SBM Offshore closes largest project financing in its history

FPSO operator SBM Offshore has completed the project financing of FPSO Sepetiba for a total of $1.6 billion, which is the largest project financing in the company’s history.

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 (NEXI) and SACE S.p., SBM said on Thursday.

A letter of intent was received from China Export & Credit Insurance Corporation (Sinosure), which intends to join this transaction by the end of the year and will replace a portion of the commercial banks’ commitments.

The facility is composed of four separate tranches with a 4.3 per cent weighted average cost of debt, a fourteen-year post-completion maturity for the ECA covered tranches and a fifteen-year post-completion maturity on the uncovered tranches.

At the end of June 2020, SBM Offshore also closed a $600 million bridge loan facility for the financing of the construction of FPSO Sepetiba. According to previous information, the FPSO 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 per cent) and its partners (35.5 per cent).

The vessel has a processing capacity of up to 180,000 barrels of oil per day, a water injection capacity of 250,000 barrels per day, an associated gas treatment capacity of 12 million standard cubic meters per day, and a minimum storage capacity of 1.4 million barrels of crude oil. The FPSO will be spread moored in approximately 2,000 meters of water depth.

FPSO Sepetiba will be deployed at the Mero field in the Santos Basin offshore Brazil, 180 kilometres offshore Rio de Janeiro. The Libra block, where the Mero field is located, is under Production Sharing Agreement to a Consortium comprised of Petrobras, as the operator, with 40 per cent, Shell with 20 per cent, TotalEnergies with 20 per cent, CNODC with 10 per cent and CNOOC Limited with 10 per cent interest. The consortium also has the participation of the state-owned company Pré-Sal Petróleo SA (PPSA), as manager of the Production Sharing Contract.

Petrobras awarded a contract to SBM Offshore for the 22.5 years lease and operation of the FPSO for the Mero field in December 2019.

In related news, SBM has also already completed the project financing for a total of $1.05 billion for the FPSO Prosperity, which will operate on ExxonMobil’s Payara development offshore Guyana.