MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas...

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MINISTRY OF MINES AND ENERGY PLANNING AND PLANNING AND BRAZILIAN ENERGY BRAZILIAN ENERGY MATRIX MATRIX July of 2006 Ministry Silas Rondeau

Transcript of MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas...

Page 1: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

MINISTRY OF MINES AND ENERGY

PLANNING AND PLANNING AND BRAZILIAN ENERGY BRAZILIAN ENERGY

MATRIX MATRIX

July of 2006

Ministry Silas Rondeau

Page 2: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

SUMARY

1 – Brazilian Electrical System

2 – Energy Planning

3 – Energy Matrix

4 – Ten Year Electrical Energy Expansion Plan 2006/2015

5 – Key Projects

6 – Electrical Energy Auctions

7 – Others Energy Souces

8 – Agro-industry

9 – Oil and Gas

Page 3: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

BRAZILIAN ELECTRICAL SYSTEM

João Pessoa

Rio Grandedo Sul

São PauloRio de Janeiro

Paraná

Uruguai

Vitória

Pará

Paraíba

Ceará

RecifeMaceió

AracajúSalvador

Mato Grosso

Brasília

Argentina

Installed Capacity = 93,926 MW• Hydro = 71,614 MW – 76.3 %•Thermal = 20,276 MW – 21.6 %•Nuclear = 2,007 MW – 2.1 %

Number of Consumer Units = 57.0 million

Energy Production = 420.0 TWh/year

(58% of South America)

Pick load = 61,800 MW(EQUIVALENT TO UNITED KINGDOM OR ITALY)

Transmission Lines = 87 518 km

Generation : 85% State owned companies 15% Private companies

Transmission: 26 companies (15 private companies) Distribution: 64 companies (80% private companies)

Source : MME

Amazonas Maranhão

Page 4: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

4 000 km

Sistemas Stand-alones

3.750 km 3.900 km

Continental Dimensions

BRAZIL EUROPE

BRAZILIAN ELECTRICAL SYSTEM

Page 5: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

BRAZILIAN ELECTRICAL SYSTEM

Thermal plantsMain Source

Isolated Systems

2 % of the Total Energy Market

1,448 kmTransmission

200 MWImports

3,186 MWInstalled Capacity

HydroelectricityMain Source

Interconnected System

98 % of the Total Energy Market

84,795 kmTransmission

7,970 MWImports

89,838 MWInstalled Capacity

ISOLATED SYSTEMS

INTERCONNECTED SYSTEM

Source: MME April - 2006

Page 6: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

BRAZILIAN ELECTRICAL SYSTEM

Source: MME, 2005

International interconnections

ITEM PRODUCT ORIGIN DESTINATION CAPACITY

1 Electrical Energy Venezuela Boa Vista - RR 200 MW

2 Electrical Energy Paraguay/Itaipu Foz do Iguaçu 5,600 MW

3 Electrical Energy Paraguay/Ande Foz do Iguaçu 50 MW

4 Electrical Energy Brazil/Argentina Garabi - RS 2,200 MW

5 Electrical Energy Brazil/Uruguay Livramento - RS 70 MW

6 Electrical Energy Argentina Uruguaiana - RS 50 MW

7 Gas Bolívia Corumbá - MS 30 millions m3

8 Gas Argentina Uruguaiana - RS 2,5 millions m3

BrazilBolivia

7 (GN)

Paraguay 3

4Argentina

8 (GN)

Uruguay

5

1

Venezuela

2

6

Page 7: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Ministry of Mines and Energy

ENERGY PLANNINGENERGY PLANNING

Page 8: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

THE PLANNING PROCESS

Basics planning goals of MME:Basics planning goals of MME:

Long term studies up to 30 yearsLong term studies up to 30 years

Purpose: Integrated and global energetic goalPurpose: Integrated and global energetic goal

Page 9: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

The Planning Process:The Planning Process:

