Pump it Up!

‘The challenge is our energy’ is the catchy communist-style slogan used to motivate the 62,000 workers that oil the wheels of Brazil’s government-controlled energy giant, Petrobras.

After hitting the world’s largest oil discovery for three decades, investors have catapulted Petrobras into an elite group of the world’s five largest companies, overtaking the likes of General Electric, HSBC and Wal-Mart over the last 12 months.

The Brazilian economy is set to follow suit taking its place in the five richest global economies by 2015. The only small detail - the ‘challenge’ of extracting up to 35 billion barrels of oil and gas from the pre-salt deepwater oil fields up to 340 km from the coastline of Rio de Janeiro and Sao Paulo. Some of the deepest fields require drilling through 2,000 m of salt and another 3,000 m of rock to a depth of 7,000 m below sea level.

To do so a fleet of 45 giant semi-submersible oil platforms, some as high as a 34-storey building, as long as 10 Olympic-sized swimming pools and each costing a paltry $1.5 billion will be needed.

Under the leadership of the leftist president, Luiz Inacio Lula da Silva, these titanic, floating steel structures are being built in Brazil for the first time. The former metalworker handed the country’s shipbuilding heartland in Rio de Janeiro a huge boost in 2003 by insisting that up to 70% of the cost of constructing these rigs be spent in Brazil. The strategy has sparked an unprecedented U-turn in Brazilian industrial development in Rio de Janeiro, further south in Rio Grande do Sul and in Lula’s home state, Pernambuco.

The moribund cranes of shipyards in Rio de Janeiro and Niteroi mothballed at the turn of the century when the Brazilian shipbuilding industry had just 2,000 workers have been dusted off to aid a workforce that now numbers 45,000.

There are plans for another $7.8 billion of investment in up to nine new yards along Brazil’s 7,491 km coastline to cater for Petrobras spending of $111.4 billion for exploration of the pre-salt oil fields in the next 10 years.

Brazil’s richest man, Eike Batista, raised $1.6 billion in April to build his own shipyard in Santa Catarina where he will construct as many as 48 rigs and drilling ships for OGX, the oil exploration arm of his EBX empire (see p???).

The first predominantly local product of this black gold rush was the P-51, the world’s third largest floating production unit, finished at the ex-Verolme shipyard in Angra dos Reis in October 2008 and now producing 180,000 barrels of oil a day in the Marlim Sul oil field.

Working in waters 1,795 m deep, the P-51 was one of the most symbolic achievements of Brazilian industry in the last decade.

Completed a month after the collapse in financial markets it was held aloft as a towering symbol of Brazil’s immunity to the global crisis by president Lula. “Don't be afraid. You must have certainty that we have found our destiny,” the president told his people.

In the depths of the crisis, Petrobras has ploughed ahead with work on two more units at the same yard, the P-56 and P-57 as well as the P-53 and P-55 being assembled elsewhere.

While the ‘challenge’ continues to provide the ‘energy‘ for the 5,000 Brazilian workers toiling on each of these titans, Petrobras has received a little help from abroad.

Tucked away in a breath-taking part of the country where the Mata Atlantica descends into the sea interrupted only fleetingly by a string of stunning beaches and the exclusive holiday homes of the moneyed elites from Sao Paulo and Rio de Janeiro, the Angra dos Reis shipyard is a melting pot for global engineering excellence.

Owned by a Singaporean marine engineering specialist, Keppel FELS, working with French engineers, Technip, the P-56 is equipped with British Rolls-Royce motors, compressor units made by US conglomerate General Electric in Florence, Italy and a steel grid that connects four towering blocks designed by Norwegian group Aker. Brazil provides the vision, steel, sweat and hard currency.

From atop a lumbering 92 m crane charged with moving units of up to 600 tonnes, the ground appears to move below as seven other cranes lumber up and down slowly going about their business assembling what resembles a 50,000 tonne Meccano set spread across a mammoth 540,000 sq m playground.

Five thousand little figures scurry around in the sweltering, humid heat, welding a million components onto one of eight modules that have been lined up ready for the final stage of the rig’s assembly.

To the right, thousands of different sized tubes are laid out ready for the complicated process of ‘deck mating’ – the marriage of the topside to its base. Two energy producing units, four gas processing modules, a 15 m flare tower and living quarters for 200 people are joined first to the ‘deck box’ before being lowered by a floating crane onto four 43.4 m columns of cold, black steel that sit on each corner of a 96 m x 85 m frame that will, almost inexplicably, keep the expensive engineering kit afloat in waters up to 2,000 m deep for the next 25 years.

