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Petrobras May Dismantle Its 4,500 Kilometers of Gas Pipelines

Written by Paulo Nogueira
Published on 14/01/2019 at 08:47
Updated on 14/01/2019 at 20:35
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Petrobras’s Intention Is to Focus on Investments in Deep Water and Leave Transportadora Associada de Gás (TAG) to the Private Sector

The Brazilian state oil company Petróleo Brasileiro, or Petrobras, could introduce a new Sales and Purchase Agreement (SPA) for the sale of the gas pipeline Transportadora Associada de Gás (TAG), after a ruling by the Supreme Federal Court in July delayed the sale.

Petrobras aims to raise about US$ 7 billion from the sale of its 4,500 km natural gas pipeline infrastructure and invest the profits in deep water assets in the Atlantic, which are considered more lucrative investments. Prior to the ruling, Petrobras negotiated with a consortium of the French company Engie and the Canadian Caisse de dépôt et placement du Québec (CDPQ).

Earlier last month, Petrobras’s board approved a five-year investment plan, including proposed investments totaling about US$ 84 billion by 2023. These are mainly focused on oil and gas exploration and production assets in deep water.

A Supreme Court ruling cost Petrobras about US$ 10 billion. The aforementioned Franco-Canadian consortium will now have to present a new SPA to the market and allow time for counteroffers from any other interested parties in purchasing Petrobras’s TAG, sources said.

Despite Judge Dias Toffoli allowing Petrobras to continue selling its assets to the private sector, this decision will still go through proceedings in the Supreme Court for evaluation, with the first of these hearings scheduled for February 27.

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Paulo Nogueira

Graduated in Electrical Engineering from one of the country's technical education institutions, the Instituto Federal Fluminense - IFF (formerly CEFET), he worked for several years in the offshore oil and gas, energy, and construction sectors. Today, with over 8,000 publications in online magazines and blogs on the energy sector, the focus is to provide real-time information on the Brazilian job market, macro and microeconomics, and entrepreneurship. For questions, suggestions, and corrections, please contact us at informe@clickpetroleoegas.com.br. Please note that we do not accept resumes at this contact.

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