Oil and gas sector contribution to Brazilian GDP reaches 13%


The oil and natural gas sector’s contribution to Brazilian GDP (Gross Domestic Product, which measures the amount of wealth produced in a country) increased from 3% in 2000 to 12% in 2010 and has attained 13% today. The main driver of this increase is Petrobras, which has an ongoing plan in place to invest US$ 220.6 billion during the period 2014-2018 and is looking to double the current level of oil production by 2020, when it expects to reach 4.2 million barrels of oil a day. This and related information was emphasized during the presentation by Petrobras’ director of Gas and Energy, José Alcides Santoro, at the plenary session entitled "The industry's role in promoting development", which took place this Tuesday (June 17th), at the World Petroleum Congress (WPC), the global oil sector’s largest event, which is being held in Moscow, Russia, on June 15th-19th.

"Several of the country’s development indices have improved over the last decade and the oil and gas sector has played a positive role in this. The human development index, for example, rose from 0.67 in 2000 to 0.73 in 2012. The number of jobs in the sector has certainly also had a positive impact on the decline in the Brazilian unemployment rate, from 9.9% in 2002 to 6.7% in 2012," said the company representative on the panel, which was hosted by Daniel Yergin, a Pulitzer Prize winner and vice-president of international consultants IHS.

As a result of the federal government’s local content policy, the creation of Prominp (National Oil and Gas Sector Mobilization Program) and the alignment of the operators - especially Petrobras – with this policy to encourage local content, the Brazilian shipbuilding industry has enjoyed very rapid growth over the last decade. Petrobras alone will take delivery, by 2020, of 28 drilling rigs, 32 production platforms, 154 large support vessels and 81 tankers, all built in Brazil. He went on to say that, “In 2003, there were only two shipyards in operation and the number of jobs in the sector totaled 7,465. This year, there are ten shipyards in operation, providing 80,000 direct jobs and approximately 320,000 indirect ones. In 2017, the number of direct jobs in Brazil’s shipyards is expected to reach 101,000.

Mr. Santoro added that, “It should be noted that the local content policy that led to this extremely fast growth is not protectionist: there is no reserved market, but merely incentives for the production of equipment to be carried out in Brazil and calling for innovation. One example of these incentives has been through the Prominp training program, which, since 2003, has provided professional qualifications to 97,000 workers and is expected to train over 17,000 more by 2015.” Altogether, there are over 180 professional categories related to the oil and gas sector, with levels ranging from basic and technical to higher education. A total of US$ 133 million has already been invested in the program and another US$ 25 million will be invested over the next year.

Furthermore, the director highlighted the partnership between Petrobras and Sebrae (Brazilian Service for Support to Micro and Small Enterprises), involving investments of US$ 64 million, which has helped to increase the number of small scale suppliers in the Petrobras portfolio, from 14,000 in 2004 (when Prominp set up the project) to 19,000 in 2013. The business generated in more than 120 bidding rounds, carried out between 2005 and 2012, came to a total of US$ 2.75 billion. The director explained that, “The initiative is aimed at developing micro and small enterprises through professional training and qualifications, making use of the best practices, advice and guidance of larger companies”.

The opportunities presented by the country have attracted many foreign companies to Brazil. Many of the sector’s major suppliers have set up here and several of them have built not only manufacturing plants but also technology development centers. Mr. Santoro concluded, “Brazil has become one of the most promising countries in the world for foreign investment by companies seeking to set up an industrial plant in order to supply the oil and natural gas market”.

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