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Brazil Joins Italy to Produce Biofuel in Brazil and Africa

Italian energy company ENI

Italian energy company ENI Brazil's state-controlled oil company Petrobras and Italy's energy company ENI signed an agreement in São Paulo, Brazil, to develop and commercialize biofuels technology and announced plans to build four bio-diesel plants in Brazil.

The memorandum defined as "a strategic alliance for international markets" was signed before Italian Primer Minister Romano Prodi and Brazil's president Lula da Silva.

Both companies will also study the possibility of using other commodities for refining into biofuels and will assess the expansion of Brazil's current capacity for refining heavy fuels.

The four biodiesel plants are likely to cost about US$ 480 million and are in line with the EU target of producing 20% of its energy from renewable sources such as bio-diesel and ethanol by 2020.

Brazil is the world's second-biggest ethanol producer (behind the US) and the top exporter. Brazil recently signed a similar agreement with the United States during the visit of US President George Bush. (US ethanol is made out of corn, Brazilian from the remains of sugar cane refining).

Brazilian cars have been running on biofuels for decades and the country's expertise is in great demand.

"The Italian market is interested in the import of biofuels because Italy is not self sufficient," said Mr. Prodi following his meeting with the all powerful São Paulo Federation of Industries.

Prodi also announced that the new strategic alliance represents "a bilateral association logic" between both countries and targeted to third parties.

The strategy could mean undertaking joint projects for the production of ethanol in African countries and "could begin in Angola", but other countries have also been considered.

Eni is 30% owned by the Italian government and Petrobras is 60% state-owned.

Mercopress

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  • Show Comments (2)

  • Luiz Alessio

    Maybe to get some investment going my friend, Its bad but we dont have the bling bling(money) hehe to get things going and its always good to held Africa. Those guys look like they need a hand. So good luck for africa brasil and italy

  • conceicao

    So Italy will import Brasilian ethanol duty-free if its national champion oil company is a partner in the Brasilian ethanol plants that produce the fuel? Or is this a deal where Italy invests money in Brasil in return for technology transfer that Eni can then deploy in an African country that has a favorable trade deal with the EU and favorable conditions for sugar cane cultivation? Why not just start importing
    Brasilian ethanol now in return for agreement by Brasilian producers to license their technology at a reasonable price to any one who might want to employ it? What is the point of all of the complication?

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