Sao Paulo state, home of 60 percent of Brazilian ethanol, halts sugar cane expansion pending outcome of impact study

In Brazil, Sao Paulo state suspended new approvals for ethanol facility construction, pending the results of an environmental impact study on increased sugar cane plantation. Sao Paulo state produces 60 percent of Brazil’’s ethanol, or 3.4 Bgy, and to facilitate this more than 1.2 million additional hectares have been planted in cane in the state since 2005.

Recently, Petrobras formed a joint venture with Mitsui and Camargo Correa to construct an ethanol pipeline connecting Senador Canedo in Goias state, to the Atlantic harbor of Sao Sebastiao, in Sao Paulo state. The pipeline, which will have an annual capacity of 3.17 billion gallons of ethanol per year, will also link the Petrobras refinery in Paulina, Sao Paulo, the Tiete-Parana channel, and an existing pipeline from Sao Paulo to Rio de Janeiro. The Sao Paul-Rio pipeline will be converted to ethanol-only usage, and connects Sao Paulo to Petrobras export port in Rio harbor. Private companies will be able to use the Petrobras pipeline.

Petrobras, the state oil company and Cosan, the largest ethanol group, have been at odds over Petrobras’ state-owned pipeline plan. “If Petrobras has the logistics, it will have control of the sector and this we don’t want,” said Rubens Ometto Silveira Mello, Cosan’s controlling shareholder and chief executive officer, told Agencia Estado. The proposed ethanol pipeline will run from Goias state to Sao Paulo. Private industry has been studying construction of its own pipeline, which is expect to cost $1.6 billion.

The state pipeline will be financed by the Japan Bank of International Cooperation, and the Inter-American Development Bank. Petrobras’ has planned a second pipeline from Goias to Paranagua, a major commodities port.

Free Subscription to the Daily Biofuels Digest e-newsletter

Related Stories

Hong Kong’s Noble Group to invest $450 million in Brazilian ethanol

In Hong Kong, Noble Group said it will invest $450 million in its Brazilian sugar-cane ethanol processing operations by 2011. Noble will increase capacity at its Votuporanga plant, to 5 million tons o...

Brazil ethanol expansion: Amazon, sugar cane worker conditions, pipeline, export markets are issues

In Brazil, questions have emerged about the scalability of the Brazilian ethanol "miracle" owing to the low wages, long hours, health problems and squalid conditions associated with sugar cane field w...

1,700 Brazilian sugarcane workers rescued from slavery or forced labor, Amnesty says; UNICA says these are isolated cases

In Brazil, Amnesty International pointed to four cases where more than 1,700 sugar cane workers were rescued from forced labor and slavery conditions. The human rights group said that 288 workers were...

Documentary on Brazilian sugarcane industry to air on Bloomberg; looks at 82,000 injuries, 300 deaths, jailing of strikers

A documentary on the Brazilian sugar cane ethanol industry has been completed and will air on Bloomberg Television on January 24th. The documentary, titled "Deadly Brew: The Human Toll of Ethanol," ...

Cosan projects 7-8 percent increase in cane harvest; mum on expansion plans in Goias state

In Brazil, Cosan announced that it expects to increase sugarcane production by up to 8 percent in the 2008/09 cane season. The company told Reuters that its 18 mills would crush up to 44.4 million ton...

Brazilian biodiesel production to reach 700 Mgy by 2015, says report

In Brazil, the São Paulo State Commerce Federation projected in a new study that Brazilian biodiesel production will reach 700 Mgy by 2015, up from 350 Mgy in 2008. The report projects that soybeans ...