Top Infrastructure Projects & Investment Opportunities in the biggest and more dynamic country in Latin America. A presentation prepared by Executive Office of the President (March 1st, 2011).

1. Brazil
Infrastructure Investment Opportunities
Tokyo, 1.3.2011
Guilherme Walder Mora Ramalho
Infrastructure Advisor
Executive Office of the President of Brazil

2. PAC – Growth Acceleration Program
In 2007 – PAC 1
! To accelerate the pace of economic growth
! To increase employment and income rates
! To decrease social and regional inequalities
! To overcome infrastructure bottlenecks
In 2009, a new goal
! To reduce the impact of the international economic crisis –
countercyclical policy
In 2011, a new stage: PAC 2 – 2011-2014

3. GROWTH ACCELERATION
PROGRAM – PAC 1, 2007-2010
Infrastructure projects in three areas US$ billion
Area 2007-2010 After 2010 TOTAL
LOGISTICS 54.5 28.9 83.3
POWER G&T 171.7 429.4 601.1
SOCIAL AND URBAN 146.8 18.0 164.9
TOTAL 373.0 476.3 849.3

4. GROWTH ACCELERATION
PROGRAM – PAC 2, 2011-2014
Preliminary investment forecast
US$ billion
Area 2011-2014 After 2014 TOTAL
LOGISTICS 59.4 2.6 61.9
POWER G&T 262.3 356.2 618.5
SOCIAL AND URBAN 221.0 - 221.0
TOTAL 542.6 358.8 901.4

5. INVESTMENT OPPORTUNITIES:
POWER GENERATION AND TRANSMISSION
HIGHWAYS
RAILROADS
AIRPORTS
PORTS
URBAN MOBILITY
HOUSING AND SANITATION

6. ELECTRIC POWER
GENERATION AND TRANSMISSION

7. ELECTRIC POWER SYSTEM – GENERAL FEATURES
Installed Capacity – 105,066 MW
• Number of Customers – 64.6 million
• Energy Production – 463.2 TWh / year –
60% of South America
• Peak – 67,632 MW
• Transmission Lines – 96,207 km ! 230kV
Source: Ministry of Mines and Energy

8. ELECTRIC POWER GENERATION
Priority to competitive, renewable sources with low
carbon emission
• Annual tenders to contract energy in the regulated
contracts environment
• Hydroelectric power plants – energy to be delivered at the fifth
year after the tender
• Thermal power plants and others – energy to be delivered at the
third year after the tender
• Tenders planned
2011-14 54 HPP – 47,870 MW – US$ 57.9 billion

9. ALTERNATIVE ENERGY SOURCES
! From 2011 to 2014
!71 Wind Power Plants – 1.803 MW
!3 Biomass TPP – 224 MW
TOTAL PROJECTED INVESTMENT- US$ 5.5 billion

10. TRANSMISSION LINES
! Large Interconnections – 22.765 km
! Regional Lines – 13.921 km
TOTAL PROJECTED INVESTMENT- US$ 14 billion

11. Alternative Energy Sources
Wind Power
Aratua 1 Araras Coqueiros
Areia Branca Buriti Quixaba
Miassaba 3 Cajucoco Garças
Lagoa Seca
Vento do Oeste
Morro dos ventos I, III, IV, VI, IX
Dunas do Paracuru
Taíba Águia
Rei dos Ventos 1, 3 Taíba Andorinha
Icarai I e II
Eurus VI
Colonia
Cabeco Preto Embuaca
Mangue Seco 1, 2 , 3 e 5 Barra dos Coqueiros
Planaltina Faisa I, II, III, IV e V
Mar e Terra Porto Seguro
Santa Clara I Rio Verde
Guirapa Icarai
Guanambi
Igapora
Sangradouro 3 Candiba Serra do salto
Alvorada Ilheus
Sangradouro 2
Pedra do Reino Pindai Santa Clara II, III, IV, V e VI
Osório 2
Seabra
Macaubas Nossa Senhora da Conceição
Fazenda Rosário 3 Pajeu do vento Licinio de Almeida
Coxilha Negra V Novo Horizonte
Coxilha Negra VI
PAC 2 Coxilha Negra VII
Fazenda Rosário

