Enagás seeks partner for international operations

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Tuesday, February 20, 2018

Spanish natural gas operator Enagás aims to advance this year with plans to find a partner for its international business, according to executive chairman Antonio Llardén.

The natural gas operator's global operations include the GNL Quintero LNG terminal in Chile, stakes in Peru's TGP and COGA, and in Mexico, the Altamira regasification plant, the Morelos gas pipeline and the Soto La Marina compressor station.

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The strategy does not entail selling assets but a partnership to continue growing the international business, Llardén said during the company's 2017 results presentation on Tuesday.

"We have an international activity that we think is working very well or reasonably well, that is providing revenue that we did not have before," he added.

PERU GAS PIPELINE

Regarding recouping Enagás' investment in the Peru southern gas pipeline, Llardén said the government has acknowledged receipt of the company's proposal.

Enagás was part of the project's consortium whose concession contract was revoked by Peru's government in January 2017 after the concessionaire missed a financing deadline. The Spanish company aims to recover 511mn euros (US$630mn).

Llardén said that Peru's international investment dispute authority Sicresi, which is part of the economy and finance ministry (MEF), is scheduled to meet with Enagás this week to advance talks.

He highlighted that if direct negotiations fail, arbitration would begin with the World Bank.

MEF has ruled out any compensation for the consortium, based on the concession contract.

"There is payment for the value of the assets, but that payment is made by the next project winner. [Investment promotion agency] ProInversión is responsible for selecting the next winner. There still is not a value for the assets," state news agency Andina quoted MEF as saying earlier this month.

ProInversión aims to launch a new process to continue development of the pipeline, now known as Sistema Integrado de Transporte de Gas Zona Sur, near year-end.

Pictured: Work on the southern Peru gas pipeline (CREDIT: ProInversión)