The transportation unit of Brazil's state oil company Petrobras said Wednesday that it will pay $1.2b to build 10 oil tankers.
Brazil's National Development Bank will finance the shipbuilding project with $1.16m, the press office of Brazilian President Luiz Inacio Lula da Silva said in a statement earlier Wednesday.
Silva and Petrobras Chief Executive Sergio Gabrielli signed the deal at the port of Suape in the northeastern state of Pernambuco.
The financing is the largest ever by the development bank for Brazil's once-flourishing shipbuilding industry, which the government is trying to revive.
The 10 Suezmax tankers will be built by the Atlantico Sul consortium, composed of construction companies Andrade Gutierrez, Camargo Correa, Queiroz Galvao and Aker Promar.
Petrobras' transportation unit, or Transpetro, plans to build 26 new oil
-industry vessels by 2012, at a cost of $2.48b, Petrobras said.
In May 2006, Petrobras, or Petroleo Brasileiro SA signed four other deals to build 16 ships.
By 2015, Transpetro plans to boost the number of new vessels to 42.
Building the vessels in Brazil is only 1 percent more expensive than building them abroad, and Petrobras said it will save leasing costs.