12. Alternative Energy Sources
Biomass
UTE Unid. Bio. Morro Vermelho
UTE São João da Boa Vista UTE Boa Vista UTE Ben Bioenergia UTE Unid. Bio. Água Emendada
UTE Quirinópolis (1ª etapa)
UTE Baia Formosa
UTE Quirinópolis (BC)
UTE Porto das Águas
UTE Angélica
UTE Jataí
UTE Rio Brilhante F. I e II
UTE Cachoeira Dourada
UTE Unid. Bio. Alto Taquari UTE Codora
UTE Chapadão Agroenergia UTE Paraúna
UTE Ferrari UTE Caçu I
UTE Santa Isabel BC
UTE Santa Luzia I UTE Lagoa da Prata F. I e II
‘ UTE CBB
UTE Costa Pinto BC
UTE Unid. Bio. Costa Rica UTE Vale do Tijuco
UTE São Fernando UTE Vale do São Simão
UTE Bonfim UTE São José BC
UTE Iacanga UTE Bevap
UTE Noble
UTE Ipaussu Bioenergia ‘
UTE Decasa UTE São João Biogás
UTE Pioneiros II BC UTE Interlagos
UTE Cocal II UTE São Luiz
UTE Santa Cruz AB F.I e II UTE Biopav II
UTE Flórida Paulista BC
UTE Clealco- Queiroz UTE Colorado BC
UTE Barra Bioenergia
UTE Noroeste Paulista PAC 2
UTE Rafard BC
PAC 1
UTE Destilaria Andrade UTE Quatá BC
PAC 1 com conclusão
UTE Ester UTE Conquista do Pontal original após 2010

13. OIL AND GAS
Exploration, Production and Natural Gas Transport Infrastructure

14. PRODUCTION AND EXPLORATION
Increase oil and gas production
Seismic assessment, drilling, plataform production
! To explore the reserves and enlarge national production,
including the new Pre-Salt discoveries
! Value chain: naval industry, mecanic engineering, steel, chemical,
precision engineering among other
US$ 418,5 billion
2011-2014 – US$ 110.4 billion
after 2014 – US$ 308 billion

15. PRODUCTION AND EXPLORATION – Pre-Salt
Reserves around 10.6 a 16 billion barrels of oil equivalent (boe)
Total Pre-salt área: 149 mil km²
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16. REFINEMENT, PETROCHEMESTRY and FERTILIZER
Refinaria Premium I Refinaria Clara Camarão
Refinaria Premium II Refinaria Abreu e Lima
Petroquímica Suape – PTA
FAFEN-SE
Petroquímica Suape – PET POY Sulfato de amônio
Fabrica de Amônia
Complexo Químico
UFN-4
Fábrica de Fertilizantes
Nitrogenados III
Complexo Petroquímico do Rio
US$ 76.6 billion
PAC 2 2011-2014 – US$ 41,8 billion
PAC 1
PAC 1 com conclusão Pós 2014 – US$ 34,71 billion
original após 2010

17. HIGHWAYS

18. PAC 2 – 2011 – 2014 - HIGHWAYS
Preliminary investment forecast
Total - US$ 29 billion
Type of investment Km
Construction 8.000
Maintenance 55.000
Projects 12.600

19. FEDERAL HIGHWAY CONCESSION PROGRAM
Central-South Region –
54% of Brazil’s GDP
Length: 2,212.4 km
• BR-040/Distrito Federal-Goiás-Minas Gerais – 937 km
• BR-116/Minas Gerais – 817 km
• BR-101/Espírito Santo – 458.4 km
GO
Total Investment: US$5.5 billion
DF BR-116
BR-101
BR-040
Governador
ES
Valadares
Concession bidding MG
Belo
Horizonte Vitória
1nd Half, 2011

