By an OGJ Online Correspondent
PARIS, Feb. 11 -- Gaz de France SA is renegotiating its contractual obligations in Argentina, a move that could well be a prelude to a withdrawal from the troubled country.
GdF holds 64% in Gas NEA, a joint venture with the government of Entre-Rios province with 20% and Pan American Energy LLC (itself a JV of BP PLC and Bridas) with 16%. In 1997 the consortium won the international tender to build and develop the natural gas distribution network of the provinces of Entre Rios, Corrientes, Misiones, Chaco, and Formosa in Northeast Argentina.
According to a Gaz de France spokesman, the devaluation of the peso has compromised the economic balance of the concessions signed under the privatization contracts. Within the joint venture, one of the partners, Entre Rios, has $13 billion in debt.
GdF has already spent $60 million on the project. The French utility is reportedly thinking of provisioning $50 million.
So far, GdF's important commitments in nearby Uruguay are not affected. In 1995, GdF begun a 30-year project to manage, through Gaseba Uruguay, the 410-km existing gas network assets and develop it in Montevideo. The project is so far supplied by gas manufactured from naphtha. In 2002, this manufactured gas will be gradually replaced by natural gas supplied from Argentina through the 5 million cu m/year Southern Cross gas pipeline being built by BG Group, Pan American Energy and Ancap.
Gaz de France has a 51% stake in Gaseba Uruguay, Pan American Energy has 34%, and the Uruguay's distribution company Acodike has 15%.