BRAZIL – ENERGY IN 2002 MAIN INDEXES

Public and auto-producers generation in Brazil reached 344.6 TWh in 2002, a result 4.9% higher than that of 2001. These results include 278.7 TWh (+6.1%) from public hydraulic generation, 36.7 TWh (-5.2%) from public thermal generation and 29.3 TWh (+7,9%) from auto-producers.

The import of 36.6 TWh added to the internal generation resulted in 381.2 TWh total energy supply, an amount 4.1% higher than that of 2001.

Nuclear generation, that in 2001 had a large increase due to the full power of Angra II when it grew from 6.1 TWh to 14.3 TWh, decreased slightly in 2002, namely 13.8 TWh (-3.1%).

In what concerns natural gas, it grew in the public and auto-producers generation. In the public generation it grew from 6.9 to 9.7 TWh (+41%) that represents 26% of thermal generation and 3.1% of the total public generation.

The 7.9% increase of auto-producers generation concentrated on the steel, aluminum and sugar-alcohol sectors.
The structure of electric energy supply in 2002 can be seen in the graphic below. When compared to the world structure it is noticeable that hydro-electricity in Brazil has a significant high weight.

Structure of Electricity Supply in Brazil

Structure of World Energy Supply

The final electricity consumption reached 321.6 TWh in 2002, an amount 3.4% higher than that of 2000 but still smaller than that of 2000 (-3%). In this context the 72.7 TWh residential consumption maintained a negative performance (-1.4%), the 45.8 TWh commercial consumption reversed the previous drop and grew 2.4% and the 148.6 TWh consumption of the industrial sector was the one that presented the largest recovery since it grew 6.6%.

The negative performance of the residential consumption for two consecutive years has in some way frustrated the expectations of the sector’s agents that expected a recovery after the 2001 rationing. However, the average adjustment of the worker’s salary, the increase of the residential electricity average tariff (16.3%, a rate higher than the IBGE Consumer Price Index -14.74%), the high interest rates and the economical retraction has restrained the access to durable consumer goods by the population, not to mention the conservation habits absorbed during the crisis.

In 2002, 6.2 GW has been added to the installed capacity in Brazil that reached 82.5 GW of which 76.8 are from the public service and 5.65 from the auto-producers. The main power plants that started operation are: UHE Machadinho RS – units 1, 2 and 3 (1140 MW), UTE Macaé Merchant RJ (900 MW), UHE Lajeado TO, units 3, 4 and 5 (542 MW), UTE Araucária PR (484 MW), UHE Cana Brava – GO (472 MW), UHE Porto Primavera – units 12 and 13 (220 MW) and UTE Termoceará – CE (200 MW).

In 2002, electric energy maintained its participation of 13,6% in the Brazilian Energy Matrix.

PETROLEUM AND ITS PRODUCTS

The petroleum and LNG (liquefied natural gas) production in 2002 was 1499 mill bbl/d (barrels per day) an amount 12.2 % higher than that of 2001. The petroleum products production, 1763 mil boe/d (includes refinery gas and FCC coke), decreased 2% and consumption also decreased 2.6%. With these results, external dependency on these products was significantly attenuated from 22.9% in 2001 to 10.0% in 2002 (data base in toe). Net petroleum imports added up to147 mill bbl/d in 2002 as compared to 320 in 2001 – a 54.1% reduction – and net imports added up to 53 mil bbl/d in 2002 as compared to 104 in 2001 – a 48.8% reduction.

The production and consumption balance of petroleum products shows also deficits of diesel (14% of the demand), of LPG (26% of the demand) and of naphtha (27% of the demand) and surpluses of fuel oil (44% of the supply) and gasoline (17% of the supply).

The largest use of diesel oil occurs in road transport (75%) followed by the agriculture and husbandry sector (16%) and electric energy generation (5%). In the road transport diesel has grown 2.5 % in 2002 while it grew 7% in agriculture.

The car gasoline still had in 2002 a negative growth rate (-4.4%) while in 2001 this rate was (-2.6%) and (-0,6%) in 2000.

Fuel oil continued to be substituted by petroleum green coke and by natural gas. In 2002 the decrease of industrial consumption was maintained (-14.2%).

The average price increase of residential LPG above 30% and in some states above 50% and the comments above concerning residential electric energy are the determining facts of the significant consumption decrease of this energy source for food cooking (-3.5%).