20. CONCESSION MODEL
Internal Rate of Return: 8.0% per year
• Reference value used on the 3rd Phase of the Federal Highway Concession
Program
Term of Concession: 25 years
Annual tariff adjustment according to inflation variation
Investments described in the Highway Usage Program
• Constructions required (recovery, duplication, lighting, and others)
• Constructions conditioned to the volume of traffic (to expand capacity)
• Performance Parameters: paving, safety, signage, lighting, user assistance,
and others.
Focus on service quality
Concessionaire performs the necessary investments in the most efficient way to
meet the Performance Parameters
*Allows the participation of Brazilian or foreign companies, financial institutions,
pensions funds and private equity funds, separately or in consortiums

21. BR-040/DISTRITO FEDERAL-GOIÁS-
MINAS GERAIS
Connects the federal capital, Brasília, to two
important cities: Belo Horizonte and Rio de Janeiro
Length: 937 km GO
Toll Plazas: 12 DF
Basic Tariff BR-040
• US$ per 100 Km: 2.1
MG
• Toll*: US$ 1.4 Belo
Horizonte
Total Investment: US$1.8 billion
Concession bidding
1nd Half, 2011
*Prices on January, 2007

22. BR-116/MINAS GERAIS
Important South-Southeast connection with
the Northeast
Length: 817 km
Toll Plazas: 8 BR-116
Basic Tariff
• US$ per 100 Km: 3.1 Governador
• Toll*: US$ 3.5 MG Valadares
Total Investment: US$2.3 billion
Concession bidding
1nd Half, 2011
*Prices on January, 2007

23. BR-101/ESPÍRITO SANTO
Connecting corridor linking RJ, SP and BA states, tourism
hubs with high traffic volume. Crucial to cargo transportation
Length: 458.4 km
Toll Plazas: 7 BR-101
Basic Tariff
• US$ per 100 Km: 3.7
Total Investment: US$1.4 billion
ES Vitória
Concession bidding
1nd Half, 2011

24. RAILROADS

25. PAC 2 – 2011–2014 – RAILROADS
Preliminary investment forecast
Total - US$ 26 billion
Type of investment Km
Construction 4.700
Studies 2.985
High Speed Train 1.991

26. RAILROAD CONCESSION PROGRAM
Participation in bidding processes
• North-South Railroad
• East-West Integration Railroad
• High-Speed Rail

27. NEW CONCESSION AND USAGE MODEL FOR NEW
RAILROADS – In study by the Government
Separation of Infrastructure and Operations:
• VALEC is a public company which is the concessionaire for the
North-South, East-West Integration and Midwest Integration
Railroads
• Infrastructure management would continue to be under
VALEC’s responsibility, and totally separated from the
operation
• The operation concessionaire (logistics operator) would
acquire the right-of-way to use a preset number of tracks
• Goal is to optimize the usage of the railroad and reduce costs
due to the efficiency gains

28. Port of Vila do Conde /PA
Port of Itaqui/MA
São Francisco Waterway
Palmas/TO
Figueirópolis/TO
Anápolis/ GO
Ilhéus/BA
Estrela D’Oeste/SP
Port of Itaguaí/RJ
Port of Santos/SP

29. NORTH-SOUTH RAILROAD – SOUTH SECTION
Port of Itaqui / MA
Açailândia
Aguiarnópolis
Araguaína
Palmas
Alvorad
a Uruaç
u
Anápolis
• 33% of Brazilian agricultural production Santa Fé do
Sul
Açailândia
• 72% of agricultural land Aguiarnópolis
• Large mineral reserves Araguaína
• Outflow of the agro-industrial and Palmas
mineral production to four ports Peru North Section
South Section
Uruaçu
Length: 1,525 km Anápolis
Bidding for the logistic operator
1st Half, 2011 Estrela D’Oeste (SP)
Section to be Concessed
Concessed Section

