Bento Albuquerque, who assumed office as minister of mines and energy in January 2019, says that investments into oil and gas should come in parallel with those into clean energy to meet demand, even as the country’s energy matrix changes shape. 

“Brazil is a developing country. Many people ask me [whether] Brazil will continually invest in the exploration and production of oil. Yes, because we are a developing country, we need these inputs,” he says in an interview with fDi Intelligence. 


But he adds that in a few years from now, there will likely be a “stabilisation and natural decline” in the global oil market. 

The country’s gas market reform, which was approved by law in April, is set to increase efficiency, promote competition, reduce costs and see state-run oil giant Petrobras divest some of its assets. Its full regulatory framework is yet to be released.

Mr Albuquerque says there will be an important auction towards the end of the year that will see the creation of new thermoelectric plants based on natural gas, which will in turn contribute to the expansion of the market and bring costs down. The result of this will be a more competitive market and better consumer access, he adds.

Separately, the government plans to sell off part of its stake in state-run electricity giant Eletrobras. In the next eight to nine years, Mr Albuquerque says, there will be investments of roughly $80bn in the energy sector, while in the mining sector he expects this figure to be around $50bn. 

Investment drive

During the Brazil Investment Forum 2021, a two-day international event held on May 31 and June 1 to attract foreign investment in the country, president Jair Bolsonaro said Brazil is prepared to offer “unique opportunities” to foreign investors. He expects Latin America’s largest country to receive $50bn-worth of foreign investment and generate 22,000 jobs in 2021 and 2022.


Brazil remains heavily reliant on hydroelectric generation due to the country’s wealth of water sources with 75.3% of its electricity coming from hydro in 2020, according to the International Energy Agency (IEA). “What we have observed is that hydroelectric generation has made room for new energy sources, such as wind, biomass and solar,” Mr Albuquerque says, adding that “little by little, our matrix is transforming so as to maintain Brazil’s energy security”.

Brazil’s energy sector recorded 37 projects in 2020, according to fDi Markets, 31 of them in renewable energy (excluding hydroelectric projects). With one of the highest consumption of automotive fuels in the world behind the US, China and India, Brazil has also launched its ‘fuel of the future’ programme to expand the use of sustainable and low-carbon-intensity fuels. In 2017, the government passed the RenovaBio bill, which aims to increase the use of biofuels, such as ethanol.

Focus on hydrogen 

Now, the ministry of mines and energy is drafting a national hydrogen programme, which Mr Albuquerque says will “contribute to the decarbonisation of our transportation, electric and energy [matrices]”. In March, Australian company Enegix Energy announced a $5.4bn green hydrogen project in the northeastern Brazilian state of Ceará, as Brazil plans to turn this region into a hydrogen export hub.

Mr Albuquerque says the federal and state governments are well aligned on energy policies: “With the new national hydrogen programme, we aim for this to be approved by the National Council for Energy Policy and then it will be implemented by each state and by the federal government.” 

But the changing nature of the country’s energy matrix and the road to decarbonisation does not preclude short-term gains from the liberalisation of traditional energy markets, he adds: “We have no doubt that the world is moving towards an energy transition but that doesn’t stop, or limit, developing countries such as Brazil with great abundance of natural resources to continue increasing production in these sectors [oil and gas].”