Prumo, a private Brazilian company controlled by EIG Global Energy Partners, and bp, Siemens and SPIC Brasil (“SPIC”) today announced the completion of the previously announced transaction by which SPIC acquired 33% of GNA I and GNA II LNG-to-power projects located in Port of Açu, Rio de Janeiro. SPIC has also closed on the previously announced agreement to participate in potential future expansion projects, GNA III and GNA IV, which are expected to be fueled by a combination of LNG and domestic gas from Brazil’s vast pre-salt reserves.
Together, GNA I and GNA II comprise the largest gas-to-power project in Latin America, with 3 GW of installed capacity — enough to supply energy for up to 14 million households. The complex also includes an LNG terminal with a total capacity of 21 million m3/day and pipelines capable of connecting offshore pre-salt gas and LNG to Brazil’s gas transportation network.
GNA I, which has an installed capacity of 1.3 GW, will commence operations in the first half of 2021. The first LNG cargo, supplied by bp, was successfully transferred to the BW Magna floating storage and regasification unit (FSRU) on December 27, 2020.
GNA II secured a $737 million financing agreement with the Brazilian Development Bank (BNDES). With 1.7GW of installed capacity, GNA II is expected to create up to 5,000 jobs during construction and an additional 500 jobs when it begins operations.
The successful close of this transaction during the COVID-19 pandemic reinforces GNA’s position as a key player in Brazil’s rapidly growing natural gas and power markets and a catalyst for the global energy transition. This agreement strengthens Brazil’s position as a fertile environment for attracting new investments and helps lay the groundwork for the GNA III and GNA IV expansion projects and the domestic gas hub strategy and renewables projects. The estimated total planned investment in the GNA gas and power complex is approximately $5 billion.
SPIC’s contribution to this partnership is centered on its expertise in operation and project management strategy in Brazil. Siemens Financial Services – the financing arm of Siemens AG, plans to contribute capital, innovative technology and its expertise managing similar projects. Siemens Energy will be responsible for the power plant construction and will also provide long-term operation and maintenance (O&M) service for the power plant.
bp will contribute its global portfolio of LNG acting as a key integrated and innovative gas supplier. And Prumo will contribute the entire port infrastructure and operations to the partnership while steering project development and integration. The partnership facilitates the expansion of a range of projects and demonstrates the parties’ commitment to completing the significant investments under development.
BofA Securities and Lakeshore Partners acted as financial advisors to GNA and its sponsors. Itaú BBA acted as exclusive financial advisor to SPIC.
