Singapore-based LNG company Pavilion Energy said its wholly owned subsidiary Pavilion Energy Trading & Supply has agreed to buy Spanish energy company Iberdrola's portfolio of liquefied natural gas (LNG) assets.
The portfolio comprises about 4 million tonnes per annum (mtpa) of Iberdrola's long-term LNG sale and supply contracts.
It also includes long-term regasification of approximately 2 mtpa at the Grain LNG terminal (UK), regasification access in Spain and the Spanish-France border pipeline capacity, as well as the time-charter of a newbuild MEGI LNG vessel. In a related transaction, both parties have concluded a gas sales agreement for Pavilion Energy to supply natural gas in Spain to Iberdrola Generación Espana.
"Building on Pavilion Energy’s success in Singapore and in the Asia-Pacific Basin, this acquisition brings us a portfolio of prime assets primarily in Europe and the Atlantic Basin. The combined portfolio achieves global reach with the scale and flexibility required to outperform," said Frédéric H. Barnaud, Group Chief Executive Officer of Pavilion Energy.
"This is a critical step towards our vision to be a leading global LNG player, leveraging our LNG portfolio with deep access to strategic gas markets in Singapore, Spain, and the UK, combined with sophisticated optimisation and risk management skills," he added.
Meanwhile, Iberdrola confirmed in a statement that it has signed the agreement with for the sale of its portfolio of LNG, an annual volume greater than 5 bcm, sea transport and long-term regasification capacity contracts in the United Kingdom, as well as other gas supply related agreements.
This divestment from Iberdrola will be completed on 1st January 2020. The final valuation is subject to several upward or downward adjustments stipulated in the contract, as well as the value of the LNG inventory transferred on the closing date of the transaction.
The agreement signed today between Iberdrola and Pavilion Energy represents a change in the group's current gas supply strategy, to fulfil not only the customer needs, but also those of combined cycle plants.
As a supplier of one-third of Singapore’s downstream natural gas demand, Pavilion Energy has been an ardent advocate of natural gas as a cleaner fuel for power generation, industrial use, and as bunkering fuel. This strategic transaction will enable Pavilion Energy to play a greater role in energy transition as well as to offer competitive solutions to our customers and suppliers.
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