| SAO PAULO, April 18
SAO PAULO, April 18 Brazil's state-controlled
oil company Petróleo Brasileiro SA has expressed
strong opposition to a government-led program to increase the
use of biofuels following its recent decision to completely
withdraw from the sector.
In a document the energy ministry posted on its website, the
company known as Petrobras said it was worried about the impact
of more biofuels on forest conservation and food production.
The document, made public last week, was prepared in
response to government calls for public comment on its RenovaBio
program to boost biofuels. Petrobras was the only company to
submit a comment. Most submissions were from trade associations.
Long an ally of Brazil's ethanol industry, Petrobras said in
the document that sugar mills were financially unprepared to
raise ethanol output. It also suggested it was not necessary to
increase biofuel use to meet Brazil's commitments under a global
Petrobras' new position marks an about-face from the recent
past, when it aimed to diversify energy sources and become one
of the world's five largest biofuels producers.
The company did not respond to a request for additional
In December, Petrobras agreed to sell stakes in ethanol
producers Guarani and Nova Fronteira and close some biodiesel
plants, as Chief Executive Officer Pedro Parente prioritized
investments in offshore oil fields to ramp up cash generation
and reduce its nearly $100 billion in debt.
Petrobras' new position on biofuels has surprised former
partners including Donizete Tokarski, who heads the biodiesel
association Ubrabio which supports the government program.
"This is a throwback to outdated views on biofuels and a big
step backwards for the company," he said.
One of Brazil's commitments under the 2016 Paris climate
agreement was to sharply increase the share of biofuels in its
energy mix to help it meet an ambitious target to cut greenhouse
gas emissions 43 percent from 2005 levels by 2030.
For ethanol, that target would mean almost doubling current
production to 54 billion liters by 2030.
In criticizing possible increases in biofuels usage,
Elizabeth Farina, head of cane industry group Unica, said
Petrobras seemed to be looking out for its own shifting
"Pedro Parente has clearly said the focus is on fossil fuels
... but you can't go against what is happening in the world,"
she said. Unica strongly supports RenovaBio and has proposed
mandates for biofuel use similar to those in the United States.
(Reporting by Marcelo Teixeira; Editing by Lisa Shumaker and