With a number of new O&G discoveries popping up nearly continuously in Brazil, both in shallow and deepwater, there has been a significant increase in ROV demand by operators, not only the major players but by all players involved on the Brazilian oil boom.

In general the delivery of a complete ROV system may take around nine months, this includes the delivery of key equipment such as heavy duty winches, power and control umbilicals, flotation foam blocks, control modules, tooling kits and backup equipment. Here in Brazil, ROV manufacturers, which are basically all foreign companies with local offices, have been increasing their local stocks of ROV systems.

 Most companies have some form of technical maintenance warehouses in the city of Macaé, a few hundred miles northeast of the city of Rio. Macaé is still the main hub of the O&G industry in Brazil, concentrating operations offices, training centers and warehouses stocking replacement equipment. Some say the city is reaching its limit in terms of new areas for construction of oil industry facilities, including various kinds of factories. Luckily, this is far from the truth as Macaé still has a lot of land available for construction in the outskirts of town.

With the great amount of PSV, Multipurpose Vessels, Drillships, Rigs and FPSOs being built, and with most of these requiring at least a couple of ROVs, the demand for these vital subsea workhorses is steady and showing a tendency to increase in the next few years.

Most ROV manufacturers and also suppliers of various specialized tools and equipment used in ROV systems appear to be quite satisfied with business in Brazil. I have heard complaints mostly related to logistics problems in delivering equipment to Brazil, mainly due to customs inefficiency and bureaucracy, which unfortunately is an ongoing problem that creates a bottleneck for any equipment placement logistics plan.

It is quite possible that more ROV manufacturers will build construction facilities in Brazil, as has already happened to umbilical and flow line manufacturers. There is also a good possibility that in the next 5 years at least a couple of national ROV manufacturers may join the growing marked. This is true because the technology used in ROV systems, although state-of-the-art, is now more accessible to small and highly technical entrepreneurs, especially with the growing emphasis in high end technology research geared to the O&G industry and led by the UFRJ´s (Federal University of Rio de Janeiro) technology park.

Claudio Paschoa

The Alpha Crusis is a 64 meter (213feet)  long and 11 meter (36 feet) wide research ship, capable of carrying up to 20 passengers, weighing 972 tons and with a 40 day sailing autonomy.  The research ship was bought by Fapesp (Foundation for the Support of Research of the State of São Paulo) from the University of Hawaii for use by the Oceanographic Institute of the University of São Paulo.  The ships total cost including renovations ran at $11 million. When it belonged to the U of H, the ship was called the Moana Wave and was being run by NOAA until it was acquired by Brazilian Fapesp, after which it went through 10 months of renovations and refurbishing in a Seattle shipyard.

The new research ship will be launching buoys and deepwater sensors in various locations off the Brazilian coast in order to monitor hot and cold water current circulation in an ambitious project that has the goal of identifying how the forests and the sea in and around Brazil affect the global climate balance.

The Alpha Crusis will be substituting the Professor W. Besnard which was in use between 1967 and 2008, when it had a major fire and has been non-operational since.

Another ship, the Alpha Delphini, which was the first specialized oceanographic ship built in Brazil, is also part of the project. It is 25 meters long and will be launched from a shipyard in Fortaleza, northeast Brazil in July.

The Alpha Crusis is already in Brazilian waters after enduring harsh weather conditions when leaving Seattle, with rough seas and 10 meter waves that tested the ships seaworthiness and endurance. It has already undergone research equipment tests off the mouth of the Amazon River. It will be motoring down the Brazilian coast collecting samples, launching buoys and deepwater sensors at pre-established locations including many river mouths, underwater canyons, deepwater basins and reefs along the coast in a wide area which will take it close inshore and also over 100 nm offshore.

The Alpha Crusis is a DP (Dynamic Positioning) ship, which offers many advantages when collecting underwater data, especially in deep and ultra deep waters.

Claudio Paschoa

The Moana Wave when it was being operated by NOAA, before being refurbished and renamed the Alpha Crusis

In an importand development for Brazilian high-speed communications with the United States, U.S. based Seaborn Networks service provider is primed to lay a new system of submarine cummunications cable that will provide a direct route between the Unites States and Brazil.

