☐ |
REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR (G) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☒ |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Title of each class
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Name of each exchange on which registered
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American Depositary Shares (“
ADS
”), representing Class
“B” Shares
|
|
New York Stock Exchange
|
Class “B” Shares, par value Ps. 1.00 per share
|
|
New York Stock Exchange*
|
Class “A” Shares, par value Ps. 1.00 each
|
405,192,594
|
|||
Class “B” Shares, par value Ps. 1.00 each
|
389,302,689
|
|||
Total
(1)
|
780,894,503
|
|||
(1)
Excludes 13,600,780 treasury shares, representing 1.71% of the total shares not deemed outstanding under Argentine law.
|
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Yes
|
☒
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No
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☐
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Yes
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☐
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No
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☒
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Yes
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☒
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No
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☐
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Yes
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☐
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No
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☒
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
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Non-accelerated filer
|
☐
|
Emerging growth company
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☐
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☐
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U.S. GAAP
|
☒
|
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International Financial Reporting Standards as issued by the International Accounting Standards Board
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☐
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Other
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Item 17
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☐
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Item 18
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☐
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Yes
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☐
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No
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☒
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Page | |||
i
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iv
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1
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Item 1.
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1
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Item 2.
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1
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Item 3.
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1
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||
Item 4.
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40
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||
Item 4A.
|
80
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||
Item 5.
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80
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||
Item 6.
|
108
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||
Item 7.
|
120
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||
Item 8.
|
125
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||
Item 9.
|
129
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||
Item 10.
|
132
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||
Item 11.
|
149
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||
Item 12.
|
151
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153 | |||
Item 13.
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153
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Item 14.
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153
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Item 15.
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153
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Item 16.
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153
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Item 16A.
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153
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Item 16B.
|
154
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Item 16C.
|
154
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Item 16D.
|
155
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Item 16E.
|
155
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Item 16F.
|
156
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||
Item 16G.
|
156
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Item 16H.
|
158
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||
159 | |||
Item 17.
|
159
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Item 18.
|
159
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Item 19.
|
159
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• |
statements regarding changes in general economic, business, political or other conditions in Argentina;
|
|
• |
estimates relating to future tariffs and volumes for our natural gas transportation services and future prices and volumes for our natural gas liquid products such as
propane and butane (also referred as liquid petroleum gas or
“LPG”
), ethane and natural gasoline (collectively
“Liquids”
) and for products and services respectively produced and provided in our other non-regulated businesses;
|
|
• |
statements regarding future political developments in Argentina and future developments regarding the license granted to us by the Argentine government (the
“Government”
) to provide natural gas transportation services through the exclusive use of the southern natural gas transportation system in Argentina
(
“License”
), the impact of the adoption of the new revised scheme of tariffs resulting from the renegotiation process with the Government of our
License, regulatory actions by
Ente Nacional Regulador del Gas
(
“ENARGAS”
) and other agencies of the Government, the legal framework established by the Federal Energy Bureau and any other applicable governmental authority that may affect us and our business;
|
|
• |
risks and uncertainties with respect to the relations with our employees in Argentina;
|
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• |
statements and estimates regarding future pipeline expansion and the cost of, or return to us from, any such expansion;
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• |
estimates of our future level of capital expenditures, including those required by ENARGAS or other governmental authorities for the expansion of our pipeline system or
other purposes, and unscheduled and unexpected expenditures for the repair and maintenance of our fixed or capital assets;
|
|
• |
statements regarding the ability of companies engaged in the upstream business in the region where we operate to identify drilling locations and prospects for future
drilling opportunities, and drill and develop such locations (such as the Vaca Muerta formation), as well as the Government’s regulations and policies affecting such projects; and
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|
• |
the risk factors discussed under “
Item 3. Key Information—D. Risk Factors.
