Offshore staff

(Brazil)- Petrobras has commenced tests on its fixed platform in the offshore Peroa natural gas field in the Espirito Santo basin as it waits for the conclusion of a 128-km gas pipeline to allow commercial production.

The platform has capacity to produce 5 MMcm/d of gas.

Petrobras CEO Jose Gabrielli officially inaugurated the Peroa fixed platform earlier this week, as well as three other gas and oil production, processing and transport projects in the Espirito Santo basin. The other projects are the Cacimbas natural gas treatment unit, the Fazenda Alegre heavy crude transport unit and the Norte Capixaba sea terminal.

Investment so far in the four projects is 690 million reais ($316 million), the company said in a statement.

Investment in the first stage of the Peroa field development was 270 million reais. Peroa is a shallow-water field linked to the Cacimbas gas treatment unit through an underwater pipeline. The unit will process the gas before it is transported south to the city of Vitoria, where there is demand for the gas in local industries.

Commercial production at Peroa requires the conclusion of the 20 MMcm/d-capacity Cacimbas-Vitória pipeline, which is part of the strategic Gasene project aiming to link gas networks in the southeastern and northeastern regions. However, construction of the Vitoria-Cacimbas stretch has stopped because Spanish companies Masa and Dragados abandoned the project late last year, claiming financial difficulties. Petrobras has said it has started a new tender to hire other companies to conclude the project.

In the meantime, the Cacimbas gas treatment unit will process 1.3 MMcm/d produced in onshore fields in the Linhares region near Cacimbas, which will then be carried through an existing smaller pipeline to Vitoria.

Construction is still scheduled to be finished by the end of June this year, a Petrobras spokesperson said.

"Production in Peroa can start at any time after the conclusion of tests but this means reducing output from onshore fields," the spokesperson added.

02/09/2006