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Senators

Enhancing Energy Cooperation between the US and Brazil: Insights from the Senate Hearing

Strategic Insights

— 1 min read

The US Senate Foreign Relations Committee heard testimony from four high-ranking nominees, including Thomas Shannon, Carlos Pascual, Arturo Valenzuela, and Kenneth Merten, on their qualifications for key diplomatic positions on July 8, 2009. The hearing provided valuable insights into the energy cooperation between the US and Brazil, with a focus on biofuels and hydrocarbons. Brazil's expertise in cane-based biofuels and its potential as a hydrocarbon producer were highlighted as areas for cooperation. The removal of the current tariff on sugar-based ethanol was discussed as a potential step to enhance energy cooperation between the two countries.

Key Takeaways:

  • Brazil's biofuels expertise comes from cane-based biofuels, while the US has expertise in corn-based biofuels, which can be helpful in developing second-generation biofuels, especially cellulosic biofuels.
  • The US and Brazil are working together on biofuels issues, including the development of second-generation biofuels, to enhance both countries' ability to find alternative and renewable energy sources.
  • Brazil has significant hydrocarbon reserves, including off-shore deposits, making it one of the tenth-largest potential producers of hydrocarbons in the world.
  • Removing the current tariff on sugar-based ethanol could create a long-term opportunity for the US and Brazil to enhance cooperation on biofuels, but its removal would not have an immediate impact on Brazil's ability to enter the US market.
  • The removal of the tariff would require Brazil to put a different logistical structure in place to export the product in a different way than it does now.
  • The US and Brazil are working with other countries in the region, such as Argentina, Uruguay, Chile, Peru, Colombia, on biofuels production.

Statistics:

  • Brazil has significant hydrocarbon reserves, including off-shore deposits, making it one of the tenth-largest potential producers of hydrocarbons in the world.
  • Brazil is not producing enough biofuels to meet its own market demands, and neither is the US, which is one of the reasons for the two countries' larger biofuels MOU to help develop biofuels industries in third countries.

Sources:

  • Federal News Service, Inc., Ste. 500, 1000 Vermont Avenue NW, Washington, DC 20005 USA.

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