That Pão de Açucar is left in the dark at night spotlights no longer illuminating the sugar loaf landmark in Rio de Janeiro is a visible sign of Brazils power challenge.

Recognising the need to reduce its reliance on hydropower, the government has turned to thermoelectric power plants fuelled by natural gas. Predictions foresee an increase in the natural gas share of the energy matrix from the current 3% to 12% by 2010. To the major oil and gas logistic company in Brazil, this is a major challenge.

Says Victor Celso Ferreira Ielo, Transpetros general manager of gas pipelines, We are aiming to rapidly double the gas we transport. Today we handle 20 million cubic metres a day. In the next two years, we are preparing to handle 30 million cubic metres a day, and more than 40 million per day in 2005.

Improvements are being made to Transpetros present 3,000 km gas network. Expansion of the grid includes a new line between Sao Paulo and Rio de Janeiro, a new grid in the Northeast, and an interconnection between the two. New compression stations are also to be installed in the existing pipeline networks.

Energy turnround
Internationally, the big oil companies are transforming into energy companies. For Ielo this is a positive move. You must move away from the old rules; the major oil companies are becoming energy companies. They have to look at alternative sources of energy. For Transpetro this is the best thing that could happen. Gas was normally considered secondary. Oil always came first. When Petrobras made the decision to become an energy company, gas was lifted to an equal first place with other energy sources.

Service provider
Transpetro is the direct result of the 1997 Brazilian Petroleum Act that opened the market to foreign companies. Complying with the deregulation laws, Petrobras established the subsidiary Petrobras Transporte S.A (Transpetro) in 1998. The logistics company took over Petrobras Fronape ship management in January 2000, and the pipelines and terminals later the same year. It handles the transport and storage of bulk, crude, by-products and gas through pipelines, terminals and vessels of its own and third parties, plus construction and administration of new pipelines, ships and terminals.

Says Ielo, We have changed from a product-selling company to a service provider. A change in mindset has been important. Transpetro was born as a Petrobras company, but we are not restricted to work for Petrobras. When competitors are ready to transport their products, they can purchase capacity on Transpetros infrastructure.

Ensuring excellence
Ielo manages Transpetros gas pipeline grid. Together with the oil pipelines, Transpetro operates a 12,075 km network. Spread across 8.5 million square miles, a centralised safety approach makes perfect sense.

Petrobras as a whole has established a US$1 billion safety programme called PEGASO, ensuring excellence in health, safety and the environment. PEGASO has a three-pronged approach, addressing hardware, procedures and human factors.

Transpetro is spending millions of dollars detecting possible leakages, weaknesses in the systems and other hazards. Says Ielo, We have made a major change in our supervisory system. Information from all the pipelines is fed to a central system, giving us an overview of all pipelines in Brazil.

Ielo is referring to the newly inaugurated Operational Control Centre (COO) that centralises Transpetros domestic network for oil and gas transport. The COO, whose basic concept was created entirely by Transpetro engineering, has two independent systems: the oil pipelines (petroleum and derivatives) and gas pipelines (natural gas). To check up on the gas flow the quantity, quality or delivery Ielo gets on the elevator in the Transpetro headquarters located in downtown Rio de Janeiro, stepping off at the 8th floor.

Here in the COO, operators at large computer consoles monitor all Transpetro-operated oil and gas pipelines, with the exception of supply lines belonging to third parties and ship loading and unloading lines at port terminals.

Explains Ielo, The system enables operators to open and close the valves controlling the flow of gas, adjust the quality and content of the gas, and conduct sales at the other end all by the click of a button. In addition to optimising the planning and transportation of products, real-time monitoring of the network provides greater operational safety.

The natural gas transported over Transpetros pipelines comes from Brazilian and Bolivian reserves. We are looking to extend pipelines in other South American countries, and with this system, we will be able to control them from Rio as well, says Ielo.

International benchmarking
To identify current conditions, Transpetro relies on DNV in cooperation with Jardine. Says Ielo, We are now performing a reliability analysis of all our processes. This is a complete analysis, not just of the equipment but of all our processes from equipment to profit. We are trying to find out how reliable our assets and processes are.

The aim is to benchmark the services Transpetro provides to clients. In addition, DNV is performing a Risk Based Inspection study of certain gas pipelines.

Says Ielo, Currently DNV is involved in the reliability studies of the gas pipeline networks. If this goes well, the plan is to expand to the oil pipelines. Preparing our company to go international, we are looking for global partners such as DNV. We are preparing our services for international benchmarking.

As Transpetro prepares for future challenge, it is investing in a third dimension: people. Ielo emphasises that, Through the PEGASO programme, we have a broad focus on safety. A good balance of technology, processes and people is crucial. If you dont involve the staff, you dont have anything. They must be trained and aware of what we expect of them: to have a concept of safety instilled within them. You need more than just procedures on paper.

Text: cecilie.lone@dnv.com