IBP1110_19

THE RELEVANCE OF FUEL TRANSMISSION PIPELINES IN

BRAZIL
Vitor Manuel E. S. Silva¹,
Carlos Augusto G. Pacheco2, Marcelo C. B. Cavalcanti3,
Patricia F. B. Stelling4, Marcos Frederico. F. Souza5

Copyright 2019, Brazilian Petroleum, Gas and Biofuels Institute - IBP

This Technical Paper was prepared for presentation at the Rio Pipeline Conference and Exhibition 2019, held
between 03 and 05 of September, in Rio de Janeiro. This Technical Paper was selected for presentation by the
Technical Committee of the event according to the information contained in the final paper submitted by the
author(s). The organizers are not supposed to translate or correct the submitted papers. The material as it is
presented, does not necessarily represent Brazilian Petroleum, Gas and Biofuels Institute’ opinion, or that of its
Members or Representatives. Authors consent to the publication of this Technical Paper in the Rio Pipeline
Conference and Exhibition 2019.

Abstract

This paper provides an analysis of current transmission pipelines in Brazil, analyzing

parameters such as volume of cargoes, pipeline takeaway capacity, and forecasts for gasoline
and diesel fuel demand. In addition, this study will be contextualized within a national energy
planning, related to the analysis of the importance of the expansion of pipeline infrastructure
for the transportation of liquid or liquefied fuels, in line with economic aspects associated to
the guarantee of fuel supply.

Keywords: oil pipelines, gasoline, diesel; fuel supply

1. Introduction

The high share of energy demand of road transportation sector in the final energy
consumption in Brazil in 2018 (32%) shows the importance of fuels - in particular, gasoline
and diesel, in the composition of the national energy matrix (EPE, 2019). Aspects related to
the supply of these products can greatly affect the performance of the country's commercial
activities, with repercussions on logistics infrastructure, economy and environmental issues.
The transport sector led the advance of energy demand in 2017, expanding by 1.9 million toe
(EPE, 2018), mainly due to the 2.7% increase in diesel consumption owing to the higher
cargo transport activity. For the light-duty vehicle market, there was a 0.5% increase in the
production of automotive gasoline, while consumption of this fuel expanded at a rate of 2.6%
(EPE, 2018).
In 2018, the domestic fuel market remained practically stable, with an increase in sales of
0.3% compared to the previous year. The figures were slightly below GDP growth of 1.1%
(with retraction in the energy consumption of the transport sector by 0.8%). The truck drivers'
strike, which occurred in May 2018, contributed to a reduction in the demand for fuels - in
particular, gasoline and diesel, which showed reductions in demand of 13% and 1%,
respectively. The total share of these two fuels was 69% higher in the energy consumption of
the transport sector, according to Figure 1.

______________________________
1
Specialist, Chemist, Energy Research Analyst - EPE
2
MSc, Economist, Energy Research Analyst - EPE
3
PhD, Economist, Deputy Head of Oil Department - EPE
4
Post graduated, Chemical Engineer, Technical Advisor - EPE
5
MSc, Mathematician, Head of Oil Department - EPE
 Rio Pipeline Conference and Exhibition 2019

Natural gas Others

Biodiesel
2.3% 1.0%
Jet fuel 4.4%
4.0%
Diesel fuel
Ethanol 43.6%
18.8%

83.7 million tep

Gasoline
25.8%
Figure 1. Energy consumption in the transport sector - 2018
Source: EPE (2019)

Due to the lack of gasoline and diesel supplies at that time, the demand for supply alternatives
increased, especially the vehicle demand for compressed natural gas (CNG) in locations that
have gas pipelines networks, with expansion of 12.2% compared to 2017 (EPE, 2019), the
largest non-mandatory fuel growth in the transport sector1.

