Petrobras to launch oil rig tender

Brazil?s state-run Petrobras will launch a bid round on 28 oil rigs to be built in Brazil and used for massive offshore subsalt fields, the company said.

Brazil plans to rely mostly on locally manufactured equipment to pump crude from deep-sea subsalt fields, part of President Luiz Inacio Lula da Silva?s bid to create jobs and bolster domestic industry as Brazil taps new energy wealth.

Petrobras wants up to 28 rigs designed for deep-water exploration to be ready between 2013 and 2018 and will begin by contracting an initial group of nine rigs. It originally announced the tender more than a year ago and it is expected that each rig will cost around $300 million.

The shipyard that wins the first group of rigs will be able to use the funds to expand shipbuilding capacity, the company said. Brazil?s subsalt push will require a large fleet of deep-water rigs capable of drilling through a thick salt layer beneath the ocean floor that is in some cases 2,000 meters deep.

Critics say Petrobras? local content strategy will force it to pay higher prices for goods and services, particularly if political pressures lead it to prioritize job creation over ensuring it acquires equipment at the lowest possible cost. It may also risk delaying new oil exploration if local shipyards cannot deliver products on time or up to standards.