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Petrobras Bets Big on Rio's Refining Commitment With Major Projects
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Key Takeaways
PBR will invest R$33B ($6B) to boost refining, biofuels and petrochemicals in Rio de Janeiro.
Petrobras' new biojet fuel facility at Boaventura will produce 19,000 bpd of SAF and HVO fuels.
Braskem plans R$4B expansion of its polyethylene plant, adding 230,000 tons/year capacity.
Petróleo Brasileiro S.A. - Petrobras (PBR - Free Report) is making bold strides in revitalizing Brazil’s downstream sector. It announced a sweeping $33 billion reais ($6 billion) investment plan centered in Rio de Janeiro. Through integrated refining, petrochemical and renewable fuel initiatives, the company aims to boost domestic fuel supply, support energy transition goals and stimulate industrial synergy across the value chain.
Boaventura and Reduc: The Heart of Integration
The core of the initiative lies in connecting the Boaventura Energy Complex in Itaboraí with the Duque de Caxias Refinery (Reduc). Together, these projects represent a R$26 billion investment, which is already included under Petrobras’ 2025-2029 Business Plan, wherein the service packages are currently in the bidding phase. Once operational, this infrastructure will enhance S-10 diesel output by 76,000 barrels per day (bpd), 56,000 bpd from quality improvements and 20,000 bpd from additional capacity. The project will also increase jet fuel production by 20,000 bpd and expand Group II lubricants output by 12,000 bpd.
Boaventura will also host a state-of-the-art biojet fuel facility producing 19,000 bpd of sustainable fuels, Hydrotreated Vegetable Oil (“HVO”) and Sustainable Aviation Fuel (“SAF”), alongside two 400 MW gas-fired thermoelectric plants. The power plants are designed to integrate with the nearby Itaboraí gas processing unit, participating in future capacity reserve auctions.
Circular Economy and Decarbonization at Reduc
At Reduc, Petrobras is exploring a lubricant oil re-refining unit with a monthly capacity of 30,000 m3 (6,300 bpd). This would enable the reuse of waste oil into high-value products, in line with circular economy practices. The facility has already gained regulatory approval for a co-processing test.
Reduc is also pushing renewable fuel production. A pilot to blend 1.2% corn oil into jet fuel has been successfully completed, paving the way for 10,000 bpd commercial-scale production. Diesel R5 with 5% renewable content is already in production and a Diesel R7 with 7% blend is under testing, reinforcing Petrobras’ ambition for low-carbon fuels.
In parallel, Petrobras plans to modernize its on-site power infrastructure with a new thermal plant to replace outdated steam and power generation equipment with investments of up to R$860 million. The company also plans to spend up to R$2.4 billion on maintenance shutdowns between 2025 and 2029 to ensure operational safety and efficiency.
Expanding Petrochemicals and Strategic Partnerships
Petrobras is also eyeing new petrochemical capabilities. Studies are underway for the local production of acetic acid and monoethylene glycol at Boaventura, materials that Brazil currently imports.
Braskem, a Petrobras affiliate, is expected to invest around R$4 billion in expanding its polyethylene plant. The project, which is subject to necessary approvals by Braskem's governance bodies, hinges on increased gas flow from Route 3 and aims to add 230,000 tons per year of production capacity.
The partnership between Petrobras and Braskem is strengthening, particularly as both seek to shift from naphtha to gas-based feedstocks like ethane for a competitive edge. Talks are also underway to supply Braskem’s Bahia operations with domestic gas, further reducing import reliance.
Looking Ahead: Gas Supply, Renewables and National Reach
Petrobras’ current focus is on boosting domestic gas availability. Reactivating shut-in gas wells and pursuing integration with Argentina and Bolivia are part of a broader strategy to lower prices and meet rising demand from Brazil’s expanding digital and industrial sectors.
Beyond Rio de Janeiro, Petrobras is preparing to invest in the second refining train at RNEST in Pernambuco (R$8 billion) and resume fertilizer production (R$6 billion). The company also plans a new bidding round to convert units at the Presidente Bernardes refinery for renewable fuel output.
As Petrobras sets its sights on a cleaner, more self-sufficient energy future, these investments reflect a decisive commitment to modernization, sustainability and long-term national benefit. The company's business plan also foresees a capex of $17 billion in the refining, transportation and commercialization area between 2025 and 2029.
PBR’s Zacks Rank & Key Picks
Headquartered in Rio de Janeiro, Petroleo Brasileiro S.A., or Petrobras S.A., is the largest integrated energy firm in Brazil and one of the largest in Latin America. Currently, PBR has a Zacks Rank #3 (Hold).
BKV Corporation is an energy company that produces natural gas from its owned and operated upstream businesses. The Zacks Consensus Estimate for BKV’s 2025 earnings indicates 338.18% year-over-year growth.
In the oil and gas sector, Flotek serves major and independent energy producers and oilfield service companies, both domestic and international. The Zacks Consensus Estimate for FTK’s 2025 earnings indicates 64.71% year-over-year growth.
Dallas, TX-based Energy Transfer is one of the largest and most diversified midstream energy companies in North America. ET’s nearly 130,000 miles of pipelines and associated energy infrastructure in 44 states transport oil and gas products. The Zacks Consensus Estimate for ET’s 2025 earnings indicates 12.50% year-over-year growth.
