SBM Offshore completes largest project financing in its history
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SBM Offshore completes largest project financing in its history

By Sam Tabahriti 16 Sep 2021 (Last Updated September 16th, 2021 11:22)

Dutch FPSO specialist SBM Offshore closed the project financing of the Sepetiba vessel for $1.6bn.

SBM Offshore completes largest project financing in its history
Dutch FPSO specialist SBM Offshore closed the project financing of the Sepetiba vessel for $1.6bn. Credit: SBM Offshore

Floating production storage and offloading (FPSO) operator SBM Offshore has completed the largest project financing in its history, of FPSO Sepetiba, for a total of $1.6bn.

SBM Offshore was established in 1862 and its main activity is to design, supply, install, operate, and maintain FPSO vessels and it accounts for over 1,660,000 total fleet oil production capacity.

The project financing was secured by a consortium of 13 international banks, with insurance cover from export credit agencies (ECA) Nippon Export and Investment Insurance and SACE.

China Export & Credit Insurance Corporation (Sinosure) sent a letter of intent that stipulates it will join this transaction by the end of the year and will replace a portion of the commercial banks’ commitments.

A 4.3% weighted average cost of debt and four separate tranches, the facility is also composed of a 14-year post-completion maturity for the ECA covered tranches and a 15-year post completion maturity on the uncovered tranches.

Earlier this year, SBM Offshore completed $1.05bn financing for the Prosperity vessel, secured by a consortium of 11 international banks. Back in July 2020, it also closed a $600m bridge loan facility for the financing of the construction of FPSO Sepetiba, which is expected to be delivered in 2022.

FPSO Sepetiba is owned and operated by a special purpose company owned by affiliated companies of SBM Offshore (64.5%) and its partners (35.5%).

The vessel has a processing capacity of up to 180,0000 barrels of oil per day, a water injection capacity of 250,000 barrels per day, associated gas treatment capacity of 12mmscm, and a minimum storage capacity of 1.4mmbbl.

The FPSO will be built under SBM’s Fast4Ward program, which incorporates a newbuild, multi-purpose hull, combined with several standardised topsides modules. It will be spread moored in approximately 2,000m water depth and will be deployed at the Mero field in the Santos Basin offshore Brazil.

The Libra block, where the Mero filed is located, is under production sharing agreement to a consortium comprised of Petrobras as the operator with 40%; Shell with 20%; TotalEnergies with 20%; China Southern Petroleum Exploration and Development Corporation with 10%; and China National Offshore Oil Corporation with 10% interest.

Petrobras, a state-owned Brazilian multinational corporation in the petroleum industry, awarded a contract to SBM Offshore for the 22.5 years lease and operation of the FPSO for the Mero field in December 2019.

The consortium also has the participation of the state-owned company Pré-Sal Petróleo SA, which will act as manager of the production sharing contract.