Coordination and Definitions: MMECoordination and Definitions: MME

Studies Development: EPEStudies Development: EPE

Interaction with CNPE and Society: MMEInteraction with CNPE and Society: MME

THE PLANNING PROCESS

Page 10: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Ministry of Mines and Energy

ENERGY MATRIX ENERGY MATRIX

Page 11: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

The most competitive source of the countryRenewable resource Available Power: 260 GW (28% in operation)

HYDRO PLANTS

Expressive power available for generation of electrical energy)Renewable ResourceAvailable Power over 500 MW/year

BIOMASS

Important reserves of mineral coal are available32 billion ton (90% in Rio Grande do Sul State)Power of 20,000 MW available for 100 years (supposing 50% used for generation of electrical energy)

MINERAL COAL

NUCLEAR6 th largest reserve of uranium in the world 32 billion ton (equivalent to a 1.2 billion toe )Huge power for generation of electrical energy

NATURAL GASReserve of 306 billion m3 (equivalent to 0.3 billion toe)Production: 48 million m3/day (2005)50% of Brazilian natural gas market was supplied with national production (2005)

toe – ton oil equivalent

MAIN SOURCES FOR ELECTRICTY GENERATION

Page 12: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Brazil

RENEWABLE NO RENEWABLE

0

20

40

60

80

100

World

14

86

4555

Source: MME, 2006

RENEWABLE SOURCES: BRAZIL AND THE WORLD

Page 13: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

ENERGY MATRIX - 2005

Source: MME 2006

Oil 38.4%

Natural Gas9.3%

Uranium1.2%

Hidroeletricity15.0%

Other Renewable

Sources2.7%

Sugar Cane13.9%Wood

13.1%

Coal6.4%

Renewable sources:

Brazil 2005 – 45 %

World 2003 – 14 %

OCDE 2003 – 7.1 %

100%218.6 million [toe]

Page 14: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Matrix associated with generation of electrical energy.

Included energy imported from Itaipu. Source: MME 2006

BRAZILIAN ELECTRICAL ENERGY MATRIX

100%441.6 [TWh]

Renewable Sources:

Brazil 2005 – 89%

World 2003 – 18%

Hydro85.4%

Uranium2.2%

OilDerivatives

2.8%Biomass

3.9%

Natural Gas4.1%

Coal1.6%

Page 15: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

AGENDA

TEN YEAR EXPANSION PLAN2006-2015

Ministry of Mines and Energy

Page 16: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TEN YEAR EXPANSION PLAN 2006-2015

Important aspects:Important aspects:

MME guidelines: Specific plans, since long term studies are on execution.

Electrical Energy Market: from 374 TWh, in 2005, to 618 TWh, in 2015, requiring increments from 2,500 to 3,300 MW per year (firm energy) in the supply capacity, over the ten year period.

Supply: Adjustment of supply capacity to market requirements

At the end of planning period:

Brazil strongly interconnected.

Page 17: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TEN YEAR EXPANSION PLAN 2006-2015

Reference Terms: Developed by MME and handed to all public and private agents.

Plan Technical Studies: developed by EPE (Enterprise of Energetic Resource) under contract, supervision and follow up by MME.

Integration MME/EPE: strong interaction during the process with the teams of EPE and of MME/SPE.

Report of Ten Year Expansion Plan - 2006/2015: subject to public consultation on MME’s home page at http://www.mme .gov.br

Preparation Process:Preparation Process:

Page 18: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TEN YEAR EXPANSION PLAN 2006-2015 DEMAND

Market Forecast: three projections of the economic growth

0 2 4 6 8

2006-2011

2011-2016

0 2 4 6 8

2006-2011

2011-2016

0 2 4 6 8

2006-2011

2011-2016

6.0%

4.5%

HIGH GROWTH

4.5%

4.0%

REFERENCE GROWTH

3.5%

3.0%

LOW GROWTH

ten years average of GDP: 5.0% p.a.

