1. José Sergio Gabrielli de Azevedo Petrobras and the
CEO and President
August, 2007
Biofuels
1

2. PETROBRAS
Cautionary Statement
The presentation may contain forecasts about future events. Such forecasts
merely reflect the expectations of the Company's management. Such terms as
"anticipate", "believe", "expect", "forecast", "intend", "plan", "project", "seek",
"should", along with similar or analogous expressions, are used to identify
such forecasts. These predictions evidently involve risks and uncertainties,
whether foreseen or not by the Company. Therefore, the future results of
operations may differ from current expectations, and readers must not base
their expectations exclusively on the information presented herein. The
Company is not obliged to update the presentation/such forecasts in light of
new information or future developments.
Cautionary Statement for US investors
The United States Securities and Exchange Commission permits oil and gas
companies, in their filings with the SEC, to disclose only proved reserves that
a company has demonstrated by actual production or conclusive formation
tests to be economically and legally producible under existing economic and
operating conditions. We use certain terms in this presentation, such as oil
and gas resources, that the SEC’s guidelines strictly prohibit us from including
in filings with the SEC.
22

3. Latin American Share of Oil World Reserves
Latin American oil reserves are becoming increasingly important
1984 1994 2004
R/P* = 26,77 R/P* = 41,78 R/P* = 41,84
4,8% 8,0% 8,5%
5,0%
3,8% 3,5%
8,8% 5,1%
13,4%
9,4%
6,4%
7,6% 56,5% 65,1% 61,8%
7,9% 11,7%
12,7%
Total Total Total
762 billion barrels 1.017 billion barrels 1.188 billion barrels
Middle East Europe & Eurasia Africa
North America Pacific Asia Latin America
In 20 years, Latin America proven reserves increased from 36.6 billion barrels (1984) to 101 billion.
Source: BP Statistical Review of World Energy * Reserves/Production Latin America (years)
3

4. Net Oil Availability
Latin America
Russia Mbpd
Asia
United States
OECD(- Mexico)
Projected growth in
oil production and
demand suggests
balance and
independence of
supply from politically
unstable regions
Source: Internacional Energy Agency Reference Scenario
Includes Bitumen and non-conventionals, including synthetic oils. 4

5. Gas Rich Region with limited infrastructure
Proven Reserves as of January 1, 2005
4.3 T m3
Ample gas reserves will allow for: 0.55 T m3
152 Tcf
19.4 Tcf
::: Regional growth in consumption 0.41 T m3
substituting some demand for oil 14.5 Tcf
Venezuela
Trinidad
::: Higher exports of liquids Mexico
0.33 T m3 Brazil
11.7 Tcf
Perú 0.74 T m3
0.74 T m3 26.1 Tcf
But: 2005 Gas
::: Will require increasing energy Proven Reserves Bolivia 0.50 T m3
integration and World: 26.1 Tcf 17.7Tcf
179,8 T m3
::: Substantial investments in South and Central
America: Argentina
infrastructure covering great 7,02 T m3
distances and environmentally
sensitive regions
Source: Cambridge Energy Research Associates.
5

6. Production X Demand X Refining Capacity: Reaching Self-Sufficiency
Production/ 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2006 2011F
Consumption
(%) 3,0 30,5 28,4 32,2 19,5 16,7 56,2 55,3 49,3 70,4 97,6 112,1
Brazil: first major market to shift
from import dependency to self
sufficiency since first oil from
Proj.
2500 North Sea in 1971 began to shift
european balance
2000 Production
THOUSAND BPD
Consumption
1500
Refining
1000
500
0
1954 1960 1970 1980 1990 2000 2006 2011
6

7. A Track Record of Growth 7.9% p.y. 2015
In Thousand boed 4,556
8,7% p.y. 278
1996 2001 2006 2011 742
3,493
185
2,298
2,217 383 724
2,036 2,020
1,810 551
277
274
1,636 252 250 265
1,565
1,405 232
221
1,238 197
1,090
1,008 179
2. 812
163
152
1540 1684 1778 2. 374
1500 1493
1271 1336
1132
1004
809 869
Oi l and N GL - B r az i l N at ur al Gas - B r az i l 2015
Oi l and N GL - I nt er naci onal N at ur al Gas - I nt er naci onal For eca st
7

