Miami-headquartered private equity firm I Squared Capital is injecting US$300 million capital investment into an affiliate firm of oil and gas company Atlantic Gulf & Pacific Company (AG&P), which is currently pursuing various projects in the gas sector.
In a statement to the media, AG&P specified that the first tranche of US$200 million had already been funneled into the company’s Singapore-based firm AG&P City Gas which is developing about 12 city gas distribution networks or concessions in India under brand name AG&P Pratham.
The equity investment of I Squared Capital into AG&P City Gas is via its ISQ Global Infrastructure Fund and ISQ Growth Markets Infrastructure Fund.
As emphasized, AG&P City Gas is into development and operation of compressed natural gas (CNG) stations for vehicles, piped natural gas to homes as well as distribution of liquefied natural gas (LNG) to industrial and commercial customers.
“City gas projects benefit from marketing exclusivity in their designated areas for 8-10 years and construction exclusivity of related infrastructure for 25 years,” the Manila-based company explained.
It was further noted that within 25-year span, “the concessions have the potential to reduce CO2 (carbon dioxide) up to 37 million tons by displacing fuels, such as diesel, petrol, liquefied petroleum gas, coal and heavy fuel oil.”
According to Gautam Bhandari, managing partner at I Squared Capital, their private equity firm “was one of the early foreign institutional investors in the Indian city gas sector and is committed to helping the country achieve its target of having 15-percent of natural gas in its primary energy mix by 2030.
While AG&P has its main corporate base in Manila, the company’s equity investors are well-entrenched foreign entities that include Asiya, a Kuwait Investment Authority-affiliated fund; Osaka Gas and the Japan Bank for International Cooperation.
Joseph Sigelman, chairman and CEO of AG&P Group, asserted that their new partnership with I Squared Capital will “expedite the rollout of these vital gas networks being developed in India by AG&P City Gas.”
He qualified that the venture “will continue to grow to serve millions of customers in their homes with clean, affordable, safe fuel as India’s middle class advances in size and purchasing power.”’
AG&P City Gas has likewise cast the installation of 1,500 CNG stations so that cars, taxis and buses “can transition seamlessly to run on clean fuel,” according to Sigelman.
In the Philippines, the main investment being advanced by AG&P is a floating storage and regasification unit (FSRU) for the emerging LNG industry, which it is targeting to bring to commercial operations next year.
The country will critically need additional gas supply next year, with the anticipated depletion of the Malampaya facility, which is the only commercially producing gas field to date. ###