Mitsui, Petrobras and Camargo Correa partner on $1.5 billion Brazilian ethanol pipeline

In Brazil, Mitsui, Petrobras and Camargo Correa have combined their pipeline building efforts into a single entity, PMCC, that will link Uberaba in Minas Gerais to the sugarcane processing center of Paulinha in Sao Paulo state, and then to ports and export terminal in Sao Sebastiao and Ilha d’Agua.

The pipeline is expected to commence operation in 2010, will be fully completed in 2012, and will transport up to 3.17 billion gallons of ethanol per year. The project cost is expected to reach $1.5 billion and will transport up to 40 percent of ethanol production from Brazil’s southern region.

The other major pipeline project is from Cosan, which said that it will invest $1 billion in a 386 mile long ethanol pipeline that will link the port of Santos with the city of Paulinia in Sao Paulo state. The company is partnering with sugarcane ethanol producers Copersucar and Crystalsev on the projects, with the project scheduled for completion in 2011. The pipeline will increase Brazilian export capacity to 3.7 billion gallons per year.

Brenco is also reportedly looking at a pipeline project. Last October, the company announced a multiyear agreement to sell sugarcane ethanol to the Netherlands’ Lyondell Basell, which will distribute fuel to the US. Brenco is constructing 100 Mgy in ethanol capacity  at two mills that will open in 2009, in Mato Grosso state. Brenco’s longer-term strategy is to build four sugarcane ethanol plants, including plants in Goias and Mato Grosso do Sul states. Brazilian national development bank BNDES will hold a 15-20 percent stake in the plants, according to Valor Economico. Brenco is also planning an ethanol pipeline from Mato Gross to the port of Santos.

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