Petrobras to sell 90% of stake in Transportadora Associada de Gás

Brazil’s state-owned oil and gas company Petrobras has initiated the sale process of 90% of its stake in Transportadora Associada de Gás (TAG).

TAG is Petrobras’ natural gas transportation subsidiary that operates and manages a 4,500km gas pipeline system, located mostly in the north and north eastern regions of the country.

The identity of the buyer and the financial terms of the proposed transaction were not disclosed.

TAG has a transport capacity of 74.7 million cubic feet a day, which is fully employed through long-term contracts with ship-or-pay clauses.

Petrobras Transporte has been contracted by TAG to provide operation and maintenance services (O&M).

According to Petrobras, the proposed divestment will be carried out in multiple phases, including commencement of non-binding phase, beginning of binding phase, concession of exclusive negotiation, approval of transaction by senior management and signature of contracts, and closing.

As of last year, TAG had earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.2bn.

It has gas transportation agreements with around 13 years of the remaining period.               

Last month, Petrobras approved corporate restructuring in its petroleum derivatives distribution and marketing subsidiary Petrobras Distribuidora.

The restructuring plan involves capital contribution of around R$6.3bn ($2.02bn) and a partial split-off of Petrobras Distribuidora.

Petrobras recently signed an agreement with China Development Bank to explore opportunities on the Chinese financial market, according to Reuters.

The agreement is expected to cover the financing and leasing of oil platforms and other equipment needed for oil exploration and production, in addition to entailing joint investment opportunities in exploration and refining, the news agency reported.