Petrobras and Mitsui to sign ethanol plant deal in May

Brazil's state-owned oil giant Petrobras is set to sign a $ 250 mm ethanol plant deal with Japan's Mitsui and local ethanol producers in Brazil in May, the company's chief financial officer Almir Barbassa said.
"We are ready to sign our first ethanol plant deal with Mitsui next month," Barbassa said in Tokyo. "The plant capacity will be about 200 mm litres a year [1.26 mm barrels/year]," Barbassa said.

Barbassa said the plant will be built near its existing ethanol export pipelines. It will likely be owned 10-20 % each by Petrobras and Mitsui, with the remaining stakes shared by unidentified local producers, Barbassa said. Petrobras and Mitsui's latest ethanol deal will come after the companies formed a joint venture in March to produce and export sugarcane-based ethanol from Brazil, Barbassa said.
Meanwhile, Petrobras plans to spend $ 1.5 bn on biofuels and renewable energy in 2008-2012, up 25 % from $ 1.2 bn in its 2007-2011 plan. Of the total, 46 % will be spent on ethanol pipelines; 29 % on biofuels; 21 % on other renewable forms of energy including solar energy; and the remaining 4 % on biodiesel produced from hydro-treated refining technologies, according to company plans.

Petrobras and Mitsui also separately agreed in February last year to conduct a feasibility study on a pipeline to carry ethanol from the south-central interior states of Minas Gerais and Goias through Sao Paulo to Petrobras' coastal export terminal at Sao Sebastiao.
Petrobras plans to boost its ethanol exports to 4.75 bn litres by 2012 through production and infrastructure investments after securing long-term buyers in countries such as Japan, the US, Norway, Sweden and Portugal, Barbassa told earlier.