By Brazil Stock Guide – Petrobras (BVMF: PETR4) has signed a supply contract worth up to $1 billion with Vallourec (EPA: VK), securing tubular products and related services for its offshore operations through 2029, the French manufacturer said Thursday.
The agreement will cover Petrobras’ needs between 2026 and 2029 and reinforces Vallourec’s long-term presence in Brazil. “The contract illustrates the success of our investment plan in Brazil, which allowed us to produce locally tubes that previously had to be imported,” said Vallourec Chief Executive Officer Philippe Guillemot.
Over the past two years, Vallourec has scaled back output of lower-margin products while shifting toward high-value tubular goods in a bid to reduce debt and strengthen its balance sheet. The strategy enabled the company to become a key supplier for Petrobras’ offshore projects, particularly in the pre-salt fields.
In September 2024, Petrobras and Vallourec signed a three-year contract for as much as 25,000 tons of steel tubes and accessories for the Sépia 2 and Atapu 2 projects. The latest agreement consolidates the French group’s role in Brazil’s offshore oil sector and ensures Petrobras can secure critical inputs for its expansion plans in deepwater exploration, according to Valor Econômico.
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