New Delhi: Bharat Petroleum Corporation Ltd (BPCL) said on Tuesday that Petrobras has signed a contract with SBM Offshore for a Floating Production Storage and Offloading (FPSO) unit at its SEAP-I project in Brazil. Petrobras is the operator of the BM-SEAL-11 consortium. The project will develop oil and gas discovered in the BM-SEAL-11 and BM-SEAL-10 concessions. BPCL has a stake in the venture through its subsidiary IBV.
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BPCL has interest in the project through its wholly-owned subsidiary Bharat PetroResources Ltd (BPRL) and step-down subsidiaries, which together hold a 65.4 percent stake in IBV Brasil Petroleo LTDA (IBV). IBV in turn holds a 40 percent participating interest in the BM-SEAL-11 concession, with Petrobras, as operator, holding the remaining 60 percent. That structure leaves BPCL with an effective economic interest of roughly 26 percent in the concession (65.4 percent of IBV's 40 percent share).
IBV's total investment in the project is expected to be about USD 2.8 billion, BPCL said, adding the crucial caveat that the spend is "subject to Government of India approvals," meaning the figure is an estimate, not a sanctioned outlay. The company framed the strategic rationale around upstream security, saying the project "has the potential to provide access to equity oil to IBV for its share which will help in strengthening the energy security of the country."
The FPSO contract is structured on a Build, Operate and Transfer (BOT) basis, under which SBM Offshore will design, build and operate the unit for an initial period of 6.5 years through a separate operation and maintenance contract. The vessel will have an installed capacity to process 120 thousand barrels of oil and condensate per day and 10 million cubic metres of gas per day.
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The SEAP-I unit, designated P-81, is one of two FPSOs Petrobras contracted with SBM Offshore on May 29 for its Sergipe Deepwater (SEAP) development, the other being P-87 for the separate SEAP-II project. First production from SEAP-I, located about 100 km offshore, is scheduled for 2031, targeting light, high-quality oil in the Agulhinha, Agulhinha Oeste and Palombeta fields. Petrobras has put combined investment across the two projects at over Real 60 billion, with expected output of more than 1 billion barrels of oil equivalent.
BPCL holds the stake in IBV as part of its overseas upstream portfolio aimed at securing equity oil.