Brazil’s state-owned oil company Petrobras has signed a loan of up to $1 billion to finance a cogeneration facility and other GHG-reducing efforts.
The Japan Bank for International Cooperation (JBIC) will pay $600 million, according to JBIC, while the Bank of Tokyo-Mitsubishi UFJ, which is co-financing the loan, will provide $400 million. JBIC will provide a partial guarantee for the co-financed portion.
The long-term loan will finance two energy efficiency projects, according to JBIC. One is a cogereration project at Comperj oil refinery, under construction outside of Rio de Janeiro. The second is for a flaring gas reduction project at multiple offshore oil concessions in the Campos Basin, Brazil’s main oil producing region. This reduces GHG emissions by diverting flaring gas, which would be otherwise wasted, to increase the supply for domestic consumption in Brazil.
JBIC estimates GHG emission reductions will reach 0.3 million tons of CO2 per year from the CHP project and 2.41 million tons of CO2 per year from the flaring gas reduction project.
This is the bank’s first loan targeting specific projects under its GREEN (Global action for Reconciling Economic growth and ENvironmental preservation) program.
The first phase of the cogeneration facility, expected to begin operation in 2015, will have the capacity to refine 165,000 barrels of heavy crude oil a day, Reuters reports. Most of the output will be used to make petrochemicals.
Petrobras has said it will spend $976 million between 2010 and 2015 on projects that maximize energy efficiency and reducing GHG emissions.
Last year, the state-run oil company was dropped from the Nasdaq OMX CRD Global Sustainability Index, Environmental Leader reported.