Mitsui buys stake in Brazilian Cegas
Japan’s Mitsui & Co., Ltd. has signed a Share Purchase Agreement with Brazil’s Taquari Participacoes S/A, to acquire a share in Companhia de Gas do Ceara S.A. (Cegas), a local gas distribution company in the state of Ceara, in the northeastern part of Brazil, on December 17, 2014.
In 2006, Mitsui acquired Mitsui Gas e Energia do Brasil Ltda (MGEB), which has local gas distribution companies in 7 states of Brazil and is undertaking the development and maintenance of infrastructure for gas distribution and stable distribution of gas for 8 years.
Mitsui has acquired a share in Cegas (common share 24.5%, preferred share 50%, economic investment ratio 41.5%) through MGEB. Consequently, the gas distribution volume of LDCs under MGEB will be 14.69 million m3 per day, which is equivalent to 22% of the total distribution volume in Brazil.
Under the concession agreement which has been executed between Cegas and the state government, Cegas undertakes the development and maintenance of infrastructure for gas distribution, and distributes gas, which is purchased from Brazilian public petroleum company Petrobras, to the thermal power plant, industrial customers, fuel for natural gas vehicles, etc. in the state of Ceara.
The Ceara state capital, Fortaleza, which is the fifth biggest city in Brazil with a population of 2.5 million, has geographical advantage as an industrial park, and the northeast railway is being expanded to the port of Pecem. Ceara offers convenient access to the US, Europe, and Africa. Cegas distributes 1.96 million m3 of gas per day, mainly to the thermal power plant and industrial customers, and an increase in gas demand accompanying the economic development is expected.