Petrobras lets contract for gas pipeline

May 2, 2006
Petrobras and Sinopec have signed a $239 million contract for engineering, procurement, and construction of the Cabiúnas-Vitória gas pipeline in Brazil.

By OGJ editors
HOUSTON, May 2 -- Brazil's Petroleo Brasileiro SA (Petrobras) and China's Petroleum & Chemical Corp. (Sinopec) have signed a $239-million contract for engineering, procurement, and construction of the Cabiúnas-Vitória (Gascav) natural gas pipeline in Brazil.

The 300-km, 28-in Gascav line is the first leg of Gasene, a 1,215-km system connecting gas suppliers in Brazil's southeastern and northeastern regions and increasing the country's transportation capacity and gas supply from northern fields and Bolivia (OGJ, Sept. 27, 2004, Newsletter).

The Gascav leg, which will have a capacity of 20 million cu m/day, will be laid in three stages over 15 months. The first section, 78 km in length, will extend from the Cabiúnas terminal on the coast in northern Rio de Janeiro state to a delivery point in Campos de Goytacazes. The 126-km middle stage will extend from Campos de Goytacazes to the future Piúma compression station on the coast of Espírito Santo state. The third section will extend 96 km from Piúma to a pressure-reduction station at Serra in Espírito Santo state.

The $1.3 billion Gasene pipeline will not only link gas imported from Bolivia and produced in northeastern and southeastern Brazil with markets in both regions. It also will open markets, particularly between Cabiúnas in Rio de Janeiro, and Catu in Bahia state.

In addition to Gascav, the system includes the 125-km Vitória-Cacimbas pipeline, which is under construction, and the 765-km Cacimbas-Catu pipeline section.

Brazil's strategic gas and energy plan during the next 5 years calls for capital expenditures of $ 6.5 billion, including the Gasene system construction.

Petrobras and Sinopec have had partnership agreements in place since early 2004 for oil exploration, production, refining, oil products sales, petrochemicals, pipeline engineering services, and technical cooperation in Brazil (OGJ Online, Sept. 16, 2004).