The second of 11 new production units off Brazil's southeast coast is on track to hit peak output of 120,000b/d by December, according to Portugal's Galp Energia.

Three wells have already been connected to the Cidade de Paraty vessel, which has also begun exporting natural gas via the Lula-Mexilhão pipeline, Galp said in its second quarter results report.

The floating production, storage and offloading (FPSO) unit began operating in May last year in the ultra-deepwater Lula field.

Located in block BM-S-11, Lula is one of the largest oil discoveries in the western hemisphere with estimated reserves of more than 5Bboe.

Brazil's state-run oil major Petrobras has a 65% operating stake in the block while BG Group holds 25% and Galp 10%.

Cidade de Paraty is one of eight production vessels brought online by Petrobras since January 2013. Another three are due to begin operating by December.

Galp reported Q2 net profit of 68mn euros (US$91mn), down from 86mn euros in the year-ago period.

The Lisbon-based firm said growth in the liquefied natural gas (LNG) and electric power segments had been offset by lower refining margins.