Brazil Cosan Warns Against Petrobras Ethanol Pipeline

Summary by the Bank Information Center:

Brazil’s largest ethanol group, Cosan Ltd., has joined with other ethanol groups in opposition to the ethanol pipeline proposed by Petroleo Brasileiro SA or Petrobras. The pipeline, which would run from Goias to the Sao Paulo port of Sao Sebastiao, is scheduled to break ground later this year. Ethanol producers fear that the pipeline would give too much control to the state-run oil company and would increase logistical costs for ethanol producers.  

In response, the Union of Sugarcane Industries, or Unica, along with the majority of Sao Paulo ethanol producers are looking into constructing their own pipeline from the Sao Paulo municipality of Paulinia to Sao Sebastiao port.  The study will be finished in two months, and the project, if pursued, could be financed by the Japan Bank of International Cooperation and the Inter-American Development Bank.

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