Brazilian state-owned oil and gas giant Petrobras has teamed up with several Chinese companies in a bid to bring its strategic five-year plan to life and prepare itself for a more sustainable future during the energy transition journey. In line with this several cooperation agreements related to the energy sector were inked with China National Offshore Oil Corporation (CNOOC), China Petrochemical Corporation (Sinopec), China Energy International Group, and Citic Construction (CITIC).
According to Petrobras, its CEO recently met with CEOs of Chinese companies and signed four cooperation agreements regarding opportunities in the energy sector. The first MoU was inked with CNOOC to extend collaboration and explore the potential for global cooperation in the energy sector in segments of mutual interest, such as oil and gas exploration and production, refining, and petrochemical industry, among others.
The second MoU was signed with Sinopec to collaborate in the research and evaluation of opportunities in Brazil or abroad, in the exploration and production, refining, trading, energy transition projects, and carbon capture segments. The third deal is a strategic cooperation framework agreement with China Energy International Group, which is expected to aid in identifying potential business opportunities in Brazil related to renewable energy generation and the production of sustainable hydrogen and ammonia.
The fourth deal is a non-disclosure agreement with CITIC to discuss possible business opportunities and joint projects, including the formation of joint ventures for investments in Brazil and abroad. Petrobras outlines that the signed agreements are non-binding. In a bid to monitor the progress of the studies and discussions, committees will be formed with representatives from each company.
Once the technical analyses have been completed, potential projects arising from the signed agreements will have official cost, time, and return estimates, so that, they can be assessed by internal approval bodies in the future, in accordance with the company’s governance. The agreements are aligned with the strategic elements of Strategic Plan 2024-28, which aim to prepare Petrobras for a greener future, contributing to the overall progress of the energy transition story.
Enabling transition to low-carbon energy
These strategic elements of the 2024-28 strategic plan are seen as a way to aid the Brazilian giant in the search for a just and safe energy transition in the country, reconciling the current focus on oil and gas with the search for diversification of the firm’s portfolio in low-carbon businesses.
Petrobras says the purpose outlined in this plan highlights the need to “provide energy that ensures prosperity in an ethical, just, safe, and competitive way” while showing respect for life, people, and the environment on the road to “a prosperous, sustainable future.”
In lieu of this, the company intends to maximise the value of its portfolio with a focus on profitable assets, replenish oil and gas reserves, including exploration of new frontiers, increase the supply of natural gas, and promote the decarbonisation of operations. Additionally, the firm plans to diversify its portfolio in a profitable way and seek to decrease emissions, contributing to a fair energy transition, and enabling solutions in new energies.
In light of the new strategic elements, Petrobras is targeting between 6 per cent and 15 per cent of total CAPEX for low-carbon, compared to 6 per cent in its 2023-27 strategic plan, to be confirmed in the detailing of the project portfolio that will be brought to final approval along with the new plan in November 2023.
Jean Paul Prates, Petrobras’ CEO, who believes that the great challenge for #COP28 is to reverse the general understanding that the oil and gas industry is the villain of the global energy transition process, underscored: “We need to understand that the industry is not only part of the problem but also part of the solution. There is no fair energy transition, and there is no ecological transition, without the engagement of the oil industry.
“Our industry is essential for the energy transition as it has state-of-the-art technology, qualified personnel, capillarity with the economies of various countries and profiles, and scale to promote the necessary transformation. It is necessary that, by COP 28, the oil and gas industry in transition make a full statement of commitment to the goals of the Paris Agreement, declaring that it will actively work with both its suppliers and its consumers in favour of these goals.
“The decarbonisation targets and the principles of energy transition should not be understood as an imposition that threatens the survival of anyone, especially the most fragile populations. They are, in the opposite sense, a call to the leadership of the largest companies to contribute to a decisive change in defence of the preservation of life on our planet. When called upon to act, we must lead by example, understanding that local socioeconomic realities will dictate different timetables in this process.”
Petrobras’ recent oil and gas milestones encompass the start of operations of the FPSO Anita Garibaldi, which was put into production as the second unit since May 2023 to operate in the post-salt and pre-salt of the Marlim and Voador fields. The first of two FPSOs that are part of this project was the FPSO Anna Nery, which came online in May 2023.
The Brazilian giant also sold two clusters in the Espírito Santo Basin offshore Brazil to BW Energy.
Source: Offshore Ennergy
