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PBR Charters DOF Group's Construction Vessel for Offshore Operations

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Key Takeaways

  • PBR signed a $165M four-year charter for DOF Group's subsea construction vessel Skandi Salvador.
  • The vessel comes with ROVs, a subsea crane, and space for 100 people, with delivery due in December.
  • DOF also expanded its inspection contract with PBR, adding over $50M in new work through 2025.

Petrobras S.A. (PBR - Free Report) , a Brazilian state-owned energy company, has tapped Norwegian offshore services provider DOF Group ASA for a flexible, large subsea construction vessel. The vessel is on a four-year charter with the Brazilian energy giant, and the contract is valued at approximately $165 million.

The vessel named Skandi Salvador shall be equipped with two work-class remotely operated vehicles for subsea maintenance and inspection services, along with a subsea crane for lifting subsea equipment. Delivery of the construction vessel is anticipated in December this year. The contract for Skandi Salvador was secured in the same tender process where the company obtained contracts for three other vessels, namely Skandi Achiever, Skandi Carla and Geoholm.

Skandi Salvador has a length of 106 meters and can accommodate up to 100 people. The vessel has prior experience working in Brazilian waters while supporting Subsea7 with subsea umbilicals, risers and flowlines projects. Along with the new contract with PBR, the DOF Group also announced an addendum to its long-term inspection contract with the Brazilian energy giant. The addendum includes an expanded scope of work, which is expected to be completed by year-end 2025. The cumulative value of this addendum is more than $50 million.   

PBR’s Zacks Rank & Other Key Picks

Currently, PBR carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks from the energy sector are Enbridge Inc. (ENB - Free Report) , Antero Midstream Corporation (AM - Free Report) , and Galp Energia SGPS SA (GLPEY - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.

Enbridge is a leading midstream energy firm that operates an extensive crude oil and liquids transportation network spanning 18,085 miles, along with a gas transportation network covering 71,308 miles. The company has a stable business model supported by take-or-pay contracts, protecting it against commodity price volatility.

Antero Midstream generates stable cash flow by providing midstream services under long-term contracts with Antero Resources. The company’s higher dividend yield, compared to its sub-industry peers, makes it an attractive choice for investors who seek consistent returns.

Galp Energia is a Portuguese energy company engaged in exploration and production activities. The company’s oil exploration efforts have yielded positive results, particularly the Mopane discovery in the Orange Basin, offshore Namibia. After the initial exploration phase, Galp estimated that the Mopane prospect could hold nearly 10 billion barrels of oil. This discovery allows Galp to diversify its global presence, with the potential to become a significant oil producer in the region.

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