Basic Political Developments
· Brazil will cut spending and raise taxes after lawmakers refused to renew a tax on financial transactions that accounted for about a tenth of government revenue.
· The Brazilian government said Jan. 1 that is regrets the stall in the hostage release plan in Colombia.
National Economic Trends
· Brazil's annual trade surplus narrowed 14 percent in 2007, down to $40.04 billion from $46.46 billion in 2006.
Business, Energy or Environmental regulations or discussions
· Mobile satellite communications firm Globalstar announced Jan. 2 that it has agreed to acquire an independent operator that owns three satellite gateway ground stations in Brazil for $6.5 million.
· According to a Dec. 31 report, Brazilian power holding company CPFL does not rule out new partnerships with Spanish power company Endesa's Brazilian subsidiary Endesa Brasil.
· Marfrig Frigorificos e Comercio de Alimentos, Brazil's third-largest beef exporter, has acquired Argentine meat-based snack firm Mirab for $36 million. The acquisition comes amidst Argentina’s struggle to compete in the beef production sector.
Activity in the Oil and Gas sector (including regulatory)
· Brazilian national development bank BNDES President Luciano Coutinho told the media Jan. 2 that oil and gas investments in Brazil will reach $115 billion in the 2008 to 2011 period.
Petrobras
· Petrobras' Manati MNT-4 well in the Manati field located in a Brazilian offshore area has been tied-in and all six Manati wells are now producing, according to Jan. 2 reports.
· China Development Bank and Chinese oil major Sinopec will be involved in the construction of two sections of a Petrobras natural gas pipeline set to run from Cabiunas to Catu, connecting southeast and northeast Brazil.
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Basic Political Developments
http://www.bloomberg.com/apps/news?pid=20601086&sid=awIwGH5b7fTs&refer=latin_america
Brazil to Cut Spending, Add Taxes to Blunt CPMF Loss (Update1)
Jan. 2 (Bloomberg) -- Brazil will cut spending and raise taxes after lawmakers last month refused to renew a levy on financial transactions that accounted for about a tenth of government revenue.
New taxes, spending controls and increased revenue because of an accelerating economy this year will total about 40 billion reais ($22.7 billion), fully compensating for the loss of the tax on financial transactions, Finance Minister Guido Mantega and Budget Minister Paulo Bernardo said today.
Brazil needed to cut spending and raise taxes to prevent the country's budget deficit from widening and forcing the government of President Luiz Inacio Lula da Silva to borrow more. The failure to renew the tax, known by its Portuguese acronym as the CPMF, threatened to stymie Brazil's efforts to win an investment-grade credit rating for its sovereign debt.
``We have to restore this loss,'' Bernardo told reporters in Brasilia. ``That's why we are seeking more revenue, on one hand, and on the other, we will cut spending.''
Brazil will trim outlays by 20 billion reais, Mantega said. At the same time, a tax on financial operations, mainly bank lending, will be increased by 0.38 percentage point, and a tax on profits by financial institutions will rise to 15 percent from 9 percent, he said.
The measures ``can make credit a bit more expensive in Brazil, but we expect credit to continue to grow,'' Mantega said.
The higher taxes will add 10 billion reais in revenue, Mantega said. Another 10 billion reais will come from acceleration in economic growth that boosts tax collection, he said.
The CPMF tax that Senators voted down had been in place since 1996 and imposed a 0.38 percent levy on all financial transactions such as bank withdrawals or transfers. The government championed the tax because it helped combat evasion, while industry groups, such as Sao Paulo's Commerce Federation, opposed it, saying it raised production costs and expenses.
http://news.xinhuanet.com/english/2008-01/02/content_7351575.htm
Brazil expresses regret over delayed hostage release in Colombia
BRASILIA, Jan. 1 (Xinhua) -- The Brazilian government on Tuesday expressed its regret over the delay of the release of three hostages by the Colombia's Revolutionary Armed Forces (FARC) rebel group.
The Ministry of Foreign Affairs said in a statement it sympathizes with the families of the hostages, Consuelo Gonzalez, Clara Rojas and her four-year-old son Emmanuel, whose release was stalled on Monday.
The FARC on Monday announced the delay of the handover of the three hostages, claiming that the Colombian government's military activity had made it impossible to safely release the captives.
A new date for the release was not announced.
