Rolls-Royce announces investment in Brazil
Date added: 31st May, 2011 at 12:25
(view all articles from May, 2011)
Categories: Natural Resources
Rolls-Royce is bidding for a new contract that will see the company increase its investment in Brazil.
The industrial group, which is based in the UK, is hoping to secure a deal to produce turbine engines for Petrobras, the Financial Times reports.
This comes after the federal oil firm recently announced it is to inject $27 billion (£16 billion) into domestic exploration in 2015 with the intention of boosting crude oil output to three million barrels a day, Dow Jones asserted.
Rolls-Royce will also take on more employees as it attempts to make its mark on the Brazilian oil industry and up its presence in the world's emerging markets.
Francisco Itzaina, Rolls-Royce's chief executive for Latin America, told the newspaper that the brand considers the country to be a prime opportunity for investment as the recent economic downturn did not have as much of an impact there as it did elsewhere.
The enterprise's presence in Brazil is currently quite small, however it hopes that as the nation develops its oil industry it will be able to more than double sales by 2020.
If it wins the Petrobras contract, the firm will produce 32 engines for oil drilling platforms - a project that could grow to be worth $2.5 billion over the next five years.
This is part of an overall investment of $120 million the company has planned for Brazil over the next few years. This money will be spent on a new training centre similar to those already established in Norway and Singapore, among other things.
"We are globalising by the second because this is the only way that you can preserve growth nowadays," Mr Itzaina stated.
However, Rolls-Royce does face competition, as General Electric is also bidding for the rights to the oil project.
The energy sector is not the only industry on which the company is focusing, the publication noted.
Mr Itzaina pointed out that the aviation industry is growing and the business has already taken orders for 300 aircraft, which will be delivered to Brazil over the next decade.
"The growth in air travel is fantastic because of the increase in the purchasing power of the population. Air travel starts competing with bus transportation," the expert stated.
Rolls-Royce is also planning to up the number of employees it has based in South America, increasing numbers from 500 to 700 during the next three years.
"Brazil has also finally come of age," Mr Itzaina concluded.
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