Petrobras unit to cancel vessel orders

Brazil-based Transpetro, the transportation unit of Brazil’s state-controlled oil company Petrobras, plans to cancel orders for 17 tankers and other vessels.

“We decided to revoke the contracts for those ships,” Antonio Silvino, head of Transpetro, told reporters during a presentation at Rio Oil & Gas conference, adding that orders for three other vessels currently under construction at Petro Eisa 1 shipyard in Rio de Janeiro could also be cancelled.

From the total number of 46 vessels originally included in the PROMEF programme, 17 were delivered, 17 have now been cancelled, three are at risk, and nine are being built in other shipyards.

Brazil’s PROMEF project, which started in 2003, was a headline programme of former Brazilian President Luiz Inacio Lula da Silva. He had hoped to revive the country’s shipbuilding industry using the oil and commodities boom and orders from Petrobras, as the oil company is known. However, the commodities boom collapsed, while the financial position of Petrobras has deteriorated.

The ship contracts have embroiled in the price-fixing, bribery and political corruption scandal at Petrobras.

Transpetro’s Silvino said that the cancellations do not necessarily mean that the company will operate with a reduced fleet. He said that Transpetro was evaluating options to increase the number of ships that will be offered on lease to Petrobras.