Oil companies and contractors are likely to wait out restarting drilling operations until there is more clarity after US judge overturned the 6-month ban on deepwater drilling in the US Gulf, which has affected 33 oil wells. The White House said it would immediately appeal against the court ruling. Already, some companies are eyeing moves to Brazil and Africa but Petrobras indicated that it has not seen any increased rig availability just yet and if the US moratorium lasts 6-12 months, the impact may be limited as rigs are normally contracted on a long term basis.
Meantime, Petrobras has obtained board approval for its 2010-14 business plan, which calls for investments of US$224b or 28% more than the 2009-13 budget and higher than previous estimate of US$200-220b. E&P will account for US$119b or 53% of the total investment and the group plans to have a total of 26 deepwater rigs by 2014 and 53 by 2020 and double its support fleet to 504 vessels by 2020. To fund the massive investment, mgmt has projected US$155b in net cash flow based on US$80/bbl oil price with the rest coming from new equity and debt funding. However, it has postponed a proposed share sale from Sep to Jul.
Both KepCorp and SembMarine are currently bidding for contracts in Petrobras' 28 rig tender.
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