When one of the most complicated of engineering operations is completed later this year, the giant rig will be towed to an anchorage 124 km to sea, where it will begin its task to drain 100,000 barrels of black gold a day from wells 7,000 m below the sea surface, pumping up to $5bn a year into the Brazilian economy.

Everyone wants to be like EIKE

While Oliver Stone’s fictional money mogul, Gordon Gekko, eschewed the mantra ‘greed is good’ to paraphrase the gold rush on Wall Street and deregulated money markets in the 1980s, for Brazil’s richest man Eike Batista, it’s more about speed than greed.

With his wealth growing at a rate of $2.2 million an hour, Eike Fuhrken Batista or just plain Eike (Ay-Kee), as he likes to be known, is on a mission and he doesn’t like to be kept waiting. When he is not flying between Brazil, India and China in his Embraer Legacy 600 private jet racking up the world’s fastest growing fortune, he gets his kicks from messing around Rio de Janeiro’s Guanabara bay in his Pershing 115 speed boat.

Evidently there is little that can stop him in his race to become the world’s richest man in time for the Olympics and his 60^th birthday in his beloved Rio de Janeiro in 2016.

“Speed is good. Everyone loves speed. Right?” Who could argue with the poker faced, multi-billionaire dressed in Prada and Ralph Lauren, whose wealth grew quicker than anyone else in the world last year.

According to Forbes, his estimated fortune almost tripled with the value of his self-built empire stretching from oil to iron ore, coal and gold mining, logistics, shipbuilding, energy generation, restaurants, fashion, retail, hotels and entertainment heading into the stratosphere in 2009.

While most of the world’s money moguls saw their fortunes tank in the worst financial downturn since 1929, foreign investors seeking to get their hands on Brazilian minerals helped catapult Eike 134 places up Forbes’ rich list to number eight.

His wealth increased from a measly $7.5 billion in 2008 to $27 billion in 2009, as he cranked up the X-factor, which represents the money multiplier in his main companies, EBX (Eike Batista X), OGX (Oil and Gas X), MMX (Mining and Metals X), LLX and MPX.

The float of OGX in 2008 - a company which owns 22 oil fields off the coast of Rio de Janeiro and is estimated to control the largest oil reserves in Brazil after state-owned oil giant, Petrobras - and strategic sales in his mining empire to Chinese and Anglo-American investors helped Eike add $1.63 billion a month, $375 million a week, $54 million a day or a bewildering $2.2 million an hour to his estimated fortune last year.

At 53, the blue-eyed son of Eliezer Batista da Silva, the man that built the country’s second largest company mining giant, Vale, has set his sights on being top of the podium before 2016.

By the Olympics, he estimates his fortune could have reached $100 billion almost double the current fortune of Carlos Slim, who topped this year’s rich list with $53.5 billion. Being the world’s richest man is not just Eike’s destiny, he’s doing it for Brazil.

“I am a proxy for Brazil. I am a proxy for what Brazil is right now!” he tells Wallpaper* in his laid-back, baritone English after inviting us into the uber-VIP area of his exclusive yacht club, Marinha da Gloria.

As we talk, Brazil’s more anonymous moneymen are climbing over his advisors to get some face time with the Midas from Minas Gerais in the hope that some of his magic will rub off one them.

Three days earlier he pulled off his latest coup, raising $1.6 billion on the Sao Paulo stock exchange with the sale of a stake in a shipbuilding company that has yet to turn a profit and still has to build the yard it needs to construct up to 48 oil platforms for sister-company, OGX.

These are just minor details for Eike who learnt at an early age from his father to ‘think big’.

From his comfortable perch at the very top of the Brazilian food chain, he sees his title of the world’s richest man as inevitable.

“It is a consequence of the assets and what Brazil is,” he says. “I mean my money is not in my bank. My money is building new projects from zero. We do not buy a company that is in trouble and make it grow we build things, logistics, you know we are building the super port, new oil production, everything is new so its new jobs. I think it’s even more than philanthropy because you know philanthropy is getting money then distribute it we are applying all our money in Brazil on these transformational mega infrastructure projects,” he says.

"My companies are seeing a trend and turning it into gold," he told the media after listing his fifth company on the stock exchange in three years.

