Brazilian state-run energy giant, Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) or Petrobras has awarded two ultra-deepwater contracts to the project management, engineering and construction company, Technip (ADR) (OTCMKTS:TKPPY). However, the value of the contracts has not been disclosed.
The French company would deliver flexible pipes of about 100 kilometers that would support oil production, gas lift and gas injection. These pipelines will be supplied to the Sapinhoá Norte field and I5 at Lula field, in the Santos Basin, offshore Brazil which lay at water depths of around 2,500 meters.
The contract by Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) also includes supply of related equipment for the floating production storage and offloading (FPSO) units, Cidade de Angra dos Reis and Cidade de Ilhabela.
The gas injection top risers have been developed by Technip in its Flexi France plant in Le Trait and production of these, along with a major portion of the other equipment will be carried out at a new manufacturing facility in Brazil, Flexibras Açu. Production is expected to start in the first quarter of 2014.
The remaining equipment for the contract will be manufactured in Flexibras Vitória. The engineering and project management activities will be performed at the company’s Rio de Janeiro operating center.
Headquartered in Rio de Janeiro, Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) is an integrated energy firm. Petrobras’ activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) currently holds a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, one can look at better-ranked players in the energy sector like Harvest Natural Resources, Inc. (NYSE:HNR) and Athlon Energy Inc (NYSE:ATHL). Both these stocks currently sport a Zacks Rank #1 (Strong Buy).
Disclaimer: This article is written by Zacks Equity Research and originally published at Zacks.com.