8. Brazil is the 1st country to reap benefits from Ethanol
Because program is government regulated there are no benefits from KT but benefits
of reduction in CO2 emissions have already materialized;
Used up to 10% in petrol, ethanol substitutes lead
Alcohol Exports
and MTBE as an oxygenate, withour any change in 2005
engines, without harmo to air or groundwater End of regulation
1999 FFV
160000
Beginning of the
During this sector deregulation
140000
period,
ethanol PROÁLCOOL
120000
utilization Alcohol Vehicles
saved 644 10000
million ton.
of CO2 80000
emission
60000
1000 BEP
Accumulated effective economy:
40000
1 Billion boe ~US$ 52 bi
20000
CNG
ETHANOL 0
GASOLINE 1972 1976 1980 1984 1988 1992 1996 2000 2004
Source: MME, BEN 2006

9. Ethanol
Ethanol can be introduced also as a partial or full substitute for petrol: up to 25%
(Brazil) partial motor adjustments require participation of automobile industry; up
to/over 85% requires flex-fuel vehicles, consumer preference (price/performance).
Source:Henry Joseph Jr. ANFAVEA - Volkswagen 9

10. Demand Overview
• A strong increase in the demand for ethanol is expected;
• Ethanol as a substitute to Lead and MTBE
• This amount of future consume may be levered if new countries adhere the compulsive
blend with ethanol.
Strong Increase in Demand
Renewable Fuels Standard
Ethanol Global Demand (Million liters/Year)
MTBE Substitution
Clean Air Act
Lead Substitution
Source: F.O. LICHT, 2004 10

11. Demand Overview
A PROMISING MARKET
Potential demand Ethanol
Country Comment
(Billion liters) addition
Potential demand considering 3% ethanol addition to
Japan 1.7 3% the gasoline formula
Expected demand in 2012, according with the
US 16.8 - Renewables Fuels Law
Potential demand considering 10% ethanol addition
China 4.5 10% to the gasoline formula
Potential demand considering 5% ethanol addition to
EU 7.4 5% the gasoline formula in 2011
India ? 5% Percentage approved only in some regions
Potential demand considering 5% ethanol addition to
Thailand 0.7 5% the gasoline formula
Total: 31.1 billion liters
•Only in the US, a 5.7% addition of ethanol the gasoline would translate into a consumption of 30 billion
liters of ethanol per year.
Souce: EIA/DOE; Comissão Européia; FO Licht; Copersucar 11

12. O Etanol contribui para a redução do aquecimento global
Demand Overview
•Biofuels usage can reduce CO2 emissions at a 5:1 rate;
•Besides being a cleaner source of energy, sugar cane ethanol produces 8,3 more energy
than the fossil energy used in its production process. Ethanol usage in Brazil has decreased
the emission of Greenhouse Effect Gases at 13% (1994 data);
•Sugar-cane is the most productive among ethanol raw materials and the production of
ethanol has limited affect on food supply.
Energetic balance - Ethanol Ethanol Productivity
10 7000
6000
8
5000
liters per hectar
6
Energetic ratio
4000
3000
4
2000
2
1000
0 0
sugar-cane sugar- sugar-cane corn - USA wheat - EU
Sugar Wheat Beet- Corn
- Brazil beet- EU - India
cane root
Source: World Watch Institute 12

13. Quais seriam os motivos do diferencial de produtividade brasileira ?
Price Reduction
Ethanol Engine Relative Performance*
Greater production cost
140
reduction when compared 120 110,0%
132,4%
103,3%
20 to gasoline. 100
110,0%
80
18 60
40
16
20
0
14
Power
Consumption
US$/GJ 2002
12 Gasoline 100% Gasohol 22% Ethanol 100%
10
8
6
4
2 1985 1990 1995 2002
1980
0 Ethanol prices in Brazil Rotterdam regular gasoline price
Source: Goldemberg 2004
*Source: Volkswagen (Brazil) - Presentation prepared for review within The Warren Centre for Advanced Engineering at Sydney
University 13

