Brazil: Prysmian Opens Flexible Pipes Plant. Wins New Order from Petrobras

Prysmian Group, world leader in the energy and telecom cables and systems industry, is stepping up its expansion into the business of products and services for the offshore oil industry. The new flexible pipes plant in Brazil is now fully operational and the integration with Draka has broadened the product range to special DHT (Downhole Technology) cables, opening up new opportunities in the North American market.

The Group also announces the acquisition of important orders from Petrobras worth a total of some $50M, for the supply of flexible pipes to connect platforms to wellheads thousands of metres below sea level, and special DHT cables, including fibre optics to control downhole instrumentation, power and hydraulic fluid cables. It is worth highlighting the significant Brazilian content of these projects, both in terms of local workforce and know-how development and with regard to the use of domestic raw materials.

“The start of full operations by the new plant in Brazil and the acquisition of the first important commercial contracts – explains Fabio Romeo, Energy Business Senior Vice President – marks a sharp acceleration in the Group’s expansion plans in the high-tech sector of flexible pipes for offshore oil production. In addition, Draka’s entry into the Group has expanded the range of technologies and products offered, created interesting cross-selling opportunities, as in the case of the Petrobras contract for DHT cables, and accelerated this business’s expansion outside of Brazil, such as the USA and other areas of the world where oil is produced offshore such (West Africa, Northern Europe and ASEAN). By the end of 2011 we expect to have made more than $150M sales in this market – covering flexibles, umbilicals and DHT cables – confirming the importance of this high-tech business for the Group”.

Built with an investment of some $150M, including R&D, the plant stretches over an area of 15,000 sqm and has the capacity to produce more than 150km of flexible pipes per year with a workforce of some 400 employees. The new plant complements the existing umbilical cables plant, opened in 2007 still in Vila Velha, and Draka’s two Downhole Technology cable plants in Massachusetts and New Jersey, USA. Petrobras remains the main customer and technological partner, but following the Draka integration, the Group has widened its customer base to prestigious oil industry names like Schlumberger, Baker- Hughes, BJ Services, GCDT and Roxar.

In detail, the Petrobras contracts refer to around 25km of 2 ½” and 4” flexible flow lines for the Sidon and Namorado oil fields, and are worth a total of some $20M. The first contract awarded by Petrobras to Draka is for the supply of DHT cables for various fields in the Campos Basin, and is worth a total of some $30M over 3 years. This contract means not only further consolidation of the Petrobras relationship but also a first important benefit deriving from the integration. With Prysmian not previously present in this product category, the new Group has now a wider range of technologies and can capitalise on Draka’s already established presence in the American market.

Prysmian Group

Prysmian Group is world leader in the energy and telecom cables and systems industry. With sales of some €7 billion (pro-forma 2010 Prysmian/Draka), 22,000 employees across 50 countries and 98 plants, the Group is strongly positioned in high-tech markets and provides the widest range of products, services, technologies and know-how. In the Energy sector, Prysmian Group operates in the business of underground and submarine power transmission cables and systems, special cables for applications in many different industrial sectors and medium and low voltage cables for the construction and infrastructure industry. In the Telecom sector, the Group manufactures cables and accessories for the voice, video and data transmission industry, offering a complete range of optical fibres, optical and copper cables and connectivity systems. Prysmian is listed on the Milan Stock Exchange in the Blue Chip index.

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Source: Prysmian, November 9, 2011