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- The South African Gas Development Company, also known as iGas, a subsidiary of the South African government’s Central Energy Fund (CEF) Group together with Companhia Mocambiçana de Gasoduto (CMG), a subsidiary of Empresa Nacional de Hidrocarbonetos, EP (ENH), announced that they had exercised their pre-emptive rights to acquire a 30% equity interest in the ROMPCO pipeline (“the Transaction”) from Sasol South Africa (SSA).
- The ROMCO gas pipeline runs approximatley 835km from Temane in Mozambique to Sasol Petrochemicals plant in Secunda, Mpumalanga, South Africa.
iGAS’ and CMG’s pre-emptive rights were exercised after Sasol announced on 14 May 2021 that SSA, a major subsidiary of Sasol, had concluded a sale and purchase agreement in terms of which SSA had agreed to sell a 30% equity interest in ROMPCO to an acquisition vehicle beneficially owned by a consortium, comprising Reatile Group Proprietary Limited and the IDEAS Fund managed by African Infrastructure Investment Managers Proprietary Limited.
Following the fulfilment of all conditions precedent, the transaction is now complete.
The Sale Shares have been sold for a consideration comprising an initial amount of R4,1 billion, subject to certain adjustments, and a deferred payment of up to R1 billion, which is payable if certain agreed milestones are achieved by 30 June 2024.
SSA retains a 20% shareholding in ROMPCO and Sasol will continue to operate and maintain the pipeline in terms of the commercial agreement between Sasol and ROMPCO, which is independent of the Transaction. Sasol’s agreements with ROMPCO to transport gas to Secunda are unaffected by the Transaction and the tariffs remain as per the said agreements, which were approved by the National Energy Regulator of South Africa (NERSA).
This Transaction marks the completion of the major transactions in Sasol’s accelerated, strategy-aligned, asset divestment programme announced in March 2020. Sasol remains fully committed to its integrated natural gas business in Southern Africa, which is integral to Sasol’s long-term strategy.
Author: Bryan Groenendaal
