Eike Batista, Brazilian billionaire businessman, is mulling the establishment of an auto factory at the Acu port complex. Batista is to invest $1 billion in the undertaking, as he moves towards securing a share of the burgeoning car industry. There has been an increased demand for cars in Brazil, the result of a growing and thriving middle class.

At a press conference call last week, Batista announced he will be revealing plans for a 400,000 car factory by May. According to Batista, Brazil currently has an annual production capacity of four million vehicles per year. However, in 15 years, it will reach 10 million vehicles per year, he said.

Batista reiterated that the new factory will be built in partnership with a foreign auto maker, but he declined to give any further details about possible tie-ups. In 2010, the billionaire investor had said he was planning to set up an electric car factory.

The latest project however is to include two lines producing about 200,000 vehicles per year, with each line capable of manufacturing up to four or five distinct models, said Batista. The Acu port complex is being developed by Batista’s firm LLX Logistica SA. The port is central to the establishment of a large industrial complex that will also include an oil-processing plant, steel mill and iron ore export facilities.

According to Batista, upon completion of the project, the oil-processing plant is expected to run at a capacity of processing 1.2 million barrels a day, which is likely already too small given the amount of oil produced off Brazil's coast close to the port. The Acu port lies beside the Campos Basin which produces more than 85% of Brazil's crude oil.

Batista’s LLX plans to establish Acu as a center for receiving oil and gas from fields in Brazil's offshore Campos, Santos and Espirito Santo basins. Significant new oil and gas prospects have recently been discovered in these areas. Acu port will also be home to a steelmaking joint venture between LLX parent company EBX and China's Wuhan Iron and Steel Co (Wisco).

EBX will hold a 30% stake in the steel joint venture with Wisco. Wisco will retain the remaining 70%. The plant is expected to have installed annual production capacity of five million metric tons of steel products.

13 Feb 2011.