Petrobras, Marubeni reach refinery project agreement

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Mar. 15 -- Brazil's state-operated Petroleo Brasileiro (Petrobras), playing down contrary reports in the Brazilian press, said it signed a memorandum of understanding in January with Marubeni Corp. for a feasibility study on a 600,000-b/d refinery in Maranhao state.

"The memorandum is based on Marubeni's interest in being a potential project partner and is aimed at performing joint studies to analyze the Japanese corporation's participation in the project," Petrobras said.

It said the MOU does not represent any further obligation beyond the feasibility study for Marubeni, nor did the document create any financial obligation for Petrobras.

The Petrobras clarification followed an earlier denial by Marubeni that it would foot the entire cost of the project.

"So far, we've only agreed to discuss possibilities," a Marubeni spokesman said. "No letter of intent has been signed, and common sense dictates that Marubeni would not foot the whole bill in any case."

The statements by Petrobras and Marubeni follow a Mar. 12 newspaper report saying the Japanese firm had agreed to finance the 20-billion-real ($8.58 billion) refinery in exchange for a stake in the complex and sales of oil products.

The report in Valor Economico cited comments from Brazilian Mines and Energy Minister Edison Lobao, who said: "(The Japanese) visited Petrobras, and they've already signed a protocol of intentions. It's a firm proposal."

Lobao told the paper that initial discussions included Marubeni's assuming a possible 10-15% stake in the refinery.

"Lobao is positive the negotiations should progress and believes groundbreaking to start by December," the paper said.

It added: "A letter of intentions has been signed with Petrobras around the 600,000 b/d project, with the first stage of 300,000 b/d to be ready by 2013 and the second by 2015."

The Maranho refinery is one of five the Brazilian company is aiming to construct in an effort to increase refining capacity. Others include the 30,000 b/d Guamare unit in Rio Grande do Norte, due in 2010; the 200,000 b/d Abreu e Lima plant in Pernambuco, due in 2011; the 150,000 b/d Rio de Janeiro Comperj complex, due in 2012; the 600,000 b/d Maranhao facility, due in 2016; and the 300,000 b/d unit in Ceara state, due in 2016.

Contact Eric Watkins at hippalus@yahoo.com.

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