2. DATA OF PETROLEUM AND ITS PRODUCTS
SPECIFICATION	UNIT	2001	2002	% 02/01
PETROLEUM AND LNG PRODUCTION	mill bbl/d	1336	1499	12,2
PETROLEUM PRODUCTS PRODUCTION	mill bep/d	1798	1763	-2,0
TOTAL CONSUMPTION OF PETROLEUM PRODUCTS	mill bep/d	1887	1838	-2,6
NET PETROLEUM IMPORTS	mill bbl/d	320	147	-54,1
NET IMPORTS OF PETROLEUM PRODUCTS	mill bep/d	104	53	-48,8
CAR GASOLINE CONSUMPTION	mill bbl/d	291	278	-4,4
ROAD DIESEL CONSUMPTION	mill bbl/d	489	501	2,5
INDUSTRIAL FUEL OIL CONSUMPTION	mill bbl/d	108	106	-2,7
RESIDENTIAL LPG CONSUMPTION	mill bbl/d	179	172	-3,5
GREEN COKE CONSUMPTION	mill bbl/d	73	69	-5,4
PETROLEUM PROVED RESERVES	bill bbl	8,485	9,813	15,7
REFINING INSTALLED CAPACITY	mill bbl/d	1818	1822	0,2

The demand structure of petroleum products in 2002 is shown in the following graphic.

The 9813 million barrels petroleum proved reserves are equivalent to about 18 years of the present production what guarantees a comfortable situation for the country. For the OECD countries the reserves are equivalent to 11.5 years of production while the world average is 40.3 years.

NATURAL GAS

Natural gas production was 42.7 million m3/d in 2002, an amount 10.8% higher than that of 2001. Imports from Bolivia added up to 14.4 million m3/d, growing 14.4% relative to 2001.

In 2002, the main use of natural gas was in the industrial segment - 17,6 million m3/d and 25,3% growth. It is followed by Petrobrás’ industrial activities - 6.7 million m3/d 1.3% growth.

3. NATURAL GAS DATA
SPECIFICATION	UNIT	2001	2002	% 02/01
PRODUCTION	mill m3/d	38,5	42,7	10,8
IMPORTS	mill m3/d	12,6	14,4	14,4
THERMAL USE BY PETROBRAS	mill m3/d	6,6	6,7	1,3
INDUSTRIAL CONSUMPTION	mill m3/d	14,1	17,6	25,3
CAR CONSUMPTION	mill m3/d	1,6	2,7	71,5
PUBLIC GENERATION CONSUMPTION	mill m3/d	4,2	5,9	39,9
COGENERATION CONSUMPTION	mill m3/d	2,1	2,3	7,9
NON-ENERGY USES	mill m3/d	2,2	2,1	-4,7
PROVED RESERVES	bill m3	219,8	236,6	7,6
INSTALLED CAPACITY OF NGPUs	mill m3/d	28,4	30,3	6,7

It should be emphasized the 39.9% growth of natural gas consumption for public electric generation (5.9 million m3/d) and the large growth in car transport, about 71.5%, corresponding to a consumption of 2.7 million m3/d. In a smaller volume, the 7.9% growth of auto-producers (2.3 million m3/d) should also be noticed.

The structure of all natural gas uses in 2002 is shown in the following graphic.

(i) Industrial (+) consumption in refineries and in petroleum exploration and production

The proved natural gas reserves - 236,6 billion m3, are equivalent to 15.2 years of the present production. For the OECD countries reserves are equivalent to 13.7 years of production, while the world average is 61.9 years.

SUGARCANE PRODUCTS

Alcohol production in 2002, namely 216,9 mill bbl/d, represented an increase of 9.8% relative to 2001, repeating the good performance of 7.2% in 2001 relative to 2000. Alcohol total consumption reverted the negative performance of the previous year, increasing 3.2% (206 mill bbl/d) in 2002 explained by the low hydrated alcohol price relative to gasoline and by the percent increase of anhydrous alcohol participation in the C gasoline. After large alcohol stock reduction in 1999 and 2000, 2001 and 2002 practically maintained a balance between supply and demand.

Sugarcane bagasse consumption grew 11.8% reaching 87.2 million t resulting from the growth of alcohol production, specially the 14.6% growth of sugar production.

About 75% of alcohol produced comes from sugarcane juice (yield close to 84l/t of sugarcane). The remaining 25% comes from sugar production (yield close to 330l/t of molasses).

In 2002 total bagasse production was close to 94.4 million t, generating 7.2 million t of waste for non-energy uses.

The energy products from sugarcane represent 12.8% of the Brazilian Energy Matrix.

MINERAL COAL

The use of mineral coal in Brazil is divided in two types: national steam coal (energy use) of which 90% is used for electric generation and imported metallurgical coal, characterized by expansion when there is partial combustion, producing coke specially used in the steel industry.

In this context the numbers presented in the following table represent both the performances of mineral coal electric generation and steel industry use (10.8% increase of steel production) in 2002