Portugal’s Galp Energia and Brazil’s Petrobras invest in biofuel project

19 May 2010

Lisbon, Portugal, 19 May – Portugal’s Galp Energia and Brazil’s Petrobras are to set up a partnership to produce second-generation biofuel, the chairman of Galp Energia, Manuel Ferreira de Oliveira and of Petrobras Biocombustíveis, Miguel Rossetto.

Noting that the partnership would invest 357 million euros, conditioned by the tax burden that the Portuguese government would place on the products, the two managers said that the aim was to produce 260,000 tons of second-generation biofuel per year to supply the Spanish and Portuguese markets.

The biofuel will be produced at the Sines palm oil refinery from oil produced at plantations in the Brazilian state of Pará.

First generation biofuels are currently exempt from tax on oil products, but may only be incorporated into diesel at up to 7 percent of volume.

Second generation biofuels will complement these and it now only remains to be seen what tax rate the Portuguese government will apply to the new products.

Rosetto and Ferreira de Oliveira said that, “if everything goes according to plan, the partnership, which is equally shared by the two companies, will be prepared to start production of second generation biofuels at the beginning of 2015.” (macauhub)