Shell Taps Vallourec for Major Orca Deepwater Project in Brazil

MEUDON, France – January 12, 2026 – French tubular solutions giant Vallourec has secured a significant contract with energy major Shell, a move that reinforces the strategic importance of Brazil's prolific deepwater oil and gas sector. Following a competitive bidding process, Vallourec will supply a comprehensive suite of premium tubular products and services for Shell’s highly anticipated Orca project, located in the pre-salt Santos Basin.

The agreement covers the full OCTG (Oil Country Tubular Goods) scope for the development, which is slated to begin drilling in April 2027. The current plan encompasses 10 offshore wells, requiring an estimated 12,000 to 15,000 tons of high-specification pipes. This contract not only underscores the technical demands of modern deepwater exploration but also highlights a broader industry trend toward integrated supply and service partnerships.

Brazil's Enduring Deepwater Prize

The Orca project, formerly known as Gato do Mato, is a cornerstone of Shell's strategy in Brazil, where it stands as the largest foreign producer. Situated in ultra-deepwater approximately 200 kilometers off the coast of Rio de Janeiro, with depths reaching over 2,000 meters, the project taps into the lucrative gas-condensate discoveries of the pre-salt layer. Shell, as the operator with a 50% stake, leads a consortium that includes Ecopetrol and TotalEnergies.

After reaching its Final Investment Decision (FID) in March 2025, Shell has moved decisively to secure its supply chain for a project expected to commence production in 2029 via a Floating Production Storage and Offloading (FPSO) vessel capable of processing 120,000 barrels of oil per day. The Orca development is a clear signal of the long-term viability and appeal of Brazil's offshore assets. The nation's oil and gas industry is projected to attract over $120 billion in investments by 2029, with the vast majority flowing into offshore production in the Santos and Campos Basins. This contract places Vallourec at the heart of that multi-billion dollar investment wave, capitalizing on the sustained demand for complex, high-value energy projects.

Beyond Steel: An Integrated Solutions Victory

This agreement is far more than a simple order for steel pipes. It represents a victory for Vallourec's integrated business model, which combines its world-renowned products with a comprehensive suite of value-added services. The contract scope extends well beyond the delivery of seamless pipes and VAM® premium connections, which range from 4.5” to 18” in both carbon and stainless-steel grades.

Vallourec will also provide a host of onshore and offshore services through its Vallourec Tubular Services (VTS) division. This includes critical support functions such as desk engineering, material coordination, rig preparation, offshore supervision, and post-operation rig return repairs. By embedding its expertise directly into Shell's operations, Vallourec aims to optimize efficiency, enhance safety, and reduce potential downtime—a crucial value proposition in the capital-intensive world of deepwater drilling.

Philippe Guillemot, Chairman and CEO of Vallourec, commented on the strategic nature of the win in the company's official announcement. “After recently winning an order to supply line pipes on this key offshore project, this new contract demonstrates Vallourec’s ability to support its customers across the entire value chain,” he stated. This dual success on a single project showcases the company's capacity to serve as a one-stop-shop for the most demanding offshore developments, providing a significant competitive advantage.

The Technological Edge for Extreme Environments

Operating in Brazil's pre-salt fields presents immense technical hurdles. The combination of ultra-deepwater, high-pressure, and high-temperature (HPHT) conditions places extreme stress on every component of the well architecture. It is in these unforgiving environments that the quality and reliability of tubular connections become paramount to operational success and environmental safety.

The contract's emphasis on Vallourec's proprietary VAM® premium connections is a testament to their reputation for performance under duress. These advanced threaded joints are engineered to provide superior gas-tight sealing and structural integrity, mitigating the risks of leaks or failures that can lead to catastrophic environmental damage and astronomical financial losses. VAM® connections are specifically designed to withstand the immense external pressures and temperature variations characteristic of deepwater drilling, ensuring the well's integrity from the seabed to the reservoir.

For an operator like Shell, the reliability of these components translates directly into improved drilling economics. The enhanced fatigue resistance and faster, more reliable make-up times of VAM® connections reduce non-productive time on the rig, where daily operational costs can run into the hundreds of thousands of dollars. By supplying the technological backbone for the Orca project, Vallourec is not just delivering a product but enabling the safe and efficient extraction of resources from one of the world's most challenging subsea environments.

Navigating a Complex Energy Landscape

The Shell-Vallourec deal unfolds against the backdrop of Brazil's complex and often contradictory energy policy. While the nation is aggressively pursuing its deepwater oil and gas potential to fuel economic growth, it is also positioning itself as a leader in the global energy transition. The government is actively developing a legal framework for a massive expansion of offshore wind power and promoting investments in green hydrogen.

This duality creates a dynamic operating climate. Major energy projects like Orca, with timelines stretching to the end of the decade and beyond, demonstrate that large-scale fossil fuel investments are set to coexist with renewable energy initiatives for the foreseeable future. However, these projects are also subject to increasingly stringent environmental regulations and public scrutiny. The ability of companies like Shell and their partners to navigate this landscape depends on deploying the safest, most efficient technologies available. This contract, therefore, can be seen as a strategic move to de-risk a multi-billion-dollar investment by partnering with a supplier known for its technical excellence and integrated service capabilities, ensuring the project aligns with the highest operational standards in a world of evolving energy priorities.