Mitsui partners with Petrobras, state governments in Brazilian gas distribution

Mitsui & Co., Ltd. and Petróleo Brasileiro S.A. signed a Share Purchase Agreement Monday, where Mitsui will acquire 49 percent of Gaspetro shares through Mitsui Gas e Energia do Brasil Ltda (Mitsui Gas) under an estimated purchase price of approximately $486,936,446.

The gas distribution business in Brazil is primarily composed of regional monopolies that are based on the concessions granted by the state's government. Under the agreements signed with state governments, each gas distribution infrastructure and gas pipeline network is to be developed in their service areas in each state while gas purchased from Petrobras, power stations, general industrial and commercial users and residential consumers is distributed. Gas will also be distributed for use of fuel for vehicles that run on natural gas.

Mitsui is currently engaged in gas distribution operations in eight different Brazilian states. The acquisition of shares in Gasperto are aimed to increase the number of states that are served by gas companies and the amount of gas that is supplied by those companies to 30 million cubic meters per day within Brazil.

Gas demand is expected to grow in accordance with economic development in many regions, including central, northeastern and southern Brazil.