South African Gas Development Company (SOC) (iGas) and Mozambique-based Companhia Mocambiçana de Gasoduto (CMG) have exercised their right to acquire Sasol’s 30% stake in the ROMPCO gas pipeline.
The move follows the signing of a deal in May 2021 where Sasol agreed to sell a 30% stake in the 865km-long gas transmission pipeline to a Reatile-led consortium for $353m.
The transaction, however, was subject to pre-emptive rights on the shares owned by existing shareholders iGAS and CMG.
Owned by the Republic of Mozambique Pipeline Company (ROMPCO), the Mozambique pipeline transports gas from Mozambique to South Africa.
ROMPCO is a joint venture of Sasol’s major subsidiary Sasol South Africa (SSA) (50% stake), CMG, a subsidiary of Mozambique’s Empresa Nacional de Hidrocarbonetos (ENH) (25%), and iGas, a subsidiary of South Africa’s Central Energy Fund (CEF) (25%).
Upon completion of the deal, state-owned energy firms iGAS and CMG will increase their share in the pipeline project to 40% each. Sasol’s share in ROMPCO will reduce to 20%.
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By GlobalDataENH CEO Estevão Pale said: “Having both governments as majority shareholders of the cross-border pipeline is strategic, since the pipeline is the single source of gas to the South African market, and gas is the immediate alternative supplier of cleaner energy.”
The sale is part of Sasol’s plan to reduce debt.
CEF Group CEO Dr Ishmael Poolo said: “There was a concerted effort to fast track the acquisition of these shares, which is a hallmark of the group’s investment strategy in the energy value chain geared to reignite the South African economy and create much needed jobs.
“It also furthers the mandate held by iGAS for the development of gas and gas infrastructure in Southern Africa.”
