APLA '18: Brazilian energy reforms are benefiting oil output

Source: ICIS News

2018/11/12

CANCUN, Mexico (ICIS)--A series of recent reforms to Brazil's energy industry should result in sustained increases in oil production for the next decade, an executive with Braskem said.

"We are very positive, and we are very bullish on production," said Edison Terra, vice president of Braskem's business unit for polyolefins, renewables and Europe.

He made his comments on the sidelines of the annual meeting of the Latin American Petrochemical Association (APLA).

Several companies are considering projects in Brazil's pre-salt oil basins and its associated gas, he said. As a result, Brazil could have good options for oil and gas in the next decade.

Most of Brazil's crackers rely on naphtha as a feedstock, although some can also use varying amounts of ethane.

If Brazil can increase oil and gas production and build the necessary infrastructure to extract naphtha from the oil and ethane from gas, then it could provide Braskem with feedstock for new capacity.

One possible project is the near-doubling of capacity at its Duque de Caxias gas cracker in Rio de Janeiro state.

The reforms started by President Michel Temer made it easier for companies other than state energy producer Petrobras to invest in energy projects.

President-elect Jair Bolsonaro supported such reforms during his campaign.

The APLA annual meeting runs through Tuesday.

Interview article by Al Greenwood