Mitsui Ocean Development & Engineering Company (Modec) has signed a letter of intent with Petrobras for the supply and operation of a floating production storage and offloading (FPSO) vessel.

The company said the VLCC Radiant Jewel will be converted into the FPSO Cidade de Sao Paulo MV23 with a capacity to process 120,000 barrels of oil a day.

The vessel will be operated in the BM-S-9 (Guara) block in the Santos Basin region.

MODEC, together with Schahin, will provide the design, construction and operation of the FPSO, the company said.

The vessel is scheduled to be delivered by the end of 2012.