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Petrobras Embraces Green Energy Transition with Domestic Renewables Investment

 |  January 22, 2024

In a significant departure from its historical focus on oil and gas, Petrobras, Brazil’s state-run oil firm, is set to venture into the realm of domestic renewable energy. The company’s Chief Executive, Jean Paul Prates, revealed that Petrobras plans to acquire stakes in operational onshore wind and solar projects, aiming to establish a substantial 2 gigawatts (GW) renewable energy portfolio by the end of this year.

This strategic move aligns with President Luiz Inacio Lula da Silva’s push for a green energy transition and stands in stark contrast to the previous administration led by President Jair Bolsonaro. Under Bolsonaro, the government pursued asset sales and emphasized deep-water exploration and production, marking a paradigm shift for Petrobras under new leadership.

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While the precise investment figure for this year remains undisclosed, Petrobras intends to allocate $5.2 billion by 2028 towards the development of solar and wind power, as outlined in its November business plan. Prates emphasized the firm’s commitment to a responsible and decisive transition, expressing confidence that the market will respond positively, potentially impacting Petrobras’ share price.

Mauricio Tolmasquim, Petrobras’ head of energy transition, recently confirmed the company’s exclusive focus on domestic ventures, ruling out investments in foreign solar and wind projects. The anticipation of a regulatory framework for offshore wind, expected to gain approval from Brazil’s Congress, adds another layer to Petrobras’ strategic vision. Prates highlighted the company’s eagerness for the regulatory green light, having presented initial offshore wind studies in collaboration with Norway’s Equinor last year.

As Petrobras charts a course toward renewables, its foray into domestic onshore wind and solar projects signifies not only a greener future for the company but also a notable shift in Brazil’s energy landscape.

Source: Reuters