Brazil's planned refinery awaiting Petrobras-PVDSA settlement on crude supply contract

22-Jan-09

Abreu e Lima, a jointly planned 200,000 bpd refinery in North Brazil by two oil majors -Brazil's state-owned Petrobras and Venezuela's state-run Petroleos de Venezuela S.A. (PVDSA) - is awaiting a settlement by both sides on the price of crude supplied by Venezuela, Latin American Herald Tribune reported. Should the agreement not be reached on this matter, Petrobras may go ahead autonomously with the US$4.5 bln project which kicked off construction work last September and is expected to be realized by 2010. Initially, Petrobras and PVDSA have planned a 60:40 arrangement for the refinery. As per media reports, PDVSA intends to supply crude for the refinery at above-market prices which has led Brazil's oil major to proceed independently with the project if the settlement was not reached promptly. Petrobras is demanding crude supply contract which is linked to the Brent or West Texas Intermediate crude prices.