GDP

ten years average of GDP: 4.2% p.a.

ten years average of GDP: 3.1% p.a.

Page 19: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TEN YEAR EXPANSION PLAN 2006-2015 DEMAND

Obs.: Load supplied by Electricity System without classic self-production (without use the transmission lines). **Trajectory of reference

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 201546 341 48 591 51 120 53 703 56 167 58 635 61 342 64 522 67 757 70 800 73 998

Load of Electricity** [MWyear]

300 000

350 000

400 000

450 000

500 000

550 000

600 000

2005 2007 2009 2011 2013 2015

High

Reference

Low

Total demand - Brazil (GWh)Total demand - Brazil (GWh) Load - Brazil (MWyear)Load - Brazil (MWyear)

45 000

50 000

55 000

60 000

65 000

70 000

75 000

80 000

85 000

(*) percentual of reference forecast

11,732MW year15.4% (*)

High

Reference

Low

87.2 TWh9,954 MWyear16.9% (*)

2005 2007 2009 2011 2013 2015

Page 20: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TEN YEAR EXPANSION PLAN 2006-2015 DEMAND

Industrial43.2%

Other13.7% Residential

25.1%Commercial

18.0%

Industrial46.5%

Other14.4%Commercial

15.3%

Residential23.8%

2005 2015

Total 2005*: 346 TWh Total 2015*: 567 TWh

* Without classic self-production (when energy is produced near the load and without using the transmission system) .

Consumption StructureConsumption Structure

Page 21: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TEN YEAR EXPANSION PLAN 2006-2015 SUPPLY

Sources:Sources:

Hydroelectricity;

Natural Gas;

Coal;

Biomass*;

Small Hydro Plants*;

Wind Power Plant*;

Nuclear

Cogeneration by natural gas;

Modernization and Power Upgrading;

* Sources of the governmental program called PROINFA

Page 22: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TEN YEAR EXPANSION PLAN 2006-2015 GRID

System under study:System under study:

Page 23: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

REFERENCE GROWTH

GROWTH GDP = 4.2% Population = 2.0 millions/year

Electrical energy consumption = 5.1% year

INSTALLED CAPACITY

2005 – 92,865 MW

2015 – 134,667 MW

ENERGY NECESSARY

2005 – 47,500 MW average

2015 – 76,000 MW average

DEMAND NECESSARY

2005 – 62,000 MWh/h

2015 – 99,000 MWh/h

BASIC GRID

2005 – 82,092 km

2015 – 123,429 km

41,800 MW INSTALLED

CAPACITY IN 10 YEARS

Investments US$ 56 billions by 10 years

Source: MME, PDEE 2006-2015

41,300 Km OF TRANSMISSION LINES IN 10 YEARS

TEN YEAR EXPANSION PLAN 2006-2015 SUMMARY

Page 24: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

HYDRO73% NUCLEAR

2%

COAL2%

PCH, PROINFA, etc.3%

FUEL OIL1%

GAS9%

IMPORTS8%

DIESEL OIL2%

BIOMASS0%

OTHERS10%

HYDRO73%

NUCLEAR2%

PCH, PROINFA, etc.4%

FUEL OIL1%

GAS9%

IMPORTS6%

DIESEL OIL2%

BIOMASS1%

OTHERS12%

COAL2%

Jan/2006 – 93,728 MW (*)

Dec/2015 – 134,667 MW

(*) Included the power of the existing plants in the Isolated Systems that will be connected: Manaus/Macapá and

Rondônia/Acre

Share of the Sources

Source: MME, PDEE 2006-2015

TEN YEAR EXPANSION PLAN 2006-2015 Installed Capacity

Page 25: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Source: MME, PDEE 2006-2015

Interconnections ExpansionInterconnections Expansion

20092009

North (Imperatriz) / North East – 1,500 MW in Dec.

