost of US$30 billion. As per the announcement, each of the 48 offshore oil rigs will aim to produce 1.4 million barrels of oil per day by 2019. The shipbuilding arm of Eike Batista’s group, OSX’ main business focus is OGX’ offshore rigs investments, according to OSX’ share offering prospectus sent to the Brazilian securities and exchange commission -CVM. On the prospectus, OSX warns potential investor of high risk shares yet to be issued, with no date set.
“Our business relies on oil exploration, development and production in the Brazilian oil & gas sector, which is significantly affected, among other factors, by volatile oil & gas prices. Price fall may decrease our services demand which would have an impact on our business” as stated on the prospectus. OSX is a shipbuilding company. Its main asset will be a 2.9 million square metres shipyard located in Santa Catarina state. This shipyard will be built with technical support of the Korean Hyundai which may acquire a 10% stake in this project in the future. A dry dock will be built on the shipyard which will process 220.000 tons of steel per year. |
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Translation based on an article published in Diário Mercantil |
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Chevron to invest US$ 5.2 billion in the Campos Basin | |
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The US oil company Chevron and its partner Petrobras have jointly made the final decision to invest in Papa-Terra project in the Campos Basin. Chevron announced a total investment of US$ 5.2 billion to retrieve 380 million barrels of oil. Chevron holds a 37.5% stake in this project and Petrobras is the operator. Papa-Terra is part of BC-20 concession which was granted to Petrobras prior to the end of the Brazilian oil monopoly, and awarded to Chevron after the monopoly was over in exchange for stakes in African projects.
This will be Chevron’s second development project in Brazil. The first project is called Frade in partnership with Petrobras which is in operation inthe Campos Basin. Papa-Terra heavy oil field is located at 110 kilometres off the coast of Rio de Janeiro. A Tension Leg Platform (TLP) connected to a FPSO will be used to produce 140.000 bpd. Oil production is expected to commence in 2013. |
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Translation based on an article published in DCI |
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PETOBRAS, BG GROUP and REPSOL in partnership | |
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The Brazilian oil giant Petrobras in partnership with BG Group and Repsol signed a letter of intent with Schahin/Modec consortium for a 20-year charter and operation of a FPSO, as announced by Petrobras last week. The FPSO vessel will work as a production, storage and export unit of hydrocarbon at the Guara pilot in the BM-S-9 block in the pre-salt Santos Basin.
Petrobras E&P director Guilherme Estrella has emphasized the importance of including the Brazilian entrepreneurs in projects for the construction of big oil production units in Brazil and the importance of a high national content in Petrobras, BG and Repsol consortium’s project. The FPSO has an oil production capacity of 120.000 barrels of oil and 5 million cubic metres of gas per day and will start operating in the end of 2012. The contract for the construction of the new FPSO yet to be signed will have a national content of 65%. |
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Translation based on an article published in Nicomex Notícias. |
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Petrobras contributes 10% of Brazil’s GDP | |
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Petrobras purchased its first ethanol plant just before Christmas last year. In the previous month, Petrobras acquired 50% stake in a biodiesel plant. In the beginning of 2010, Petrobras increased its stake in Braskem which acquired Quattor to become one of the biggest petrochemical companies in the world. Due to these transactions, Petrobras has boosted its contribution in different areas of the Brazilian economy.
Petrobras’ production value, and investment impact and costs represent 10% of the Brazilian GDP. There are commercial, economic and political reasons behind the Government’s strategy to boost Petrobras. Petrobras is aiming to raise oil production, reduce costs, compete internationally and diversify its operations to be protected from crisis and abrupt price variations. |
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Translation based on an article published in Estado de São Paulo. |
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Industry more optimistic than it has been in 11 years | |
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Industry’s optimism has reached its highest level in 11 years due to recovery of the Brazilian economy. The Business Confidence Index released by the Brazilian National Confederation of Industry (CNI) hit 68.7 points, on a scale of zero to 100, in January 2010, climbing 2.8 points over October 2009 and 21.3 point in comparison to January 2009. CNI Business Confidence Index is updated every 3 months.
Transformation, extractive and civil construction industries reached more than 60 points in the Index which was considered as positive results by CNI. According to CNI, positive results were due to Government incentives. The Government has encouraged the lower social class to purchase their own properties and has cut Industrial Products Tax (IPI) on construction equipment until 30 June 2010, The manager of the Research, Evaluation and Development Unit of CNI, Renato da Fonseca said. |
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Translation based on an article published in Jornal do Brasil |
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State-owned companies hit a record high investment in 2009 | |
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The Brazilian state-owned enterprises invested R$ 71.5 billion in 2009, reaching 87% of the R$ 82 billion investment plan for 2009. The Director of the Brazilian Department of Coordination and Governance of State-owned Enterprises- DEST Murilo Barella said, in an interview, that state-owned enterprises’ nominal investment value and budget level execution hit a record high.
DEST is part of the Brazilian Ministry of Planning. In the past two years, state-owned enterprises investments soared by 30%, as per data presented by Mr. Barella. In 2008, an investment of R$ 53 billion was made and in 2007 a total of R$ 39.9 billion were invested. According to Mr. Barella, investments are currently growing 40% per bimester. |
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Translation based on an article published in Estado de São Paulo |
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Petrobras is the world’s 4th largest oil company says PFC Energy | |
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Petrobras has climbed from 9th to 4th place in the world’s 50 biggest energy companies ranking, according to PFC Energy consulting firm. PFC Energy informed that Petrobras’ shares soared 103% through out the year, which is more than what was reached by the top three companies (Petrochina, Exxon and BHP Billiton).
The calculation took into consideration the market value of the companies in 2009. PFC Energy is a consulting firm providing services to private and state-owned enterprises worldwide for more than 20 years. The ranking is annually updated by PFC. Companies are ranked by their stock market performance. |
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Translation based on an article published in Nicomex Notícias |
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Lobao: Government is studying the possibility of importing ethanol from the US. | |
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The Minister of Mines & Energy, Edison Lobão stated that the Brazilian Government is studying a proposed tax cut on the US ethanol imports to stop price rise. Members of The Brazilian Sugarcane Industry Association - UNICA have requested tax cuts. However, Lobao is not happy with this tax cut proposal. UNICA has lodged a tax cut proposal with Chamber of Foreign Trade-CAMEX. The US ethanol is currently taxed at 20%, and the Brazilian ethanol is also heavily taxed in the US. UNICA argues that tax reduction will encourage the US to open up to Brazilian ethanol which is currently taxed on US$ 0.14 cents per litter.
According to sources from CAMEX, the Brazilian Treasury will agree to cut taxes only if they conclude that it will lead to ethanol price reduction. The proposed tax cut will not be passed just to benefit the Americans. “We are not happy with the idea of importing ethanol. We would rather find an internal solution for this issue. We are still studying the possibility of a tax cut”, said Lobao. The Government will reduce the percentage rate of ethanol blended into gasoline from 25% to 20% during the period between sugar-cane harvest |
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Translation based on an article published in O Globo |
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