Washington, July 14, 2004 — The International
Finance Corporation, the private sector arm of the World Bank Group, will
provide up to $90 million in financing to Comgás, the largest distributor
of piped natural gas in Brazil. The loan consists of $45 million
equivalent for IFC’s own account and syndications of $45 million equivalent.
IFC’s financing will support the company’s plans to expand and
upgrade its distribution network to make gas available to 70,000 new customers
in the next five years, and 200,000 within 10 years.
Established in 1872 to provide street lighting in the city of São Paulo
and privatized in 1999, Comgas is now the largest distributor of piped
natural gas in Brazil, with 3,600 kilometers of lines in a concession area
cover 177 municipalities. At present Comgás attends 45 municipalities in
region of Sao Paulo, the Paraiba Valley, and the Campinas. It provides
service to more than 420,000 residential, commercial and industrial customers
and had net sales of 1.9 billion reais (about $633 million) in 2003.
Comgás plans to invest 300 million reais (about $100 million) to improve
service and deliver gas to new users.
Comgás is also developing the natural gas transportation sector by providing
compressed natural gas to vehicles through a growing network of fueling
stations. Its expansion plans aim to make it Latin America’s largest distributor
of natural gas while maintaining quality, safety, and respect for the environment.
Francisco Tourreilles, director of IFC’s Infrastructure Department, said,
“We are very pleased to be able to work with a leading private Brazilian
gas distribution company and contribute to the country’s efforts to promote
the use of natural gas. This project will have a significant development
impact by helping reduce air pollution through the substitution of natural
gas for heavy fuel oil. It will also improve access to a clean, low-cost,
and reliable energy source .”
Atul Mehta, IFC's director for Latin America and the Caribbean, added,
“This project fits well with IFC’s strategy in Brazil, to support infrastructure
development as a means of improving economic prospects and quality of life.
We are excited to partner with companies like Comgas that share our vision
for sustainable development and a true commitment to protecting the environment.”
As Mr. Roberto Lage, Director Finance of Comgás, also noted,“IFC’s long-term
funding is essential to financing Comgas’ expansion program in its concession
area and will enable the company to extend the natural gas distribution
network to 18 new cities in the State of São Paulo, Brazil.” Mr. Lage,
added: “With the implementation of these investment plans , and the consequent
displacement of existing pollutant fuels , Comgás will be making a significant
contribution to the improvement of the environmental conditions in the
concession area and increasing the use of natural gas in the country’s
The mission of IFC (www.ifc.org)
is to promote sustainable private sector investment in developing countries,
helping to reduce poverty and improve people's lives. IFC finances private
sector investments in the developing world, mobilizes capital in the international
financial markets, helps clients improve social and environmental sustainability,
and provides technical assistance and advice to governments and businesses.
From its founding in 1956 through FY03, IFC has committed more than US$37
billion of its own funds and arranged US$22 billion in syndications for
2,990 companies in 140 developing countries. IFC's worldwide committed
portfolio as of FY03 was US$16.8 billion for its own account and US$6.6
billion held for participants in loan syndications.