TAG is the operator of around 4,500km of gas pipeline infrastructure in Brazil
French electric utility company ENGIE and Caisse de dépôt et placement du Québec (CDPQ) have agreed to acquire Petrobras’s remaining 10% stake in the Brazilian pipeline operator Transportadora Associada de Gás (TAG).
The companies have signed a share purchase and sale agreement with Brazilian state-run oil company Petroleo Brasileiro (Petrobras).
The deal, which is worth BRL1bn ($187.5m), follows sale of the other 90% of TAG for $8.6bn last year by Petrobras to the same group.
TAG is the operator of around 4,500km of gas pipeline infrastructure in Brazil.
The gas pipeline system, with an installed capacity of 75 MM m3 /d, is located along the coastline of the Northeast and Southeast regions as well as a further stretch which connects Urucu to Manaus (AM).
ENGIE will own 65% stake in Brazilian pipeline operator TAG
Through the deal, ENGIE’s total equity share in TAG will increase to 65%, of which 32.5% is held by ENGIE Brasil Energia. The remaining 35% interest will be held by CDPQ.
ENGIE said that it will keep the current equity consolidation method, upon completion of the acquisition.
ENGIE interim CEO Claire Waysand said: “We have been operating in Brazil for almost 25 years with a long-term investment focus. This acquisition allows us to invest further in an asset we know, capitalizing on our expertise in networks, in a key country for ENGIE.”
Fuerther, it said that the capacity of TAG is fully contracted on the basis of ship-or-pay clauses with an average residual duration of 11 years.
Currently, its network represents 47% of the country’s entire gas infrastructure.
The infrastructure is said to have further development potential such as network extension, additional connections, gas storage development and green gases transport.