Petrobras Commits USD 1 Billion to Restart UFN-3 Nitrogen Plant, Awards BRL 1.8 Billion in Contracts

Petrobras approved roughly USD 1 billion on April 13, 2026 to finish the UFN-3 nitrogen fertilizer plant in Tres Lagoas, Mato Grosso do Sul, a project idle since 2015, with commercial operation set to begin from 2029.

A consortium led by Nova Engevix with China's PowerChina won contracts worth BRL 1.8 billion in the restart, according to Forbes Agro citing Reuters. Nova Engevix, part of the Nova Participacoes group, leads the consortium with a 60% stake.

The consortium took three of the 11 lots tendered by Petrobras for completion of the plant. The contracts were signed on June 25, 2026 in Tres Lagoas, according to a Nova Engevix post on LinkedIn.

The scope covers executive design, construction and commissioning of the granulated urea handling system, power and steam generation, the main substation, and the molten urea and granulation units. Nova Engevix said the project should be completed between the end of 2028 and the start of 2029.

As designed, UFN-3 produces 3,600 tonnes of urea per day and 2,200 tonnes of ammonia per day. Those volumes are treated as strategic for supplying farming regions including Mato Grosso, Mato Grosso do Sul, Goias, Parana and Sao Paulo.

William Franca, director of Industrial Processes and Products at Petrobras, told Reuters that this plant alone could cut Brazilian urea imports by 12%. Combined with other units, the reduction could reach 35%.

That wider figure depends on assets beyond Tres Lagoas. The UFN-3 restart connects to the reactivation of other Petrobras fertilizer units in Parana, Bahia and Sergipe.

The capital allocation is the substantive part for anyone tracking how state-controlled producers spend. An oil and gas company is directing about USD 1 billion into nitrogen chemicals rather than fuels output, on a build schedule that runs through the end of the decade before a single tonne is sold commercially. The economics rest on displacing imported urea, not on a fuel margin.

Ammonia and urea are gas-derived products, which places the plant on the same molecule chain as the company's upstream business while serving agricultural demand rather than energy demand. The 12% import-substitution figure cited by Franca is the yardstick to watch against the 35% target that requires the Parana, Bahia and Sergipe units to come back as well.

A foreign engineering partner carries the balance of the consortium behind Nova Engevix's 60% share, with PowerChina named alongside the Brazilian lead contractor on the winning bid. The award covers three of 11 lots, leaving the remaining packages as a separate measure of how quickly the full construction program can be staffed and financed.