(Press Release) IFC, a member of the World Bank Group, and two funds managed by the IFC Asset Management Company have signed an agreement to make their largest-ever equity investment in Colombia’s infrastructure, providing $150 million for Pacific Infrastructure Ventures to support the growth in the country’s oil and gas exports.
The equity investment will be provided by IFC; the IFC African, Latin American and Caribbean Fund; and the IFC Global Infrastructure Fund to help Pacific Infrastructure develop port, storage, and transportation facilities. This will be a significant investment in a growing company. The investment will improve the logistics of the Colombian oil and gas sector—and strengthen the country’s infrastructure. Globally, it represents IFC’s largest equity investment in support of a new infrastructure project.
“We are very excited to be joining efforts with IFC in the development of our projects,” said Juan Ricardo Noero, President and CEO of Pacific Infrastructure. “IFC maintains high standards in corporate governance and environmental and social performance. Its participation as a shareholder in Pacific Infrastructure will be of great value as we continue to grow. This investment is a testament to Colombia’s robust economic and business environment, which allows the development of large-scale, greenfield initiatives such as ours.” Inverlink S.A. acted as financial advisor to Pacific Infrastructure for the structuring of this transaction.
In recent years, Colombia has increased oil and gas production but exports have been constrained because of inadequate transportation infrastructure. This equity investment will help Pacific Infrastructure develop two new assets: Sociedad Portuaria Puerto Bahía S.A. and Oleoducto del Caribe–Olecar S.A.S.
Puerto Bahía is a new liquid import-export terminal on the bay of Cartagena, one of the largest trade hubs in Latin America. It is designed for an initial storage capacity of 3.3 million barrels of crude oil and hydrocarbon products. The total facility comprises 140 hectares and is expected to include a general cargo handling area, as well as an industrial free-trade zone.
Olecar is a 130-kilometer crude oil pipeline, which will connect Puerto Bahía’s facilities with Colombia’s principal crude export terminal in Coveñas, located on the Caribbean coast. It will also include a direct connection between Puerto Bahía and Refineria de Cartagena – Reficar.
“Oil exports represent half of Colombia’s total exports and are highly vulnerable to the country’s dependence on a sole terminal,” said Irene Arias, IFC’s Manager for the Andean Region. “This investment will reduce bottlenecks and help producers access international markets more efficiently.”
“As the first investment made by the IFC Global Infrastructure Fund, we are pleased to partner with the ALAC Fund and IFC to work with a growing company that plays a significant role in the development of a crucial sector of the Colombian economy,” said Darius Lilaoonwala, head of the IFC Global Infrastructure Fund.
About IFC Asset Management Company
IFC Asset Management Company LLC, a wholly-owned subsidiary of IFC, invests third-party capital, enabling outside investors to benefit from IFC’s expertise in achieving strong equity returns, as well as positive development impact in the countries in which it invests. It manages over $5.5 billion of capital across six investment funds.