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Petrobras Orders $1.5 Billion in Subsea Oilfield Equipment from FMC Technologies

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March 29, 2012

HOUSTON (Dow Jones)–FMC Technologies Inc. (FTI) said Thursday it struck a $1.5 billion four-year deal with Petroleo Brasileiro SA (PBR) for the supply of subsea oilfield equipment.

The agreement comes as Petrobras, as the Brazilian oil company is known, embarks on an ambitious bid to tap its deep-water oil and gas riches, many of which lie beneath salt domes buried deep beneath the ocean. The deal underscores how U.S. oilfield service equipment providers, which helped pioneer the deepwater revolution in the U.S. Gulf of Mexico, the North Sea and elsewhere, are benefitting from that expansion despite strict rules for local content in oil-rich nations like Brazil. FMC shares are up 2.81% at $49.81.

The agreement could include the delivery of up to 130 subsea trees–an ensemble of underwater pipes and valves designed to manage the oil and gas flow of a deepwater well–and other tools. The equipment will be designed and built at FMC‘s facilities in Rio de Janeiro, where Petrobras is based.

“We have made significant investments in our Brazilian operations to enable large-scale product manufacturing and the development of new technologies,” said Tore Halvorsen, FMC‘s senior vice president, Subsea Technologies.

-By Angel Gonzalez, Dow Jones Newswires

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