Spanish gas network operator Enagas said Tuesday its net debt was on track to reach its lowest level since 2008 as it prepares to invest billions of euros in hydrogen projects.
The sale earlier this year of its 30.2% stake in U.S. energy infrastructure company Tallgrass Energy allowed Enagas to cut its debt by about 1 billion euros ($1.08 billion) to around 2.4 billion euros, a level it expects to maintain until 2026.
The US divestment followed other asset sales in Chile and Mexico, as the company refocuses on Spain and Europe.
With Spanish gas demand falling in the last two years, the company is shifting from its traditional gas business to the management of a hydrogen infrastructure network.
This will require gross investments of nearly €6 billion, including those for a planned hydrogen network in Spain and its flagship H2Med trans-European corridor, which aims to connect the hydrogen networks of the Iberian Peninsula with northwest Europe.
Including grants, the company expects to make net investments of around €3.2 billion by 2030. To help finance the plan, it has already slashed its dividend.
Enags, which is 5% state-owned, will sound out potential interest in the H2Med hydrogen corridor by launching a call for expressions of interest together with its partners on November 7.
It will present a new strategic plan with next year's first-quarter results, it said Tuesday.
Enagas' strategy is in line with the Spanish government's ambition to make the country a European leader in green hydrogen.
The company says it is on track to exceed the targets it revised in July, after posting a loss of 130.2 million euros in the first nine months of the year.
In July it said it expected to post a loss of between €80 million and €90 million for 2024 as a whole, following a capital hit from the sale of the U.S. asset.
In the first nine months of last year, the company posted a profit of €258.9 million.