Petrobras to pump billions into biofuel

Mar 09, 2009 01:00 AM

Brazil's oil giant Petrobras has announced a business plan for investments of $ 2.4 bn (EUR 1.89 bn) into biodiesel and ethanol production for the 2009-2013 period, 91 % of which will be in Brazil.
This amount is part of the total of $ 2.8 bn Petrobras has earmarked for the biofuels business, which also foresees expenditures of $ 400 mm in infrastructure, such as ethanol pipelines.

The total resources represent an 87 % increase compared to the previous business plan. Petrobras also earmarked $ 530 mm for biofuel research in the period. Of the $ 2.4 bn, 80 % will be invested in ethanol, with 20 % in biodiesel.
One of the company's goals is to reach 640 mm litres of biodiesel in Brazil by 2013. To achieve it, a new plant is expected to be built in Northern Brazil. The Candeias (state of Bahia) plant will be duplicated, and the experimental plants in Guamare, in the state of Rio Grande do Norte, will be adapted for commercial production.

Work will also be executed on enhancing productioncapacity at the Quixada (state of Ceara) and Montes Claros (state of Minas Gerais) plants. Furthermore, the possibility of acquiring two new plants is under consideration.
For the ethanol segment, the goal is to reach, in partnerships, the production of 1.9 bn litres in 2013, aimed at the foreign market, and 1.8 bn litres to be distributed in the domestic market.

The idea is to sign partnerships for four new ethanol production projects, involving a foreign partner, which will ensure market share, and a domestic ethanol producer.
The company may also acquire participation in existing plants. An ethanol production unit is under analysis for Colombia.

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