In 2020, India and Brazil had inked a MoU for cooperation in the field of Oil and Natural Gas. During the go to of the Brazilian President Jair Bolsanaro final January, ethanol was one of the troubles on the agenda of talks. “Brazil and India are energy powers, with strong capabilities both in oil & gas and renewables,” Energy Minister Bento Albuquerque of Brazil tells Huma Siddiqui in his initially ever interaction with the Indian media.
Following are excerpts:
How can Brazil assist India accomplish its target of 20 per cent blending of ethanol in petrol and 5 per cent blending of biodiesel in diesel by 2030?
In the case of ethanol, Brazil has a decades-lengthy practical experience, which we are prepared to share with our Indian partners. We are the biggest producer of sugarcane ethanol, when India has the biggest sugar market in the globe. We can surely achieve a lot collectively in this sector.
Our practical experience with ethanol because the 1970s helped us save more than two billion barrels of oil equivalent so far. This signifies 2 years of the total CO2 emissions of a main economy, not to mention savings produced in import substitution of refined gasoline. ‘Proálcool programme’ was the stepping stone of our present mandatory blending of 27 per cent of ethanol to gasoline, which Brazil has been employing because 2015. In addition, we are getting particularly positive final results in our national diesel engine-testing system with biodiesel blends of 15 per cent (b15), which we want to attain in 2023. Since March 2020, we have adopted the b12 national blending.
Our new biofuels policy, named Renovabio, became operational in the starting of 2020. Renovabio is a credit carbon industry exactly where distributors will need to obtain de-carbonization credits (CBIOS) from biofuel importers/producers. If distributors commercialize more fossil fuels that contribute to worldwide warming, they can obtain CBIOS to compensate for their emissions. Renovabio stimulates innovation and investment to raise operational efficiency in biofuel production. If a approach has much less carbon intensity, more CBIOS may well be issued per liter of biofuel production.
When I met Minister Dharmendra Pradhan, final year, I proposed we join our efforts and forces to make ethanol a worldwide commodity. Blending is one of the techniques that could assist us attain our ambitions. We can share not only our technologies, but initially and foremost our 50-year practical experience and regulatory greatest practices we have collected so far.
We have currently began to work on that. In February 2020, as I pointed out just before, we organized an occasion named “Sustainable Mobility: Ethanol Talks” in New Delhi. It was a roadshow that permitted the exchange of experiences with regards to the promotion of ethanol use and production. It also helped bring collectively the private sectors of each nations, with a view to a next step. We are preparing a second edition of an occasion on ethanol this year, to be hosted by Brazil, most almost certainly in a virtual format, so as to deepen our discussions about two principal ambitions: enhancing our technical cooperation in ethanol production and use and exploring new business enterprise possibilities.
What is the update on the MoU on Bio-power cooperation that was authorized in 2020?
When President Jair Bolsonaro visited New Delhi, one year ago, we decided, collectively with our Indian partners, to set an ambitious bilateral agenda in power, amongst a quantity of other strategic sectors. I met with my counterparts in the ministries of Petroleum, Natural Gas and Steel New and Renewable Energies Road Transport and Highways, in addition to getting visited the International Solar Alliance (ISA) and seizing the chance to address a pretty certified audience of businessmen and government leaders. Different agreements had been signed, covering a variety of regions of mutual interest, like renewables, in which Brazil and India have recognized capabilities and ambitious ambitions.
Bioenergy has a confirmed contribution to road transport and market de-carbonization – in which we each face quite a few challenges. Technologies are currently accessible which permit for elevated productivity due to biotechnology study. Ethanol, Biodiesel, HVO and Biogas are drop-in fuels that can provide substantial and even instant final results, decreasing our carbon footprint, oil dependency and, let’s not overlook, producing sustainability and higher-good quality jobs. Biomass can be competitively created with higher levels of sustainability, effective use of organic sources, and with an particularly low carbon footprint.
Emerging biofuels and biomaterials are probably to transform the landscape for de-carbonization in some tough-to-abate regions, such as aviation and shipping. The possibilities for bio-bunker in navigation and
Bio-kerosene in aviation ought to not be neglected. Interesting synergies with hydrogen also apply.
Despite all the challenges we faced final year, due to the pandemic, crucial methods had been taken in our bilateral collaboration in bioenergy. We have currently organized a mission to New Delhi, with representatives of public and private sectors, in order to present to Indian stakeholders the Brazilian ethanol sector. We are in the approach of fulfilling the needs for the establishment of a joint working group below the Memorandum of Understanding in bioenergy, and the Brazilian side is searching forward to starting a more structured bilateral work in this location.
Recently, Essar group produced a binding give to Brazil’s Petroleo Brasileiro SA to obtain the country’s second-biggest oil refinery. What is the update?
Brazil is a main customer of oil goods, an crucial crude oil producer worldwide, and its oil goods industry is projected to develop steady in the next couple of years. Essar group is an crucial worldwide investor, and we are certainly interested in getting their investments in Brazil.
With Petrobras’ divestment system, eight refineries and their corresponding logistics assets that are at present becoming sold. They can approach 1.1 million barrels per day or a half of total Brazilian capacity. With that, we anticipate to market competitors and attract investments in infrastructure for oil production and logistics, also enhancing fuels give and decreasing rates to Brazilian customers.