Set to go active in 2014, the new Seabras-1 submarine cable will offer 32 Tbps of capacity connecting Miami and Sao Paulo, with a branch that lands in Fortaleza, Brazil. The service provider's timing couldn't be better as the Brazilian government prepares to adopt a National Broadband Plan and the country is also preparing to host upcoming 2014 Soccer World Cup and 2016 Olympic Games, which will drive greater growth of voice, video and data services throughout Brazil. The major increase of U.S. oil and gas companies opening offices in Brazil due to the massive exploration of the deep water pre-salt O&G frontier off the Brazilian coast are also set to benefit from this high speed u/w cable.

A Frost & Sullivan report forecast that growth in Brazil's telecom investments will total $35 billion from 2011 through 2016. Over the past three years, Seaborn and a number of traditional telecommunication providers, including BT, Level 3 and Orange Business Services, have made continual investments in Latin America. While Seaborn is new, its founders--including CEO Larry Schwartz--have plenty of experience building out large submarine cable networks. Before the creation of Seaborn Networks, Schwartz led Bridgehouse Marine, an installer of submarine fiber optic cables systems for the telecommunications industry.

This experience will come in handy as the provider begins building out its network and targeting potential wholesale customers in both Brazil and the United States. The recent meeting between the Brazilian and U.S. presidents and the possibility of easier transit through immigration for citizens of both countries is also expected to drastically increase commerce between the two countries, if this really goes through, the new high speed comms will be very handy indeed in order to speed up contact between business men in both countries.

There has not been much talk about eventual environmental impacts caused to the seabed by the u/w cable system but it will definitely be something to look at as there are many sensitive areas along the Brazilian coast that need to be protected. Obviously the fingerprint left by a telecomm cable is negligible as compared to O&G pipelines, but it still is something that needs to be looked at in order to protect the u/w environment as much as possible.

Claudio Paschoa

An interesting article by the leading Brazilian newspaper O Globo, signed by Journalist Marcio Beck, brings to light the need to urgently create a database with information on the “DNA” of oil produced in Brazilian fields. According to researchers from the Academia and from the O&G industry, this is essential in order to speed up the identification of those responsible for any given oil spill.

According to the article, the basic characteristics found in the formation of an oil reservoir, such as types of stones, sediments and organic matter along with time, temperature and pressure conditions, which give a distinct DNA to each different oil reservoir. Therefore, it would be possible to identify from which field any given oil sample originated from. This would expedite identifying which operator is responsible for a spill in order to quicken response to spills and clean up of affected areas.

This would also help end the mystery pertaining to the so called “orphan” oil slicks (those oil slicks that cannot have their origins immediately identified). A good example is the Chevron oil spill in the Frade field at the Campos Basin, in November 2011, which was originally considered an orphan spill, when first identified by Petrobras between the Frade and Roncador fields. Only 2 days after the beginning of the spill, on November 9^th,did Chevron officially communicate its responsibility for the spill and initiate security and containment measures.

Another good example of how this database could be used is the fact that Chevron claims that the oil that is still seeping through the crack in the rocks under the seabed are not from the same well as the oil from the spill in November. This claim is based on the fact that samples of this oil were analyzed by Ipex, a laboratory belonging to Brazilian independent operator HRT Oil & Gas and revised by Chevron technicians, attests to the fact that the origins of the oil samples differ. The operator does not divulge the exact test results or the oil “DNA” as this is considered classified information.

With such a dynamic growth as the Brazilian O&G industry is experiencing and with the knowledge that this growth will continue for another decade at least, signifying hundreds of new wells to be drilled and put in production, where the oil will go upstream to refineries by way of thousands of miles of pipelines and hundreds of tankers, it may become extremely difficult to identify a spill´s source without a comprehensive independent oil identification database.

It is probable that any such independent oil analysis laboratory would be headed by Coppe-UFRJ as they are the leading academic institution in Brazil, when it comes to oil and gas research. According to Luiz Landau, a leading engineer at Coppe-UFRJ and coordinator of its Laboratory of Computational Engineering Methods (Lamce) at Coppe-UFRJ, the Brazilian database should be centralized and contain the chemical signature of the oil in each well in Brazil. “The companies (operators) have databases because it is interesting commercially.” There is also the strategic value in being able to compare different kinds of oil.

