Oceaneering secures $75m contract to support Petrobras operations

Oceaneering International, Inc. (NYSE: OII) has made a significant announcement regarding its subsidiary, Marine Production Systems do Brasil Ltda. The subsidiary has successfully secured a five-year contract from Petrobras (Petróleo Brasileiro S.A.) for the operation of three existing drill pipe riser (DPR) systems. These systems will play a vital role in supporting intervention and completion operations in Brazil. Additionally, Petrobras retains the option to include a fourth DPR system by notifying Oceaneering before mid-December 2023. The contract holds the potential to generate up to $75 million in revenue during the five-year period.

As per the contract’s terms, Oceaneering will continue delivering a range of services to Petrobras, utilizing three existing DPR systems, each equipped with installation workover control systems (IWOCS). These services encompass project management, engineering, and comprehensive support. In 2024, Oceaneering will also undertake the task of replacing the umbilicals on the existing systems. Notably, the replacement umbilicals are planned to be manufactured at Oceaneering’s facility in Niteroi, Brazil.

Field operations under this contract are expected to commence either when the current contract expires or 18 months after the contract award date. In the event that Petrobras decides to incorporate a fourth system, Oceaneering will have an additional 18 months to construct the system. This fourth system would be projected to commence operations in June 2025.

Roderick A. Larson, President and Chief Executive Officer of Oceaneering, expressed his satisfaction, stating, “We are very pleased to continue providing Petrobras with DPR services over the next five years. Since winning the initial contract in 2018, we have greatly expanded our presence in Brazil and have leveraged our portfolio of services and products into other areas of the growing Brazilian market. We believe our strong performance under the original DPR contract and our expertise in control systems and umbilicals for the subsea industry were key elements to winning this contract. We look forward to supporting Petrobras in connection with this and future projects.”