Proximity amongst oil creating fields on the Brazilian coast and the big and desirable Brazilian domestic industry for oil commodities tends to make the regional downstream segment in Brazil a one of a kind and compelling investment chance.
According to Petrobras´ schedule, the approach is at present undergoing a new round of binding proposals. In this new round, petrobras asked all participants which submitted binding proposals to make their final provides. The participants had been not disclosed in the approach. Petrobras expects to get all these provides by the finish of the initially quarter of 2021.
During the initially half of 2020, India was the third-biggest importer of Brazilian crude oil, acquiring 1.9mt (million metric tons), behind China and the US. Brazil could be a very good option resolution for India’s power safety. Your views.
In the Latin American and the Caribbean context, Brazil ranks 1st in the production of oil. Crude oil is the principal item of our exports of goods to India, equivalent to about a billion dollars of worth exported in 2020, or as considerably as 42 per cent of the total quantity of exports from Brazil to India in worth. Meanwhile, more than 40 million barrels of crude oil had been imported from Brazil in the final two years.
Our oil production is anticipated to raise drastically in the coming years, reaching up to 5 million barrels a day by 2030, when Brazil will most probably grow to be one of the 5 biggest producers in the globe, according to the international power agency. In this context, there surely is a lot of space to expand our oil trade with India.
Since you pointed out the idea of power safety, I would like to recall one of the messages I conveyed in my mission to India final January — for Brazil, power safety lies on the diversity of sources. That is why I commonly say that, as far as power is concerned, the future is bio, it is oil, it is gas, it is nuclear, it is wind & solar, it is coal. It is diversification. In this context, our organic complementarities can surely take Brazil-India relations to a next level.
What is the status of study & improvement of renewable power and second-generation biofuels?
This is a pretty very good and timely query. Supporting R&D is an crucial component of a sound policy atmosphere. As we pointed out, Brazil has precise public policies for R&D in 2nd generation biofuels and renewables in basic.
As far as 2nd generation biofuels are concerned, we have two targeted policies: the present mandatory blending of 27 per cent of ethanol to gasoline and “Renovabio”, our flagship system, which is a industry driven incentive mechanism. Renovabio stimulates investment in the 2nd generation as organizations can provide more CBIOS per liter of biofuel than the 1st generation. We think that in the close to future we will have industrial production of 2nd generation biofuels. In addition, our contract for E&P has an R&D clause by which oil organizations will need to invest in study, improvement and innovation, like 2nd generation biofuels.
When it comes to the share of renewables in our energy mix, I should recall that R&D has been incorporated into the reality of the electrical energy sector via legislation because the turn of the century, with the unbundling of that sector. Legislation delivers for the mandatory application of .5 per cent of the net operating income of entities regulated in R&D. Over 10 % of these sources are invested in option renewable sources projects and also cutting-edge applications, which differ from advertising effective use of energy till combatting energy waste and monitoring environmental practices by signifies of the infrastructure of preexisting transmission lines.
As you know, we should be pretty cautious not to backtrack in the bio-economy. Due to the pandemic, worldwide biofuels production dropped for the initially time in the final two decades, as a reaction to the financial influence of COVID-19 and response measures. A plunge in crude oil rates at the start off of the pandemic produced biofuels much less competitive than regular fossil fuels, exacerbating the circumstance for renewable options.
This drop in the all round transport fuel demand brought reduced greenhouse gas emissions in 2020, and an instant air good quality improvement in quite a few cities. However, these brief-term rewards stand to be rapidly erased if we shed track of bioenergy recovery, one of the greatest and most accessible instruments for transport and market de-carbonization.
Building a complete, sustainable, sensible and big-scale bioenergy tactic, like ethanol, biodiesel, biogas, bioelectricity, and new and sophisticated biofuels is each feasible and hugely valuable, producing higher-good quality jobs, decreasing greenhouse gas emissions, bringing improvement to rural regions and providing the country’s population more power alternatives and more power safety. This continued help should discover its roots, of course, in sound and predictable public policies.
We know that India is currently pretty sophisticated in the improvement of cellulosic, second generation biofuels, and with a national programme supporting the building of a big quantity of sophisticated bio-refineries employing distinct technologies mixes. Brazil also stands to study from this current practical experience by India. This is only a single instance of how considerably our nations can advantage from a closer cooperation in this location.
How can the two nations work collectively to industry access and sustainability of biofuels, bio-electrical energy and biogas provide chain?
There is a lot we can study from each and every other in this field. Brazil is prepared to share the practical experience and technologies accumulated by our ethanol and biodiesel industries. We use e27, e100 and b12 in all gas stations, that is to say more than 40 thousand gas stations. Our automobile market has a strong expertise on how to deal with biofuels.
Considering bio-electrical energy, our ethanol producers, who have a considerable contribution for our method, have tremendously enhanced the technologies to create energy. Biogas provide chain, for its turn, is becoming created in Brazil, and we currently have a strong regulatory framework to use bio-methane in cars and substitute NGV. In 2020, we inaugurated a plant that combines generation of biogas and ethanol production. We think that this idea will be disseminated to other sugarcane ethanol producers as we have a terrific possible to use Vinasse, the final by-item of the biomass distillation for the ethanol production, to create biogas.
As you see, there are numerous possibilities and avenues to discover below the Brazil-India partnership in the power sector. What we have to do is to bring public and private sectors collectively, in order to recognize and greater discover our current synergies and shared ambitions.