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Petrobras plan increases investment in dirty energy

06/15/2012 - 12h27

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DENISE LUNA
FROM RIO DE JANEIRO

In the middle of Rio+20, the U.N. conference whose objectives include finding ways to reduce carbon emissions in the atmosphere, Petrobras announced a business plan yesterday that increases investment in fossil fuels (oil and gas) and reduces the investment in biofuels (ethanol and biodiesel).

The oil company's business plan for 2012 - 2016 includes a 5.2 percent increase compared to its previous plan for 2011 - 2015, in response to requests from the government that state-owned companies increase their investments.

By 2016 the company will invest US$236.5 billion, compared to the US$224.7 billion that was originally included in the previous plan.

This will increase the annual expenditure from US$44.9 billion to US$47.3 billion, which helps the economy.

Of the total investment included in the plan, 60 percent (US$141.8 bliion) will go to Exploration and Production, an increase of 3 percent compared to the previous plan.

The proportion of the company's investment going to biofuels, however, fell from 2 percent to 1.6 percent, showing a clear shift in the focus of the company, which had previously planned to increase its participation in the ethanol market from 5 percent to 12 percent of its total investments.

At the same time that it announced an increase in the amount of investment that would go to production, the state-owned company decreased its goal for petroleum production from 6.4 million barrels a day to 5.7 million.

For this year and into 2013, production will remain relatively stable compared to last year, which saw only 2.021 million barrels a day.

The company also increased its corporate expenditures by 25 percent, including salaries and building administration, which accounts for US$3 billion, or 1.3 percent of the total.

SILENCE

Strategically, the state-owned company will wait until after June 25 to comment on the plan, after the U.N. conference is over.

A reduction in the participation of renewable energy in the strategy of the oil company goes against what is being discussed in the halls of the Riocentro conference center, the headquarters of Rio+20.

One of the two points that is being negotiated in the text, 'The Future We Want,' which will be the foundation for the final document of the conference, proposes to double the portion the global energy grid that comes from renewable sources, currently at 15 percent. A full 45 percent of Brazil's energy grid comes from renewable sources.

SHARES FALL

Less projected production affected shares of Petrobras, which yesterday accounted for one of the largest drops in the Bovespa stock exchange.

Folha found that the company is evaluating whether it will maintain the previously planned construction of refineries in Maranhão and Ceará announced by then president Lula.

Translated by Anna Edgerton

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