Brazil: Chambriard’s Team Replaces Solar and Wind with Ethanol

What happened: Petrobras CEO Magda Chambriard presented the strategic investment plan for 2026-2030.

Why it matters: The plan reaffirms the NOC’s commitment to its lucrative pre-salt crude business but also steps back from a solar and wind future envisioned by Chambriard’s predecessor, Jean Paul Prates.

What happens next: Instead, Chambriard’s team will build out a series of biorefineries and make a play to become a major ethanol producer in the coming year.

On 28 November, Petrobras CEO Magda Chambriard and her team unveiled their updated $109bn strategic investment plan for 2026-2030 amid declining crude prices. Most expected the NOC to downsize its investment portfolio without affecting the lucrative pre-salt E&P that has driven profits for a decade. Chambriard did not disappoint.

Under her plan, Petrobras will invest $91bn in current initiatives, reserving the balance for further evaluation. Her team has set aside $78bn for E&P projects, with much of the spending in the Atapu, Buzios, Mero and Sepia pre-salt fields.

Chambriard noted forecasts of declining crude prices to justify the modest investment retrenchment but sounded positive notes over the company’s near-to-medium term profitability. Her plan assumes an average Brent crude price of $63 next year ($70 thereafter), much lower than the $77 adopted in last year’s plan, but Chambriard cautiously noted that prices could fall further before a rebound.

The NOC plans to increase crude output from 2.4mn bpd in 2025 to 2.7mn bpd by 2028 with an average internal rate of return for E&P set at 23%, higher than its downstream and renewable energy businesses.

On the exploration side, Petrobras aims to spend $7.1bn over the next five years, drilling up to 40 new wells. Accordingly, the plan calls for 15 wells in the equatorial margin play with a focus on the Foz do Amazonas (deepwater Amapa) Basin, 14 wells in the pre-salt fields of Campos and Santos Basins along with the frontier Pelotas Basin, and another 11 wells — including offshore exploratory activities in Colombia, South Africa, Sao Tome and Principe, and onshore gas activities in Argentina and Bolivia.

The CEO's team will suspend investments in solar and wind power, preferring to stay the course with biofuels — at least through 2030. Chambriard justified the redirection by pointing to the recent trend toward renewable energy curtailment, underscoring the return on investment differential between alternative renewables and Petrobras’ core strength of crude production and export.

The move away from solar and wind will be matched by the NOC's entry into the ethanol market in 2026. For decades, Petrobras stayed away from ethanol production, focusing on biodiesel, especially after the enactment of the 2006 National Biodiesel Production and Consumption Plan, before pulling back from biofuels under former President Jair Bolsonaro.

Petrobras Energy Transition and Sustainability Director Angelica Laureano (see Featured Personality) influenced the decision as the NOC builds out a series of new biorefineries to boost renewable diesel and sustainable aviation fuel output, along with ethanol. Laureano pledged to spend $2.2bn over five years on ethanol production, a move that will likely restructure and raise Brazil’s renowned ethanol production system.

Ironically, Petrobras plans to spend $80mn over the next five years to build solar energy farms at four of its refineries: REGAP in Minas Gerais, REPLAN in Sao Paulo, RNEST in Pernambuco and Boaventura in Rio de Janeiro. This effort is part operational decarbonization and part public relations after former CEO Jean Paul Prates pledged to transform the NOC into a solar and wind powerhouse.

Overall, Chambriard’s team continues to lead Petrobras as a national development motor with deep investments in E&P, the gas midstream and downstream, and an expanded refining complex that includes significant expansion and diversification of its biofuel output mix. Shareholders have applauded her persistent focus on profitability while juggling the NOC's lucrative crude production and exports with the political imperative to invest in the energy transition.

In our view, the more business-minded Laureano (compared to her predecessor Mauricio Tolmasquim) has asserted her vision of a transition powered by gas and biofuels, which are considered current strengths. Although her plan has sparked debate among environmentalists, its execution under Petrobras’ strategic investment plan leaves the solar and wind power industries wide open for investment without worrying that the NOC could stomp out competition — as it has in various segments of the gas market.