Malaysian entrepreneur FPSO Yinson has signed a letter of intent with the Brazilian oil company Enauta Energia for the supply, operation and maintenance of an FPSO on the Atlanta Enauta field in the Santos Basin, off Brazil.

Enauta produced oil from the field using the Petrojarl I FPSO as an early production system and sought to deploy another FPSO on the field for full field development.

The oil company and the Malaysian FPSO supplier signed a memorandum of understanding in August with Malaysian FPSO specialist Yinson for the direct and exclusive negotiation of FPSO supply contracts for the Atlanta field’s Definitive System. after Enauta launched the tender process for a full development FPSO in March.

The call for tenders process envisaged a unit with a processing capacity of 50 thousand barrels of oil per day, to which 6 to 8 producing wells will be connected, including 3 wells already in operation in the Early Production System, and adaptation of an existing FPSO, which has not yet been deployed, OSX-2.

Enauta said on Monday that the letter of intent included initial activities related to the detailed engineering and long-term item commitments of the FPSO OSX-2. Operation and maintenance (“O&M”) for 24 months.

The cost of acquiring and adapting the FPSO will be approximately US $ 500 million. Prior to the start of production of DS, Yinson will have the option to purchase the unit linked to financing. If the option is exercised, it will be tied to charter, operation and maintenance contracts for a period of 15 years, which can be extended for an additional five years, for a total of US $ 2.0 billion. for 20 years.

The conditions agreed to in the LoI will be subject to the signing of the final contracts, which is expected to occur during the final investment decision (FID) in the first quarter of 2022, Enauta said.

“Based on our agreement with Yinson, we have continuously ensured the implementation of viable technologies to minimize carbon emissions. We reaffirm that the adaptation of this FPSO unit will be a pioneering project in terms of avoided emissions, optimizing its operational and environmental efficiency ”, declared Carlos mastrangelo, COO.

In addition to the unit, capital expenditure related to drilling wells and subsea equipment continues to be estimated at $ 500-700 million, Enauta said.

Chairman and CEO of the Yinson group Lim Chern Yuan said: “We are confident that the excellent working relationship between Yinson and Enauta, which has been the basis of our very successful negotiations on the MoU and Letter of Intent, will continue to accompany us throughout the execution of the project and its subsequent operations. We believe this will ultimately enable both sides to achieve our common goal of advancing Brazil’s energy industry through solutions that are as sustainable as possible.

Chief Executive Officer of Yinson Offshore Production Flemming Grünnegaard said emissions reduction technologies were included in the design of the FPSO.

He said: “We believe Yinson and Enauta’s joint engagement in pioneering low-emission designs will pave the way for the FPSO industry to help alleviate global climate change issues. After successfully building our resources, capabilities and expertise in Brazil over the past few years, we are delighted to be stepping up a gear in order to execute this project well and deliver on our commitments. “

The FPSO will be Yinson’s third project in Brazil, with the first two allocated assets nearing completion in 2023 and 2024 respectively.