”
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• |
risks and uncertainties resulting from Government regulations that have affected or may affect our business, financial condition or results of operations, such as the
prohibition on tariff increases for our natural gas transportation segment and restrictions on payments abroad and exchange controls;
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• |
risks and uncertainties related to changes in the peso-U.S. dollar exchange rate and the Argentine domestic inflation rate, which may materially adversely affect our
revenues, expenses and the comparability of our historical financial information;
|
|
• |
risks and uncertainties associated with our non-regulated business, including those related to international and local prices of Liquids, taxes, cost and restrictions on
the supply of natural gas and other restrictions imposed on Liquids exports, our ability to renegotiate our agreements with customers and possible adverse changes in the regulation of the Liquids industry;
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• |
capital expenditures required by ENARGAS or other governmental authorities for the expansion of our pipeline system or other purposes, including the risk that we may be
forced by ENARGAS or other governmental authorities to make investments that are not profitable or not as profitable as other investment opportunities identified by our management, or to take any other action not consistent with our
business plan and strategy;
|
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• |
risks and uncertainties associated with unscheduled and unexpected expenditures for the repair and maintenance of our fixed or capital assets;
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• |
risks and uncertainties resulting from the prospect of additional regulation on our business or other Government involvement in our business;
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• |
developments in legal and administrative proceedings involving us and our affiliates;
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• |
changes to, or revocation of, our License and the tariffs we are allowed to charge; and
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• |
risks and uncertainties impacting us as a whole, including changes in general economic, political and social conditions, changes in the Argentine laws and regulations to
which we are subject, including tax, environmental and employment laws and regulations, and the cost and effects of legal and administrative claims and proceedings against us.
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For the year ended December 31,
|
|||||||||||
|
2018
|
2017
(3)
|
2016
(3)
|
|||||||||
(in thousands of pesos)
(1)
|
||||||||||||
Consolidated Statement of Comprehensive Income Data:
|
||||||||||||
Revenues
|
34,062,670
|
19,953,266
|
14,645,510
|
|||||||||
Gas transportation net revenues
|
15,462,061
|
7,456,052
|
4,162,220
|
|||||||||
Liquids production and commercialization net revenues
|
16,627,429
|
11,173,975
|
9,404,793
|
|||||||||
Other services (midstream and telecommunications) net revenues
|
1,973,180
|
1,323,239
|
1,078,497
|
|||||||||
Operating profit
|
14,257,059
|
6,204,819
|
2,912,817
|
|||||||||
Net financial results
|
(2,846,259
|
)
|
(528,344
|
)
|
(709,334
|
)
|
||||||
Net income before income tax
|
11,429,007
|
5,698,116
|
2,208,572
|
|||||||||
Net income and total comprehensive income for the year
|
11,415,836
|
5,751,193
|
1,106,295
|
|||||||||
Net income and total comprehensive for the year attributable to:
|
||||||||||||
Owners of the Company
|
11,415,832
|
5,751,191
|
1,106,293
|
|||||||||
Non-controlling interest
|
4
|
2
|
2
|
|||||||||
Per Share Data:
(2)
|
||||||||||||
Net income per share
|
14.48
|
7.24
|
1.39
|
|||||||||
Net income per ADS
|
72.40
|
36.20
|
6.95
|
|
(1) |
Except per share and per ADS amounts or as otherwise indicated.
|
|
(2) |
Net income per share and ADS under IFRS has been calculated using the weighted average shares outstanding. Each ADS represents five shares.
|
|
(3) |
Comparatives figures as of
December 31, 2017 and 2016 have been adjusted for the hyperinflation accounting and arise from our consolidated financial statements of December 31, 2018.
|
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As of December 31,
|
|||||||||||
2018
|
2017
(3)
|
2016
|
||||||||||
(in thousands of pesos)
(1)
|
||||||||||||
Consolidated Statement of Financial Position Data:
|
||||||||||||
Total current assets
|
23,163,316
|
10,588,796
|
n/a
|
|||||||||
Property, plant and equipment, net
|
38,685,519
|
34,160,708
|
n/a
|
|||||||||
Total non-current assets
|
38,779,711
|
34,264,631
|
n/a
|
|||||||||
Total assets
|
61,943,027
|
44,853,427
|
n/a
|
|||||||||
Total current liabilities
|
7,146,361
|
6,897,692
|
n/a
|
|||||||||
Total non-current liabilities
|
23,851,361
|
12,676,146
|
n/a
|
|||||||||
Total liabilities
|
30,997,722
|
19,573,838
|
n/a
|
|||||||||
Non-controlling interest
|
10
|
12
|
n/a
|
|||||||||
Shareholders’ equity
|
30,945,305
|
25,279,589
|
n/a
|
|||||||||
Other Data:
|
||||||||||||
Common stock (nominal value)
|
794,495
|
794,495
|
n/a
|
|||||||||
Additions to property, plant and equipment
|
6,906,410
|
2,296,641
|
n/a
|
|||||||||
Depreciation
|
2,223,083
|
2,020,216
|
n/a
|
|||||||||
Number of outstanding shares
(2)
|
780,894,503
|
794,495,283
|
n/a
|
|
(1) |
Except number of outstanding shares or as otherwise indicated.
