Biofuel Investment Agreement
Posted on October 11, 2008 – 1:35 pm | by oilandgaspress.com
(Rio de Janeiro, October 10 2008) – PETRÓLEO BRASILEIRO S/A - PETROBRAS, [Bovespa: PETR3/PETR4, NYSE: PBR/PBRA, Latibex: XPBR/XPBRA, BCBA: APBR/APBRA], a Brazilian international energy company, announces it signed with Galp Energia SGPS an Investment Agreement today (10/10) to create a joint-venture to develop a biofuel production and marketing project.
This agreement is the outcome of the breakdown of the Memorandum of Understanding the companies signed last May 18 which was aimed at studying the feasibility of joint biodiesel production, marketing, and distribution projects in the Brazilian, Portuguese, and international markets. The studies and analyses that were carried out indicated the deal, dubbed as the Belém Project, is feasible.
The Project foresees the production of 600,000 tons of vegetable oil per year in Brazil, which will be used to produce 500,000 tons of 2nd Generation biodiesel (2G Biodiesel) per year. Half of this volume will be produced in Portugal, while the other half at a location yet to be defined. The product will be marketed in Europe, prioritarily in the Iberian market.
The companies intend to deepen their studies on the Project’s viability and, if confirmed, a company be incorporated with joint stock shared between Petrobras (50%) and Galp Energia (50%), and the companies may be represented in such corporation by their affiliates.
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