Claudio Paschoa

Recently Petrobras, the Brazilian national O&G operator announced that it had awarded Technip a 5-year frame agreement contract for the supply of around 1,400 kilometers of flexible pipes, with supply starting in 2013 and orders are guaranteed for at least 50% of the total value, which is currently estimated to be worth around US$2.1 billion.

The scope of the contract includes the manufacture of over 150 types and diameters of risers, flowlines and associated equipment and accessories

Flexible pipes for the contract will be produced both at Technip's existing manufacturing site in Vitoria, and also at our new manufacturing facility under construction in Açu, Brazil.

This agreement is a direct spinoff of the investment Technip made last year in building a second state-of-the-art flexible pipe plant in Brazil, which promises to apply a wide range of technological advances in manufacturing, targeting efficient and safe flex-pipe products for the deep-water plays.

This is just an example of the magnitude of pipelines being laid on the seabed and floating up to FPSOs and production rigs. In terms of seabed mounted pipelines we are talking of tens of thousands of kilometers of pipes crisscrossing the Brazilian offshore seabed and linking oil and gas to the coastal refineries. Although today most of the produce transported by pipes to refineries is composed of gas, the amount of oil carrying pipelines will dramatically increase with the new pre-salt fields coming online.

Presently, there are no effective and independent monitoring schemes for these rigid and flexible pipelines except by the monitoring done by the operators themselves. There is also no effective legislation or even guidelines as to where these pipelines may be laid.

Any environmental concerns are foreshadowed by logistics needs of the operators. Obviously these pipelines, rigid or flexible are vital to the growth of the Brazilian O&G marked but with such a huge amount of pipelines being laid it appears to be necessary to have greater transparency as to how decisions are made as to where the pipelines will be placed and what resources are available to contain possible leaks caused by ruptures is these pipelines.

Will it be necessary for a major spill to happen before authorities decide to monitor these thousands of kilometers of pipelines?

Claudio Paschoa

 

The Ponta Negra Terminal (TPN) to be built at the south side of Jaconé Beach at Ponta Negra Point is to be one of the biggest ports in the country. DTA Engineering, responsible for the project, unofficially called the Pre-salt port and with an investment forecast of $5,4 billion in an area of 557,2 thousand square meters, is expected to link oil & gas pipelines from the Pre-salt plays to the Petrochemical complex of the state of Rio de Janeiro (Comperj), which is located in the nearby city of Itaborai. The project includes a port, a ship and rig maintenance shipyard and a refinery. Authorities consider the location ideal due to the fact that the point has a natural depth of 30 meters.

The refinery project is forecast to receive 850 thousand barrels of oil per day, equivalent to 40% of the current Brazilian oil production. The builders are promising an unspecified novel new technology against oil spills, this new technology is also untested.

Environmentalists are very worried because this location at Black Point (Ponta Negra) is one of the most preserved beaches in the state of Rio de Janeiro. It has its own characteristic sand, the location is important breeding area for four kinds of whales, it is also a location which was visited and considered of great environmental importance by Charles Darwin in the XIX century. “Ponta Negra” is also an excellent surf location, which can hold swells up to 20 feet. This is another worry as massive breakwaters will have to be built way beyond the point itself. The swells there are so strong that they may cause serious damage to the port and to ships, which in turn may lead to environmental accidents. Local fishermen are also incensed by the idea of having such a location rich in various noble fishes polluted.

There have been no serious studies on the environmental impact of such an enterprise in this location and the city of Marica, which is the nearest city to the port complex, simply does not have enough infrastructure to house such a major project, almost certainly causing an increase in pollution, crime and violence in a very calm area, due to the influx of workers for the port construction. Shantytowns are expected to be built by these workers and there are no known plans to curb the imminent pollution caused by such an influx of people.

Unfortunately, the state government is all for it, irrespective of the consequences. The national development bank BNDES is also very interested in financing the project and little is spoken about environmental impacts. When any of the parts directly involved actually speak of impacts, they downplay any consequences and actually make fun of such worries.

The sad truth is that by the second semester of 2012 the port is expected to receive its environmental licence, with only a token environmental impact study to back it up. Financial and logistic interests are nearly certain to overlap any concerns with nature.

There are other locations along the coast that could house this port complex leaving a much smaller footprint, unfortunately it looks like the developers and the local government have their mind set on this and are not even looking at any alternatives. So once again it looks like ignorance and economic interests will prevail, as is almost always the case in these types of developments in Brazil.

