Fuel import and logistic bottlenecks were subjects for discussion
Rio de Janeiro, September 26 – On Wednesday, discussions about the future of Downstream in Brazil was one of the highlights in Rio Oil & Gas. Imports of fuels and the challenge in regulating supply in Brazil were some of the subjects discussed at the Downstream Forum, which is part of one of the tem Rio Oil & Gas side events.
Cade’s former chairman, Gesner Oliveira, said that the fuel sector has a dominant company (Petrobras) which, according to him, is not a problem.
“The situation, however, demands clear and transparent rules”, he said.
Sérgio Araújo, president of the Brazilian Association of Fuel Importers (ABICOM), said that import companies started operating when Petrobras announced that it would no longer be the sole responsible for supplying the country.
“Petrobras has repositioned itself and we have made investments in terminals and the companies started operating in imports”, said Araújo.
The Downstream Forum also brought a panel that discussed measures to encourage the construction of pipelines in Brazil. José Mauro Coelho, director of oil, gas and biofuels studies at the Energy Research Company (EPE), pointed out that Brazil has features that foster the movement of oil and by-products by pipelines, such as the continental size of the country, the large number of refineries on the Brazilian coast, the consumer market spread throughout the national territory and the growth in demand for derivatives, mainly diesel and aviation fuel.
Leandro Barros, Plural’s director of supply, has argued that the downstream chain lacks a strong regulatory environment that ensures a well-structured supply safety and attracts investment. For him, there are four main infrastructure issues that need to be enhanced: incentives to investments; regulatory improvement; improvement of the competitive environment and integrated logistic planning.
“We need an integrated discussion with public players in the construction of a feasible and viable Action Plan”, said Barros.
Biofuels – Biofuels and bottlenecks in the logistic chain were also placed in the agenda of the event. Experts spoke of the increased supply of biofuel and its consequences on logistics. According to the founding partner of Leggio, Marcus Delia, the encouragement to biofuel production will generate an inverse logistic flow in the energy industry.
“Currently, the great demand is taking derivatives from the coast to the countryside. The production of biofuels and ethanol will open up a strong demand in the opposite direction: from the countryside to the coast”, he said.
Carlos Octávio de Lima, executive Supply & Logistics manager of Ipiranga, pointed out the concentrations of industrial centers – ethanol, mainly in the South-Central region, and biodiesel in the Midwest – as another logistic challenge. “If investments happen, if the new National Biofuel Policy (RenovaBio) fulfills its role, we will have a 90% increase in traffic flow”, he warned.
Streamlining business cycles – In the Exploration & Production field, the panel “Global value chains and the new reality of the oil & gas industry” was headed by executives from major oil companies. ExxonMobil’s CEO Liam Mallon highlighted cooperation as a key factor in streamlining the industry.
“The first alignment should be between operators and regulators. The second one would be a good partnership between the acting companies. The third, which has been the focus of ExxonMobil in recent years, is the contractual integration with suppliers. Choosing strategic suppliers is the way to eliminate rework”, explained Mallon.
For Equinor’s Vice-President of Supply Chain, Mauro Andrade, digitization is part of a new wave of improvement in the sector. And this culture must be shared with suppliers. “90% of Equinor’s costs go to suppliers and only 10% are internal costs. They need to be integral parts of the process. The watchword is cooperation”, he said.
Felipe Arbelaez, regional president for Latin America at BP Energy, presented the energy transition as one of the company’s top priorities. “The low carbon economy is a demand of society. We will seek more energy, at lower costs and with fewer emissions. ”
Research and Development – Brazil will have US$ 13 billion by 2030 to be mandatorily invested in RD&I, in order to leverage technological innovations in the country’s supply chain, according to IBP’s Executive Secretary of Exploration and Production Antonio Guimarães, who participated in the panel ” Perspectives for the Oil & Gas Industry: A Window of Opportunity in Global Value Chains “.
For Guimarães, any investment in Research, Development and Innovation (RD&I) consists of the “local content of the future” and will allow Brazil to be competitive and integrate global value chains into the oil & gas industry.
PetroRio’s Operations Director, Roberto Monteiro, said that Brazil has means to meet the demand and mentioned the company’s recent investments in its new drilling campaign, which costed US$ 50 million. The company hired suppliers, many of them domestic, to drill three wells, which added 3,500 barrels/day to the production of the Polvo field, in the Campos Basin.
Economic stability for development – The country’s economic situation was also discussed on Wednesday at Rio Oil & Gas. The Executive Secretary of the Ministry of Finance, Ana Paula Vescovi, reported that Brazil faces an unprecedented fiscal crisis and that it is important to strategize in order to reverse the current scenario. Vescovi participated in the panel “Economic stability as the foundation for the development of key industries”. She advocated the rebalancing of public policies and inflationary control to keep the country’s economy in good standing.
“Besides, we need to discuss an effective economic reform again, a measure of great importance for the fiscal environment”, he added.
Esteves Colnado, Minister of Planning, Development and Management believes that there are still challenges in the Brazilian fiscal situation, but moving forward with structuring and microeconomic reforms is a must-do.
For Esteves, the scenario of uncertainties in both the domestic and foreign environments contribute to the depreciation of the national currency and increase of the real interest rate, generating greater economic instability. The minister said, however, that the government transition is being carried out in a strategic manner.
Exhibition – In this 19th edition, the Rio Oil & Gas exhibition brings together 400 companies. Petrobras has brought interactive games that simulate a Formula One race and an underwater trip to learn about the features of each rig used in submersible drilling. Visitors will be transported for a trip approximately 300km off the coast, at water depths exceeding two thousand meters. At the booth, there is also a full-size replica of one of McLaren’s cars, the company’s partner team.
Shell has created discussions boards where relevant issues about the company are addressed. At Shell Talks, the employees themselves are invited to talk about diversity and inclusion, startups or how to become a supplier.
ExxonMobil has created the Exxon Lab, with mini design thinking and Lean Six Sigma courses. The company also introduced a virtual reality simulator to demonstrate a drilling process in distinct environments such as ice, forest and mountain.
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