Brazilian state-run oil company Petróleo Brasileiro (Petrobras) has signed an agreement to divest 90% stake in its natural-gas pipeline unit to Brookfield Asset Management and its partners for $5.2bn.

The stake sale in Nova Transportadora do Sudeste (NTS) is part of the company’s efforts to reduce its debt amid low energy prices.

Petrobras, however, will retain 10% stake in the NTS, which operates 2,048km natural gas pipeline network in Brazil.

As part of the deal, the stake in NTS will be sold to a group led by Brookfield’s publicly-traded subsidiary, Brookfield Infrastructure Partners. It partners in the deal include British Columbia Investment Management (BCIMC), CIC Capital and GIC Private (GIC).

Petrobras said that the deal promotes new investments to expand gas transportation infrastructure in the country.

Brookfield Infrastructure CEO Sam Pollock said: "This is a unique opportunity to invest in a large-scale, high quality utility business and participate over time in Brazil's growing gas industry.

“We are very pleased to be significantly expanding our utilities business in a sector and geography that we know well and that we believe will offer opportunities to deploy further capital at attractive risk-adjusted returns."

Brookfield expects the NTS to provide stable, inflation-linked cash flows backed by long-term, fixed-price, off-take agreements.

Planned to be completed in December 2016, the transaction is subject to the approval to certain usual precedent conditions, including approval by the regulatory entities.

Petrobras earlier announced its plan to divest roughly 35% of the $15.1bn target during the period 2015 – 2016.

Image: Petrobras’s NTS unit operates 2,048km of natural gas pipeline assets in Brazil. Photo: courtesy of supakitmod/