Brasília - A memorandum of understanding to develop bilateral cooperation in the areas of petroleum, natural gas, renewable fuels, electricity, and mining was signed in Beijing by the Minister of Mines and Energy, Dilma Rousseff, and the Chinese Ministry of Trade. The Brazilian and Chinese govenments can also define cooperation projects of mutual interest in these areas.

The memorandum envisions the formation of a Mixed Working Group (GMT) within the ambit of the Sino-Brazilian Mixed Commission to execute the plans established in the agreement. The Commission is coordinated by the two Ministries, and the agreement is valid for ten years and renewable for identical terms.

According to the Press Office of the Ministry of Mines and Energy, during Minister Rousseff's visit to China Petrobras and the BNDES (National Economic and Social Development Bank) also signed memoranda of understandings with Sinopec, the Chinese state petrochemical company, and the China Exim Bank, the country's export incentive bank. Sinopec is responsible for 57.8% of China's total fuel supply.

Petrobras and Sinopec will be in charge of designing, engineering, provisioning, and constructing the Gasene, a natural gas pipeline which will link the municipalities of Cabiúnas (RJ) and Catu (BA), as well as gas compression stations which will be installed along the pipeline. The China Exim Bank will provide financial resources to execute the project, and the BNDES will be the borrower of these funds and the direct lender to the project.

The gas pipeline will connect gas pipeline networks in the Southeast to those of the Northeast, permitting available natural gas to be transferred from one region to another. The Gasene was chosen to kick off cooperation between Brazil and China in an agreement between Petrobras and Sinopec, signed soon after President Luiz Inácio Lula da Silva's trip to China this May.

Still another memorandum of understanding was signed between Eletrobrás and CITIC (China International Trust & Investment Corporation), a conglomerate of companies in the area of energy (except petroleum and gas), private banks, insurance companies, investment firms, and fund management outfits. The document mentions reinforcing the generating capacity of systems owned by Eletrobrás.

Agência Brasil
Translator: David Silberstein
09/08/2004