Petrobras Partners With Constellation for Major Well P&A Project

Petróleo Brasileiro S.A. - Petrobras PBR recently awarded a contract to Constellation Oil Services Holding for Plug and Abandonment (P&A) of shallow-water wells in the Sergipe, Alagoas, Ceará and Potiguar basins. The $170 million deal underscores Petrobras' responsible decommissioning plans and Constellation's expertise in offshore drilling services.

Constellation will deploy the jack-up rig Admarine 511, owned by its commercial partner ADES Holding Co. The rig, currently in Bahrain, will be mobilized to Brazil and operate for a firm execution period of 1,143 days, with an option to extend for up to 472 days. Constellation will have about 210 days to mobilize Admarine 511 and will also be operated and run by it.

An Insight Into Admarine 511

The Admarine 511 is a three-legged MSC CJ46-X100D model cantilever jack-up rig, capable of working in water depths up to 375 feet. Before deployment, it is undergoing class inspection and modifications to meet Brazilian regulatory standards.

The campaign will commence with the P&A of multiple wells linked to fixed platforms, ensuring a systematic and efficient decommissioning process. The project is expected to generate around 100 direct new jobs, primarily for Brazilian professionals, reinforcing Constellation’s role in supporting the local workforce.

Expanding Constellation’s Market Reach

Constellation emphasized the significance of this contract as it marks its strategic return to shallow-water operations, expanding its market segment. It also highlighted that this initiative aligns with Petrobras' decommissioning plans, ensuring ongoing demand for P&A services beyond this contract’s duration.

This partnership sets a benchmark for future collaborations, solidifying Constellation’s position as a key player in Brazil’s offshore oil and gas sector and validating its long-term partnership with Petrobras.

PBR’s Zacks Rank and Key Picks

Headquartered in Rio de Janeiro, Petroleo Brasileiro S.A., or Petrobras S.A., is the largest integrated energy firm in Brazil and one of the largest in Latin America. Currently, PBR has a Zacks Rank #3 (Hold).

Investors interested in the energy sector might look at some top-ranked stocks like Expand Energy Corporation EXE, ARC Resources Ltd. AETUF and Diversified Energy Company PLC DEC. While Expand Energy and ARC Resources currently sport a Zacks Rank #1 (Strong Buy) each, Diversified Energy carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The U.S.-based Expand Energy is a leading natural gas producer formed through the merger of Chesapeake Energy Corporation and Southwestern Energy Company. The Zacks Consensus Estimate for EXE’s 2025 earnings indicates 422.70% year-over-year growth.

Calgary-based ARC Resources is engaged in the exploration, acquisition and development of oil and natural gas properties in western Canada. The Zacks Consensus Estimate for AETUF’s 2025 earnings indicates 86.13% year-over-year growth.

Birmingham, AL-based Diversified Energy is focused on natural gas and liquids production, transport, marketing and well retirement. The Zacks Consensus Estimate for DEC’s 2025 earnings indicates 65.13% year-over-year growth.

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This article originally published on Zacks Investment Research (zacks.com).

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