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Brazil's BNDES to more than double oil, gas lending this year
* BNDES expects to lend $3.94 bln for oil, gas this year
* Bulk of money may go to fund Petrobras suppliers
* Oil loans 5.3 pct of expected disbursements this year
By Rodrigo Viga Gaier
RIO DE JANEIRO, Sept 6 (Reuters) - Brazil's state development bank BNDES plans to more than double lending for oil and gas projects this year, part of efforts to help state-led oil giant Petrobras and other companies develop giant offshore oil reserves.
The bank will lend about 8 billion reais ($3.94 billion) this year for projects in the industry, more than double the 3.3 billion reais disbursed last year, BNDES President Luciano Coutinho told reporters at a news conference in Rio de Janeiro.
The proposed oil lending represents 5.3 percent of the 150 billion reais Coutinho expects BNDES to lend overall this year. BNDES is the largest source of long-term bank loans in Brazil and one of the world's largest development banks.
About 3.8 billion reais of this year's loans to the industry will go to Petrobras to help finance its growing network of equipment and service suppliers in Brazil. Under oil concession contracts, companies must use a certain amount of locally produced or sourced equipment and services. Most new contracts aim for about 65 percent local content.
Delays in developing this network of suppliers is one of the reasons Brazilian oil production has stagnated. Brazilian oil and gas output in July was 1 percent lower than a year earlier.
Increased oil and gas lending from BNDES comes as Petrobras and foreign oil companies -- including Royal-Dutch Shell Plc , Norway's Norsk Hydro ASA and BG Plc -- move to develop the country's so-called subsalt reserves near Rio de Janeiro.
The entire sub-salt area, the size of the U.S. state of New York, may contain 100 billion barrels of oil, according to a study by the National Oil and Gas Institute at the State University of Rio de Janeiro. That is enough oil to provide for all petroleum needs in the United States, the largest consumer, for about 15 years.
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