20102010 Magnifying North/South – 1,100 MW in Dec.South/South East /Mid West – 1,000 MW in Dec.

20112011 Madeira / South East – 3,000 MW in Jan.

20122012 Madeira / South East – 3,000 MW in Dec.

20132013 Belo Monte / North – 3,000 MW in Dec. Belo Monte (Colinas) / South East – 1,100 MW in Dec.

20142014 Belo Monte / Colinas – 3,000 MW in Dec.

NE

N/ Man

SE/CO/RO

SIvaiporã

Imperatriz

*

IT

Mad

BM

DC

System

AC System

TEN YEAR EXPANSION PLAN 2006-2015

GRID

Page 26: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

AGENDA

KEY PROJECTS

Ministry of Mines and Energy

Page 27: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

KEY PROJECTS

Hydro plants on the Madeira riverHydro plants on the Madeira river

AHE Rio Madeira

AHE Santo Antônio

AHE Jirau

BOLIVIA

Madeira river (6,450 MW) JIRAU Hydro plant - Capacity: 3,150 MW

- Expected to operate (first unit): January, 2011.

SANTO ANTÔNIO Hydro plant - Capacity: 3,300 MW

- Expected to operate (first unit): January, 2012.

Total Investment:

US$ 7,378.80 millions

US$ 1.00 = R$ 2.70

Page 28: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

KEY PROJECTS

BELO MONTE Hydro plantBELO MONTE Hydro plant

AHE Belo Monte

BELO MONTE - project overview

Xingú river

Capacity: 11,181 MW

Expected to operate (first unit): December, 2013.

Total Investment: US$ 3,162.76 millions

US$ 1.00 = R$ 2.70

Page 29: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Average of ground inundated per power installed:

• UHEs existing: 0.52 km²/MW

• UHEs of PDEE: 0.27 km²/MW

• UHE Belo Monte: 0.04 km²/MW

• UHE Jirau: 0.08 km²/MW

• UHE Santo Antônio: 0.09 km²/MW

ENVIRONMENTAL AND SOCIAL INDICATORS

Source: MME, PDEE 2006-2015

Page 30: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

KEY PROJECTS

TRANSMISSION GRID:

• Two circuits, alternating current, 500 kV, 3 350 km, 2 250 MW; and

• Two bipolos, direct current, 600 kV, 2 450 km, 4 200 MW.

System Interconnection Projects - MADEIRASystem Interconnection Projects - MADEIRA

Page 31: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

KEY PROJECTS

TRANSMISSION GRID:

• Under study to supply the NW and N regions.

• Existing interconnection already to SE.

Interconnections studied - BELO MONTEInterconnections studied - BELO MONTE

Page 32: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

AGENDA

AUCTION 2006

Ministry of Mines and Energy

Page 33: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Auction Date: June 29, 2006

Start of Supply : 2009

Projects that traded electrical energy:

15 Hydro plants and 16 Thermal plants

Results:

Energy traded: 356,314 MWh (1,682 MW year)

Hydro: 270,331 MWh (1,028 MW year)

Thermal: 85,983 MWh (654 MW year)

