Petrobras to invest billions in its biodiesel, ethanol segments

By Bryan Sims | August 15, 2011

Brazilian oil and gas conglomerate Petrobras, through its wholly-owned biofuel subsidiary Petrobras Biocombustivel, plans to invest $2.5 billion in increasing biodiesel and ethanol production between 2011 and 2015. The total amount is part of $4.1 billion earmarked for its total biofuel business, with its business plan calling for investments totaling approximately $224.7 billion in the next five years.

Although increasing ethanol production will be a priority for Petrobras—accounting for nearly 76 percent of the total investment in biofuels production in the four-year span—the company intends to invest $600 million to bolster its biodiesel and agricultural supply segments in hopes of maintaining a 25 percent domestic market share in the coming years.  This figure, according to the company, would take into account the organic growth in demand for diesel and Brazil’s B5 regulation currently in effect.

With the addition of its 50 percent ownership stake in in-country biodiesel producer BSBios Industria e Comercio de Biodiesel Sul Brasil S.A. in July, Petrobras currently has a total of five operating biodiesel plants with a combined capacity of approximately 700 MMly (185 MMgy). Moving forward, the company now intends to focus its efforts in the State of Para where it plans to deploy a plant to supply biodiesel to Northern Brazil, as well as concentrate on its Belem project, which will produce green diesel—or renewable diesel—in Portugal in partnership with Portuguese company Galp.

Meanwhile, in its biofuels research area, Petrobras intends to invest $300 million to advance the development and commercialization of second-gen biofuels, such as cellulosic ethanol, as well as increase research into aviation biofuels and improve production processes to keep the company at the forefront of sustainability. 


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