Claudio Paschoa

The Brazilian National Petroleum Agency (ANP) is examining a scenario where a series of seabed leaks may occur in a 7km radius around the Frade oil field in the Campos Basin, due to sagging of the seabed in the area and fissures in the rocks surrounding the Frade oil reservoir. The Frade well is located 130km off the city of Macaé in Northeast Rio de Janeiro at a depth of 1,200 meters (3,996 ft). Although it is still unclear if Chevron, the main field operator is responsible for this due to having exceeded the pressure limits of the well, there is evidence that the super-major operator did exceed the well wall pressure limit. Transocean´s chief driller at the site, Brain Mara, claims that while drilling, a mud pressure of 9,5 pounds per gallon was not enough to contain a kick from the reservoir, therefore the drillers increased this pressure to 13,9 pounds per gallon in order to push the oil back down and control the kick. He also claimed to know that the maximum pressure the walls of the well could take would be up to 10,57 pounds per gallon, but continued with the risky operation as he was following orders. The rupture of the well wall if mud pressures over 10,57 was applied was forecast in the wells Leak Off Test (LOT). However Chevron´s president in Brazil, George Buck, claims that the mud pressure was only increased 6 days after the initial spill in November 7th which was comprised of a 300 meter fissure which spilled a total of 2,400 barrels. On March 4th another fissure 800 meters long was discovered around 3 km from the original spill location and that´s when the sagging of the seabed was positively identified. This spill was much smaller than the original spill as the wellhead was already sealed off but geologists in Brazil are claiming that the reservoir pressure is still forcing out small quantities of oil through the fissures in the rocks surrounding the deepwater well. They also claim that these fissures and the seabed sagging were caused by the overpressure applied to the well walls before the first spill in November. Chevron denies that the two spills have any relation. Nothing is proven either way at this point, but the fact is that the seabed sagging along with the fissures on the rocks surrounding the reservoir may well force the premature ending of any operations in the Frade field, which before the November accident had other wells producing a total of 61,500 barrels/day. Chevron has already suspended production and it is increasingly likely that Chevron may have its operations license in Brazil revoked due to the accident. Claudio Paschoa

The Brazilian ROV pilot training company RRC Robotica Submarina, has recently acquired two work class ROVs from majorn U.S. ROV manufacturer Schilling Robotics. RRC Robotics also offers specialized services such as; Consulting and Auditing ROV systems; 3D modeling of subsea operations; Subsea engineering; ROV operations and rental, sales and maintenance of ROVs and tools from its base in the City of Macaé, located northeast of the city of Rio de Janeiro. Macaé is also the main hub for all offshore O&G companies and service providers in Brazil. Schilling Robotics was founded in 1985. Schilling is headquartered in California U.S.A. and has regional offices in Texas U.S.A., Aberdeen, Scotland, and Singapore. Schilling Robotics also operates a service and support station in Brazil. The newly built 278 square meter (3000 square feet) facility is located on the FMC Technologies campus in Macaé.FMC Technologies, Inc. has held a 45% interest in Schilling since 2008. In January of 2012, the company announced it would purchase the remaining 55% interest by March 30, 2012. The Work Class ROVs acquired by RRC are of the HD model, which offer 150hp power systems and are rated to 3000m (9990ft) depth. The ROV systems are scheduled for delivery in the second quarter of 2012. These ROVs will be installed on two separate PSVs for work offshore in Brazil. José Ramos, General Manager for RRC-Robotica Submarina stated, “RRC is very pleased to acquire two HD ROV systems from Schilling. The Brazilian market and its clients will now experience the use of the very high quality and reliable equipment. Together with our management innovation and full local support from Schilling, we are 100% sure that the results will impress our clients.” This is really good news for RRC due to the huge demand on Work Class ROV systems in Brazil. Presently, there are no work class ROVs being manufactured in Brazil by local companies. So any local company wanting to enter the growing ROV rental market in Brazil needs to acquire their ROVs from foreign manufacturers. This should also give a great boost to RRCs ROV pilot training program, which is one of a kind in Brazil, as it will potentially permit the RRC trainees to get hands on experience with live ROV operations. Claudio Paschoa

