Brazil’s Petrobras gets board approval to sell stake in NTS pipeline unit

Brazil’s Petrobras has secured clearance from the board to offload its remaining 10% stake in the natural gas pipeline unit, Nova Transportadora do Sudeste (NTS), for $337m (BRL1.8bn).

The stake will be purchased by Nova Infraestrutura Gasodutos Participações, a company formed by Nova Infraestrutura Fundo de Investimentos em Participações Multiestratégia (FIP), a fund managed by Brookfield Brasil Asset Management Investimentos and Itaúsa.

The related purchase and sale agreement and deal completion is expected in the next few days.

Petrobras will get BRL1.5bn following dividend payments and contract adjustments.

Petrobras said in a press statement: “Considering the discount of dividends, interest on equity and restitution through capital reduction received by Petrobras throughout 2020 and 2021 and the other adjustments provided for in the contract as per the base date, it is estimated that the cash inflow is $2768m (BRL$1.5bn), to be paid in full on the date of the signing and closing of the transaction.

“This disclosure complies with Petrobras’ divestment guidelines and the special regime of assets divestment by federal mixed capital companies, provided for in Decree 9,188/2017.”

The sale is said to be in line with Petrobras’ strategy for portfolio optimisation and improvement of capital allocation to maximise value for shareholders.

It also aligns with the company’s efforts to promote competition in the natural gas sector in Brazil.

NTS operates and manages nearly 2,000km of pipeline network with a capacity to transport 158.2 million m³/d of natural gas.

Located in the states of Rio de Janeiro, Minas Gerais and São Paulo, the NTS pipelines are connected to the Brasil-Bolivia pipeline, TAG transportation network, Baía de Guanabara LNG regasification terminal and to natural gas processing plants.

Other partners of NTS include FIP with an 82.35% stake and Itaúsa with a 7.65% interest.