While his father taught him to think big, life in the world’s most glamorous city, Rio de Janeiro, has given him an eye for the spectacular, including his wife for 13 years, Luma de Oliveira.

The former Carnival queen and Playboy model added the glitz to the financial alchemist who studied metal engineering in Aachen, Germany when she persuaded him to jilt Rio socialite Patricia Leal in 1991. Divorced in 2004, Eike now dates the uber-tanned lawyer Flavia Sampao, 30 years his junior.

Together they are on a crusade to bring back some of the glory to the Cidade Maravilhosa (Marvellous City) by hosting the best events in the world and stamping EBX Group’s Inca sun logo all over them.

“Because of the media reporting mostly about the violence in Rio we lost some flair, we lost some importance,” he says. “Events like the Class 1 World Powerboat Championship and the Olympics finally puts Rio back onto the world map.”

Important changes are afoot in Rio, according to Eike, with cash flowing in to get a piece of the boom being fuelled by the largest oil discovery in the world in the last three decades.

Petrobras, the state-owned oil giant and the world’s fifth largest company, has its HQ here, as does Vale. Eike’s EBX group has its offices overlooking Sugar Loaf Mountain and Flamengo beach.

The discovery of as much as 50 billion barrels of black gold off the coast of Rio de Janeiro and Sao Paulo has turned Brazil’s former capital into ‘the zone’, the hotspot at the centre of Eike’s dazzling solar system.

“Rio and Sao Paulo are the states that are part of this new trillion dollar economy which is basically the pre-salt oil which is huge with all the industries that back up this industry. When it is oil it is transformational so the transformation of this wealth creation will obviously benefit Rio because we are right in the middle of this zone,” he says.

Eike wants Rio to become the capital of what he describes as the ‘Estée Lauder financial circuit’ stretching from Brazil to India and China.

“If you look at the world in the next 10 years the axis of development has moved to Brazil, India and China. This is the circuit. OK. The Estée Lauder financial circuit.” He predicts that Brazil will move from the world’s eighth to fifth largest economy by 2015 but as a numerologist, five is not the number Eike wants to be remembered for.

He has already set his sights on a smaller prime number and it is not the number three emblazoned on his polo shirt. The man that broke the speedboat record between Rio and Santros doesn’t believe in coming second either.

To strengthen Rio’s brand and to place it at the heart of this designer financial circuit he recently clinched a deal to bring Class 1 World Powerboat Championship and all the glamour of the ‘Formula One of the Seas’ to the city where he lives with his two boys, Brazil’s most eligible teenagers, Thor (17) and Olin (12).

Much of his personal wealth is being spent on cleaning up his adopted home town with a donation of more than a $5.6 million to the campaign to land the 2016 Olympics, a $111m re-fit of the famous 1922 Hotel Gloria and a $15.6 million plan to clean the Rodrigo de Freitas Lake between Ipanema beach and his mansion perched underneath the Christ the Saviour in Jardim Botanico.

Cleaning up the city needs more than just Eike on the job, however, and he is backing a new government policy based on the ‘occupation’ of Rio’s slums, or favelas, to help seize control back from the drugs gangs that have ruled the roost in the poorest parts of the city and spread tensions in Ipanema, Leblon and Jardim Botanico for the likes of Eike and his well-heeled neighbours.

“Five favelas have already been occupied by the ‘Pacification Police’ as they call them. It has been a mega success,” beams Eike. For someone who has built an empire cherry-picking the best real estate in Brazil, be it oil fields off the coast of Rio de Janeiro or iron ore mines in Minas Gerais and Mato Grosso, or a new 7,600 hectare industrial port in upstate Rio, he can see the ‘win-win’ in giving the people a slice of the Brazilian dream he has come to represent.

“People are getting their property titles so you are creating a boom in the real estate. Prices are quadrupling in these places,” he says. “People are finally getting their land titles plus the occupation of the state. It is a friendly occupation, you know the police with health, with schools this is what is necessary and the city has a budget and every couple of months there is a new area that is occupied,” he says.

More than 100,000 people have been liberated by the new policy since 2008.

While he admits there is still a long way to go, he believes it is time the rest of the world started to learn from the largest country in Latin America.

“I think the world can learn from Brazil. It can learn a lot about biofuels, green energy. If you stop today in fuel stations in Brazil all Brazilians can fill up their tank with green energy, with ethanol, which is unique in the world,” says the man who reportedly has a Mercedes SLR McLaren sportscar parked in his front room.

