GE Oil & Gas and Brazil’s semi state-owned petroleum company Petrobras have signed the world’s largest subsea wellhead production contract, worth nearly $1.1billion.
The massive deal coves the delivery of approximately 380 subsea wellhead systems and installation tools needed in oil well exploration, and more than 75% of the parts will be made in Brazil, which insists on maximising local content.
Petrobras plans to install the subsea wellhead systems in various oil and gas fields in Brazil, including sub-salt. The equipment will be produced at the GE plant in Jandira (São Paulo), where GE has invested $30million to expand production capacity.
“The Jandira facility has been crucial in allowing GE Oil & Gas to provide world-class technology and has prioritised Brazilian-based production, which is a critical component in local social and economic growth,” said Fernando Martins, president of Subsea Systems for GE in Latin America.
Joao Geraldo Ferreira, president and CEO of GE Oil & Gas for Latin America said of the latest success with Petrobras: “This new agreement between two of the world’s largest companies shows our commitment to collaborate in the development of the oil and gas sector in Brazil.
“In recent years our investments and efforts have been focused on preparing our company to support market growth and to be ready for contracts of this size, developing the entire supply chain. We want to grow with the country.”
This contract builds on GE’s existing relationship with Petrobras and follows previous successful projects. In 2009, the company and Petrobras signed what was then the biggest wellhead contract in history. It was worth $250million.
Such successes for GE have been made possible by the group’s acquisition of VetcoGray in 2007 and Wellstream last year coupled with ongoing investments in technology.
Indeed, over the past 30 years, more than 1,200 what are now regarded as GE wellhead systems and 180 subsea Christmas trees have been produced and installed in Brazil.
With more than 5,000 subsea employees operating in more than 50 countries, including a large number based in and out of Aberdeen, GE is supporting some of the industry’s largest and most challenging projects.
And the most challenging market of all, arguably, is Brazil where GE invested more than $30million in the Jandira plant to raise capacity and upgrade the operation overall.
In Niterói (Rio de Janeiro state), GE is investing $200million to expand its flexible line plant, to serve the new sub-salt fields.
In June, the group announced the completion of its $32million expansion of its plant in Macae (Rio de Janeiro state), tripling the size of the facility and making it GE Oil & Gas’s most modern subsea system services provider in the world. This expansion has increased the workforce at the site by 150%.
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