Total Investment: US$ 16.9 billions

Average Price: Hydro plants - US$ 46.95/MWh

Thermal plants - US$ 49.03/MWh

Average Price - US$ 47.76/MWh

ELECTRICAL ENERGY AUCTION - A-3

US$ 1.00 = R$ 2.70

Page 34: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

7 Projects:7 Projects:

Salto Grande53 MWMauá

382 MW

Dardanelos261 MW

Barra do Pomba80 MW

Cambuci50 MW

Santo Antônio3,150 MW

Jirau3,300 MW

MW US$ millions

7,276 7,977

US$ 1.00 = R$ 2.70

Date: 09/05/2006

ELECTRICAL ENERGY AUCTION - A-5

Power Total Investments

Page 35: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

TRANSMISSION AUCTION

AUGUST/2006

RIO BRANCO

BOA VISTA

MANAUS

MACAPÁ

BELÉM

SÃO LUÍS

TERESINA

FORTALEZA

NATAL

J OÃOPESSOA

RECIFE

MACEIÓ

ARACAJ U

SALVADOR

CUIABÁ

CAMPO GRANDE

SÃOPAULO

VITÓRIA

RIO DE J ANEIRO

CURITIBA

FLORIANÓPOLIS

PORTOALEGRE

BRASÍLIA

GOIÂNIA

B.HORIZONTE

PALMAS

Jauru

Vilhena

PimentaBueno

Ariquemes

PORTO VELHO

Ji Paraná

Funil

Itapebi

Marimbondo

Poços deCaldas

São Simão

Ribeirão Preto

Ja guaráMasca renhas

Verona

Mato Grosso – Rondônia Integration - 230 kV – 949 km

5 Projects

Completing Norte – Sul Integration 500 kV – 720 km

6 Projects

Mascarenhas – Verona 230 kV – 107 km

Funil – Itapebi 230 kV – 198 km

Auction 01(August, 18 of 2006)

2,261 kmUS$ 414.6 millionsUS$ 1.00 = R$ 2.70

Cascavel Oeste – Foz Iguaçu 230 kV – 115 km

Neves1 – Mesquita 500 kV – 172 km

Page 36: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Bateias

Jaguariaíva

Londrina

Itararé

Paraíso

Açu

Atlântida

CamposNovos

Pirapora

Paracatu

Brumado

Ibicoara

Santa Maria

D. Francisca

Tauá

Picos

Videira

Maringá

RIO BRANCO

BOA VISTA

MANAUS

MACAPÁ

BELÉM

SÃO LUÍS

TERESINA

FORTALEZA

NATAL

J OÃOPESSOA

RECIFE

MACEIÓ

ARACAJ U

SALVADOR

CUIABÁ

CAMPO GRANDE

SÃOPAULO

VITÓRIA

RIO DE J ANEIRO

CURITIBA

FLORIANÓPOLIS

PORTO ALEGRE

BRASÍLIA

GOIÂNIA

B.HORIZONTE

PALMAS

Paraíso – Açu 230 kV – 135 km

Curitiba – Bateias 500 kV – 38 km

C. Novos – Videira 230 kV – 71 km

Tauá – Picos 230 kV – 180 km

Paracatu – Pirapora 500 kV – 260 km

Ibicoara – Brumado 230 kV – 105 km

Londrina – Maringá 230 kV – 83 km

D. Francisca – Santa Maria 230 kV – 66 km

Canoinhas – S.Mateus 230 kV – 48 km

Itararé – Jaguaraíva 230 kV – 40 km

Auction 02(September)

1,026 kmUS$ 199.4 millionsUS$ 1.00 = R$ 2.70

TRANSMISSION AUCTION

SEPTEMBER/2006

Page 37: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

OTHERS ENERGY SOURCES

Page 38: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

PROINFA, co-coordinated by the Ministry of Mines and

Energy (MME) and implemented by Eletrobrás, is an

important instrument to the diversification of the

national energy mix, once it will guarantee greater

reliability and supply security.

PROINFA has assured the purchase of 3,300 MW from

power plants based on biomass, wind and small hydro

power (SHP) to be connected to the integrated national

grid (SIN).

RENEWABLE ENERGY INCENTIVE PROGRAM PROINFA

Page 39: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

GENERAL RESULTS

Programa de Incentivo às

Fontes Alternativas de Energia Elétrica - PROINFA

139 projects hired. :Total capacity 3,300 MW- 06 in operation (capacity – 141.70 MW)- 36 under construction- 52 with EPCs signed

Forecast 2006 – 38 power plants installed ( 938.27 MW)Forecast 2007 – 101 power plants installed (2,211.73 MW)

Renewable Energy Incentive Program PROINFA

Page 40: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

AGRO- INDUSTRY

Page 41: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Current Situation:

