Shell to sell its interest in Brazil’s Comgás for $380m

Dutch oil and gas company Shell is set to divest its interest in Brazilian gas distributor Companhia de Gas de São Paulo (Comgás) to Cosan SA Indústria e Comércio for around $380m.

Deciding to execute an existing put option agreement, Shell Gas, Shell Brazil Holding and Integral Investments have signed an agreement in connection with the sale of all of Shell’s 16.8% interest in Comgás.

Under the agreement, Cosan will receive around 21.8 million common shares in Comgás in exchange for its shares plus cash.

Shell Integrated Gas and New Energies director Maarten Wetselaar said: “This transaction allows us to focus our efforts in Brazil on areas where we see the most strategic value for Shell longer-term.

“Brazil is an important country to Shell, and our portfolio of high-quality assets and development opportunities positions us well for the future.”

Cosan already holds a 63.4% interest in Comgás, which serves power, commercial, industrial and residential users in the state of São Paulo, with a natural gas pipeline network of more than 14,000km.

Notwithstanding the proposed sale, Shell will continue to operate in Brazil through diverse operations, including its deepwater portfolio and downstream business.

The company has interest in biofuel producer Raízen through a joint venture with Cosan.