Agreement Signed for Construction of Cabiúnas-Vitória Gas Pipeline

Petróleo Brasileiro S/A (Petrobras)and the Chinese stateowned oil group, Sinopec, signed an engineering, procurement and construction agreement on 17 April for the Cabiúnas-Vitória (Gascav) gas pipeline. This is the first stretch of Gasene, the Southeast-Northeast Gas Pipeline, which will interconnect carry natural gas suppliers in the Southeast and Northeast regions.

The Vitória – Cacimbas pipeline - 125 km long and already under construction - and the Cacimbas-Catu gas pipeline, the longest stretch at 765 km and in the project phase, are also part of the Gasene project.

The contract is for US$ 239 million and involves the construction of the gas pipeline over a 15-month period as from signature date.

Gascav will have a daily throughput of 20 million cubic meters, measures 28-inches in diameter, will be about 300km in length and will be constructed in three stages. Stretch A, 78 km in length, begins at the Cabiúnas terminal on the northern seaboard of the state of Rio de Janeiro and ends at the delivery point in Campos de Goytacazes (RJ). Here, stretch B begins - approximately 126 km in length -, ending at the future Piúma compression station located on the coast of the state of Espírito Santo. The third stretch of the gas pipeline will run about 96 km from the Piúma compression station to the pressure reduction station in the city of Serra (ES).

Gasene

The expansion of the transportation infrastructure is fundamental if the natural gas sector in Brazil is to reach the market maturity stage. The Southeast – Northeast Gas Pipeline Interconnection is included among the projects under Petrobras' Strategic Plan, which envisages the allocation of capital expenditures of US$ 6.5 billion in the next five years for the gas and energy segment. The Interconnection's construction, made up of a total of 1,215 km of pipelines, will allow the interlinking of gas imported from Bolivia and gas produced in the Brazilian Northeast and Southeast with the consumer market in both regions.

Gasene will meet the shortfall in gas supplies to the Northeast Region, increase the distribution of Bolivian gas and create new markets, notably between Cabiúnas in the state of Rio de Janeiro and Catu in the state of Bahia. Once unveiled, the pipeline will also permit the monetisation of existing and future gas reserves from the Campos, Santos and Espírito Santo basins and provide greater flexibility for the redistribution of gas supplies to meet eventual fluctuations in demand. For all these reasons, Gasene is fundamental to the consolidation of the Brazilian natural gas industry by integrating the South, Southeast, Midwest and Northeast markets.

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Petróleo Brasileiro S/A (Petrobras)
Sinopec

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Posted 19/04/06

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