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OMERS enters South America with $341m Chilean LNG deal

The Canadian pension fund acquired a 34.6% stake in the GNL Quintero natural gas terminal, its first infra investment in South America.

The Ontario Municipal Employees Retirement System has moved into the South American infrastructure market, purchasing a 34.6 percent stake in Chile’s GNL Quintero natural gas terminal for $341 million.

Located 160km northwest of Santiago, the $1.1 billion terminal receives, unloads, stores and gasifies 15 million cubic meters of natural gas per day. GNLQ, which initiated operations in 2009, serves almost all central Chile’s gas demand, according to OMERS.

The purchase, made by OMERS vehicle Borealis Infrastructure, “signals our entrance into South America”, OMERS global head of infrastructure Ralph Berg said. He added that the asset “aligns closely with our ongoing effort to diversify our global portfolio of core infrastructure holdings – and pay pensions to our members”.

OMERS acquired its shares from Enagás, a Spanish energy company that now holds a 45 percent stake in the terminal. OMERS will grant Enagás a 12-month call option for 5 percent of its shares. The remaining 20 percent of the asset is owned by Empresa Nacional del Petróleo, the Chilean state-owned energy company.

OMERS, among Canada’s largest pension funds, holds just over $85.2 billion in assets under management, with 17 percent allocated to infrastructure investment. OMERS is looking to up its infrastructure allocations to 21.5 percent, focusing on North America, Europe and Australia, according to the fund’s 2016 annual report. The fund made its entrance into the Australian sector last year, acquiring the continent’s largest container port, the Port of Melbourne.