Capturing Pipeline Opps In Brazil

OVERVIEW OF THE PIPELINE INDUSTRY IN BRAZIL

CAPTURING PIPELINE OPORTUNITIES

MARCELO RENNÓChairman, Pipeline Comittee

Brazilian Petroleum, Gas, and Biofuels Institute

Director, Petrobras / TRANSPETRO

DISCLAIMER

� The presentation may contain forecasts about future events. Such forecasts

merely reflect the expectations of the Company's management. Such terms

as "anticipate“, "believe“, "expect“, "forecast“, "intend“, "plan", "project", "seek",

“should", along with similar or analogous expressions,

are used to identify such forecasts.

� These predictions evidently involve risks and uncertainties, whether foreseen

or not by the Company. Therefore, the future results of operations may differ

from current expectations, and readers must not base their expectations

exclusively on the information presented herein.

� The Company is not obliged to update the presentation/such forecasts in light

of new information or future developments.

TOPICS

The Brazilian pipeline sector

Opportunities

Achievements

Challenges

Rio Pipeline 2009 Conference and Exposition

Conclusions

THE BRAZILIAN PIPELINE SECTOR


PIPELINE NETWORK OF BRAZIL

CURRENT

Gas, Oil and Product Pipelines

Land: 7,000 km of oil and product pipelines

7,000 km of gas pipelines

Offshore: 4,000 km of rigid pipelines

5,000 km of flexible pipelines

Slurry Pipelines

1,500 km of slurry pipelines

Pecém

Rio de Janeiro


FSRU - Floating Storage and Regasification UnitsPecém, Ceará

Guanabara Bay, Rio de Janeiro

OPPORTUNITIES

OPPORTUNITIES

BUSINESS PLAN 2009-2013

OPPORTUNITIES

PETROBRAS TOTAL PRODUCTION (000B/D)

NATURAL GAS EXPANSION

OPPORTUNITIES

OPPORTUNITIESNATURAL GAS EXPANSION

BALANCING SUPPLY & DEMAND

OPPORTUNITIESNATURAL GAS EXPANSION

70% expansion 2003 - 2010

ETHANOL PIPELINES

OPPORTUNITIES

OPPORTUNITIESETHANOL PIPELINES

STRATEGIC MOTIVATION

�Brazil has high potential for ethanol exports;

�Increasing world interest in fuel ethanol

for socioeconomic, strategic and

environmental reasons;

�Kyoto Treaty;

�Excellence in ethanol logistics in Brazil, due

to 30 years experience in pipeline transportation;

�Flex-Fuel technology: different percentage

of ethanol – gasoline.


TECHNOLOGICAL ADVANCES IN DISTRIBUTION

Product CProduct D Ethanol Product B Product A


TRANSPORTATION OF ETHANOL IN PRODUCTS PIPELINE BY BATCHES


PETROBRAS’ PRODUCT AND ETHANOL PIPELINES UNDER CONSIDERATION

Mato Grosso

Mato Grosso do Sul

Goiás

São PauloParaná

Rio de Janeiro

EspiritoSanto

Minas Gerais

High

Good

Exceptional

(*) Average for the next10 years

DF

Bahia

Tocantins

Santa Catarina

Rio Grande do Sul

Areas Productivity:


RIGHTS OF WAY FOR ETHANOL LOGISTICS AND PRODUCTION AREAS

Source: IDEA

PRODUCT PIPELINES

OPPORTUNITIES

OPPORTUNITIESOIL PRODUCTS EXPANSION

Hidrovia

New Pipelines

Existing Pipelines

FROM TO LENGTH

(KM)

DIAMETER

Curitiba Londrina 341 14

Londrina P Eptácio 10 12

P Eptácio Campo Grande 286 12

Campo Grande Rondonópolis 444 10

Rondonópolis Cuiabá 171 10

TOTAL 1,432 KM

MIDWEST PIPELINE

SLURRY PIPELINES

OPPORTUNITIES

OPPORTUNITIESSLURRY PIPELINE

SLURRY (ORE) PIPELINES IN BRAZIL

�More than 1,500 km in

operation;

�First ore pipeline started

operations in 1977;

�Ore transported:

�Bauxite

�Iron Ore Concentrate

�Phosphate

�Kaolin

Source: J. Chapman, PSI

OFFSHORE PIPELINES

OPPORTUNITIES

OPPORTUNITIESOFFSHORE PIPELINES

BM-S-21

BM-S-24

BM-S-8BM-S-9

BM -S-10

BM-S-11

BM-S -17

BM -S-42

BM -S-42133 km

166 km

PMXL

22 km

BM-S-21

BM-S-24

BM-S-8BM-S-9

BM -S-10

BM-S-11

BM-S -17

BM -S-42

BM -S-42133 km

166 km

BM-S-21

BM-S-24

BM-S-8BM-S-9

BM -S-10

BM-S-11

BM-S -17

BM -S-42

BM -S-42

133 km

166 km

PMXL

22 km

OFFSHORE PIPELINES PRE-SALT AREAOFFSHORE OPPORTUNITIES

OPPORTUNITIES

SAFETY and UPGRADES

OPPORTUNITIESSAFETY and UPGRADES

TERMINALDE BARUERI

TERMINALDE GUARULHOS

RECAP

TERMINALDE UTINGA

TERMINALBR DISTRIBIUDORA

PONTO 1

OB

ATI –

50 km

OS

SP

–15 km OSSP –

11.9

km

OSSP – 9.1 km

OSSP – 8.5 km

OSVAT / GASPAL 22’

