Brazil: Petrobras Allocates USD 800 Million for LNG Projects

Petrobras’ Gas & Energy director, Graça Foster, detailed the $13.2 billion in investments foreseen for Gas and Energy for the period ranging from 2011 to 2015 this Tuesday (08/09).

Of this amount, she stated that $12.9 billion will be invested in Brazil. Graça emphasized her area aims to obtain the “maximum economic results from the minimum possible investments” in the period. Petrobras’ Business Plan calls for total investments in the order of $224.7 billion between now and 2015.

Graça noted that the Company has already completed the natural gas transportation network cycle, which consumed $15 billion in resources. Most of the funds ($5.9 billion) will be earmarked to convert natural gas into urea, ammonia, methanol and other products used to produce fertilizers. According to the director, another large part of the budget ($3.4 billion) will be allocated to new natural gas delivery points and management projects with the distributors in order to boost sales. “There are 27 (state) gas distribution companies in Brazil, and Petrobras holds stakes in 21 of them,” mentioned Graça. Additionally, $2.8 billion will be invested in thermoelectric power generation, while $800 million will go to the Liquefied Natural Gas (LNG) chain (regasification and liquefaction), to transport the gas from the pre-salt region and to supply the thermal market. “We have attained increasingly better results in the pre-salt,” celebrated Graça, emphasizing the correlation between her area and Exploration and Production, which supplies the gas.

In 2015, Exploration and Production is expected to supply 78 million cubic meters per day. On account of the increased production of oil and gas foreseen by the Company, this volume will rise to 102 million cubic meters per day in 2020, an amount that represents a large part of the natural gas supply in Brazil. The director also spoke about the current total supply and demand for natural gas. “We expect supply to exceed demand by 10 million cubic meters per day in 2011.” Demand is predicted to reach 96 million cubic meters per day this year.

Finally, the director listed the major projects under the G&E portfolio. Among them are the Bahia Regasification Terminal, with capacity for 14 million cubic meters per day and scheduled to start operating in January 2014; the Baixada Fluminense Thermoelectric Power Plant, which will have a generating capacity of 512 MW and is scheduled to go on stream in March 2014; the Nitrogen Fertilizer Unit III (UFN III), slated to produce 1.2 million tons of urea and 81,000 tons of ammonia per year and is hoped to begin its operations in September 2014; the Gas Chemical Complex (UFN IV), which will produce urea, melamine, acetic acid, formic acid, and methanol and go on stream in June 2017; and, finally, the Ammonia Plant (UFN V), which is hoped to commence operations in September 2015.

The investments made in the fertilizer area will enable the country achieve self-sufficiency in ammonia in 2015 (Brazil currently imports 53% of what it consumes); to reduce its dependence on imported urea to 28%, also in 2015 (53% of consumption is imported); and to decrease methanol imports to 20% in 2017(today, 68% of Brazilian consumption comes from abroad).

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Source: Petrobras, August 11, 2011;