Petrobras and its partners are to invest $3 billion in the construction of three pipelines for the transport of Ethanol from Brazilian sugarcane growing areas to local markets, as well as for export. Paulo Roberto Costa, Petrobras director for supplies told reporters in Sao Paolo the state owned oil giant is mulling the investment plans, as it seeks to bolster its Ethanol export earnings.

The pipelines are expected to have a length of 1,200 kilometers and will transport up to 20 million cubic meters yearly by the year 2020, added Costa. He further added that construction work on the first stretch of pipeline will begin Tuesday in the city of Ribeirao Preto, the heart of the sugarcane industry in the interior of Sao Paulo state.

A group of six companies will set up a network for distribution and storage of ethanol and other liquids. The six companies, Petrobras and five partners, will establish a new company, with initial capital of 100 million reais ($58 million), for the purpose of setting up the network. Shareholders in the new firm include Petrobras, with 20%; Cosan SA Industria e Comercio SA, 20%; Copersucar SA, 20%; Odebrecht Transport Participacoes SA, 20%; Camargo Correa Oleo e Gas SA, 10% and Uniduto Logistica SA, 10%.

The firms’ first pipeline will be constricted to run from Senador Canedo in Goias state, center-west Brazil, through Minas Gerais and Sao Paulo states to Sao Sebastiao port in Sao Paulo state. A second pipeline network will link Goias, Sao Paulo and Parana, ending at Foz do Iguacu, using river transport on the Parana and Tiete rivers, with a pipeline link to the first pipeline. The third pipeline will link the first pipeline with Ilha d’Agua port in Rio de Janeiro state.

Petrobras, Camargo Correa, Odebrecht and Uniduto have already carried out studies on the new project, Petrobras said in a statement last week. Petrobras is a semi-public Brazilian multinational energy company headquartered in Rio de Janeiro.

Petrobras is the world’s second-largest public listed company, the largest company in Latin America by market capitalization and revenue, and the largest company headquartered in the Southern Hemisphere by market value. It remains a significant oil producer, with output of more than 2 million barrels of oil equivalent per day, as well as a major distributor of oil products.

The company also owns oil refineries and oil tankers. Petrobras is a world leader in development of advanced technology from deep-water and ultra-deep water oil production.