Lula inaugurates work on Brazil's biggest ethanol pipeline

Sao Paulo, Agency
President Luiz Inacio Lula da Silva inaugurated construction Tuesday of what will be Brazil's biggest pipeline for ethanol.

Lula, a former metalworker, soldered the first pipe joint of the 202-kilometer (126-mile) pipeline, which will be finished in mid-2014 with a capacity for transporting 21 billion liters (5.5 billion gallons) of ethanol per year.

The first phase of the project will start operations in 2012, according to the government.

In Riberao Preto, an agribusiness city 313 kilometers (194 miles) from Sao Paulo, Lula gave an accounting of the progress made in the ethanol industry since he took office in January 2003, during which time Brazil reached its highest production and export volumes of the sugar-based fuel.

"I managed to sell the idea that humanizing the work in the sugarcane fields was important for selling ethanol to other countries," the president said.

Gasoline in Brazil is mixed with 25 percent ethanol, and more than 90 percent of automobiles leave the factory with flex-fuel technology incorporated, which permits motors to run on either of the two fuels or a combination of both.

Once complete, the pipeline will replace daily delivery runs by 1,500 tanker trucks.

At present, 95 percent of ethanol transport is done by tanker trucks.

The construction initiated Tuesday is the first part of a project to transport the ethanol produced in the interior states of Goias and Mato Grosso do Sul to the refineries of Sao Paulo, a distance of 850 kilometers (530 miles) covered by pipelines and riverboats.

In 2013 the riverboat segment will begin operations on the Tiete and Parana rivers, with vessels capable of transporting 7,200 cubic meters (254,000 cubic feet) of ethanol, according to Transpetro, a subsidiary of state energy giant Petrobras.

The system, with investments estimated at $5.7 billion reais ($3.28 billion), will be integrated with existing pipelines in the coastal region of Sao Paulo and will facilitate ethanol exports through the port of Santos.