Spanish Enagas Reports Profit, Raises Target
Spanish infrastructure operator Enagas made a net profit of €444mn in 2020, a 5.1% increase on 2019, despite the impact of the Covid-19 pandemic, it said February 23.
It said it met "all its targets for the 14th consecutive year, maintaining its firm commitment to employment." The company was helped by a foreign exchange gain of €18.4mn and by keeping a close watch on expenses and inefficiencies. And since the start of this year it has been receiving revenue from its €218mn investment in the TransAdriatic Pipeline, of which it owns 16%.
Enagas also announced stiffer targets for decarbonising, after a year that saw very high gas demand. It has brought forward its goal for carbon neutrality to 2040 – ten years sooner than last year's plan.
The gas network operated at maximum technical and commercial availability levels. In 2020, 238 LNG tankers unloaded at Enagas' terminals, delivering 220.8 TWh into the grid. As of year-end, around 95% of storage capacity had been contracted. Demand for natural gas was the second highest since 2012, growing 3.1% compared with 2018 to 360 TWh.
In January 2021, natural gas played a pivotal role in ensuring energy supply during Spain's biggest cold snap in recent years, prompting exponential growth in the demand for residential natural gas of up to 30%, and breaking all time highs, it said.
Enagas' strategic update for 2021-2026 foresees an average annual dividend of €250mn from its affiliates, as these are regulated or protected by long-term ship or pay contracts. "Against the backdrop of the crisis, this solid cash generation will allow Enagas to maintain its dividend policy until 2026," it said, allowing it to boost dividends by 5% in 2020. It is sticking to its plan to pay out 1%/yr for the coming three years.
The company has brought down its emissions by 63.2% between 2014 and 2020 and is looking at renewable gases projects in Spain. Already driving the use of LNG as a marine fuel, Enagas is working on 30 hydrogen and 16 biomethane projects, with more than 50 partners and in practically all the Autonomous Communities in Spain, which could mobilise a joint investment of around €5bn.
Other plans include replacing grey hydrogen with green hydrogen and blending that with captured CO2 to produce synthetic fuels; and biomethane from waste.
Enagas is also working with gas marketer Naturgy on the largest green hydrogen plant in Spain at La Robla in Leon. The aim is green hydrogen corridors, integrated with electricity generated by renewables.