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The National Economic and Social Development Bank (BNDES) of Brazil has announced that it has entered into a financing agreement with Logum Logística SA totalling BRL1.81 billion (US$466.3 million) to support the development of the Ethanol Logistics System.
The Ethanol Logistics System will consist of approximately 481km of Logum's own pipelines and terminals in Uberaba (Minas Gerais state), Ribeirão Preto (São Paulo) and Guarulhos (São Paulo), with the purpose of connecting the producing regions of the interior of São Paulo and from Minas Gerais to the main consumer centers in the metropolitan areas of São Paulo and Rio de Janeiro, through its own pipelines and Petrobras pipelines operated by Transpetro.
About 353km of Logum pipelines, between Uberaba and Paulínia (São Paulo), and the ethanol storage and collection terminals in Ribeirão Preto and Uberaba are already in operation, having been constructed with bridge loan support from BNDES, contracted in 2011. Part of the new financing will be used to lengthen the debt of the bridge loan.
From Paulínia, Logum pipelines connect to Petrobras pipelines operated by Transpetro to service the metropolitan areas of São Paulo and Rio de Janeiro.
The new phase of investments will allow the expansion of the system to the consumer centers of São Paulo. BNDES' financing will support the construction of an additional 128km of pipelines from Guararema to São José dos Campos (36km) and São Caetano do Sul (92km)
Logum also plans to develop a fuel storage terminal in Guarulhos (São Paulo), which will act as a regulatory stock to guarantee more reliability and faster delivery of ethanol.
Considering both phases, BNDES support has accounted for approximately 54% of all of the investments in the Ethanol Logistics System, totaling around BRL3.3 billion (US$850.2 million).
In 2017, the system transported 2.5 billion liters of ethanol through pipelines, making it the main Brazilian ethanol disposal system and the only one to utilise pipelines. Upon completion of the new phase, scheduled for 2021, the fuel transportation capacity will be expanded to more than 8 billion liters of ethanol per year.