Endesa blocking BG stake sale in LNG terminal to Enagas
BY GRACIELA IBANEZ
READING -- BG Group can' t conclude the planned sale of its remaining 20% stake in a LNG regasification terminal in central Chile as ENDESA one of the terminal' s shareholders, hasn' t approved the transaction. BG needs the consent of its partners in the LNG venture to sell its remaining GNL Quintero stake, but Endesa won' t approve the transaction as supply contract negotiations haven' t ended yet, Diario Financiero reported citing unnamed sources.
As the discussions with Endesa are turning sour, the British gas supplier is studying to seek arbitration, Diario Financiero reported. A rift between Endesa and BG broke out last year, when BG sought to renegotiate the conditions of long-term gas supply contracts signed in 2007 with Endesa and other two shareholders in GNL Quintero. BG reached a deal with the terminal' s other shareholders,Enap and Metrogas, but not with Endesa.
While it was negotiating new gas supply contracts, BG was also in the process of divesting its Chilean assets. The company sold a 20% stake in GNL Quintero to Enagas and is planning to sell its remaining 20% stake in the terminal also to Enagas for $176 million by the end of 2012. "Naturally, BG Group is disappointed that it has been unable to conclude the sale of a second and final 20% equity tranche in GNL Quintero," a BG spokesman said in an email.
Endesa and Enagas representatives declined to comment, but BG confirmed that a third-party is "withholding consent for the transaction." The BG spokesman declined to comment whether the company would seek arbitration to solve the dispute with Endesa.
Dow Jones Newswires