By Reuters 

  12 August 2016 22:31 GMT

Sete Brasil will present on Friday a draft reorganisation plan that includes seeking up to $5 billion in funding and a dramatic downsizing of business, three months after the Brazilian rig builder sought court protection against 18 billion reais ($5.7 billion) in looming debt payments.

Rio de Janeiro-based Sete Brasil will ask creditors, which include some of the world' s top shipbuilders and the nation' s largest lenders, to endorse a plan to help build between eight and 12 rigs, down from an original target of 28, chief Eeecutive Officer Luiz Eduardo Carneiro said in an interview

The plan will be submitted to a court in Rio de Janeiro, where Sete Brasil' s in-court reorganization is being handled.

Fundraising could vary along with the number of rigs to be built and delivered to state-controlled Petrobras, Sete Brasil' s sole client, Carneiro said. While looking for clients other than Petrobras is a possibility, Sete Brasil' s priority is convincing the state firm to rent the rigs, said Eduardo Sampaio of Alvarez & Marsal Holdings, Sete Brasil' s main advisor.

Founded in 2008 to fill the world' s biggest deep-water drilling fleet order, Sete Brasil had to file for bankruptcy protection in late April after efforts to secure a long-term contract with Petrobras failed. Petrobras owns 5% of the rig builder.

The $90 billion project began to fall apart in 2014 when Petrobras and Sete Brasil became engulfed in Brazil' s worst corruption scandal, leading the Brazilian government - the main sponsor of the project - to delay promised financing and the signature of the long-term rig supplying contract.

The tussle between Petrobras and Sete Brasil' s management and shareholders has forced the rig leaser' s creditors to write off some of the 15 billion reais in loans they extended to Sete Brasil.

Sources have told Reuters that a collapse of Sete Brasil would be devastating not only for the banks, pension funds and investment firms that backed the project, but also for dozens of shipbuilders and manufacturers supplying the company.