April 11 (Bloomberg) -- Petroleo Brasileiro SA, Brazil's state-controlled oil company, may purchase tankers from Brazilian shipyards to export ethanol as the company moves to quadruple foreign sales of the biofuel.

The ships would expand a plan to build 42 vessels for Rio de Janeiro-based Petrobras's fleet of tankers as increased oil, gas and fuels production transforms Brazil from an energy importer into an energy exporter, said Sergio Machado, head of Transpetro, the company's transportation unit.

``We have the land, the sun and the water to become the Saudi Arabia of ethanol,'' Machado said in an interview at Rio de Janeiro's Sermetal shipyard. ``We need to have our own ships to export our output too.''

Machado expects the first such ethanol tanker, which would likely be a 75,000 metric-ton, Panamax-class fuel tanker treated to resist the biofuel's corrosive effect on steel, to be built by 2011.

Petrobras is in the middle of a $2.5 billion plan to build 26 tankers for oil, natural gas and other fuels with the first deliveries scheduled for 2009. The plan is part of Brazilian president Luiz Inacio Lula da Silva's plan to revive the country's shipbuilding industry, which in the early 1980s was the world's second largest.

Each Panamax-size ethanol tanker would cost about $130 million to build, the same price as a normal gasoline or general-fuels tanker, he said.

Transpetro expects to complete contract negotiations with Brazilian shipyards and Brazil's state development bank, BNDES, for 16 more ships by the end of May. The bank is supplying subsidized loans for up to 90 percent of the costs for the domestically built ships.

Petrobras, which is planning to build ethanol pipelines for export, is also considering plans to ship ethanol on barges using the country's river systems, Sillas Oliva Filho, Petrobras' ethanol sales chief, said in an interview March 27.

To contact the reporter on this story: Jeb Blount in Rio de Janeiro at jblount@bloomberg.net

Last Updated: April 11, 2007 18:48 EDT