2. The Brazilian gasoline and diesel market

The supply of gasoline and diesel oil in Brazil comes from local production (refineries,
petrochemical plants and formulators) and import. The Brazilian refining complex is
composed of 17 refineries, with a processing capacity of approximately 2.3 million barrels per
day (b/d). Currently, Petrobras holds 98% of the national refining processing capacity (EPE,
2018).
In 2018, 42 million m³ of diesel oil (115 thousand m³/day) was produced - a volume 3%
higher than the production of the previous year. Gasoline production was around
25 million m³ (69,000 m³/day), a decrease of 9% compared to 2017. Import volumes for both
fuels decreased in 2018. Diesel reached a mark of 12 million m³ (32 thousand m³/day) and
gasoline of 3 million m³ (8 thousand m³/day). Figure 2 shows the production and import
history for gasoline and diesel.
150 Gasoline import Diesel import Gasoline production Diesel production
Thousand m³/ d

125
100
75
50
25
-
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Figure 2. National production and import of gasoline and diesel fuel
Source: ANP (2019)

1
Throughout 2018, the mandatory increase of the biodiesel content to 10% in the blend that makes up the
commercialized diesel resulted in an increase in biodiesel consumption by 26%.

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The production of diesel registered in 2018 was 42 million m³ (115 thousand m³/day), volume
3% higher than the production of the previous year. Gasoline production was around
25 million m³ (69,000 m³/day), a decrease of 9% compared to 2017. Import volumes for both
fuels decreased in 2018. Imports reached 12 million m³ (32 thousand m³/day) for diesel and
3 million m³ (8 thousand m³/day) for gasoline.
The Ten-Year Energy Expansion Plan 2027 (EPE, 2018) indicates that, due to the little
increase in the processing capacity of the Brazilian refinery, the national production of
gasoline and diesel will present slight variations in the period. The start-up of the second train
at the Abreu e Lima Refinery (RNEST) in 2024 would increase the production of some oil
products, in particular, diesel.
The national gasoline and diesel oil balance (supply x demand), in Figure 3, shows that Brazil
will remain an importer throughout the analyzed horizon.

Figure 3. National Gasoline and Diesel Oil Balance

Source: EPE (2018)

The Energy Research Office (EPE, 2018) estimated a need to import 9 thousand m³/day of
gasoline and 36 thousand m³/day of diesel in 2027.

3. The relevance of the pipeline mode in the national supply of gasoline and diesel oil
Considering the aspects of the gasoline and diesel fuel market, as well as its importance in the
national energy matrix, it becomes relevant to discuss the various aspects related to the supply
of these fuels in Brazil. From the sources of supply (local production and import), gasoline
and diesel are transferred to terminals and distribution bases, by means of several modes of
transport: pipelines, waterways (coastal shipping, or cabotage), railways and road transport.
It should be emphasized that an efficient logistics consists in taking to the consumer the
largest volume of goods, with the least time and cost. In the international oil industry,
pipelines are strategic in several stages of the logistics chain, given its competitiveness, and
due to factors such as transportation capacity, operational costs, autonomy, reliability and
safety. In addition, an oil pipeline has economic and environmental benefits, as it reduces
logistical costs throughout the process, as well as offering an alternative of transportation that
provides a significant reduction in the emission of pollutants, and contributes to mitigating the
impact of road traffic, especially in large urban centers.

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Despite having continental dimensions, Brazil does not have a pipeline network that is
consistent with its territorial extension. The existing infrastructure has high importance to
guarantee the national supply of these oil products. However, it presents bottlenecks in
logistics infrastructure that need to be addressed.
In 2017, Brazil had 618 pipelines destined to the movement of crude, oil products, natural gas
and other products, totaling 19.7 thousand km (ANP, 2018). Of these, 151 pipelines
(14.3 thousand km) were destined for transmission2 and 467 (5.4 thousand km) to the
gathering / transfer3, as presented in Table 1.
Table 1. Quantity and length of pipelines in operation, by function, according to products
Operational pipelines
Products
Function Quantity Length (km)
Transfer 337 1.180
Clear Products
Transmission 98 4.794
Gathering/Transfer 62 2.246
Natural Gas
Transmission 48 9.486
Oil Gathering/Transfer 32 1.985
Gathering/Transfer 36 37
Others¹
Transmission 5 40
Total 618 19.768
¹ Includes pipelines for handling anhydrous alcohol, hydrated alcohol, turpentine and methanol, ethane and propane for
petrochemicals, pyrolysis gasoline and propylene for the petrochemical industry.
Source: ANP (2018).

