The sale of its LNG assets to Pavilion Energy is part of Iberdrola's €3.5bn (£3.1bn) non-strategic asset rotation plan
Image: The sale of its LNG assets to Pavilion Energy is part of Iberdrola's €3.5bn (£3.1bn) non-strategic asset rotation plan. Photo courtesy of Pavilion Energy.
Pavilion Energy, a Singapore-based LNG company, has signed an agreement with Iberdrola, a Spanish electric utility company, to purchase its portfolio of LNG assets.
The acquisition agreement has been signed by Pavilion Energy Trading & Supply, a wholly-owned subsidiary of Pavilion Energy.
The portfolio to be acquired by Pavilion Energy includes approximately 4 million tonnes per annum (mtpa) of long-term sale and supply LNG contracts, long-term regasification of approximately 2mtpa at the Grain LNG terminal (UK), regasification access in Spain and the Spanish-France border pipeline capacity, along with the time-charter of a newbuild MEGI LNG vessel.
As part of the transaction agreement, both the companies have signed a gas sales agreement for Pavilion Energy to supply natural gas in Spain to Iberdrola Generación Espana.
Pavilion Energy group chief executive officer Frédéric H. Barnaud said: “Building on Pavilion Energy’s success in Singapore and in the Asia-Pacific Basin, this acquisition brings us a portfolio of prime assets primarily in Europe and the Atlantic Basin. The combined portfolio achieves global reach with the scale and flexibility required to outperform.
“Today is a critical step towards our vision to be a leading global LNG player, leveraging our LNG portfolio with deep access to strategic gas markets in Singapore, Spain, and the UK, combined with sophisticated optimisation and risk management skills.”
The sale of is part of Iberdrola’s non-strategic asset rotation plan
The sale of its LNG assets to Pavilion Energy is part of Iberdrola’s €3.5bn (£3.1bn) non-strategic asset rotation plan, announced by the company in its Outlook 2018-2022.
Till date, the company has disposed of assets valued at €1.7bn (£1.5bn), almost half the target set for the period.
The transaction is expected to be closed on 1 January 2020, and the final valuation is subject to several upward or downward adjustments stipulated in the contract, along with the value of the LNG inventory transferred on the closing date of the transaction.
Pavilion claims that it supplies for one-third of Singapore’s downstream natural gas demand.