“In Brazil we have probably the largest agricultural surface in the world. Many countries like China have to think about food security but Brazil can help the world in terms of food security and energy in terms of oil, so there are two major things - food security and energy and resource security. Then there is clean energy because our matrix is 80% hydro-power and in the future there will be atomic power I think Brazil is the greenest country in the world?”

Where Brazil is playing ‘catch up’ he says is in education, where he argues the country has ‘probably lost one or two generations’.

“We didn’t have the means. Brazil had very high interest rates, you know, unfair! The rating agencies gave us a credit rating that we never deserved and this has probably cost us $100bn.”

The equivalent of four Eike’s at the current share price or just one in 2016?

“No!” With a little squeeze of the arm and another billion dollar grin. “With this we could have educated all the children!” he points out from a very privileged position at the top of the Brazilian money mountain.

Every country needs a hero and with the glamorous, uber-tanned girlfriend on one arm, a diamond-encrusted Rolex on the other, oh and about 27 thousand million other very good reasons we could mention, it’s easy to see why there is an army of people in Brazil who want to be like Eike.

Lenny Niemeyer - Queen of the Beach Bums

If you have more than one-name in Brazil something isn’t working. In a country of 192 million, getting lumbered with two, three or four names simply isn’t cool. The country’s footballers opt for one early on in their careers and hope that it will one day rank alongside the greats – Pele, Zico, Ronaldo and Romario. The country’s richest man is known simply as Eike and even the president has ditched his family name for Lula, or squid.

Those able to carry off a mono-moniker after throwing away a heavyweight surname like Niemeyer, are clearly doing something right, hey Lenny?

After wisely opting to ditch a glittering career as a designer trying to make sense of the Sao Paulo landscape, Lenny Niemeyer, chose to become the undisputed queen of Brazilian beach fashion. Where else but the world capital of body beautiful, Rio de Janeiro?

In 1993, she joined the Brazilian world of one-name wonders with the launch of her exclusive brand of designer bikinis, swimsuits and beachwear, Lenny. Since she has added a store every year and established herself as the bikini guru for Brazil’s (read the world’s) most exquisite figures.

Famed as much for her parties as her sleek designs, Lenny put the style back into Rio de Janeiro and is one of the pillars holding up the contemporary ascent of Brazilian fashion.

As the world’s fifth largest country looks increasingly beyond its own extensive boundaries, Brazil’s growing confidence can be seen clearly on the runways of Sao Paulo Fashion Week and Fashion Rio.

“I think that every year Brazil has more and more its own identity,” says Lenny.
“Brazilian fashion is becoming much more professional with a lot more personality. When I began as a stylist 20 years ago Brazil did not have this sense of identity and many of the ideas were imported from abroad. Today I think Brazilian fashion is very strong and it has its own personality, a personality which reflects Brazil which is more light and cheerful, more relaxed.”

Top-notch labour, high quality textile producers and a deep pool of artisans yet to be harnessed points to a bright future for the Brazilian fashion business, she says.

Lenny points to designers like Andrea Marques of A Mais Bonita, Oskar Metsavaht of Osklen, André Lima and Alexandre Herchcovitch who have opened up the possibility of moving beyond a ‘sub-mundo’ (underworld) of beach fashion to standout shows in Paris, Milan and New York.

“SPFW and Fashion Rio have contributed a lot to this,” she says. “To do a show in Miami, New York or Europe was expensive but these shows, the promoters, the journalists, the Brazilian models working abroad have given a lot of force to Brazilian fashion and the country has started to sell itself beyond beach fashion,” she says.

Teenage prodigy, Pedro Lourenço, the 19-year old son of SPFW stalwarts, Reinaldo Lourenço and Glória Coelho stormed Paris earlier this year with his bold blend of ‘Diana the Huntress and Brazilian architect Oscar Niemeyer’. Lourenço, says Lenny, offers a glimpse of the future of Brazilian fashion – ‘confident and highly accomplished’.

She herself has got caught up in the 50^th birthday of her uncle’s most famous work, the Brazilian capital, Brasilia.

Her last two collections were inspired largely in Brazil’s indigenous roots with organic patterns and earthy tones but Brasilia’s birthday has put her and the rest of the country in a more modernist frame of mind.

“I am preparing a collection that looks at modernist architecture with forms that are very clean. I am at the experimental stages but I like to do this. My life is to create, innovate, to surprise, and to take risks,” she says.