The number of pipelines dedicated to oil products (gathering/transfer and transmission)

represents 70% of the total in operation (corresponding to 30% of the total extension) (ANP,
2018).
Transpetro, Petrobras’ logistic arm, operates almost 100% of pipeline network related to the
movement of oil and refined products. In 2018, 564 million m³ of oil and his byproducts were
transported in its terminals and pipelines, 1.4% lower than the total registered in 2017
(TRANSPETRO, 2019). This result was attributed to the reduction of cargoes processed at
the refineries, mainly due to an operational occurrence at the Paulínia Refinery (Replan), in
August 2018. In its 2019-2023 Business and Management Plan, Transpetro projects for the
year 2023 a total liquid handling of 612 million m³ in pipelines and terminals operated by the
company, with 263 million m³ related to oil products (TRANSPETRO, 2018).
The largest pipeline extension are concentrated in the Southeast and South regions, where
most of the refineries are located. Specifically, the pipeline network of the State of São Paulo
is complex, since it interconnects several terminals, refineries and distribution bases. Among
the refineries located in this state, the Paulínia Refinery (Replan)4 stands out, from where the
largest pipeline in Brazil (the São Paulo-Brasília Pipeline - Osbra, with 964 km) originates.
Table 2 presents the main transmission pipelines of oil products in Brazil and their
characteristics.

2
Transmission pipelines are those that move oil, oil products and biofuels in a course/route considered of
general interest (ANP, 2018).
3
The gathering/transfer pipelines are those in which the movement of petroleum, its products and biofuels
occurs in a route considered to be of specific and exclusive interest to the owner or operator of the facilities,
according to Law n.º 9,478/1997 (Article 6, subsections VII and VIII). Transfer pipelines may be reclassified by
the National Agency of Petroleum, Natural Gas and Biofuels (ANP) in transmission pipelines, if there is proven
interest of third parties in its use (Law nº 9.478/1997, article 59) (ANP, 2018).
4
Replan refinery has a throughput of 66,000 m³/day, equivalent to 415,000 barrels. Its production corresponds to
20% of all of the oil refining in Brazil, processing approximately 80% of the domestic oil, most of which coming
from the Campos Basin.
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Table 2. Oil products transmission pipelines

Total
Diameter Max. capacity
Pipeline Origin State Destination State lenght
[inches] [m³/day]
[km]
Osplan Replan SP Guararema SP 153 18 17.612
Osplan São Sebastião SP Guararema SP 80 24 26.217
Osplan Guararema SP Replan SP 153 24 29.394
Osbra Replan SP Brasília DF 962 20/12 30.693
Osrio Guararema SP Reduc RJ 372 16 10.800
Orbel Regap MG Campos Elíseos RJ 364 18 7.200
Osvol Japeri RJ Volta Redonda RJ 58 10 4.800
Orsub Temadre BA Ipiaú BA 225 10 5.280
Orsub Ipiaú BA Jequié BA 75 8 3.600
Orsub Ipiaú BA Itabuna BA 94 8 3.600
Olapa Repar PR Paranaguá PR 93 12 10.800
Opasc Repar PR Itajaí SC 200 10 7.787
Opasc Itajaí SC Florianópolis SC 66 8 3.085
Oscan Osório RS Refap RS 98 16 12.000
Source: Transpetro (2019).

