Union Fenosa, Galp buy stake in EGuinea gas project

27th April 2011, Comments 0 comments

Spain's Union Fenosa Gas and Portugal's Galp Energia have bought a German firm's 25 percent stake in Equatorial Guinea's 3G gas pipeline project, the government in Malabo said Wednesday.

After the buyout of E.ON Ruhrgas's stake, Fenosa now owns a fifth of the company's shares and Galp 15 percent. The rest are either owned by government or its state-run energy company Sonagas, said an energy ministry statement.

The consortium is looking to build and operate a gas pipeline in Equatorial Guinea to supply domestic and foreign demand. The country is already Africa's third largest oil producer but is now hoping to tap into its substantial gas reserves.

The ministry declined to give details on the transaction and said the German gas firm withdrew for "general strategic reasons unrelated to the 3G project."

Equatorial Guinea, one of Africa's smallest and most impoverished countries, rakes in 90 percent of its revenue from fossil fuels. According to official figures, it currently produces around one million tonnes of methanol per year, 8,000 barrels of butane per day and 14,000 barrels of propane per day.

© 2011 AFP

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