Colombia's GEB 'not ready' to complete Promigas sale

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Thursday, November 23, 2017

Colombia's Grupo de Energía de Bogotá (GEB) said Thursday it has yet to commit to a second phase of its divestment in gas distributor Promigas amid tepid investor interest.

GEB began offloading its 15.6% stake in Promigas in June as part of a wide-ranging sale of non-core assets, including minority interests in transmission firm ISA, processed food company Nutresa and Banco Popular.

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"We're analyzing the market and haven't made a decision yet," GEB chief financial officer Felipe Castilla said during a quarterly earnings call.

"Prices have shown volatility and we're not ready to announce to the market when we will proceed with the process."

In September, GEB said it awarded just 4,547,620 of the 177,464,263 shares offered in the first phase of the sale, which targeted workers and pensioners.

In addition to distributing gas in Colombia and Peru, Promigas operates pipelines, distributes electricity and is a part-owner of the Cartagena LNG regasification terminal.

Meanwhile, GEB said it would seek private capital to finance its planned participation in the country's second LNG import facility on the Pacific coast.

Castilla said the company was awaiting further details of the project from gas market regulator Creg.

"We expect invitations for bids to be sent in the first half of next year and when that happens we believe everything will be defined," he said. "We still need to know what the conditions are and aspects such as whether it will be a floating plant or built on land."

Last week, GEB subsidiary TGI revealed it hired a consultancy firm to help search for a strategic joint venture in the project.

Earmarked for the port city of Buenaventura, the LNG terminal is expected to boast capacity of 400Mf3/d and has been budgeted at US$560mn.

The project's blueprint also includes a gas pipeline linking the plant to the northern outskirts of Cali, Colombia's third largest city, and an associated 148MW thermopower station.