In early 2008, before the global economic crisis reared its head, Odebrecht Óleo e Gás (OOG), the Group’s oil and gas arm, won a tender conducted by Petrobras for a 10-year charter and operation contract (as of 2011) for two drill ships, christened Norbe VIII and Norbe IX. In May 2008, the contracts were signed with Petrobras and the shipyard Daewoo Shipbuilding & Marine Engineering Co., Ltd. (DSME), in South Korea. The financial engineering for the construction of those vessels began immediately, but in September, when the road show was about to present the project to the institutions that would issue the loan, Lehman Brothers went bankrupt. The resulting crisis of confidence spread throughout the global financial market,dealing the biggest blow to the world economy in the past 80 years.

Marco Rabello, Director of Structured Operations for OOG, recalls: “That forced us to modify our design to increase the liquidity of the operation so it would attract financial institutions. And instead of negotiating with two institutions that would be the anchors of the operation, we had to work virtually one-on-one with 19 banks and two ECAs (state export credit agencies).” One of the measures OOG’s team took was to seek the support of GIEK and the Korean Eximbank (two export credit agencies from Norway and South Korea, respectively), which would provide loan guarantees for the project. Other adjustments included reducing the term of the financing and increasing interest rates. The result was the strong approval of 12 of the 19 banks and both ECAs.

“This means that a good project always gets funded. And Norbe VIII and Norbe IX are proof of that,” concludes Helena Ramos, OOG’s Structured Operations Manager, who took part in the negotiations alongside Marco Rabello.

The quality of the financial engineering behind that project financing led OOG to win awards from four specialized publications for the international financial market: PFI - Project Finance International (published by Reuters), Project Finance and Infrastructure Finance and Trade Finance (Euromoney publications) and Latin Finance.

Operations begin in 2011
Construction of the Norbe VIII got started on July 22, 2009, it was launched on March 28, 2010 and the drill ship is scheduled to begin operating in Brazil by May 2011, according to Project Director Pedro Mathias, who is responsible for the construction of both vessels at the DSME shipyard in South Korea. Construction of the Norbe IX began on November 10, 2009 and it will be launched in July of this year. It should go into operation by August 2011.

Herculano Barbosa, OOG’s CEO for Drilling Operations, observes that the two vessels will be capable of drilling wells up to 10,000 m deep, in water depths of up to 3000 m. “What our team did was incorporate all of the client’s technical requirements while avoiding subsequent changes in project scope, which allowed us to seek the exact amount of funding required from the financial market,” Herculano explains.

The 12 banks and two ECAs that participated in the project financing for Norbe VIII and Norbe IX:
Banks: Santander, Société Générale, BNP Paribas, Banco do Brasil, Banco Espírito Santo, Banco Caixa Geral, Calyon, HSBC, NIBC, ING, West LB and CIC.
Agencies: Korean Eximbank and GIEK/Eksportfinans.

The construction and operation of drill ships like Norbe VIII and Norbe IX is part of the company’s growth strategy and is a major milestone in the company’s 30 years of pioneering operations in the offshore industry, an anniversary that Odebrecht marked in 2009. The Group began working in the sector through Odebrecht Perfurações Ltda. (OPL).