Petrobras has announced the seventh and final round of the fleet renewal plan for offshore support vessels, Prorefam. The deadline for proposals is June 27th, and contracts are expected to be signed by October. The company also analysed the program and signed contracts for the fifth round with Bram Offshore Transportes Maritimos Ltda, Norskan Offshore Ltda and Starnav Serviços Marítimos Ltda. Contracts for the sixth round are likely to be signed within April.
Director of Exploration and Production, José Formigli said they have already signed contracts for 87 out of 146 vessels (26 in operation and 61 under construction). Winning bidders will have three years to build the Platform Support Vessels (PSV) and Oil Spill Recovery Vessels (OSRV), while a four-year deadline set for Anchor Handling Tug Supply (AHTS) units.
Under government rules, local content must comprise 60% of the PSV and OSRV work, while AHTS units require 50%. Operation of the vessels must be 70% locally sourced.
The term local content refers to the use of domestic goods and services. It would naturally be simpler and cheaper to do things locally, and the Norwegian industry did the same when they intended to build a strong local supply chain. However, what we see in Brazil now is a vast range of projects at one time and a fully-booked industry that is no longer able to cope with Petrobras’ ambitious plans.
Such rules are an attempt by the government to strengthen the local industry, increase the number of companies locally established, create jobs and develop technology and qualified labour force in Brazil. However, critics and analysts have long been concerned that the high percentage of local goods and services required in concession contracts have the potential to create bottlenecks and inefficiencies.
During the signing ceremony, Petrobras’ president Graça Foster said to the audience that increasing the production is the highest topic in the agenda, higher than the local content policies and other items on discussion. Foster also said it is not possible to accomplish everything locally, and Petrobras cannot prioritize contracts that pose a threat to the oil production curve. The federal government chose not to make an official statement about it.
Created in 2008, Prorefam aims to increase the national share of the Brazilian support vessel fleet and offers special conditions for hiring locally manufactured vessels. Nevertheless, foreign flag vessels operating in Brazil have increased twice as much as the national ones within the last five years. Today, 469 vessels operate in the country, of which 52% are foreign.