Engie Sees H2 Potential in Brazil Purchase

French Engie will be able to use its Brazilian trunkline purchase as a test-bed for low-carbon gas technology, it said June 24. In April it bought the Brazilian TAG line, the country's biggest network running to more than 4,500 km.

CEO Isabelle Kocher said the line would bring in a stable profit stream but also allow Engie the "opportunity to develop new uses for gas transportation networks stemming from new technologies such as biomethane and green hydrogen."

On the financial side, TAG would bring additional contribution at current operating income of about €130mn in 2021, "with significant medium-term growth expectations increasing this contribution by more than 10% compound annual growth between 2021 and 2024 with a net debt impact of €1.6bn. The deal was financed with 70% debt.

TAG was bought for $8.6bn in an auction organised by state Petrobras, which retains 10% and the rest is owned by a consortium of Engie S.A. (32.5%) and Engie Brasil Energia (32.5%) to give Engie just under 50%; and the Canadian investment fund Caisse de Depot et Placement du Quebec (35.0%).