The decision by Petrobras to join Venezuela’s state-run petroleum company, PDVSA, in building a new refinery in the state of Pernambuco means that the Brazilian state-run enterprise will increase its production level by 200,000 barrels/day by the year 2011.
That is good news with domestic demand rising between 2.6% to 2.7% annually. The new refinery will also create a total of 230,000 jobs over a four-year period.
At the moment, Petrobras has eleven refining units, most in the South and Southeastern regions of the country, and has been setting new production records with regularity.
In August, average daily production reached 1,828,000 barrels. That is a new record. The problem is that by 2011 it will no longer be enough.
For the period 2006-2010, Petrobras says it intends to invest a total of US$ 12.9 billion, of which US$ 7.86 billion (61%) will go to expanding refining capacity.