MercoPress. South Atlantic News Agency

Petrobras to double gas pipeline capacity

State-owned petroleum giant Petrobras is to begin work this year on seven new pipelines that will more than double its capacity to transport natural gas within Brazil, O Globo daily reported Monday.

With a total length of 3,120 kilometers (1,938 miles), the new pipelines will cover more territory than the 2,850 kilometers (1,770 miles) of the firm's existing conduits for natural gas. Brazil currently has around 9.000 kilometers (5,592 miles) of gas pipelines, most of which is owned by distribution firms that buy fuel from Petrobras.

The aim of the more than one billion US dollars project is to boost consumption of natural gas in the wake of Petrobras's recent discoveries of vast new reserves of the fuel, said Ildo Sauer, the company's director of gas and energy.

As of December, the company's reserves of natural gas stood at 313 billion cubic meters, yet Petrobras has not even begun to exploit its largest fields and most of the gas used in Brazil comes from neighbouring Bolivia.

Petrobras projects that with the new pipelines, scheduled to come on line in 2007, Brazil's annual consumption of natural gas will increase from the current 34.3 million cubic meters to 77.6 million by 2010.

"With oil prices rising, gas is going to be more and more competitive, Sauer told O Globo.

Though the Brazilian government maintains a controlling interest in Petrobras, the company's shares are traded on the Sao Paulo, New York and Madrid exchanges.