In 2010, Brazil’s TPEC amounted to 342.74 mtoe. Oil accounted for 133.67 mtoe, while coal and gas accounted for 10.28 mtoe and 23.99 mtoe respectively. ‘Other’, being renewables, accounted for 174.8 mtoe. This is 51% of the total, of which 29 percent point constitutes hydro. Biomass is also an important renewable for Brazil. ^[1]

^[2]

• 1. EIA International Energy Statistics 2010-2011
• 2. BP Statistical Review of World Energy June 2011

No sector level data is available for Brazil.

Brazil holds some indigenous natural gas resources, though limited: 417 bcm at the end of 2010. This is approximately 0.22% of the world total reserves. Only Venezuela holds larger reserves in Latin America: 2.75% of the world’s reserves.^[1]

The reserves-to-production ratio (R/P ratio) for Brazil is 28.9 years, which is more than twice as high as the EU’s average R/P ratio of 14 years.^[2]

*Reserves-to-production (R/P) ratio – If the reserves remaining at the end of any year are divided by the production in that year, the result is the length of time that those remaining reserves would last if production were to continue at that rate.  

• 1. Natural Gas Information © OECD/IEA, 2011
• 2. BP Statistical Review of World Energy June 2011

Three fields, the Campos, Espírito Santo and Santos Basin, hold the largest reserves of natural gas in Brazil. Other sizable reserves are located in the interior parts of the country. Natural gas production has grown slowly over the past few years, mainly due to a lack of domestic transportation capacity and low domestic prices. The Campos Basin offshore field, where most of Brazil’s natural gas production takes place, is located in the state of Rio de Janeiro. Most onshore fields are located in the Amazonas and Bahia states. The production from these fields is primarily for domestic consumption, due to a lack of transportation infrastructure. In 2007, oil discoveries were made in Brazil’s offshore pre-salt zone. Next to the oil, it is expected that the pre-salt fields also hold sizable levels of natural gas. One field alone, the Tupi field (later renamed Lula), is expected to contain 140 to more than 200 bcm of recoverable natural gas. This could potentially increase Brazil’s natural gas reserves by 50%. The largest project recently realized by Petrobras, in order to meet rising demand and decrease import dependency, is the Mexilhao project. This project entails transporting natural gas from the Tupi/Lula field offshore, to Mexhilao onshore, where it can then be inserted in the national grid. This project contains estimated total reserves of 227 bcm. Production began in March 2011 at approximately 4 bcm per year, eventually rising to approximately 5.5 bcm per year in 2012. ^[1]

• 1. EIA Analysis Briefs 2011

^[1]

^[1]

In 2010, gas imports accounted for an estimated 51.56% of the total volume of consumed gas (12,607/24,451 mcm); an increase of almost 50% compared to 2009. Quite some diversification in imports has taken place in 2009-2010. Whereas until 2008 imports were coming only from Argentina and Bolivia and only through pipeline, in 2010 imported natural gas came from at least six additional countries and also consisted of LNG (see above tables). ^[1]

Brazil imports natural gas from Bolivia via the Gasbol pipeline, which links Santa Cruz to Porto Alegre, via Sao Paulo. The 3,219 km (2,000 mi) Gasbol pipeline has a maximum capacity of 31.15 mcm (1.1 bcf) per day. LNG comes from Trinidad & Tobago, Qatar, and Nigeria. Import growth in the future is expected to be met more with LNG than with pipeline imports. ^[2]

• 1. Natural Gas Information © OECD/IEA, 2011
• 2. EIA Analysis Briefs 2011

Pipelines Petrobras operates Brazil’s domestic natural gas transport system. The total length of the pipeline network is around 6,430 km (4,000 mi) primarily located in the northeastern and southeastern parts of the country. The system is not completely integrated. Separate systems were located in the southeastern and northeastern parts of the country and the state of Espirito Santo. The fragmented nature of the network has hindered the further development of domestic consumption and production. However, in March 2010 the Southeast Northeast Interconnection Gas Pipeline (GASENE) linked the two markets, originating in Rio de Janeiro running to Bahia. The pipeline is about 1,400 km (870 mi) long and is the longest ever built in Brazil. The lack of infrastructure especially hindered exploration and production in the interior regions of the country. In particular, Amazonas state contains considerable reserves that remained unexploited, especially the Urucu field, which contains Brazil’s largest onshore natural gas reserves. In 2005, Petrobras began construction of the Urucu pipeline that links Urucu to Manaus, the capital of Amazonas state. The project included the conversion of an existing liquefied petroleum gas (LPG) pipeline to carry natural gas from Urucu to Coari, and a new natural gas pipeline from Coari to Manaus. The construction was completed in 2009.^[1]  

• 1. EIA Analysis & Projections - World Shale Gas Resources 2011

Currently Brazil has two operational LNG regasification terminals. One is located in the northeast (Pecém) and one is located in the southeast (Guanabara Bay). The Pecém terminal received its first LNG cargo from Trinidad & Tobago in July 2008, while the Guanabara Bay terminal came online in May 2009. Petrobras plans to bring a third terminal online in Bahia state in 2013, which will have a capacity of approximately 14 mcm per day. ^[1], ^[2], ^[3]

^[1], ^[2], ^[3]

• 1. Natural Gas Information © OECD/IEA, 2011
• 2. EIA Analysis & Projections - World Shale Gas Resources 2011
• 3. GIIGNL 2010

Brazil’s LNG facilities also act as storage facilities for natural gas, although capacity is limited.

The market is partially privatized. Production and Bolivian import pipelines are dominated by Federal State-owned Petrobras (which owns approximately 90% of all the reserves, known in 2004). Other important players are Sulgas (49% owned by Petrobras and 51% by the Federal Government (Rio Grande do Sul) and the British BG. Prices are set by Petrobras. ^[1]  

• 1. International Energy Regulation Network 2006-2009

The transmission network is operated and owned by Petrobras’ subsidiary Transpetro, which negotiates the third party access conditions subject to criteria defined by the gas regulator ANP. Distribution is handled by the states which are allowed to maintain a monopoly in the distribution of gas, although many states have partially sold shares in their distribution companies. Gas Natural (Spanish) has a stake in Rio de Janeiro’s CEG, the country’s largest distributor. ^[1] Petrobras holds a stake in 18 of Brazil's 27 state-owned natural gas distribution companies. However, Brazil passed a new Natural Gas Law in 2009 that created a separate regulatory framework for natural gas. This law is expected to facilitate private investment in the sector.  ^[2]

• 1. International Energy Regulation Network 2006-2009
• 2. EIA Analysis & Projections - World Shale Gas Resources 2011

Various distribution companies handle the downstream supply of natural gas in each state (see above). The largest consumer of gas is the industrial sector, representing about 80% of the total domestic consumption. Due to the low cost of hydroelectric generation and the plentiful availability of it in previous years, Petrobras was having difficulties finding enough demand to meet the gas supply contracted with Bolivia via take or pay agreements. Petrobras and the government were then trying to encourage wider use of natural gas through volume-linked discounts to distributors and the construction of new transmission and distribution pipelines. ^[1] Then, natural-gas-fired power generation more than doubled in 2010 and now accounts for a third of total generation, according to Brazil's Ministry of Energy and Mines. Also, the largest sources of thermal generation in Brazil are natural gas and biomass. It is projected that natural gas use in the electricity sector will increase as Brazil expands and diversifies its natural gas supplies.8. ^[2]  

• 1. International Energy Regulation Network 2006-2009
• 2. EIA International Energy Statistics 2010-2011