Argentine gas producer CGC in US$200mn bond sale
Argentine hydrocarbons firm CGC sold US$200mn in convertible bonds to local units of US chemical company Dow.
The instruments were purchased by PBBPolisur and Dow Investment Argentina, which acquired US$176mn and US$24mn, respectively.
CGC can repurchase the bonds following the second anniversary of the issuance, a regulatory filing said.
In Q1 CGC inked a deal with PBBPolisur for a dollar loan of US$30mn and issued around US$192mn in bonds on the local market to finance exploration and production work in the Austral and Golfo San Jorge basins.
Argentina’s seventh biggest gas producer in May, the company registered 6.2Mm3/d that month, up 44.4% year-on-year, the fastest pace among the group, according to data from think tank the General Mosconi energy institute. Overall gas production was 135Mm3/d, led by state-controlled hydrocarbons company YPF, accounting for 33.5Mm3/d, down 8.2% year-on-year.
CGC has full or controlling interests in over 20 hydrocarbons areas across the Austral, Neuquén, Golfo San Jorge, Cuyana and Noroeste basins.
The government last year awarded CGC supply contracts under rounds 5.1 and 5.2 of production promotion scheme Plan Gas, which involves commitments to 2028.
The company also has a major stake in gas pipeline operator TGN and the GasAndes export pipeline, which transports Neuquén basin gas to Chile’s Santiago metropolitan region.
In 2020, CGC cut the ribbon on underground gas storage facility Sur Río Chico, in Santa Cruz province, where the company is the biggest natural gas producer. The second of its kind in Argentina, the facility is designed to receive 1Mm3/d in summer and pump out 2Mm3/d in winter, when demand climbs.
ALSO READ: With an eye on Chile gas exports, Argentina’s CGC mulls midstream projects
CGC capex in 1Q23 was 24.4bn pesos (roughly US$117mn), compared with 14.6bn pesos a year earlier, according to its financial results. At end-March, the company held US$181mn in cash and financial debt – all dollar-denominated – stood at US$949mn.
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