30. EAST-WEST INTEGRATION RAILROAD
• Outflow of the agricultural Port of Vila do Conde / PA
and mineral production Port of Itaqui / MA
• Waterway integration
Figueirópolis (TO)
Length: 1,527 km Ilhéus (BA)
Bidding for the logistic operator
Port of Itaguaí / RJ
1st Half, 2011
Port of Santos / SP

31. HIGH-SPEED RAILS PLANNED
36 million inhabitants
Resende
Taubaté
São José dos Campos
Metropolitan Region of Campinas
Volta Redonda
Metropolitan Region of São Paulo
Metropolitan Region of Rio de Janeiro
Campinas - São Paulo - Rio de Janeiro – 511 km
Market Potential
• Metropolitan Region of São Paulo: 19 million inhabitants
• Metropolitan Region of Rio de Janeiro: 12 million inhabitants Concession bidding
• Metropolitan Region of Campinas: 2.5 million inhabitants
1st Half, 2011
Economic Importance
• Rio de Janeiro and São Paulo States concentrate 45 % of Brazil’s GDP
• São Paulo is Latin America's biggest financial center, concentrating 70% of the stock market
• Rio de Janeiro is the biggest Brazilian tourism hub

32. HIGH-SPEED RAIL – HSR
Project scope
• Estimated investment: US$19.7 billion
• Deadline for operation start: 2016
Concessionaire responsible for the design, construction, operation and
maintenance, complying with technical performance parameters;
Auction to be open to all existing technologies
Compulsory technology transfer
Public sector participation: own capital and financing
Documentation available at www.tavbrasil.gov.br
• Technical studies on demand, alignment, geology, operation and economic-financial
modeling completed and available

33. WORLD CUP 2014 – HOST CITIES
Fortaleza
Natal
Manaus
Recife
Cuiabá
Salvador
Brasília
Belo Horizonte
São Paulo Rio de Janeiro
Curitiba
Porto Alegre

34. RESPONSIBILITY ASSIGNMENT MATRIX
Issue Responsible
Ports
Passenger Terminals Federal Government
Airports
Passenger Terminals and Lanes Federal Government
Stadiums
Construction, reform and maintenance States and Municipalities
Federal
Government
Urban Mobility States and Municipalities financing
Hotels Private sector

35. AIRPORTS

36. AIRPORTS
Guidelines
To provide airports a structure suitable for:
• Ensuring quality care and users’ comfort
• Meet the projected increased demand
Improving the conditions for operational safety:
• Lane, yard, control tower
• Technological upgrade of the operating systems
Total: 25 airports

37. AIRPORTS
Historical Demand
1997 : 0.3 passengers carried per capita (163.8 million)
2008 : 0.6 passengers carried per capita (189.6 million)
6 milions of new passengers in 2009
After 2003: growth of 10% on passengers carried per capita
10% py 128
Number of passengers: Million boardings + landings + connections
111 113
102 13 13 13
96 12
4% py 13
82 80%
59%
74 75 71 11
68 9
63 63 10
9 10
55 10 9 115
11 98 100
83 90
65 66 71
53 54 58 61
44
97 98 99 00 01 02 03 04 05 06 07 08 09
International Domestic
Fonte: EMBRATUR

38. WORLD CUP HOST CITIES AIRPORTS
US$ Million, Preliminary
Airport Investment
Belo Horizonte 240,4
Brasília 440,2
Cuiabá 51,5
Curitiba 42,8
Fortaleza 164,4
Manaus 192,6
Natal 334,6
Porto Alegre 203,4
Recife 11,6
Rio de Janeiro 404,3
Salvador 26,5
São Paulo 1153,8
Considering Guarulhos
Total 3.266,2 (US$720 million) and Viracopos
(US$ 410 million)

39. AIRPORTS

40. PORTS

41. PORTS - World Cup
• Complementary investments to PAC
• Focus on passengers terminals
• Host cities with projected deficit in number of beds

