(Petrobras, 21.Jun.2024) — Petrobras, Gerdau, and Naturgy have signed contracts for the supply of natural gas in the free market environment to serve Cosigua, Gerdau’s long steel production unit located in Rio de Janeiro (RJ). The agreement marks the first migration of a captive industrial market customer to the free market in the State, making the company’s plant the first gas consumer to switch to this trading model in the State, whose new rules were recently approved by Rio de Janeiro’s regulatory agency.
“The proximity of the supplier company to the client is fundamental so that we can understand their demands. The new gas product portfolio offers a diversified portfolio of contracts in a competitive, open market environment. We always strive to be the best supply option for our business partners,” says Maurício Tolmasquim, Petrobras’ Director of Energy Transition and Sustainability.
In this context, Petrobras, Gerdau and Naturgy consolidate their commercial ties, partnership, and pioneering spirit in the natural gas-free market, betting on developing solutions to enable an open, competitive, transparent, sustainable, and increasingly developed trading environment in the country.
“This pioneering and innovative move allows Gerdau to increase the competitiveness of the Cosigua unit, one of the strategic plants for the company’s growth plan and long-term vision in the country. This new partnership with Petrobras, enabled by Naturgy’s new contractual distribution models, reinforces our efforts to seek opportunities through the development and supply of the free gas market in Brazil, which is a strategic input for steel production and decarbonization today and in the future,” says Flávia Souza, Gerdau’s Global Director of Supplies.
“Signing this agreement represents an important step towards making the opening of the gas market in Rio de Janeiro a reality. It also promotes competitiveness in the State’s industrial market. Gerdau has been an important customer of the captive market for many years, and Naturgy has made every effort to ensure this migration happens as quickly as possible. Measures to foster competition tend to contribute towards reducing the gas molecule price, benefiting all market segments. Naturgy will continue working to generate more customer competitiveness,” says Giselia Pontes, Commercial Director of Naturgy.
Since 2021, Gerdau and Petrobras have had a partnership for the supply of natural gas in the free market environment, which began with the service to Gerdau’s unit located in Ouro Branco (MG) and is now being expanded to the Cosigua unit. In the coming years, there are possibilities for other Gerdau industrial units to migrate to the free market.
Petrobras’ forecasted investments in the natural gas area exceed BRL 25 billion in the coming years. To ensure the supply of the input alone, USD 5 billion will be invested in projects to expand infrastructures and the capacity of the national gas supply, which will contribute towards reducing dependence on natural gas imports. The company has also been offering more flexible agreements with different term modalities and indices, allowing customers to choose the portfolio that best suits their needs.
About Gerdau
With 123 years of history, Gerdau is the largest Brazilian steel producer, one of the main suppliers of long steel in the Americas and special steel worldwide. Brazil also produces flat steel and iron ore for its own consumption. Additionally, it has a new business division, Gerdau Next, aimed at venturing into segments adjacent to steel. To empower people who build the future, the company is present in several countries and has over 30,000 direct and indirect employees in all its operations. As the largest recycler in Latin America, Gerdau uses scrap as an essential raw material: 71% of the steel it produces is made from it. Every year, 11 million tons of scrap are transformed into various steel products.
The company is also the world’s largest producer of charcoal, with over 250,000 hectares of forest base in the State of Minas Gerais. As a result of its sustainable production matrix, Gerdau currently has one of the lowest average greenhouse gas (CO₂e) emissions, at 0.86 tons of CO₂e per ton of steel, which is approximately half of the global sector average of 1.91 tons of CO₂e per ton of steel (world steel). By 2031, Gerdau’s goal is to reduce carbon emissions to 0.82 tons of CO₂e per ton of steel. Gerdau’s shares are listed on the São Paulo (B3) and New York (NYSE) stock exchanges.
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