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   TEXT I
   
   The integral approach strategies adopted by
   Favela-Bairro consist of proposals of integrated and
   participative actions. The path that goes from welfare
   to work should combine programs and services for
   human and social development with labor and incomegeneration
   opportunities. To be viable, however, social
   promotion interventions should be focused on
   geographical areas with a high concentration of poverty,
   specifically on the poorest families.
   An intersectoral decentralized and participative
   approach can produce synergetic effects capable of
   providing greater impact for poverty and inequality
   reduction policies, and capable of contributing to their
   sustainability.
   Although Favela-Bairro has been based on the idea
   of integrated urban infrastructure interventions, initially
   the program did not incorporate all the basic components
   of an integral approach strategy. These components
   were gradually incorporated into its design as a result
   of the participatory process and the transformations
   that occurred in the municipal administration.
   Favela-Bairro is the result of an evolving process
   that resulted in the creation of a typical integral
   development model with a territorial base that
   incorporates life-cycle perspectives.
   Rio de Janeiro inhabitants, either living in favelas
   or not, recognize the importance of the Favela-Bairro
   program. A public opinion poll carried out in 2003 asked
   cariocas (as Rio residents are called) to choose from
   a list of governmental programs the one to which the
   next mayor should give priority. Favela-Bairro was
   chosen in first place in all three rounds of the survey.
   The same institute asked respondents about the most
   important project for the city, and again Favela-Bairro
   ranked first: 26.1 percent of respondents have elected
   Favela-Bairro as more important than programs such
   as minimum income, popular restaurants, and even
   essential works in major city roads.
   
   (www.worldbank.org on September 10, 2005)Those who came to the poll were:

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Those who came to the poll were:

1. Texto da questão (clique para ver)

   Simulado Inglês + texto 1

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   READ TEXT I AND ANSWER QUESTIONS 
   
   TEXT I
   
   The integral approach strategies adopted by
   Favela-Bairro consist of proposals of integrated and
   participative actions. The path that goes from welfare
   to work should combine programs and services for
   human and social development with labor and incomegeneration
   opportunities. To be viable, however, social
   promotion interventions should be focused on
   geographical areas with a high concentration of poverty,
   specifically on the poorest families.
   An intersectoral decentralized and participative
   approach can produce synergetic effects capable of
   providing greater impact for poverty and inequality
   reduction policies, and capable of contributing to their
   sustainability.
   Although Favela-Bairro has been based on the idea
   of integrated urban infrastructure interventions, initially
   the program did not incorporate all the basic components
   of an integral approach strategy. These components
   were gradually incorporated into its design as a result
   of the participatory process and the transformations
   that occurred in the municipal administration.
   Favela-Bairro is the result of an evolving process
   that resulted in the creation of a typical integral
   development model with a territorial base that
   incorporates life-cycle perspectives.
   Rio de Janeiro inhabitants, either living in favelas
   or not, recognize the importance of the Favela-Bairro
   program. A public opinion poll carried out in 2003 asked
   cariocas (as Rio residents are called) to choose from
   a list of governmental programs the one to which the
   next mayor should give priority. Favela-Bairro was
   chosen in first place in all three rounds of the survey.
   The same institute asked respondents about the most
   important project for the city, and again Favela-Bairro
   ranked first: 26.1 percent of respondents have elected
   Favela-Bairro as more important than programs such
   as minimum income, popular restaurants, and even
   essential works in major city roads.
   
   (www.worldbank.org on September 10, 2005)Those who came to the poll were:

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should in "to which the next mayor should give priority" (l. 30/31) expresses a(n):

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   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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The main purpose of the text is to:

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   Simulado Inglês + texto 2

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   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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According to the author, the world gas industry, since the late 80s, has:

1. Texto da questão (clique para ver)

   Simulado Inglês + texto 2

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   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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(1,0) 5 - 

In Brazil, the gas industry can currently be considered:

1. Texto da questão (clique para ver)

   Simulado Inglês + texto 2

   ×

   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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Mark the only correct statement.

