Biofuel Production

The search for alternative energies led us to develop Biodiesel and the HBio process, and we enhanced the ethanol trade.

To reinforce our performance in this segment, we created Petrobras Biocombustível, a wholly-owned subsidiary aimed to develop and manage biodiesel and ethanol production projects.

With these projects, we meet part of the growing global demand for biofuels, which contribute to diversify the power matrix, with positive impact on reducing global warming.

Biofuel production also allows for jobs and income generation on the farmland, taking advantage of Brazil's favorable conditions, such as its climate, water, and a major agricultural frontier to be explored, without any need to advance into forest areas or demarked reserves.

Biodiesel

With biodiesel, we presented a viable biofuel alternative produced based on several oleaginous plants, such as castor beans, cotton, peanuts, denedê oil, sunflower seeds, and soybeans, in addition to alternatives feedstock such as animal fat, oil used to fry foods and residual fat.

In addition to the environmental benefit, the production of biodiesel will reduce the need for diesel fuel imports, favoring the results of our trade balance.

We have three plants producing biodiesel, located in the municipalities of Candeias (state of Bahia), Quixadá (state of Ceará), and Montes Claros (state of Minas Gerais), with total production capacity of 170,000 cubic meters per year.

In addition to them, we have two experimental plants in Guamaré (state of Rio Grande do Norte), where we developed proprietary technology for biodiesel production.

The Candeias and Quixadá plants have the "Social Fuel Seal," issued by the Ministry of Agrarian Development, and the Montes Claros plant is expected to be certified soon.

We are signing-on partnerships with entities that represent family farmers for the supply of oleaginous plants. Our goal is to work with 80,000 families residing in the regions surrounding the plants, by signing long-term agreements, guaranteeing fair prices, distributing seeds and providing technical assistance, in addition to offering an initial program for soil correction.

We follow the guidelines set forth by the National Program for Biodiesel Production and Use, and our plants have automated instrumentation and control systems.

Over and beyond adding Biodiesel to the fuel, our researchers also developed the HBio process. With this technology, we have added a new way to produce biofuels that is complementary to the Brazilian Biodiesel Program.

The HBIO production process allows vegetable oils to be mixed to mineral oil directly at the refining unit. The outcome is diesel with superior quality to that produced solely from oil.

Ethanol

Ethanol gained space in the international scenario as a clean, renewable fuel. In this field, we have accumulated upwards of 30 years of experience in storing, transporting, adding to gasoline, and trading the product.

Blending ethanol to gasoline also helped Brazil become one of the first countries to eliminate lead from gasoline.

We have worked to reach the goal of exporting 4.2 million cubic meters of ethanol in 2013. The production model we have adopted is based on partnerships to build Bioenergetic Complexes (CBio) which will also produce electric energy from burning sugarcane bagasse.

One of the actions to ensure the expansion of the internal consumption and to facilitate exports is building an ethanol pipeline system. With it, we will connect exploration points which will go through the Paulínia and Duque de Caxias refineries to the Ilha d'Água terminal, in Rio de Janeiro, and the São Sebastião terminal, in São Paulo. Another connection will join the cities of Cuiabá and Campo Grande to the Paranaguá port (state of Paraná).

We currently use the Ilha d'Água, in Rio de Janeiro, and the Maceió maritime terminals, in addition to the Santos and Paranaguá ports to meet the exports demands. The contracting of storage tanks in Korea was fundamentally important to increase the exports in order to serve not only the Korean, but also the Japanese and Australian markets as well.