Petrobras gets ‘favorable decision’ in Sete Brasil arbitration
Brazilian state-owned oil and gas giant Petrobras has obtained a favorable arbitration award related to a rig dispute with its compatriot offshore driller Sete Brasil.
Petrobras and Sete Brasil initiated an out of court mediation over an offshore rig order dispute in September 2017. The two companies picked Gustavo Binenbojm to act as an impartial third party mediator, without decision-making power.
Petrobras informed on Friday that the arbitration award rejected a request made by an investor of Sete Brasil, in judicial reorganization, in the arbitration against Petrobras, with the purpose of obtaining reimbursement of investment made in the Sondas Project.
Petrobras also said on Friday that the adjusted amount of the lawsuit is approximately R$318 million ($95.9 million).
FIP Sondas is a private equity fund from Brazil, which holds a 95% interest in Sete Brasil. The remaining 5% is held by Petrobras.
Sete Brasil was established in late 2010 to build, own and operate a fleet of ultra-deepwater drillships and semi-submersibles to develop the Petrobras-operated pre-salt oil fields off Brazil’s Atlantic coast.
This was supposed to be a 28-rig project worth about $90 billion in revenues. However, following a widespread corruption scandal in Brazil which involved both Sete and Petrobras, Sete failed to obtain the funds needed to pay for the rigs it had ordered from Sembcorp Marine and Keppel. Petrobras also refused to commit to the whole rig contract package.
In April 2016, Sete Brazil was forced to file for bankruptcy protection due to Petrobras’ hesitation to sign the long-term contracts for the rigs ordered from the driller.
Offshore Energy Today Staff