(Recasts with reaction from Grana y Montero)
LIMA Nov 23 Sempra Energy said
Wednesday that it dropped its offer to buy a stake in Odebrecht
SA's natural gas pipeline concession in Peru, leaving
junior partners scrambling to try to save the project as the
government eyes a new auction.
Sempra gave up on months of negotiations after the
government refused to strip an anti-corruption clause from the
contract that would let it seize the project if Odebrecht were
found to have broken any laws.
"A fundamental condition...was not satisfied," Sempra said
in a statement.
Odebrecht, a family-owned Brazilian engineering conglomerate
that controls 55 percent of the project, is at the center of
Brazil's biggest graft scandal. Prosecutors in Peru have been
probing potential wrongdoing in the awarding of the pipeline
Sempra's announcement was the latest setback for Odebrecht
as it faces some $2.1 billion in fines in Brazil and is seeking
to sell its assets to pay its bloated debt.
It also clouded the plans of Odebrecht's junior partners on
the project, Peruvian builder Grana y Montero
and Spanish energy company Enagas SA.
Financing for the pipeline's construction hinges on
Odebrecht's full departure from the project as a group of banks
have made that a condition to disbursing a $4.1 billion loan.
The government of President Pedro Pablo Kuczynski, eager to
push out stalled infrastructure projects to boost slumping
domestic demand, has said it could hold a new auction for the
project next year if Odebrecht does not sell its stake soon.
Grana, which bought its 20 percent stake in the pipeline
project for $215 million in 2015, said it was working on
"alternatives" to keep the project alive together with Enagas
and Italian Techint Group.
Enagas controls a 25 percent stake in the pipeline project
and Techint wants to buy a 5 percent stake from Odebrecht. "For
Techint nothing has changed," the company said in an email.
If the government rescinded the contract, Grana would
recover its investment thanks to a termination payment clause,
it said. The company's shares on the Lima bourse have dropped
about 20 percent this week.
The government said it would probably modify the contract so
it is not financed through consumer electricity bills.
Odebrecht won the rights to build and operate the pipeline
in 2014 after its sole competitor - a Sempra-led group - was
disqualified the day of the auction for making last-minute
changes to the stake each company held in the consortium.
(Reporting by Mitra Taj and Marco Aquino; Editing by Grant
McCool and Lisa Shumaker)