Petrobras NYSE:PBR cancels 5 drill ship orders
Petrobras NYSE:PBR cancels 5 drill ship orders
ORIG
Brazil’s state-controlled Crude Oil giant Petroleo Brasileiro S.A. aka Petrobras, announced Friday that it was cancelling an order for 5 new drill ships that were placed with Ocean Rig UDW Inc. NASDAQ: ORIG.
The 5 rigs were planned to be put to work in the pre-salt layer of the Santos Basin, at water depths up to 3,000 meters, about 10,000 ft.
In its press release, Petrobras said: This decision is based on the reduction of future needs for drilling, due to a fewer number of wells expected to be drilled in the pre-salt Santos Basin, relating to a higher productivity gained through the project wells in that area.
Given the company’s lack of production growth that may not be the whole story. Petrobras could be looking for ways to maintain profitability in the face of its long-term $236-B spending plans.
The 5 rigs were ordered in February at a daily rate of $548,000 for a 15-yr term. At the time, Petrobras ordered a total of 26 new rigs, all to be built in Brazil.
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