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Petrobras to complete 700-mile Brazilian ethanol pipeline by end of 2009

May 30, 2008

In Brazil, the president of Petrobras said the state oil company will complete its 700 mile ethanol pipeline from Goias state to Sao Paulo by the end of 2009. Petrobras also said that its second pipeline was in the planning stages, and the initial studies would be completed next month on the alternative route from Cuiaba and Paranagua. The Goias pipeline has a project cost of $1 billion.

Petrobras, Mitsui and Camargo Correa established a joint venture to finance and construct an ethanol pipeline between Senador Canedo and Paulínia, and the section that connects the Tietê-Paraná Waterway to the Paulínia Terminal.

Petrobras said earlier this year that it will establish a biofuels subsidiary to centralize its biofuel production management. The new unit will supervise both biodiesel and ethanol production, although sales and logistics will continue to be supervised by the Petrobras supply division. The company has set a goal of becoming the largest producer of biodiesel in the country.

Petrobras said it will construct a new 193 Mgy “superplant” for biodiesel production, and will make biodiesel directly from seeds rather than oils. The new technology is being tested at a pilot plant in Guamare, Rio Grande do Norte state. Petrobras is already constructing three smaller plants that will each have a capacity of 15 Mgy. Total project investment for the four plants will be $300 million.

Petrobras previously announced that it will construct 10 new biodiesel plants between now and 2012. Total project cost for the 13 facilities was projected at $507 million and planned capacity at the time was anoucned at 225 Mgy.Petrobras commenced marketing biodiesel in the past few months, and the company has made sales to date of 41 Mgy, primarily in Rio Grande do Sul. Petrobras will market a total of 100 Mgy which is estimated to cover Brazil’s consumption of biodiesel for the first half of 2008. Brasil Ecodiesel has a 62 percent market share in the Brazilian biodiesel market.

The Brazilian government has targeted reaching a B5 biodiesel blend level by 2013. Brazil has set a B2 blending mandate effective in January 2008, and the director general at the National Petroleum, Natural Gas and Biofuel Agency (ANP), said that he expected that there would be enough biodiesel to cover more than twice the amount mandated.

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    Written by Jim Lane · Filed Under International 

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