Figure 4 shows the history of total movement of oil products in transmission pipelines
(previously described in Table 2), as well as the volumes of gasoline and diesel. The peak in
transportation occurred in 2013 (29 million m³)5. As of 2015, there was a decrease influenced
by the economic crisis.
35

30 29
28 27 28 28
24 24
25 25 24 25
25 23
23
22 22 21 21
20
20 19
16 16
14 15 15 15 14
Millions m³

15 12 12 12 12
11 11 10
10 11 11 10
11
10 8 7 8 7 8
7 7 8
5 6 5 6 6
5 5 4 5
4 4
5

Total movement of oil products Gasoline Diesel fuel

Figure 4. Transport of oil products by major pipelines (2000-2018)

Source: Transpetro (2019).

Gasoline and diesel have a relevant participation in pipeline activities, since they are the most
consumed in the Brazilian oil products market, with concentration on the coast and the
Southeast and South regions of the country. Table 3 shows the volume of gasoline and diesel
transported in the main pipelines and the percentage of participation of these fuels in relation
to the total carried.

5
In addition to gasoline and diesel, pipelines carry naphtha, kerosene, liquefied petroleum gas (LPG), ethanol
and other intermediate petroleum fractions.
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Table 3. Transmission of gasoline and diesel by pipeline in 2018

2018
Total
Total Gasoline Diesel Fuel
Pipeline (gasoline + diesel)
m³/day m³/day % m³/day %
Osplan 18 9,180 1,678 18 2,364 26 44%
Osplan 24a 19,506 4,249 22 8,263 42 64%
Osplan 24b 4,555 872 19 3,583 79 98%
Osbra 20/12 15,331 6,267 41 9,064 59 100%
Osrio 16 5,685 1,937 34 918 16 50%
Orbel 18 1,167 809 69 357 31 100%
Osvol 10 248 117 47 114 46 93%
Orsub 10 2,566 897 35 1,117 44 79%
Orsub 8c 1,402 377 27 658 47 74%
Orsub 8d 1,094 450 41 459 42 88%
Olapa 12 5,468 1,139 21 3,437 63 84%
Opasc 10 6,287 3,615 57 1,686 27 84%
Opasc 8 985 581 59 194 20 79%
Oscan 16 1,458 - - 1,362 93 93%
a b c d
São Sebastião-Guararema Guararema-Replan Ipiaú-Jequié Ipiaú-Itabuna
Source: Transpetro (2019).

The pipeline system in the Southeast Region6 moved 56,000 m³/day of gasoline and
127,000 m³/day of diesel in 2018. Of particular note is the pipeline Osplan 24, which
internalizes by cabotage or import (São Sebastião Waterway Terminal)7, contributing to the
local supply and to the Midwest Region. The Osbra oil pipeline has a fundamental role to
meet demand from the cities of Ribeirão Preto (SP), Uberaba/Uberlândia (MG) and Senador
Canedo/Brasília (Midwest Region). In the Northeastern Region, the Bahia Recôncavo-Sul
Pipeline (Orsub) mainly moves gasoline and diesel fuel to the land terminals of southern
Bahia (Itabuna and Jequié terminals).
In the Southern Region, specifically in Paraná, the Araucária-Paranaguá Oil Pipeline (Olapa)
connects the Presidente Getúlio Vargas Refinery (Repar) to the Paranaguá Waterway
Terminal, issuing and internalizing clear products (bidirectional pipeline). The Paraná-Santa
Catarina Oil Pipeline (Opasc) guarantees the supply of the State of Santa Catarina, connecting
Repar to the onshore terminals located in Itajaí and Biguaçu (Florianópolis/SC). In Rio
Grande do Sul, the Oscan pipeline connects the Osório Waterway Terminal (Tramandaí) with
Refap (Canoas/RS), internalizing oil and clear products, in particular diesel fuel, to supply
local demand. For most of these pipelines, gasoline and diesel make up all the products
handled.
Based on the data of Tables 2 and 3, and considering the total volume ratio over maximum
capacity, one can infer the degree of pipeline takeaway capacity, according to Figure 5.