An international mission was poised to collect the three by helicopters somewhere in the Colombian jungle and transfer them to Venezuela.
The Brazilian government reiterated its support to the efforts by Venezuelan President Hugo Chavez to rescue the hostages and the operation by international delegates.
Involved in the mission were delegates from France, Switzerland, Cuba, Brazil, Ecuador, Bolivia and Argentina, including former Argentine President Nestor Kirchner, as well as representatives from the International Red Cross.
Gonzalez, a former lawmaker, was kidnapped in 2001 and Rojas was abducted during her 2002 vice presidential campaign.
Earlier this month, the FARC, Colombia's largest rebel group, promised to hand over the three hostages to President Chavez. Last Friday, the Venezuelan president sent two helicopters deep into Colombia to collect them.
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National Economic Trends
http://www.bloomberg.com/apps/news?pid=20601086&sid=aYrMMgk2dqxw&refer=latin_america
Brazil 2007 Surplus Narrows to $40 Billion on Imports (Update1)
Jan. 2 (Bloomberg) -- Brazil's annual trade surplus narrowed 14 percent in 2007 as a cheaper dollar spurred a surge in imports.
The surplus narrowed to $40.04 billion from $46.46 billion in 2006 as imports surged 32 percent to a record, the Trade Ministry said in a report released today on its Web Site.
Brazil's imports have almost tripled since President Luiz Inacio Lula da Silva took office in 2003 as lower domestic borrowing costs have encourage consumers to step up purchases of overseas goods made cheaper by the currency's appreciation. The real has almost doubled against the dollar since 2002, the best performance of the 16 major currencies tracked by Bloomberg.
``Imports are rising even more than exports because of economic growth,'' Maristella Ansanelli, chief economist for Banco Fibra SA in Sao Paulo, said in a phone interview. ``This trend will likely persist next year.''
Imports rose $120.6 billion last year from $91.4 billion in 2006, while exports rose 17 percent to a record $160.6 billion, from $137.8 billion in the previous year, the ministry said.
Ansanelli expects the trade surplus to narrow further to about $30 billion in 2008.
``This isn't a negative sign at all,'' said Ansanelli. ``It's just that imports are feeding the economic growth. But exports remain strong as well.''
The December trade surplus was $3.64 billion, 28 percent higher than the same month a year ago. Imports in December expanded 47 percent to $10.6 billion, while exports grew 16 percent to $14.2 billion.
The real increased 0.4 percent to 1.7735 per dollar at 8 a.m. New York time.
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Business, Energy or Environmental regulations or discussions
http://www.forbes.com/feeds/ap/2008/01/02/ap4486683.html
Globalstar in $6.5M Brazil Operator Buy
Associated Press 01.02.08, 11:58 AM ET
MILPITAS, Calif. -
Globalstar Inc., a provider of mobile satellite communications, on Wednesday said it agreed to acquire an independent operator that owns three satellite gateway ground stations in Brazil for $6.5 million.
The purchase will be paid for primarily in common stock, Globalstar said.
The deal with Loral Space & Communications Inc. and affiliated entities requires the approval of the Brazilian telecommunications agency. The deal also depends on a registration statement for the shares issued in the deal being declared effective by the Securities and Exchange Commission.
A Globalstar subsidiary will own and operate the Brazilian gateways, which will help the company supply mobile satellite voice and data services to all of Brazil and areas off the country's east coast.
Shares of Globalstar added a penny to $8.01 in midday trading.
http://bnamericas.com/news/electricpower/Exec:_CPFL_could_team_with_Endesa_on_future_projects
CPFL could team with Endesa on future projects - Brazil
Published: Monday, December 31, 2007 11:53 (GMT -0400)
Brazilian power holding company CPFL (NYSE: CPL) does not rule out new partnerships with Spanish power company Endesa's Brazilian subsidiary Endesa Brasil, Antônio Filippo, CPFL VP of finance and investor relations, told analysts.
"Endesa and CPFL got closer when both companies joined forces in a consortium to bid for the [3.15GW] Santo Antônio hydro plant. We had a good interaction and despite there being no formal commitment to work together on future projects, the doors are definitely open," Filippo said during a meeting with analysts in Rio de Janeiro.
