Solveig Gas Norway AS, the second-largest owner of Norway’s gas-pipeline network, started talks with banks and bondholders about its debt after the government slashed the fees it’s able to charge for transporting the fuel.
Solveig, owned by Allianz Capital Partners, the Abu Dhabi Investment Authority and the Canada Pension Plan Investment Board, is in talks with lenders about changes to the repayment terms of its bank facilities and bonds, it said in a statement today. The aim is to change the repayment schedule to “align the principal and interest payments Solveig is scheduled to make on its debt instruments with its forecast revenues.”
Norway’s previous government, led by Jens Stoltenberg, pushed through cuts as deep as 90 percent to the tariffs that operators of Gassled, the nation’s gas pipe network, can charge to ship the fuel. The changes will see the tariffs for new gas transport agreements reduced from October 2016.
State-owned Petoro AS is the biggest owner of Gassled with 45.8 percent and Solveig Gas holds 24.8 percent. The owners are suing the Norwegian government to reverse the tariff cut, which they say will reduce income by almost $7 billion.