UK-based oilfield service provider TechnipFMC plc has recently secured two significant subsea contracts from Brazilian oil and gas giant Petrobras S.A. These contracts mark a crucial milestone in the development of hydrocarbon resources in Brazil’s offshore oil fields. TechnipFMC has emphasized that all equipment manufacturing and servicing will be conducted locally to ensure that the country reaps the benefits of these contracts and its pre-salt reserves continue to evolve.
The first contract between TechnipFMC and Petrobras focuses on the design, engineering, and manufacturing of flexible riser pipes, in addition to providing related services such as packaging and storage. This contract is valued between $250 million and $500 million, highlighting its substantial impact on inbound orders for TechnipFMC. The company’s success in securing this contract, coupled with its previous involvement in the Búzios 6-9 fields, reinforces its expertise in flexible pipe technology and standardized equipment platforms. It’s worth noting that Búzios is the second-largest oil field in Brazil, following the Tupi field, both located in the Santos Basin.
The second contract entails the design, engineering, and manufacturing of subsea production systems by TechnipFMC for deployment on the Atapu 2, Sepia 2, and Roncador projects. This contract also includes additional services like installation support, life-of-field services, and supplementary equipment. With an expected inbound order value ranging between $75 million and $250 million, this contract holds equal significance for TechnipFMC. The Atapu and Sepia fields, currently in their second development phase, commenced production in 2020 and 2021, respectively. The introduction of new floating production, storage, and offloading (FPSO) vessels in these fields will significantly boost their production capacity. Similarly, the Roncador field operated by Petrobras is set to enhance its production capability with the support of TechnipFMC’s contracts.
TechnipFMC’s reputation as a leading provider of energy industry solutions is reflected in its Zacks Rank #2 (Buy). Investors interested in the energy sector may also consider exploring opportunities with companies like PEDEVCO Corp. and VAALCO Energy. PEDEVCO, currently holding a Zacks Rank #1 (Strong Buy), has seen a 33.3% improvement in the Zacks Consensus Estimate for its 2024 earnings over the past 30 days. On the other hand, VAALCO Energy, with a Zacks Rank #2, is expected to achieve a 4.8% year-over-year growth in its 2024 earnings.
These developments in the oil and gas sector underscore the significance of collaboration between global industry players and local entities in advancing energy projects and resource utilization. As TechnipFMC continues to expand its presence in Brazil through these contracts, the country’s oil and gas sector stands to benefit from enhanced production capacities and technological advancements.