1. Texto da questão (clique para ver)

   Simulado Inglês + texto 2

   ×

   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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(1,0) 7 - 

According to the text, which of the following is NOT going to be a problem for the future of the gas industry in Brazil?

1. Texto da questão (clique para ver)

   Simulado Inglês + texto 2

   ×

   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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(1,0) 8 - 

Choose the only alternative that corresponds in meaning to the following sentence in Paragraph 5 "Given the degree of gas penetration in the country's primary energy consumption, the industry is poorly developed when compared with other countries." (lines 36 - 39).

1. Texto da questão (clique para ver)

   Simulado Inglês + texto 2

   ×

   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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(1,0) 9 - 

Check the only correct option.

1. Texto da questão (clique para ver)

   Simulado Inglês + texto 2

   ×

   Reducing the dependence on oil
   Ildo Sauer, Gas and Energy Director, Petrobras.

   Brazil's energy sector is following the worldwide
   tendency towards greater diversification of primary energy
   sources and the increased use of natural gas and
   biofuels. There are several reasons for this change. The
   most important are the environmental restrictions that
   are gradually being adopted in the world's principal
   energy-consuming markets and the need to reduce the
   dependence on oil, set against a scenario of accelerated
   depletion in oil reserves and escalating prices.
   The share of gas in Brazilian primary energy
   consumption has more than doubled in a short period,
   increasing from 4.1% in 1999 to 8.9% in 2004, and this
   share is forecast to rise to 12% by 2010.
   Over the past two decades, the world gas industry
   has experienced a structural and regulatory
   transformation. These changes have altered the strategic
   behaviour of gas firms, with an intensification of
   competition, the search for diversification (especially in
   the case of power generation) and the internationalisation
   of industry activities. Together, these changes have
   radically changed the economic environment and the level
   of competition in the industry.
   Brazil's gas industry is characterised by its late
   development, although in recent years, internal supply
   imports and demand have grown significantly - the
   growth trajectory of recent years exceeds that of countries
   with more mature markets, such as Spain, Argentina,
   the UK and the US. And the outlook is positive for
   continued growth over the next few years, particularly
   when set against the investment plans already
   announced in Brazil.
   The country has a small transportation network
   concentrated near the coast. The distribution network is
   concentrated in the major consumption centres.
   Domestic gas sources are largely offshore in the Campos
   basin and Bolivia provides imports. Given the degree
   of gas penetration in the country's primary energy
   consumption, the industry is poorly developed when
   compared with other countries. The industry requires
   heavy investment in expanding the transport and
   distribution (T&D) networks, as well as in diversifying and
   increasing its supplies. Such investments are necessary
   for realising the industry's enormous potential.
   Another key industry highlight is the changing profile
   of gas supply. A large part of the gas produced
   domestically to date has been associated with oil
   production. The latter diluting or even totally absorbing
   the costs of exploiting the gas. In most cases, gas
   production was feasible only in conjunction with oil
   production activities. However, the country's latest gas
   finds are non-associated. Thus, an exclusively dedicated
   structure must be developed to produce this gas -
   translating into a significant rise in production costs. This
   is more significant when analysed against the high costs
   associated with the market for exploration and production
   (E&P) sector equipment. In recent years, the leasing costs
   of drilling rigs and E&P equipment have been climbing in
   parallel with escalating oil prices. This directly affects endconsumer
   prices.
   In a world of primary energy consumption
   diversification, of greater environmental restrictions and
   the reduced dependence on oil, Brazil has been seeking
   to develop alternative energy sources - principally natural
   gas and biofuels. The gas industry holds enormous
   potential for Brazil, although there is still a long way to go
   before it reaches maturity and major investment is
   required.
   

   World Energy in 2006. copyright © 2006, World Energy Council.
   p.29-31 (adapted)

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According to Paragraph 6 (lines 44 - 59), it is correct to state that: