Expansion Of The Brazilian Refining Industry
And Its Local Requirements: Critical Factors
For Siting A New Refinery In
Rio De Janeiro State, Brazil
Author(s)
A. Magrini, A. Szklo, G. Machado & R. Schaeffer
Abstract
The trade-off between welfare and environmental quality is clear in the refining
industry. Economic development and well-being are still related to oil product
demands in contemporary society. However, the refining industry is usually
aggressive to the environment, bringing externalities out to localities where
facilities are built. Therefore, there is a dilemma between meeting national oil
product demands growth and preventing environmental damages in the locations
eligible for a green field project. This paper shows that Brazil should expand its
refining industry over the next twenty years by two to four new refineries. One
of these refineries, focused on petrochemicals, might be located close to major
consumption centers. In this case, Rio de Janeiro State is an interesting option.
The analysis indicates the trade-offs between the positive and negative external
effects of a new refinery in the Itaguai Municipality. The advantages of good
logistics and infrastructure might be offset by the cumulative environmental
problems related to air, water and solid wastes management in the region.
Keywords: refinery expansion, location, environmental pressure, Brazil.
1 Introduction
The trade-off between welfare and environmental quality is particularly clear in
the refining industry. Economic development and well-being are still closely
related to oil product demands in contemporary society, despite relevant efforts
to substitute and/or to save oil products after the Oil Shocks in the 70’s.
Keywords
refinery expansion, location, environmental pressure, Brazil.
Related Book
Other papers in this volume
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