Joint venture looks at ethanol expansion in Brazil

Petrobras has announced a joint venture with agricultural research firm Embrapa to expand ethanol production in southern Brazil.

The partnership aims to develop varieties of sugarcane that can be adapted to temperate climates, Brazil's federal energy Petrobras said in a statement. The new crop is thought to be resistant to plagues and designed thrive in cool, dry climates.

Research will be conducted at Embrapa's laboratory in Pelotas, Rio Grande do Sul.

Government figures show that 90% of Brazilian ethanol output comes from the states of São Paulo, Paraná, Minas Gerais and Goias. The remaining 10% is produced in north-eastern Brazil.