Offshore staff

RIO DE JANEIRO, Brazil -- Petrobras has approved a contract for Golar LNG Ltd. to lease two ships for the LNG terminals in Guanabara Bay, Rio de Janeiro, and Pecém, Ceará. One of the regasification and storage floating units will have the capacity to regasify up to 14 MMcm/d (494 MMcf/d) of gas, and the other, up to 7 MMcm/d (247 MMcf/d). Both will be able to operate in any of the terminals and can be used to transport LNG.

The lease cost of the two ships will total $90 million per year, including operating expenses. Petrobras says this LNG project is the best technical and economic solution the company has found to make gas supply flexible, both in the short and long term, making natural gas available to southeastern and northeastern Brazil and ensuring thermoelectric plant reliability.

The project allows input purchase parceling adjusting to effective demand progress, as the trend of greater thermoelectric plant use during the Brazilian dry season (May to October) is concomitant with the lowest demand for LNG in the international market, Petrobras says.

The ships will be moored to an island-type pier in Guanabara Bay and to an existing pier in Pecém. Both will be installed in sheltered waters close to the transport network and to consumer markets. A pipeline will connect the pier to the coast, where the natural gas transport line will be integrated into the company's gas pipelines system and will be supplied by supply vessels.

The first vessel is scheduled to come onstream in the first half of 2008.

This project marks the entry of Petrobras into the LNG market and is aligned to the company's strategic objectives to increase the supply flexibility of the Brazilian natural gas market for the thermoelectrical generation needs, diversify input supply sources, and anticipate the development of this market, Petrobras says.

4/24/2007