Number of Sugar mills/Distilleries: 313 Production: 16 million m3

Production Capacity: 18 million m3

Cropped Area for ethanol Production: 3 million hectares

As of 2010:

Investments that will amount US$ 10.0 billion in 89 plants Increase in the ethanol production (in comparison with 2005): 8 million m3

Expansion in the sugarcane cropped area: 2 million hectares

BRAZIL (Territorial Extension): 851Total Agriculture Area: 383

of which:Fertile and free areas for agriculture: 91Present cropped area for ethanol: 3

(in million of hectares)

Source: Ministry of Mines and Energy;Ministry of Agriculture, Livestock and Food Supply - 2005

SUGARCANE AGRO-INDUSTRY

Page 42: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

FLEX-FUEL Technology

Any mixture of gasoline and alcohol can be used, from 0 to 100% ; In May/2006: The domestic flex-fuel vehicle sales represented 71% of

all light vehicles (including imported) sold in the same period;

Total domestic flex-fuel vehicle sales (2003-2006): 1,757,606 units. (*)

7 multinational automotive manufacturers settled in Brazil are producing 32 different models of

FFV vehiclesLast June, an automotive manufacturer

announced that, from now on, it will going to produce FFV vehicles only.

(*) until May/2006.

Source: Ministry of Development, Industry and Foreign Trade;Brazilian Association of Automotive Vehicle Manufacturers - 2006

AGRI-ENERGY - ETHANOL

Page 43: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

(*) Elaborated with obtained information of producing potentials and investors. Position of 31/05/06.ANP: National Petroleum AgencySRF: IRS (Internal Revenue Service)

Legend:

Under Construction or Project

In Commercial Operation

New Project Intentions

In Authorization Process (ANP / SRF)

2005to

2007

Authorized 2%

2008to

2012

Mandatory 2%

From 2013on

Mandatory 5%

Number of Plants

Installed Capacity (MM L/year)

• IN COMMERCIAL OPERATION 7 91

• IN AUTHORIZATION PROCESS (ANP / SRF) 15 366

• UNDER CONSTRUCTION OR PROJECT 15 813

• NEW PROJECTS 15 687

TOTAL 52 1,957

BIODIESEL: Producers in Commercial Operation and Projects Forecast (As of Dec/2007)

Page 44: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

In 2005, The Federal Government has established:

The mandatory B2 mixture is now anticipated for January of 2006, only for biodiesel produced by industries that have the so-called Social Fuel Certificate and commercialized in public auctions promoted by the National Agency of Petroleum – ANP.

(1) And (2): One single Auction with two Lots that will take place in July, 11th and 12th of 2006.

ANP = National Petroleum Agency

Biodiesel Auctions

Auction Volume

(Million liters)

Deliver

Nov/2005 70 2006

Mar/2006 170 2006 and 2007

Jul/2006 (1) ( 2) 600 2007

BIODIESEL AUCTIONS

Page 45: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

H-BIO: A NEW BRAZILIAN TECHNOLOGY

Page 46: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Diesel oil production process that uses vegetable oils as raw materials in a petroleum refinery.

Hidrogenation of the mixture: diesel + vegetable oil.

H-BIO AND BIODIESEL:COMPLEMENTARY PROCESSES

Page 47: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

BiodieselBiodiesel

GlGlyycerin cerin OthersOthers

Refinery

Hidrogen Fractions of diesel

Gas Station

Distributors

Agribusiness

Plantation Oil Crushing

Grains

RefinedOil

DieselDiesel

H-BIO

B2 or B5

mixtureDieselOR

TransesterificationUnitEthanol Ethanol

or

MethanolMethanol

OR

OR

BIOFUELS PRODUCTION

Page 48: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Castor Beans Sunflower Palm Oil CottonSoy

Average Agriculture Productivity

1,500 kg/ha 1,500 kg/ha 3,000 kg/ha 20,000 kg/ha 3,000 kg/ha

Percentage of Vegetable Oil

47% 42% 18% 20% 15%

Vegetable Oil Production (kg/ha)

