electricity generation is up by 253%

In 2008, Petrobras surpassed its previous record for the generating of electricity for the national grid (SIN ), with 2,025 average MW, generated at its own and leased thermoelectric plants. This volume was 253% higher than the amount recorded in 2007.

Factors contributing to this result, in addition to the increased natural gas supply and logistics, were the storage conditions of the hydroelectric power reservoirs and the introduction of new operating regulations and diversified remuneration. It is also worth mentioning the excellent operational performance of the 17 thermoelectric plants (UTEs) that comprise Petrobras’ thermoelectric power generating infrastructure, which have a total installed capacity of 5,443 MW.

INVESTMENT

The company invested R$ 664 million in the electricity area during 2008, notably in the following projects:

>> In September, the Jesus Soares Pereira thermoelectric plant (Termoaçu – RN) was inaugurated, adding 320 MW of installed capacity to meet demand in the northeast region;

>> Conversion of the Sepé Tiaraju (Canoas – RS), Termoceará (CE) and Barbosa Lima Sobrinho (RJ) UTEs to dual fuel use was completed, making them capable of generating electricity using natural gas or diesel. This flexibility increases the plants’ reliability and availability to generate electricity for the national grid (SIN).

PARTICIPATION IN NEW ENERGY AUCTIONS

In 2008, the federal government held a number of New Energy auctions, to supply the country’s electricity distributors through new thermoelectric plants. At auction A-3, involving electricity to be delivered as from 2011, the total installed capacity placed under contract amounted to 1,935 MW. Petrobras will supply natural gas to the winning bidders representing 26% of that total, equivalent to 504 MW.

Moreover, at auction A-5, involving electricity to be delivered as from 2013, the total installed capacity placed under contract amounted to 5,566 MW, and Petrobras will supply natural gas to the winning bidders representing 20% of that total, equivalent to 1,125 MW

ABSORPTION OF ASSETS

The energy assets of Petrobras Distribuidora have been transferred to Petrobras’ Gas & Energy segment. The generation infrastructure thus absorbed comprises stakes in 15 small-scale hydroelectric plants (SHEP s) and eight oil-powered thermoelectric plants. Taking into consideration the assets operating commercially and those that are being built, these undertakings have a total installed capacity of 1,471 MW .

Of that total, three thermoelectric plants and nine SHEP s are already in operation, while other SHEP s and oil-powered thermoelectric plants are expected to start commercial operations in 2009.