The supply contract to the Rio Grande do Norte State Gas Company (Potigás) runs until December 2034

Petrobras agreed new contracts to supply natural gas to the Rio Grande do Norte State Gas Company (Potigás) on Tuesday (10/31), worth around R$536 million, until December 2034. The contracts are the result of a negotiation process to extend the supply of gas to the distributor’s captive market, in the state of Rio Grande do Norte, and strengthen the commercial partnership between the companies.

“The new contracts in the Northeast, as well as those throughout the country, show that Petrobras is successfully meeting its target to ensure that natural gas remains a competitive part of the energy matrix. They are also an example of how we are offering more flexible products, with different terms and indexes; which allows each distribution company to optimize their portfolio better. We forecast that our own investments in this area will be more than R$25 billion in the coming years, which will ensure that natural gas remains a competitive fuel and a foundation of the energy transition”, stated the Director for the Energy Transition and Sustainability at Petrobras, Maurício Tolmasquim.

“Having a contract with Petrobras, especially a long-term contract like the one we have signed, means ensuring security for our portfolio and stability for our prices. Petrobras’s focus on Brazil’s natural gas market has been very important. They have taken part in public tenders based on proportional quantities, they provide security for distributors and, at the same time, they enable them to diversify their portfolio by including other suppliers. This is fundamental for the market”, said Marina Melo, President of Potigás.

This is the eleventh contract between Petrobras and a Local Distribution Company (LDC), based on Petrobras’ new product portfolio. Of the contracts recently signed in the second half of this year, this is the fourth in the Northeast, which demonstrates how Petrobras’s involvement in supplying natural gas in this region has increased as well as its competitiveness.

New Portfolio

When the natural gas market opened up, Petrobras developed a new commercial portfolio for the sale of natural gas based on varying deadlines, indexes and delivery locations, to ensure that it remained competitive in ongoing public tenders by state distributors and sales via Mercado Livre.

In addition to this diversification, the company’s commercial conditions aim to make the competitive environment and the process of opening up the market more dynamic by making it possible, among other things, to reduce the quantities agreed with state distributors in the event that demand from captive customers transfers to the free environment. They also allow the distributors’ supply management to be more flexible by including the option to decontract quantities over 2/3 of the volume sold in each concession, in line with the provisions in CNPE Resolution 03/2022.