Petrobras: Biodisel on an industrial scale

Determined to lead the Brazilian production of biodiesel, Petrobras has begun the construction of three industrial plants, with projected investments of US$ 107 million. The construction of the plants in Candeias (in the state of Bahia), Montes Claros (in Minas Gerais), and Quixadá (in Ceará) will be the responsibility of Intecnial S.A. This engineering company, established in the state of Rio Grande do Sul in the South of Brazil, uses technology developed by the US company Crown Iron Works, one of the world leaders in vegetable seed and oil processing engineering. The goal is to produce up to 171 million liters of biodiesel per year by processing vegetable oils or animal fat, and therefore exerting social and environmental responsibility. Indeed, biodiesel pollutes less than traditional diesel and promotes greater social inclusion by generating jobs and income in the countryside and by encouraging family agricultural ventures.
Thanks to these three new plants, which should come onstream at the end of 2007, the company is broadening its scope of activities on the renewable energy front. In addition, it is working towards the consolidation of the strategy included in the Petrobras 2007-2011 Business Plan, which forecasts the production of 855 million liters of biodiesel per year as of 2011. The great availability of land for the cultivation of oil-rich plants in Brazil, the favorable climate, the fertility of the soil, and the experience acquired over three decades by the Brazilian Alcohol Program (PROALCOOL), an international benchmark for renewable energy, underpin the sustainability of the strategy. This strategy, in turn, is a key factor in establishing Petrobras as an integrated energy company.
Countries such as Germany, France, and the United States already have well-structured programs for the production and use of biodiesel. The Brazilian program was approved in 2004. Law number 11097 establishes goals and timeframes for the introduction of this new fuel into the Brazilian energy matrix and, in 2005, the addition of 2% of biodiesel to all diesel sold in Brazil was authorized by the Federal government. As of 2008, this mixture will become compulsory and the required percentage will be 5%, thereby stimulating further growth of the market.
Production of the fuel on an industrial scale represents savings in oil, speeds up the elimination of the need to import diesel, and enables Brazil to save on foreign exchange. Furthermore, once production is in progress at the three plants, cultivation of the oleaginous crops will guarantee work and income for approximately 70,000 families. Farmers are already setting up cooperatives with a view to joining Petrobras’ chain of suppliers and are organizing plantations in the municipalities in the vicinity of the units. The raw materials initially used will include cotton, castor bean and soybean oils. The unit in Bahia will also use dendê oil, thereby taking advantage of the abundance of this type of palm tree in the state.
Forming partnerships with small and medium farmers will give Petrobras the right to the Social Fuel Label, created by the Brazilian government to motivate industrial producers of biodiesel who purchase raw materials derived from family farms to supply the farmers with technical assistance and to pay them fairly. The label guarantees preferential treatment to industries, by means of special financing terms and tax breaks. In the case of the production of biodiesel derived from the castor bean in the Brazilian Northeast and dendê in the North, for example, manufacturers will be exempted from taxes.
When it comes to the environment, biodiesel also has advantages. After all, its use diminishes greenhouse gases, as well as sulfur and particulate material (black exhaust fume) emissions, at the same time that it improves the lubrication and the power of the engines of vehicles fuelled with the product, as it has a high cetane content. Emissions of greenhouse gases, among which is carbon dioxide (CO2), are reduced by 95%, while carbon monoxide (CO) emissions are reduced by 48% and particulate material and hydrocarbon emissions drop by 47%.
With prospects so favorable, Petrobras is now studying biodiesel production linked to 15 other projects. “In many regions around Brazil, we are analyzing partnership proposals with investors of all sizes, ranging from major economic groups to rural farming cooperatives. Our goal is to produce 855 million liters of fuel in 2011, thereby supplying the Brazilian market, and subsequently to seek out opportunities for export. In this way we will generate foreign exchange, increasingly reduce our impact on the world climate, and promote development in our areas of activity,” concludes Ildo Sauer.
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