42. PORTS CONSTRUCTION AND MODERNIZATION
US$ 2.9 billion
! Build and modernize docks, piers, terminals, improve aquatic and land access
! Debureaucratization of port operations
! Passengers Terminals for the World Cup 2014
! Reduced logistics costs
! Better operational efficiency
! Increased competitiveness
! Encourage private investments
48 PROJECTS – 21 PORTS - US$ 2.9 billion
Ventures Quantity
Dredging 12
Port Infrastructure 24
Logistics Intelligence Systems 5
Passengers Terminals – World Cup 2014 7

43. URBAN MOBILITY

44. URBAN MOBILITY
PAC 2 - Subway, LRT, BRT and bus lanes
! 1st Phase – US$ 6.8 billion – launched Feb 16th
!World Cup - projects selected in December 2009
!Federal Government Financing
!Execution by state and city governments
! 2nd Phase – US$ 10.2 billion
!Public transportation systems in major urban centers
US$ billion
Investment
Union Budget 3.4
Financing 6.8
TOTAL 10.2

45. URBAN MOBILITY – WORLD CUP
Summary per Modal
US$ Million
Modal Qty Project Value Financing
Subway 2 21 20
Bus Terminals 3 38 36
Monitoring 3 66 66
VLT 2 370 312
Bus Corridors 18 1,138 1,067
Monorail 2 2,449 989
BRT 20 2,735 2,098
Total 50 6,817 4,587

46. URBAN MOBILITY FINANCING – WORLD CUP
• Deadline: 4 years of grace period after signing the contract
20 years to repay after the grace period (30
years for public rail transport)
• Scope: Light Rail Trains (LRTs), Monorail and Bus Rapid
Transit (BRT)

47. STADIUMS

48. STADIUM FINANCING
Main financing characteristics:
• Amount: Up to 75% of the project value, limited to R$400 million
• Term: 3 years of grace period after signing the contract
12 years to repay after the grace period

49. STADIUMS SITTUATION
Investment Capacity Cost per seat
Intervention (R$ million) (thousand) (R$ thousand)
Curitiba Reform 184.5 41 4.5
Privately-
Porto Alegre Reform 130.0 62 2.1 R$ 0.87 billion
owned
São Paulo Reform 555.0 72 7.7
B. Horizonte Reform 426.1 70 6.1
Brasília Reform 745.3 69 10.8
Manaus Reconstruction 515.0 44 11.7
Government- R$ 3.09 billion
Owned Cuiabá Reconstruction 454.2 45 10.1
R. Janeiro Reform 600.0 83 7.2
Natal Construction 350.0 45 7.8
Fortaleza Reform 623.0 60 10.4
Public-private Salvador Reconstruction 591.7 50 11.8 R$ 1.74 billion
partnership
Recife Construction 529.5 46 11.5
Total 5,704.3 687 8.3
(*) Considering the basic design values. Including the constructions around the stadiums at São Paulo and Curitiba.

50. HOUSING AND SANITATION

51. “MINHA CASA, MINHA VIDA” PROGRAM
• 1st phase – 2009-2010 – US$30.7 billion
• Production of 1 million homes to families with income up to
US$2,784 – equivalent to 14% of the housing deficit
• Subsidies for low-income families (up to US$1,670 per month)
• Long-term government partnership with private investors
• Establishment of a Guarantee Fund to reduce risks and costs
• 2nd phase – 2011-2014 – US$40.3 billion
• Production of 2 million homes

52. SANITATION
• PAC 2
• Water treatment
• Sewage and waste treatment
• Projects and studies
• To expand sewage collection and treatment system
• Improve waste treatment and reduce environmental damage
TOTAL PROJECTED INVESTMENT- US$ 12.6 billion

53. Brazil
Infrastructure Investment Opportunities
Tokyo, 1.3.2011
Guilherme Walder Mora Ramalho
Infrastructure Advisor
Executive Office of the President of Brazil