Mubadala said to be among bidders for Petrobras' natural gas unit

No details were given on the size of the bids, but the proposals were expected to go as high $8bn
Mubadala said to be among bidders for Petrobras' natural gas unit
By Bloomberg
Sun 22 Apr 2018 08:20 AM

Petrobras has received three bids for a 2,800-mile (4,506 kilometre) natural gas pipeline system being sold as part of a wider push to raise cash through divestments, said people knowledgeable on the matter.

Mubadala Development along with EIG Global Energy Partners are leading one group while Sydney-based Macquarie Group Ltd. leads another that submitted bids on Thursday for Transportadora Associada de Gas, or TAG, the people said. A third bid includes French utility Engie SA, the people said, requesting not to be named because the information isn’t yet public.

No details were given on the size of the bids, but the proposals were expected to go as high $8 billion including debt, people familiar with the process said earlier this week. Petrobras will come to a decision in two or three weeks, though more information may be needed, one person said on Friday.

China’s Silk Road Fund Co. and Italian Snam joined the Mubadala and EIG group, the people said. Sao Paulo-based Itausa - Investimentos Itau SA is competing for TAG in association with Sydney-based Macquarie, Canada Pension Plan Investment Board, and Singapore’s GIC Private Ltd.

The sale of TAG, which spans ten Brazilian states, could be Petrobras’ largest to date, accounting for more than a third of the state-controlled energy company’s $21 billion divestment target

Petroleo Brasileiro, as the oil producer is formally known, Macquarie, EIG, Itausa, CPPIB and Silk Road Fund declined to comment on the sale. Snam, Engie, GIC and Mubadala didn’t immediately respond to requests for comment.

In 2016 Petrobras sold Nova Transportadora do Sudeste, a similar but smaller pipeline network in Brazil’s southeast, to a consortium led by Brookfield Asset Management for $5.2 billion.

The TAG sale would add to growing foreign presence in Brazil’s natural gas industry as Petrobras sheds side businesses to slash debt and focus on its most profitable oil projects in deep waters of the South Atlantic. In March, China’s Shandong Kerui Petroleum signed a deal with Petrobras to invest in a natural gas processing plant in Rio de Janeiro state.

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