CPFL had a 25.05% stake in the Empresas Investimentos de Santo Antônio consortium that competed in the Santo Antônio auction on December 10. The consortium also included engineering firm Camargo Corrêa (0.9%), federal power company Chesf (49%) and Endesa Brasil (25.05%).
Rival consortium Madeira Energia presented the winning bid to build and operate Santo Antônio on the Madeira river in the Amazon region.
At the same meeting, the CPFL executive confirmed the company was interested in participating in the 2008 auction to build and develop the 3.3GW Jirau hydro plant on the Madeira river, Filippo said.
http://www.cattlenetwork.com/content.asp?contentid=187037
Brazil Beef Co Marfrig Acquires Argentina's Mirab For $36M
SAO PAULO (Dow Jones)--Brazil's third-largest beef exporter, Marfrig Frigorificos e Comercio de Alimentos SA (MRFG3.BR), has acquired Argentina's Mirab SA for $36 million, Marfrig said Wednesday in a statement. Mirab, Argentina's leading producer of meat-based snacks, including beef jerky, exports its products to the U.S., Japan and the U.K.
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Activity in the Oil and Gas sector (including regulatory)
http://www.energycurrent.com/index.php?id=4&storyid=7832
BNDES sees oil, gas investments of US$115 billionFiled from Houston
1/2/2008 6:24:33 PM GMT
BRAZIL: BNamericas reported that oil and gas investments in Brazil will reach US$115 billion in the 2008 to 2011 period, national development bank BNDES President Luciano Coutinho told reporters. "Investments in the sector will increase 10 percent a year in the 2008-11 period, which is a very meaningful volume," Coutinho said. Brazil's federal energy company Petrobras will be responsible for investing most of this, the executive said.
In previous research on the 2007 to 2010 period, the bank estimated investments in the oil and gas sector at US$104 billion, Coutinho said. "This increase does not necessarily mean oil and gas production capacity is growing in Brazil. Part of this is related to cost increases seen in this particular industry," the BNDES president said.
Investments in the sugar and ethanol sector in Brazil will reach US$11.5 billion in 2008 to 2011, growing nine percent a year over the period, Coutinho said. "This growth will be basically fueled by the domestic market. However, in the long term, an increase in investments in sugar and ethanol production for export can be expected."
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Petrobras
http://www.energycurrent.com/index.php?id=2&storyid=7826
Another Manati well flows for PetrobrasFiled from Houston
1/2/2008 4:30:14 PM GMT
BRAZIL: Petrobras' Manati MNT-4 well on the Manati field offshore Brazil has been tied-in and all six wells are now producing. Production is scheduled to adjust in accordance with market demand, but production in the fourth quarter is currently estimated to average about 166 MMcf/d. The last recorded production volume prior to MNT-4 coming online was 205 MMcf/d.
Manati is located on Block BCAM-40 in the Camamu Basin off the coast of Brazil. Petrobras operates the block with 35 percent interest. The partners are comprised of Queiroz Galvão Oleo e Gas S.A. with 55 percent interest and Norway-based Norse Energy ASA with 10 percent interest.
http://www.macauhub.com.mo/en/news.php?ID=4617
Brazil: China’s BDC and Sinopec involved in building of gas pipeline [ 2008-01-02 ]
Brasilia, Brazil, 2 Jan - Petrobras subsidiary Transportadora Gasene has obtained a US$ 4.51 billion reais loan with Brazilian federal development bank BNDES to build a gas pipeline connecting southeast and northeast Brazil, the bank announced last Thursday.
The total loan granted to Transportadora Gasene is equivalent to US$ 2.25 billion, some US$ 750 million of which will come from the China Development Bank, which has signed an accord to provide the loan through BNDES.
The Gasene project is strategic to ensure supplies of natural gas to networks in southeast Brazil from gas fields in the Espirito Santo basin.
The pipelines will total 1,400 kilometers in length and have an installed capacity of 20 million cubic meters daily, linking the Cabiunas terminal, in Rio de Janeiro state, to the city of Catu in Bahia state.
The project involves the building of the following stretches: Cabiunas-Vitoria, due for completion in 2008; Vitoria-Cacimbas, which began operating in November; and the Cacimbas-Catu pipeline, around 940 kilometers long and whose construction will start in the first quarter of 2008.
Petrobras has contracted China’s Sinopec to construct the Cabiunas-Vitoria and Cacimbas-Catu pipeline sections. (macauhub)