As the world’s largest energy-consuming nations contemplate the best methods to transition away from fossil fuels, reports have emerged from anonymous sources that state that Spain’s Enagás energy company is in talks with Singapore’s sovereign wealth fund GIC to acquire its substantial stake in France’s second-largest gas transmission company, Terega. Hydrogen has emerged from the dust of the conventional energy sector’s slow death as the most viable and promising form of renewable energy production in a sea of possibilities.
Enagás is aiming to become a regional leader in the hydrogen sector through its strategic acquisition
The Spanish energy operator is known for its exceptional expertise in the energy sector and has all the potential to accelerate the European transition to the renewable energy sector. The world has stagnated in the adoption of solar, wind, nuclear, and hydrogen energy sectors.
A recent report cites several sources that have asked to remain in the shadows as noting that Enagás is in talks with Singapore’s sovereign wealth fund GIC to acquire its 32% stake in Terega, one of France’s biggest and most influential energy companies. The other major stakeholders in Terega are Italian gas operator Snam, with a 40.5% stake, French state-owned utility EDF, with 18%, and the French bank Credit Agricole, which holds 10%.
The deal will strengthen an already beneficial partnership between the two companies
The potential deal would strengthen an already established partnership between Enagás and Terega. The two companies are already collaborating on a major cross-border hydrogen pipeline project.
Enagás has previously publicly stated its ambition to accelerate investments in hydrogen infrastructure as Europe seeks to transition to cleaner energy sources. Europe needs to walk the talk as it has mandated that EU member states accelerate the transition away from fossil fuels.
The billion-dollar deal will strengthen hydrogen in Europe; however, nothing is set in stone yet
Enagás’ potential stake could be worth approximately $694 million, according to one of the anonymous sources. That source has also noted that Terega’s total estimated value is around $4.6 billion, including existing debts.
Both Enagás and Terega are essential to Europe’s hydrogen ambitions for the future. The H2Med project, a 2.9-billion-dollar hydrogen pipeline, which recently added 40 new members to its ranks, aims to connect Portugal, Spain, France, and Germany by 2030.
In the business world, nothing is certain, and anything is possible
Due to the uncertain and volatile nature of the global business market at the moment, there is no guarantee that the deal will close, as evidenced by reports that indicated EDF and Credit Agricole were exploring the sale of their stakes, though a transaction did not materialize.
Hydrogen is the most abundant element in the universe. Any carbon-based lifeform has hydrogen as part of its DNA in some form, so the proclivity for hydrogen by the world is understandable; it is part of our identity. While the details of the potential deal are not clear, the sources have stated that they expect the deal to move forward.
Hydrogen is the best option to meet the needs of a growing energy demand across the world
The end of the conventional energy sector is an eventuality, that much has become increasingly certain over the past decade. However, the question on everyone’s lips is: what will replace it as the dominant source of energy generation in the world? Wind is promising, but faces pushback from the United States, as Donald Trump seems to have a special hatred for it. Solar power simply does not have the capacity to meet the increase in energy demand. What remains is hydrogen, which has already been allocated as the major energy source for the NEOM city in Saudi Arabia.