6
Considering only the pipelines of Table 3.
7
São Sebastião receives oil from oil tankers and supplies four refineries in the state of São Paulo over oil the São
Sebastião-Guararema and Santos-São Sebastião oil pipelines. The oil products move in/out the terminal by the
Guararema-Paulínia oil pipeline.

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Oscan 16 12%
Opasc 8 32%
Opasc 10 81%
Olapa 12 51%
Orsub 8d 30%
Orsub 8c 39%
Orsub 10 49%
Osvol 10 5%
Orbel 18 16%
Osrio 16 53%
Osbra 20/12 50%
Osplan 24b 15%
Osplan 24a 74%
Osplan 18 52%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
a b
São Sebastião-Guararema Guararema-Replan c Ipiaú-Jequié d
Ipiaú-Itabuna

Figure 5. Degree of pipeline takeaway capacity of the main transmission oil pipelines in 2018
Source: Transpetro (2019).

The national oil pipelines with the highest degrees of saturation are Opasc 10 (Repar - Itajaí
onshore Terminal) and Osplan 24 (São Sebastião Water Terminal - Guararema onshore
Terminal).The Opasc 10 pipeline shows a pipeline takeaway capacity of 81% and the Osplan
24 duct 74%. Given a more optimistic economic scenario for the country, the increase in
demand for oil products could cause growth in volume, resulting in outpacing of pipeline
takeaway capacity to bring the oil byproducts to market and, consequently, creating logistical
bottlenecks in the supply chain.

4. The impact of variations in the demand for oil products in the pipeline transportation
Oil products will still have significant relevance in the decade, in spite of the fact that it shows
a decreasing participation in the final energy consumption matrix (EPE, 2018). The diesel fuel
is the main source used to transport heavy loads in Brazil. Although its potential consumption
is reduced with the possibility of increasing the share of biodiesel in marketed diesel, it gains
importance among oil products, with an average annual growth of 1.6%. On the other hand,
gasoline presents a reduction of importance among fuels, partly due to the greater
participation of ethanol in the supply of light-duty vehicle demand, concomitant to an increase
of energy efficiency (EPE, 2018).
Taking into account the supply of fuels, projected demand and the national infrastructure for
the transportation of oil products, interregional movements and imports will be necessary to
complement the production of the Brazilian deficit regions in 2017, as shown in Figure 6.

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60%
50%
40%
24%
20% 15%

0% North Northeast South Midwest

Southeast
-20%
-16%
-40% -34%
-46%
-60%

-80%
-78%
-100%
-97% -100% -100%
-120%
Gasoline Diesel fuel

Figure 6. Balance in the regional supply of gasoline and diesel fuel in 2027
Source: EPE (2018)

The North and South regions are not able to supply the total demand for gasoline and diesel
fuel in 2027. The Southeast Region is the only one that does not present a deficit, managing to
supply the other regions, mainly the Midwest Region (where there is no production). The
Northeastern Region presents a higher demand than the gasoline supply, but it has a surplus in
diesel, contributing to the fuel demand of the North Region8.
According to the EPE (2018), some transmission pipelines are close to full capacity in the
analyzed horizon. Figure 7 highlights the situation of Opasc duct (Araucária / PR - Itajaí / SC)
and Osbra duct (Replan / SP - Brasília / DF).

8
To a large extent, to ensure that demand is met, interregional movements require the use of waterway transport
(coastal shipping and long haul) and pipeline.

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Figure 7. Transmission pipelines with possibility of full takeaway capacity in 2027

Source: EPE (2018)

Only the first stretch of the Opasc (200km; 10 inches) seems to be near a full takeaway
capacity. The Osbra sends oil products to the cities of Southeast and Midwest Regions and
present a full capacity operation all over it. The Osplan, Olapa and Orsub keep the same level
of movement observed previously.

