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