Subsea oil production in Brazil: the race between steel and flexibles continues

08 Aug 2019

Looking back at the development of offshore oil and gas in Brazil we can see a consistent theme, where Petrobras would exploit its offshore potential its own way and not necessarily follow the methodologies and contracting philosophies of its US and European counterparts.

During the late 1980s and early 90s the European O&G contracting model for subsea project developments was to execute projects on a lump sum transport and installation (T&I) basis. These projects were predominately executed in shallow waters (less than 200 ft) and relied on the use of rigid spools and pipelines utilizing a relatively abundant supply of local offshore assets from DSVs to rigid pipelay vessels. If we compare and contrast this approach to the development of offshore oil and gas in Brazil, the Campos basin which was first drilled in 1971 with first production starting in 1977 from the Enchova Field in 1977 at a water depth of 124m ( 407ft), it was obvious to most observers that the challenges that Brazil would face were centered around access to new deepwater technologies and access to a ready supply of offshore assets to meet these new challenges.

To meet these challenges Petrobras needed to develop a contracting strategy that would allow them early access to the reservoir to generate cash flow whilst allowing for a cost effective and timely delivery of the expansion of its fields at the same time as developing the local infrastructure, all of this to support the long term development of the Campos basin with projects such as Espadarte ( 800msw) and Jubart (1300m) and many other prolific fields.

It was clear that Petrobras needed to secure access to the technologies that were core to their new field developments. This centered around creating long term leasing agreements for the provision of FPSOs and developing a supply model for the provision of technology that transported the oil from the well to the FPSO. During the early to mid-90s Petrobras reviewed the use of steel and flexible product for the transport application but over time it became evident that for green fields and brown field expansion projects flexible pipe was the clear winner as it allowed Petrobras the ability to cut down on the field layout planning cycle and accommodate late changes to well locations. This strategy has matured over time into the contracting model that Petrobras utilize in Brazil which is a frame contract for in-country supply of flexible pipe with all three flexible pipe manufactures. To support these frame agreement, Petrobras also has contracts with the suppliers and operators of PLSVs and until recently had close to 20 PLSVs on long term contracts.

The new pre-salt fields, Mero 1 and Mero 2, are prescribed as being steel. The production fluids contain high levels of hydrogen sulphide and carbon dioxide, which cause problems for the flexible pipe that served Brazil’s earlier reserves so well. Despite their best efforts, flexible suppliers cannot yet rise to the technical challenge and so Brazil is almost going full circle. The flexible companies and contractors have, however, been looking at new materials technology to resolve the corrosion challenge. Thermoplastic composite pipe (TCP) solutions, particularly those that use PEEK, aren’t affected by the environmental conditions and can be handled in a similar way to flexibles. These are cutting edge solutions that are now being qualified for pre-salt conditions.

Once Petrobras has incorporated TCP into its local expertise and infrastructure, flexible pipe will most likely again increase in popularity in Brazil and the use of steel will perhaps begin to decline. For the next period of Brazil’s oil production history there is room for both steel, flexible and TCP solutions. Brazil’s economy will ultimately benefit from its local expertise in sour service and ultra deepwater production and will be in a position to export its knowledge and proven solutions.

by Tony Duncan, Executive Vice President Americas, Magma Global, for Subsea World Brazil

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