Petrobras, Brazil’s state oil exploration and production company. will build a fertilizer factory in the midwest of the country and a refinery in the southeast. The two undertakings will use up investments of US$ 3.6 billion, of which US$ 600 million will go to the factory and US$ 3 billion to the refinery.
Building the refinery, which is forecasted to start in 2007, may be anticipated if next year Brazil maintains the same growth rhythm as in 2004, according to the company’s Downstream director, Paulo Roberto Costa. Brazil should end the year with a 4% increase in domestic consumption.
“The year of 2005 will be key to decision making. In planning, we considered an average increase in consumption of 2.4% in the next few years. Since we are having a rather pleasant year from the point of view of consumption, which is currently about 3.5%, possibly closing at 4%, we may anticipate our schedule,” said the director.
The building project for the refinery will be concluded in 6 months. The unit will process fuels and inputs for the petrochemical industry from heavy oil extracted from the Marlim field, in the Campos Basin, in the state of Rio de Janeiro.
The refinery will have the capacity to process between 150,000 and 200,000 barrels of oil per day.
Petrobras has not yet defined if the facilities will be built in the states of Rio de Janeiro, Espírito Santo or São Paulo – all three states being in the southeastern region of Brazil. The decision will depend on incentives offered by the states.
“Even though the refinery will also process diesel and LPG, the main objective of the new unit will be to produce propene and ethene,” he said.
Both products are inputs for the petrochemical industry. The partnership for technological exchange set up by Petrobras with the Chinese Sinopec, which already has experience in the area, should help the Brazilian company to transform crude oil into petrochemical inputs.
Fertilizers
The fertilizer factory which will also be built by Petrobras should start operating in 2009, one year before the deadline which had been initially established.
Opening of the factory, which will have as raw material the natural gas coming from Bolivia, will cause an increase in the domestic supply of fertilizers in Brazil.
Today, only 50% of the market is supplied by companies installed in the country. According to Costa, this percentage should rise to 70%.
The oil company already owns two units for producing fertilizer in the country, one in Sergipe and one in Bahia, both states in the northeast of Brazil.
The production should increase by 20% when the new factory starts operating. The city where the plant will be installed has yet to be defined.
Petrobras may also anticipate the beginning of operations of a unit to produce propylene, close to the Paulínia Refinery, in the state of São Paulo.
The plant, which will have the capacity to produce 300,000 tonnes of propylene, will be built together with the private group Braskem and should be ready between the end of 2006 and the beginning of 2007.
ANBA ”“ Brazil-Arab News Agency