705 630 540 4,000 450

Brazilian Production in 2005 m3/year

90,000 23,000 5,600,000 151,000 315,000

CHARGE OPTIONS FOR H-BIO PROCESS

Page 49: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

OIL AND GAS

Page 50: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

500

1.000

1.500

2.000

2.500

3.000

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

Thousand barrels/day

Oil Production Oil Products + NG and Alcohol Consumption Oil Products Consumption

1995

45%

2000

71%

2005

96%

Production/Consumption Ratio

SELF-SUFFICIENCY

APRIL/2006

OIL: SELF-SUFFICIENCY

Page 51: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Refineries : (13) – nominal capacity: 2,000 thousand barrels/dayNew Refineries: (2) – nominal capacity: 350 thousand barrels/dayPetrochemical (4) – nominal capacity: 7,500 thousand ton / yearComplexes:

Estimated Investiments

Refineries: US$ 9 billion

Petrochemical Complexes: US$ 8.5 billion

REFINING AND PETROCHEMICAL

Page 52: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Source: ANP May/2006

Evolution of the Natural Gas Production in Brazil

25,05 26,9229,56

32,4836,29

38,3542,53 43,27

46,3748,48

56,80

65,60

81,17

90,20

101,80

-

20,00

40,00

60,00

80,00

100,00

120,00

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Millio

n d

e m

³/d

Production Foreseen

BRAZILIAN MARKET OF NATURAL GAS

Page 53: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

• Gas pipelines network expansion: 4,557.6 km• Investment: US$ 4.5 billion

Present Pipelines Gas Pipes under implementation

New Gas Pipes

PIPELINES kmIVESTMENT

US$ million

Present 5,688 -

Under Implementation

1,076 1,054

New 3,481.6 3,469

Total 10,245.6 4,523

Markets million m³/d

Consumption (*) 46.6

Potential until 2010 127

(*) Industry, automobile, residence, commerce, power generation, cogeneration and orders (including CNG).

#

S

Northeastern Network

GaseneSoutheastern Network

North Network

South Network Expansion

GAS PIPELINES NETWORK

Page 54: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

Stable rules

More than US$ 1.3 billion in signature bonus

US$ 16 billions in exploration and production of predicted investments (Minimum Exploratory Program)

594 awarded blocks

64 E&P concessionaries 28 from Brazil

36 foreign companies from 16 different countries

Stable rules

More than US$ 1.3 billion in signature bonus

US$ 16 billions in exploration and production of predicted investments (Minimum Exploratory Program)

594 awarded blocks

64 E&P concessionaries 28 from Brazil

36 foreign companies from 16 different countries

Perspective for 20068th Bidding Round for Exploratories

Blocks

Perspective for 20068th Bidding Round for Exploratories

Blocks

Sedimentary basins: • 6.4 millions sq km

Granted area: • 332 thousand sq km (5%)

Sedimentary basins: • 6.4 millions sq km

Granted area: • 332 thousand sq km (5%)

Source: MME/ANP (Feb/2006)

SEVEN SUCCESSFUL ROUNDS: 1999-2005

Page 55: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

OBJECTIVES

Replace petroleum reserves to guarantee the self-sufficiency at medium and long term

Replace and increase the natural gas reserves in order to enhance the production Expectation: enhancement of 30% in the natural

gas offer

8TH BIDDING ROUND FOR EXPLORATORIES BLOCKSSEPTEMBER OF 2006

Page 56: MINISTRY OF MINES AND ENERGY PLANNING AND BRAZILIAN ENERGY MATRIX July of 2006 Ministry Silas Rondeau.

MINISTRY OF MINES AND ENERGY

PLANNING AND PLANNING AND BRAZILIAN ENERGY BRAZILIAN ENERGY

MATRIX MATRIX

July of 2006

Ministry Silas Rondeau