RAMAL

COMPANHIAS

DISTRIBUIDORAS OS

SP

–24

km

PIPELINE RELOCATION - SÃO PAULO CITY








Terminal deBarueri

Terminal deBarueri

RECAPRECAP

Terminal deGuararemaTerminal deGuararema

Terminal de MauáTerminal de Mauá

EBASEBAS

Terminal de CubatãoTerminal de Cubatão

TO BE DEACTIVATE

NEW RIGHT OF WAY

FUEL OIL PIPELINES

TO BE DEACTIVATE

NEW RIGHT OF WAY

FUEL OIL PIPELINES

Terminal deAlemoa

Terminal deAlemoa

SuzanoSuzano

Terminal de

Guarulhos

Terminal de

Guarulhos

RPBCRPBC

Terminal S. Caetano

Sul

Terminal S. Caetano

Sul

PIPELINE RELOCATION - SÃO PAULO CITY - FUTURE NETWORK

ACHIEVEMENTS

ACHIEVEMENTS

THE 1950’S: CONSTRUCTION WORK AT THE SÃO PAULO-SANTOS PIPELINE

ACHIEVEMENTS

CONSTRUCTION OF THE BOLIVIA-BRAZIL GAS PIPELINE

CONSTRUCTION OF THE BOLIVIA-BRAZIL GAS PIPELINE

ACHIEVEMENTS

GASDUC III –SILVA JARDIM/RJ TUNNEL

ACHIEVEMENTSURUCU-MANAUS GAS PIPELINE



DRY SEASON WET SEASON


� SOIL

Inappropiate for equipment and machinery traffic. Low permeability and

heavy undulating terrain. Low natural drainage.

� ACCESS TO RIGHT-OF-WAY

Poor access from main rivers to right-of-way. Long distances and long

time to reach work site;

� EXCESS RAIN

2007 rainfall index above average in the region kept soil inappropriate for

traffic of machinery and heavy equipment

ACHIEVEMENTSURUCU-MANAUS GAS PIPELINE - CONVENTIONAL CONSTRUCTION



ACHIEVEMENTSURUCU-MANAUS GAS PIPELINE - NON CONVENTIONAL CONSTRUCTION

“H” BARGE FOR TRENCHING TRENCHING IN FLOODED ROW

“H” BARGE TRENCHING

COLUMN DEPLOYMENT FROM BARGE

COLUMN DEPLOYMENT FROM BARGECOLUMN DEPLOYMENT FROM BARGE

WELDING AT BARGE



CHALLENGES

CHALLENGES

PIPELINE BUSINESS CONSTRAINTS

� Harsh operational conditions;

� More restrictive environmental and social concerns;

� Demand for high quality grade fuels;

� Ageing of current assets;

� Zero tolerance to leakages;

� Shortage of skilled professionals.

CHALLENGES

CAPEX REDUCTION

�Design, materials and construction

OPEX REDUCTION

�Exploring all capabilities of installed

telecommunication and SCADA

MAIN TARGETS FOR INNOVATION

CHALLENGES

� Right-of-way selection

� Enhance risk-based alternative design methodologies

� Strain-based design for higher-strength steels

DESIGN IMPROVEMENTS

CHALLENGESMATERIALS IMPROVEMENTS

0

50

100

150

1940 1950 1960 1970 1980 1990 2000 2010 2020

X 50

X 60

X 70

X 80

X 100

X 120

Year of commercial availability

Str

engt

h(k

si)

CHALLENGESCONSTRUCTION IMPROVEMENTS

0

1

2

3

4

5

6

7

Averageinstallationrate (km/day)

1970 19901980 2000

OFFSHORE PIPELINES

ONSHORE PIPELINES

Lack of Innovation in the Onshore Pipeline Construction Industry

CHALLENGESCENPES

EXPANSION:

� Total Area: 180.000 m2

� Buildings: 54.000 m2

2010

� Total area: 122.000 m2

� Buildings: 45.000 m2

� 137 Laboratories

� 30 Pilot Plants

2009CENPES I CENPES II

CHALLENGESCENPES - Ethanol R&D Project

AIMS

� Guarantee Product Specification

� minimize losses by contamination during transportation of large volumes

of ethanol for exportation.

