Abu Dhabi’s Mubadala Capital is gearing up for a substantial investment venture in Brazil, planning to allocate around $13.5B over the next decade.
This endeavour forms part of wider initiatives for the South American nation, which include the creation of a new stock exchange.
The asset management arm of the UAE sovereign wealth fund has been broadening its presence in Brazil, venturing into various sectors such as transportation infrastructure, education, and even fast-food franchises.
Sustainable fuels
Mubadala Capital has expressed its ambition to lead the way in renewable diesel and sustainable aviation kerosene production through a flagship biofuels project in Brazil.
In an interview with the Financial Times, Oscar Fahlgren, Mubadala Capital’s Brazil chief, disclosed details of the project, outlining plans for multiple bio-refineries with substantial processing capacities.
These facilities will predominantly utilise non-food plant matter for fuel production, leveraging Brazil’s agricultural expertise and favourable climate conditions.
Led by its energy company, Acelen, the project will comprise five modules, with the first module scheduled to begin production by the end of 2026.
Each module will house a new bio-refinery capable of processing 20,000 barrels of fuel per day, alongside associated infrastructure and cultivated areas for growing the input crop. Fahlgren highlighted Brazil’s agricultural capabilities, citing its climate and fertile soil as advantageous factors for the project.
The initiative also involves repurposing an existing oil refinery in the northeastern state of Bahia, acquired from the state-controlled Petrobras in 2021.
The investment plan will also entail repurposing an existing oil refinery acquired from Petrobras, Brazil’s state-controlled oil company. Funding for this venture, totalling $13.5B, will be obtained through a combination of equity and debt over the next five to ten years.
This initiative underscores Mubadala Capital’s dedication to the transition to green energy and represents a significant addition to its existing $6 billion investment portfolio in Brazil.
Furthermore, Mubadala Capital’s engagement extends beyond the energy sector, encompassing diverse ventures such as financial assets trading platforms and fast-food franchises.
The establishment of a new football league and discussions regarding potential exits from mature assets further demonstrate the fund’s confidence in Brazil’s investment climate.
