By JEFF FICK
RIO DE JANEIRO --
Brazilian state-run energy giant Petroleo Brasileiro, or
Petrobras, said late Tuesday that it had been notified of a
court order suspending environmental licenses for its Comperj
refinery project in Rio de Janeiro state.
The order implied "an immediate work stoppage," Petrobras
said. No further details about the order suspending the
environmental licenses were available, according to a Petrobras
Petrobras said that it was evaluating all possible measures
related to the halt, which would stop work on one of the
company's largest projects.
The Comperj refinery will have installed
capacity to process 165,000 bpd of crude oil when it enters
operation in April 2015, according to the company. A second
phase, expected to be completed by 2018, would double
When completed, the refinery would ease Petrobras's
dependence on expensive fuel imports that have undercut the
company's profits over the past two years. Petrobras's
refineries are operating at 98% capacity and unable to meet
growing demand for gasoline and diesel fuel in Latin America's
largest economy, forcing the company to import gasoline and
diesel to meet demand.
But the company currently sells the imported fuels at a
discount in the domestic market because of a controversial
pricing policy that doesn't pass along international volatility
to consumers at the pump.
Despite a 22% increase in diesel prices and 15% increase in
gasoline prices over the past year, local prices remain below
international market levels. Petrobras CEO Maria das Gracas
Foster has said she is pursuing parity with international
prices, but Brazil's government -- and the company's
controlling shareholder -- has been reluctant to raise fuel
prices for fear of stoking inflation.
Dow Jones Newswires