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Petrobras Bets Big on Rio's Refining Commitment With Major Projects
Key Takeaways
Petróleo Brasileiro S.A. - Petrobras (PBR - Free Report) is making bold strides in revitalizing Brazil’s downstream sector. It announced a sweeping $33 billion reais ($6 billion) investment plan centered in Rio de Janeiro. Through integrated refining, petrochemical and renewable fuel initiatives, the company aims to boost domestic fuel supply, support energy transition goals and stimulate industrial synergy across the value chain.
Boaventura and Reduc: The Heart of Integration
The core of the initiative lies in connecting the Boaventura Energy Complex in Itaboraí with the Duque de Caxias Refinery (Reduc). Together, these projects represent a R$26 billion investment, which is already included under Petrobras’ 2025-2029 Business Plan, wherein the service packages are currently in the bidding phase. Once operational, this infrastructure will enhance S-10 diesel output by 76,000 barrels per day (bpd), 56,000 bpd from quality improvements and 20,000 bpd from additional capacity. The project will also increase jet fuel production by 20,000 bpd and expand Group II lubricants output by 12,000 bpd.
Boaventura will also host a state-of-the-art biojet fuel facility producing 19,000 bpd of sustainable fuels, Hydrotreated Vegetable Oil (“HVO”) and Sustainable Aviation Fuel (“SAF”), alongside two 400 MW gas-fired thermoelectric plants. The power plants are designed to integrate with the nearby Itaboraí gas processing unit, participating in future capacity reserve auctions.
Circular Economy and Decarbonization at Reduc
At Reduc, Petrobras is exploring a lubricant oil re-refining unit with a monthly capacity of 30,000 m3 (6,300 bpd). This would enable the reuse of waste oil into high-value products, in line with circular economy practices. The facility has already gained regulatory approval for a co-processing test.
Reduc is also pushing renewable fuel production. A pilot to blend 1.2% corn oil into jet fuel has been successfully completed, paving the way for 10,000 bpd commercial-scale production. Diesel R5 with 5% renewable content is already in production and a Diesel R7 with 7% blend is under testing, reinforcing Petrobras’ ambition for low-carbon fuels.
In parallel, Petrobras plans to modernize its on-site power infrastructure with a new thermal plant to replace outdated steam and power generation equipment with investments of up to R$860 million. The company also plans to spend up to R$2.4 billion on maintenance shutdowns between 2025 and 2029 to ensure operational safety and efficiency.
Expanding Petrochemicals and Strategic Partnerships
Petrobras is also eyeing new petrochemical capabilities. Studies are underway for the local production of acetic acid and monoethylene glycol at Boaventura, materials that Brazil currently imports.
Braskem, a Petrobras affiliate, is expected to invest around R$4 billion in expanding its polyethylene plant. The project, which is subject to necessary approvals by Braskem's governance bodies, hinges on increased gas flow from Route 3 and aims to add 230,000 tons per year of production capacity.
The partnership between Petrobras and Braskem is strengthening, particularly as both seek to shift from naphtha to gas-based feedstocks like ethane for a competitive edge. Talks are also underway to supply Braskem’s Bahia operations with domestic gas, further reducing import reliance.
Looking Ahead: Gas Supply, Renewables and National Reach
Petrobras’ current focus is on boosting domestic gas availability. Reactivating shut-in gas wells and pursuing integration with Argentina and Bolivia are part of a broader strategy to lower prices and meet rising demand from Brazil’s expanding digital and industrial sectors.
Beyond Rio de Janeiro, Petrobras is preparing to invest in the second refining train at RNEST in Pernambuco (R$8 billion) and resume fertilizer production (R$6 billion). The company also plans a new bidding round to convert units at the Presidente Bernardes refinery for renewable fuel output.
As Petrobras sets its sights on a cleaner, more self-sufficient energy future, these investments reflect a decisive commitment to modernization, sustainability and long-term national benefit. The company's business plan also foresees a capex of $17 billion in the refining, transportation and commercialization area between 2025 and 2029.
PBR’s Zacks Rank & Key Picks
Headquartered in Rio de Janeiro, Petroleo Brasileiro S.A., or Petrobras S.A., is the largest integrated energy firm in Brazil and one of the largest in Latin America. Currently, PBR has a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at some better-ranked stocks like BKV Corporation (BKV - Free Report) , Flotek Industries, Inc. (FTK - Free Report) and Energy Transfer LP (ET - Free Report) . While BKV and Flotek currently sport a Zacks Rank #1 (Strong Buy) each, Energy Transfer carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
BKV Corporation is an energy company that produces natural gas from its owned and operated upstream businesses. The Zacks Consensus Estimate for BKV’s 2025 earnings indicates 338.18% year-over-year growth.
In the oil and gas sector, Flotek serves major and independent energy producers and oilfield service companies, both domestic and international. The Zacks Consensus Estimate for FTK’s 2025 earnings indicates 64.71% year-over-year growth.
Dallas, TX-based Energy Transfer is one of the largest and most diversified midstream energy companies in North America. ET’s nearly 130,000 miles of pipelines and associated energy infrastructure in 44 states transport oil and gas products. The Zacks Consensus Estimate for ET’s 2025 earnings indicates 12.50% year-over-year growth.