Two scientists, William Jones and Guilherme Castellane discovered two giant whirlpools in the Atlantic Ocean, off the coast of Guyana and Suriname. No can really explain exactly how these whirlpools were formed even though the area in question had previously been comprehensively mapped. The two funnels are approximately 400 kilometers in diameter. Until now whirlpools of this size were not known on Earth. The funnels may exert a strong influence on climate changes that have been registered during the recent years. “Funnels rotate clockwise. They are moving in the ocean like giant frisbees, two discs thrown into the air. Rotation occurs at a rate of one meter per second, the speed is sufficiently large compared to the speed of oceanic currents, on the border hoppers is a wave-step height of 40 cm,” Castellane said. Just northwest of Brazil, winds drive part of the North Brazil Current eastward along the equator. Every now and then, this turn is especially sharp and the current loops around. The looping action pinches off a huge clockwise-spinning disk of warm water that travels northwest like a Frisbee moves through air. Although scientists have known about these “current rings” for decades, knowledge of even their basic details such as size, speed, depth and rate of spin was limited. It is not ruled out that the reason for the appearance of the whirlpools off the coast of South America is the same as in smaller whirlpools detected in other parts of the World Ocean. Scientists are currently studying the influence of those giant funnels on the climate of Latin America and Africa. Such whirlpools show influence on the atmosphere and form cyclonical air mass. They can also affect the movement of air mass formed in other places. For the time being, scientists do not know how the newly discovered water craters can affect the climate of Central and South Americas. There is also concern for dangers to navigation in the area.

 

Claudio Paschoa - Various sources, including the Journal of Geophysical Research-Oceans.

The recente Discovery of a shallow water pre-salt reservoir by Brazilian private operator OGX has definitely raised a few eye brows. This novelty is a first in Brazil as up to now all other pre-salt reservoirs have been found in ultradeep waters off the Brazilian coast and usually very far from the coast. This new discovery which is located in BM-S-57 Block, in the Santos Basin and is less than half the distance from the mainland as other pre-salt finds in the Santos Basin, exactly 102 km from the coast of Rio de Janeiro. The wellhead is only 155 meters deep and the well was drilled down to 6,135 meters, which is the normal depth where pre-salt reservoirs are expected to be found. Also of consequence is the fact that preliminary appraisals of the reservoir show estimates of 1,8 billion barrels boe, although the company was quick to point out that further tests may uncork even larger reserves. Some industry analysis claim there is potential for up to 4 billion barrels. The OGX-63 well identified a hydrocarbon column of approximately 1,000 meters with a net pay of approximately 110 meters in the Albian section. The drilling of the well reached the Aptian section, where it identified hydrocarbons through a high gas presence. It is well known that the pre-salt reservoirs began to be formed during the breakup between South America and Africa over 120 million years ago and as the continents drifted apart the reservoirs were covered up by a thick salt crust which has been found to be between 200 and 2,000 meters deep. The major pre-salt finds in the Santos Basin all have been found under the 2,000 meter salt crusts. The analysis of rock fragments led to the confirmation of a microbiolite reservoir of Aptian age, in other words, the same type of reservoir rock found in the deep and ultra-deep waters pre-salt of the Santos and Campos Basins. According to an OGX release, due to the high pressures encountered, the drilling was temporarily suspended so that OGX can replace the current Ocean Quest rig with the Ocean Star rig, also part of OGX’s fleet. The Ocean Star has the requisite specifications to continue the operation, which is expected to include logging and possibly conducting at least one drill-stem test. This new shallow water pre-salt discovery is an important milestone as it increases industry expectations that other large shallow water pre-salt reservoirs may be located close by and possibly also in other shallow water locations up and down the coast. One of the positives aspects of this possibility is the fact that drilling for pre-salt oil in a shallow water set-up is much cheaper and less complicated that drilling over 300km offshore, beyond the range of most helicopters and especially, much, much simpler than drilling in water depths in excess of 2,000 meters. Basically the shallow water pre-salt decreases safety hazards and logistics problems at the same time it increases the company´s profit margins. This is also good news for suppliers of equipment used in pre-salt drilling as it is probable that other operators with stakes in areas in the Santos Basin will be looking more closely at their survey data and drilling even more wildcat well in order to try to find more of these shallow water pre-salt reservoirs. Claudio Paschoa