14. Supply Overview – Brazilian Ethanol Exports
Brazilian ethanol exports increased sharply in the last three years, resulting in US$ 1.6 billion
export revenues in 2006.
1800 4
e
1600 eas
cr 3,5
in
%
52
US$ Million F.O.B.
1400
3 3
6:
Billion Liters
0
1200 -20
03 2,5
20
1000
2
800
1,5
600
1
400
0,5
200
0 0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Export Revenues - F.O.B. Exports (secondary axis)
Source: Ministry for the Development of Industry and Commerce 14

15. Supply Overview
The potential to expand world production is enormous
North and
Europe
Central America Brazil
37% 35% 9.8%
South America Asia
38% 16.2%
Current Market Distribution of World Consumption
Ethanol global market is 46.5 Billions Liters
Ethanol as a Fuel is 30.6 Billions Liters, or 67% of total ethanol production
Today the ethanol consumption is 2,6% of gasoline MKT
Increasing ethanol to 10% of gasoline will represent 118 Billions Lt
15
15

16. Supply Overview - Increase in the supply of Biofuels
• World Supply of Biomass and Waste reached 1,176 Mtoe in 2004 (10% of total supply);
• According to the International Energy Agency Reference Scenario, it will reach 1,645
Mtoe in 2030, an increase of 1.3% p.a., still representing 10% of total supply.
Non-Renewables
35
2004 13%
25
Shares (%)
21
Renewables
87%
10
6
2
1
Oil Coal Gas Nuclear Biomass and Hydro Other
Waste Renew ables
Source: World Energy Outlook 2006 16

17. But transport sector can still contribute to emission reductions
(IEA alternative scenario)
Reference Increase in Alternative Increase in
Increased use of renewable Demand 2004-2030 (mtoe)
Demand 2004-2030 (mtoe)
fuels can contribute to reduce
projected increase in energy for
45
transport by 7 %, to 15 % if
1,023 adequate policies followed.
659
77
132
42
Bio 2004-2030
Oil Bio Other
Oil Bio Other Reference - Alternative
5% Total: 836 mtoe
Total: 1,142 mtoe
18% United States
36% OECD Europe
OECD Pacific
The direct benefits in 4% Other OECD
emission reductions would Brazil
be equally distributed 9% China
India
between US, Europe OECD 5% Other Asia
and the rest of the world 2% 16% Rest of World
4% 17

18. Brazil’s Advantages
Average production costs are projected to drop by around a third between 2005 and 2030.
• Ethanol production costs vary widely across countries, mainly due to climatic factors:
crop production costs are much lower in tropical countries.
• According to the IEA, costs in Europe and the United States would be significantly
higher without crop and ethanol subsidies.
Source: World Energy Outlook 2006 18

19. Diferenças de produtividade na cana de açúcar
Latin America offers excellent potential to increase ethanol production
•Availability of lands, water and low labor cost also benefit production in Central
and South America.
Latin America has the largest potential arable
land per capita and only uses 13,9% of it.
Sugar-Cane Productivity
Yield per Hectare Potential Arable Land % of Potential Arable Land
actually in use
(1.000 ha per capita)
72,41 73
71,13
67,77 69,34
2,2 61,4
55,6
1,7 48,6
1000 Kg/Ha
0,6
13,9
0,2
Asia USA Central South Brazil
America America Asia and Europe North Latin Asia and Europe North Latin
World Average Pacific America America Pacific America America
Source: FAO 19

20. Diferenças de produtividade na cana de açúcar
Latin America’s Advantages
• 33% of the world’s internal renewable water resources are concentrated in Latin America;
Annual water use by sector
Internal renewable water resources Latin America and
Brazil Caribbean
(m³ per capita – 1997)
18% 9%
35000 33.097
19%
30000 27.673 21%
61% 73%
25000
20000
World
15000
20%
10000
6.984 9%
5000 71%
0
World Latin America and Brazil
Caribbean
Agriculture Domestic Industrial
Source: FAO 20

21. Ethanol Logistics System in Brazil
Ethanol collection,
storage and
distribution centers
are spread out
Large scale marine
terminals improve through producing
efficiency and consuming
regions
Large storage capacity
necessary to regulate
supply Primary Base
Secondary Base
Pipelines reduce
Collection Centers
transport costs; improve Inland Navigation
energy efficiency Railways
Road
Multi product pipelines
21
21

22. José Sergio Gabrielli de Azevedo Petrobras and the
CEO and President
August, 2007
Biofuels
22