Why Equinor's (EQNR) BM-C-33 Concept Selection is Crucial
Equinor ASA EQNR recently announced that it has received an approval for the development concept of pre-salt Campos Basin BM-C-33 from partners. The selected plan for the project, located offshore Brazil, is expected to make it optimized and “robust for future market.”
The hydrocarbons at the site were discovered in 2010. Operator Equinor has a 35% stake in the project. It has Repsol Sinopec Brasil — a joint venture between Repsol, S.A. REPYY and China Petroleum & Chemical Corporation or Sinopec SNP — as one of the partners with another 35% interest. The remaining 30% stake is owned by Petróleo Brasileiro S.A. or Petrobras PBR.
Per the concept, a floating production, storage and offloading (FPSO) vessel will be present in the field, which will receive the well streams and process the hydrocarbons. Shuttle tankers will be used to offload the crude from the production unit. Natural gas from the FPSO vessel will be transported through an offshore pipeline to onshore receiving unit at Petrobras’ TECAB site, located in Cabiúnas.
Produced natural gas will be dedicated to Brazil’s gas transmission network, which falls in line with the country’s market liberalization process for the commodity. Moreover, planned gas export capacity is 16 Mm3/d, with crude processing expected at 20,000 cubic meters per day. Equinor has selected a newly built hull, which will work for 30 years in the field that is located in the pre-salt layer.
The license is almost 200 kilometers off the coast in the famous prolific Campos Basin, at a water depth of around 2900 meters. The project will boost Equinor’s production capacity in the South American country, wherein it is working for nearly 20 years. It has 13 exploration and production licenses in the country. Importantly, Brazil can play a crucial role in Equinor’s long-term energy transition ambition, while the company boosts its green footprint. It generates 162 megawatts of solar energy in the country. Equinor expects to boost overall production capacity from renewables to 4-6 gigawatts by 2026. The company also plans to become a net-zero greenhouse gas emitter by 2050.
Price Performance & Zacks Rank
Shares of Equinor have gained 105.9%, outperforming the industry’s 74.7% rally in the past year. The company currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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