‘s national development bank BNDES has approved loans totalling R830mn towards a US$1.2bn natural gas pipeline expansion plan for federal energy company Petrobras.
BNDES abandoned plans to lend the money through Brazilian banks because they were demanding a spread of 4%. Banco do Brasil, Bradesco, Itau and Unibanco are known to have been in talks with BNDES.
The Japan Bank for International Cooperation (JBIC) will provide about US$400mn of the financing.
Petrobras wants to expand its natural gas pipeline networks in the southeast and northeast of the country. To avoid taking on the full cost of the project directly, it has reached an agreement with Japanese firms to provide the financing and build the pipelines, while it will purchase capacity from the pipelines once they start operations.
Two new companies have been created to build and manage the pipelines systems: Nova Transportadora do Nordeste (NTN, for the northeast) and Nova Transportadora do Sudeste (NTS, for the southeast).
The two companies will be owned by Japanese trading firms Mitsui & Co (40%), Itochu Corporation (30%) and Mitsubishi Corporation (30%).