Brazilian state-led Petrobras has temporarily reduced output at the Marlim Sul Field in the Campos Basin amid a coronavirus outbreak onboard a floating storage and offloading vessel, the company said March 22.

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"The P-38 [FSO] is limited, with contingency crews working," a Petrobras spokesperson told S&P Global Platts. "The P-40 and P-56 have returned to normal operations."

The outbreak was first reported by the North Fluminense Oil Workers Union, or Sindipetro-NF, and the Oil Workers Federation, or FUP. According to the unions, the outbreak onboard the P-38 peaked March 17 when operations were suspended and crew evacuated. The P-38 handles production from the P-40 and P-56 floating platforms operating in the Marlim Sul Field. The reduced capacity of the FSO P-38 forced Petrobras to reduce production at the P-40 and P-56, union officials said.

Union officials also cited outbreaks at other floating production units, including the P-25, P-35, P-43 and P-65, in the mature basin.

The outbreak came amid a brutal second wave of the coronavirus outbreak in Brazil, which as the world's second-highest death toll from the pandemic. Many major Brazilian cities have started or are planning another round of lockdowns to contain the virus, which has left intensive care units filled to the brim and shortages of oxygen and other medical supplies.

Brazil's oil industry, meanwhile, has largely avoided any major production disruptions, especially at offshore vessels. The limited outbreaks seen in Brazil typically involved in partial or temporary production shutdowns as floating production, storage and offloading vessels were cleaned.

Petrobras, for example, also initiated quarantine periods ahead of offshore deployments and conducted nearly 500,000 COVID-19 tests to prevent infections. Brazil currently has about 67 offshore installations, with 56 operated by Petrobras.

The latest outbreak, however, appeared to mimic the rapid spread seen across Latin America's biggest country as a new variant discovered in the Amazon city of Manaus expands worldwide, according to oil workers represented by Sindipetro-NF or FUP. In the week ended March 19, Petrobras registered a surge of 83 infections, FUP said. FUP and Sindipetro-NF have filed complaints with the Labor Ministry about the outbreak, the unions said.

The Mines and Energy Ministry's latest COVID-19 impact report, released March 15, said that 258 Petrobras workers had contracted coronavirus and were in quarantine, while 17 were hospitalized. The ministry lists a total of 46,416 Petrobras employees. Petrobras has also had 5,203 workers recover from coronavirus infection, with 17 total deaths.

Bahia onshore sale

In a separate statement March 19, Petrobras also said that it had advanced to the binding phase of negotiations to sell a package of oil fields and infrastructure in the onshore Reconcavo and Tucano basins. During this phase of Petrobras' asset-sales program, companies can conduct due-diligence reviews of assets and make a binding offer.

The Bahia Onshore package of assets includes 28 production concessions that pumped 13,500 b/d and 660,000 cu m/d in January-February 2021, Petrobras said. The infrastructure in the sale includes collection and treatment stations, holding tacks, oil and natural gas pipelines and the Catu natural gas processing plant. The gas processing plant could be especially lucrative after Brazil passed the New Gas Law bill to liberalize the country's gas markets.

Petrobras owns 100% of the fields and infrastructure.