‘The existing infrastructure to handle the increase in exports is still precarious’

Brazil’s Vast Infraestrutura is developing new projects at the Açu Port complex in Rio de Janeiro state.

One of them involves the installation of a liquid fuels terminal, with operations scheduled for 2025. 

The other project, which still depends on an anchor contract to get off the ground, involves crude oil tanking.

In an interview with BNamericas, Vast CEO Victor Bomfim warns that Brazil suffers from an infrastructure bottleneck that makes it difficult to handle the increase in commodity exports.

BNamericas: Could you give an overview of Vast's activities and main contracts today?

Bomfim: We operate in the logistics required to handle and export crude oil. We have the largest private terminal for handling oil in the country, with a licensed handling capacity of 1.2Mb/d. It’s the only terminal with the capacity to accommodate VLCCs [very large crude carriers] in the country. 

We’re responsible for more than 50% of all oil exported via terminals in Brazil. If we consider all national oil exports [including ship-to-ship or STS operations], we’re responsible for around 40% of all exports. Petrobras accounts for around 40% [via its own terminals], and 20% is done offshore, 10% in the Santos basin and 10% on the Uruguayan coast, for regulatory reasons. 

We have contracts with more than 10 companies, including Shell, Petrobras itself, BW, Galp, Prio, TotalEnergies, Equinor, Petronas, CNOOC and Petrochina. 

BNamericas: Do you foresee growth in export and handling operations in 2024?

Bomfim: Brazil’s production has grown at a sustainable and robust pace in recent years, and national refining capacity is limited. So all this increase had to be exported. 

Petrobras' terminals were built in the last century, when Brazil was not self-sufficient in oil and had to import. Today, they’re at full capacity. So it's normal for this additional production to go to a terminal that has availability. That's why we've been growing by around 30% year-on-year, and our outlook is to maintain strong growth for the next 10 years. 

BNamericas: What are the differences between the transshipment operations carried out by Vast and the STS underway, where the ships are moving at sea?

Bomfim: In the case of STS, which is done in Santos or Uruguay, it’s more difficult to contain any oil spills. And our operations have a carbon footprint three times smaller than the STS underway, which involves a ship sailing and therefore emitting gases.

In addition, we use tugboats that operate in our port and which, when moored, are supplied by electricity. 

BNamericas: In 2023, Vast took the lead in the crude oil export market, with 8.89Mt shipped on T-Oil. It also came second in crude oil handling. What’s the difference between these two activities?

Bomfim: Petrobras directs part of its production to its refineries, so it handled more than us. 

Brazil currently exports around 1.8Mb/d, and is expected to export more than 3Mb/d after 2030. The problem is that, even today, there’s no tankage to optimize export operations. There’s no buffer, no stock, so operations have to be just in time. This is generating a huge demand for DPSTs [dynamic position shuttle tankers] and there is a shortage of these ships on the market. 

BNamericas: Is that why Vast is planning to build tanking infrastructure at Açu?

Bomfim: Yes. This is absolutely fundamental for private companies, which, together, are already exporting more than Petrobras itself and don't have access to storage. Petrobras has its own infrastructure. 

[Editor's note: Called Spot, the project foresees the construction of up to 12 tanks with total capacity of 5.7Mb of oil.] 

BNamericas: What stage is the project at?

Bomfim: It's already licensed and the engineering is ready, but we're in a battle to convince the oil companies to make the terminal viable. 

PPSA [Pré-Sal Petróleo SA] has made it clear that it could produce something in the order of 500,000b/d. And almost inevitably this oil will be exported, as it already is. So it will also suffer intensely from this lack of tankage and DPST vessels. 

[Editor's note: PPSA represents the government's interests in production sharing contracts, which basically involve pre-salt fields, the largest in the country.]  

BNamericas: Would the idea be to invest jointly in this project?

Bomfim: In order to invest in tanking, we need to have a guarantee that they will use it.

BNamericas: What feedback does Vast get from the oil companies today?

Bomfim: They say it would be important, that we should talk... but the temperature is rising. What we're really looking for is greater determination on their part to address this critical problem in order to make a structural solution feasible. PPSA sees this as critical. The existing infrastructure to handle the increase in exports is still precarious. The country needs to invest more to make this possible. 

We have MOUs signed with Petronas, Galp, Petrochina and CNOOC for this project.

BNamericas: The state energy research company [EPE] predicts that Brazil will reach its peak production in 2029. Petrobras is also planning to expand its refining capacity in the country. Doesn't this affect Vast's plans?

Bomfim: We're working with a projection of export growth until certainly the beginning of the 2030s. Even if refining grows, with RNEST’s train 2 [the second refining train, the construction of which is being contracted by Petrobras], for example, the percentage is small in relation to the increase in production. Regarding the decline in production, some people in the market believe that the projections of a fall are more due to a lack of visibility than an actual decline. 

BNamericas: Vast is also developing a project to install a liquid fuels terminal. Could you talk about it?

Bomfim: In this case, we already have a structuring contract with Vibra Energia, involving base oil for lubricants. We’ll start construction in the second half of the year. In addition to fossil fuel derivatives, we’re focusing on energy transition liquids, such as ammonia, green methanol, biocomponents for marine fuels, biodiesel, ethanol, etc. 

[Editor's note: The contract with Vibra is for 20 years, and the terminal is scheduled to start operating at the end of 2025.] 

BNamericas: Looking to the future, what projects are you considering?

Bomfim: We want to make Açu a one-stop shop. Today we’re focused on these two projects, which are structural and will require enormous growth for the company over at least the next five to seven years. 

Will the Equatorial Margin require export operations? If that happens, of course we'll want to position ourselves there too. But what consumes our energy is here in Açu at the moment.