5. Conclusions and next steps

Gasoline and diesel fuel are the oil products that have the largest share of Brazilian pipeline
transportation. The pipeline network is of great importance to guarantee the national supply,
allowing interregional movements and imports to complement the production of the deficit
Brazilian regions. However, there are still bottlenecks in logistics infrastructure that need to
be addressed. The prospect of growth in the demand for oil products, causing an increase in

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the volume of liquids moved by pipelines, could aggravate the saturation situation and,
consequently, jeopardize the security of the national energy supply.
However, in this scenario, there are also opportunities for investment in infrastructure. To a
large extent, since the largest single share of logistics costs is represented by the transport of
fuels, the development of pipeline infrastructure for fuel transportation could contribute to
minimizing the total costs involved to meet future demand under appropriate pricing and
quality conditions, in a clear regulatory environment favorable to investments aligned with the
perspective of safeguarding energy security for Brazil.
Emphasis is placed on the relevance of a more balanced liquid fuel transportation matrix, with
more significant participation of pipelines, as well as the challenges in increasing efficiency in
the country's oil products logistics. The limited Brazilian pipeline infrastructure requires
investments in order to provide an improvement in the security of the national supply of fuels.
The development of studies on the design of the transportation pipeline structure (including
pipelines and terminals) for the transportation of oil, byproducts and biofuels is important to
stimulate the growing competitiveness in the fuel markets, against the new role of Petrobras,
while also providing support for the expansion of the domestic refining industry.
Finally, it should be pointed out that the EPE is developing tools to support the elaboration of
the Oil Pipelines Plan (Plano Indicativo de Oleodutos – PIO), and that the Abastece Brasil
government program (launched in April 2019) has a subcommittee dedicated to promoting the
development of infrastructures, including oil pipelines.

6. References
ANP. AGÊNCIA NACIONAL DO PETRÓLEO, GÁS NATURAL E BIOCOMBUSTÍVEIS, (2018).
Anuário Estatístico Brasileiro do Petróleo, Gás Natural e Biocombustíveis 2018. Available
at: <http://www.anp.gov.br/publicacoes/anuario-estatistico/anuario-estatistico-2018>.
______. ______, (2019). Dados Estatísticos. Available at: <http://www.anp.gov.br/dados-
estatisticos>.
EPE. EMPRESA DE PESQUISA ENERGÉTICA, (2018). Balanço Energético Nacional 2018: ano
base 2017. Empresa de Pesquisa Energética. Rio de Janeiro. Available at:
<http://epe.gov.br/pt/publicacoes-dados-abertos/publicacoes/balanco-energetico-nacional-
2018>.
______. ______, (2018). Plano Decenal de Expansão de Energia 2027. Empresa de Pesquisa
Energética. Available at: <http://www.epe.gov.br/pt/publicacoes-dados-
abertos/publicacoes/plano-decenal-de-expansao-de-energia-2027>.
______. ______, (2019). Matriz Energética Nacional 2019. Balanço Energético Nacional
2019. EPE. Available at: <http://epe.gov.br/pt/publicacoes-dados-
abertos/publicacoes/balanco-energetico-nacional-2019>.
PLURAL. ASSOCIAÇÃO NACIONAL DAS DISTRIBUIDORAS DE COMBUSTÍVEIS, LUBRIFICANTES,
LOGÍSTICA E CONVENIÊNCIA, (2019). Anuário Plural 2019. Combustíveis. Available at:
<https://anuario2019.somosplural.com.br>.
TRANSPETRO. PETROBRAS TRANSPORTE S.A., (2018). Relatório Anual Integrado-
Transpetro 2018. Available at: <http://www.transpetro.com.br/pt_br/acesso-a-
informacao/institucional/relatorios.html>.
______. ______, (2019). Informações em atendimento à ANP. Dutos e Terminais.
Capacidades, Disponibilidades e Histórico de Movimentações. Dutos Longos. Available
at: <http://www.transpetro.com.br/pt_br/fale-conosco/canal-do-cliente/informacoes-em-
atendimento-a-anp/terminais-e-oleodutos.html>.

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