Acquired by Brookfield for US$ 5.2 billion (transaction concluded in 2017), NTS operates a gas distribution network of more than 2,000 km linking the states of Rio de Janeiro, Minas Gerais and São Paulo (which together account for approximately 50% of Brazilian gas consumption) to the Brazil-Bolivia gas pipeline, the liquefied natural gas (LNG) terminals and the gas processing plants.
Principal financial indicators
In 2018, the company reported net operating revenue of approximately BRL 4 billion and EBITDA of BRL 3.6 billion, practically in line with the preceding fiscal year.
The company’s BRL 5.2 billion refinancing program is worthy of mention – the largest institutional debt issuance in the history of the Brazilian capital markets for a non-financial company – allowing NTS to cut its financial expenses by 22%.
NTS’s pipeline transportation capacity is 100% contracted by Petrobras through five Gas Transportation Agreements (GTAs), regulated by the National Petroleum, Natural Gas and Biofuels Agency (ANP). In 2018, the volume of natural gas transported was an average of 60.2 million m3/day. In July 2018, gas volumes reached a peak of 69.9 million m3/day.
NTS invested approximately BRL 100 million during the year focused on guaranteeing the uptime and reliability of the gas pipelines and equipment – and included adjustments and modernization in line with contractual as well as legal and regulatory compliance obligations.
The following investments were of particular importance
Conclusion of the definitive stabilization work on the GASDUC III tunnel in Cachoeira do Macacu-RJ at a total investment of approximately BRL 60 million;
Conclusion of 11 of 13 projects for improving metering systems with forecasted completion of the two remaining projects expected in 2019 at a total cost of BRL 53 million; and
Compliance with environmental requirements relating to the installation of the pipelines totaling BRL 14.5 million.
Numbers / highlights
of gas pipelines
of gas transported in 2018
NET REVENUE IN 2018
The main expectation for the gas sector in 2019 is the opportunity for new investments resulting from regulatory framework improvements.
In December 2018, a decree implementing the Gas to Grow program was signed, providing for the design of a new natural gas market and improvements in the regulatory framework of the gas transportation sector permitting third-party participation. The decree, which regulates the Gas Law of 2009, institutes a natural gas transportation system for ensuring operations are performed in a coordinated manner. In parallel, the decree creates a new system for contracting gas transportation facilities and is expected to increase competition in the sector.
With a gas transportation network operating in the largest consumer market in Brazil, NTS is well placed to capture the opportunities arising from eventual growth in demand for natural gas transportation facilities.