Latin America offshore drilling gains appeal as Iran war reshapes markets

(Bloomberg) — A leading supplier of deep-water drilling rigs to Brazil’s national oil company expects the industry to favor oil and gas projects in Latin America, where geopolitical risk is lower than the Middle East. 

Constellation Oil Services Holding SA recently extended three offshore drilling contracts with Petrobras and is optimistic about Brazil’s exploration prospects in other deep-water regions, including the Equatorial Margin and the Pelotas Basin in southern Brazil, Chief Executive Officer Rodrigo Ribeiro told Bloomberg in an interview.

“Brazil continues to be the best market in the world for offshore drilling,” Ribeiro said. “South America gains importance, not only because of the quality of its reserves,” but also because it’s seen as “a more protected and stable” geographic region, he said.

Constellation listed shares in Oslo last year and plans to pay $25 million in dividends next quarter, which may go up in the future, Ribeiro said. The company has a fleet of nine drilling rigs in Brazil.