CHALLENGESCENPES – Offshore Pipelines

SCR- STEEL CATENARY RISER

TDP

SOME FOCUS FOR DEEP AND ULTRA DEEPWATER PIPES & RISERS

CHALLENGESCENPES - Surveillance and Positioning Technologies

1. Evaluation of UAVs (Unmanned Aerial Vehicle) for ROW Inspection;

2. Remote sensing technologies in the ROW surveillance;

3. Leak detection;

4. Detection of mass movements;

5. Positioning of the pipeline for river crossing and subsea.

CHALLENGESCENPES - Remote Sensing of Right of Ways

Pipeline Monitoring System with Orbital Remote Sensing Data

Objectives

� To develop a practical, reliable and economical system to monitoring pipeline

assets using orbital remote sensing data.

Fundamental areas of pipeline safety

� Third party encroachment

� Ground motion

� Oil and gas spills

CHALLENGESCENPES

Construction

ROWMonitoring

IntegrityManagement

& Tools

ProductQualityBiofuels

FlowEfficiency

NewMaterials

& Mills

PIPELINES & TANKS

CTDTU

Pipeline Technology Center

� Independent, not-for-profit institution with real

scale test loop .

� Can be used for demonstrations, research and training.

CDTUASSOCIATES

RIO PIPELINE 2009CONFERENCE AND EXPOSITION

RIO PIPELINE 2009 CONFERENCE AND EXPOSITIONEvolution

� Organized biannually by the Pipeline Committee of the Brazilian Petroleum,

Natural Gas and Biofuels Institute- IBP

� First edition in 1997 with only 10 papers presented

� A partnership was established in 2000 between IBP and ASME –American

Society of Mechanical Engineers

� It was agreed to have Rio Pipeline and the International Pipeline Conference –

Calgary in alternate years

� Consolidation of the international standing of the Rio Pipeline

Conference and Exposition



DELEGATES PARTICIPANT COUNTRIES


TECHNICAL PAPERS PARTICIPANT COUNTRIES


EXHIBITION

RIO PIPELINE 2009 CONFERENCE AND EXPOSITION

� Rio Pipeline 2009 Conference &

Exposition will take place from

22 to 24 September at the

SulAmerica Convention Centre,

Rio de Janeiro

� The exposition, with a total area

of 2,336 m2, has been fully

booked and will include close to

100 exhibiting companies

RIO PIPELINE 2009 CONFERENCE AND EXPOSITION

RIOPIPELINE 2009 PAPER STATISTICS

AUTOMATION, SUPERVISORY SYSTEMS AND

MEASUREMENT

21

DISTRIBUTION BASES, TERMINALS, COMPRESSION AND

PUMPING STATIONS

21

CORROSION 33

SUBSEA PIPELINES 36

GIS & MAPPING 14

STRUCTURAL INTEGRITY, RELIABILITY & RISK ANALYSIS 61

LOGISTICS AND OPERATION 19

MAINTENANCE AND REHABILITATION 18

ENVIRONMENTAL AND OPERATIONAL SAFETY 34

SLURRY PIPELINES 11

DESIGN, CONSTRUCTION, FABRICATION AND MATERIALS 28

SOCIAL RESPONSIBILITY 11

INSPECTION TECHNIQUES 22

COUNTRIES PRESENTING PAPERS

United States Holland

Germany India

Saudi Arabia Ireland

Argentina Italy

Bolivia Kuwait

Brazil Mexico

Canada Monaco

Chile Norway

China Peru

Equator Poland

South Africa United Kingdom

France Russian Federation

CONCLUSIONS

CONCLUSIONS

THE PIPELINE SECTOR IN BRAZIL PRESENTS LARGE BUSINESS

OPPORTUNITIES IN AREAS SUCH AS:

� Construction and assembly;

� Materials (pipes, valves, turbines, pumps, etc);

� Onshore and offshore pipeline equipment;

� Special Services (aerial surveys, remote sensing, specialized engineering,

consulting, inspection,

repairs, certification, training, automation,

environmental protection,

corrosion control, etc).

CONCLUSIONS Partnership Opportunities

� Technological Cooperation

� Plant Installation in Brazil

� Local Components replacing Imports

� Partnerships

CONCLUSIONS

The Brazilian pipeline sector maturity,

allied to the significant demand

confirmed for the near future offers

a unique business opportunity

for the international pipeline industry .

CONCLUSIONS

CONTACTSTRANSPETRO

�Marcelo Rennó: [email protected]

�André Raposo: [email protected]

CENPES – Petrobras Research Centre

�Pedro Altoé: [email protected]

Petrobras Procurement

�Roberto Alfradique - [email protected]

Petrobras Services

�Paulo Cellular - [email protected]

IBP – The Brazilian Institute of Petroleum, Natural Gas and Biofuels

�Ernani Filgueiras - [email protected]

CTDUT – Centro de Tecnologia de Dutos (Pipeline Techno logy Centre)

�Arthur Braga - [email protected]

CONCLUSIONS

MARCELO RENNÓ

Chairman of the Pipeline Committee - IBP

Director – Natural Gas

Transpetro – Petrobras Transporte S/A

THANK YOU!