|
|
(2) |
Number of ordinary shares outstanding at year-end (excludes 13,600,780 treasury shares, representing 1.71% of the total share capital).
|
|
(3) |
Comparatives figures as of December 31, 2017 have been adjusted for the hyperinflation accounting and arise
from our consolidated financial statements of December 31, 2018.
|
|
Dividends declared and paid
|
|||||||||||||||||||
Year ended December 31,
|
(in millions of Ps.)
(1)
|
(in millions of U.S.$)
(2)
|
(Ps. per share)
(1)
|
(U.S.$ per share)
(2)
|
(U.S.$ per ADS)
(2)
|
|||||||||||||||
2014
(3)
|
764.2
|
30.5
|
0.962
|
0.038
|
0.192
|
|||||||||||||||
2015
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
2016
(4)
|
226.9
|
7.1
|
0.286
|
0.009
|
0.045
|
|||||||||||||||
2017
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
2018
(5)
|
4,329.2
|
114.6
|
5.449
|
0.142
|
0.708
|
(1) |
Stated in Ps. at Current Currency.
|
(2) |
Stated in U.S. dollars translated from pesos at the exchange rate in effect on the payment date, except that the amount of the dividends declared but unpaid as of
December 31, 2014, was translated from pesos at the selling exchange rate at such date.
|
(3) |
At a General Annual Shareholders’ Meeting held on April 30, 2014, our shareholders resolved to create a future dividends payment reserve in an amount equal to Ps. 844.7
million. Additionally, at its meeting held on November 26, 2014, our Board of Directors approved to release such reserve in full to our shareholders in the form of cash dividend payments up to an amount equal to the aggregate amount
of such reserve.
|
(4) |
At a General Annual Shareholders’ Meeting held on April 23, 2015, our shareholders resolved to create a future dividends payment reserve in an amount equal to Ps. 247.3
million. At its meeting held on January 13, 2016, our Board of Directors approved to release such reserve in full to our shareholders in the form of cash dividend payments up to an amount equal to the aggregate amount of such reserve.
|
(5) |
At the General and Special Annual Shareholders’ Meeting held on April 10, 2018, our shareholders resolved to create a future dividends payment reserve in an amount equal
to Ps. 3,763.6 million. At its meetings held on July 6, August 8 and September 6, 2018, our Board of Directors approved to release such reserve in full to our shareholders in the form of cash dividend payments up to an amount equal to
the aggregate amount of such reserve.
|
Pesos per U.S. dollar
|
||||||||||||||||
High
|
Low
|
Average
|
Period end
|
|||||||||||||
Most recent six months:
|
||||||||||||||||
November 2018
|
39.0500
|
35.4000
|
36.5036
|
37.7200
|
||||||||||||
December 2018
|
38.6000
|
36.5000
|
37.8347
|
37.7000
|
||||||||||||
January 2019
|
37.7100
|
36.9000
|
37.3902
|
37.5100
|
||||||||||||
February 2019
|
39.6700
|
37.1700
|
38.4045
|
39.1500
|
||||||||||||
March 2019
|
43.8700
|
39.8100
|
41.5158
|
43.3500
|
||||||||||||
April 2019 (through April 24, 2019)
|
43.9500 |
|
41.6200 |
|
42.8433 |
|
43.9500
|
|
||||||||
Year ended December 31,
|
||||||||||||||||
2014
|
8.5570
|
6.5450
|
8.1195
|
8.5510
|
||||||||||||
2015
|
13.4000
|
8.5550
|
9.2485
|
13.0400
|
||||||||||||
2016
|
16.0300
|
13.2000
|
14.7807
|
15.8900
|
||||||||||||
2017
|
19.2000
|
15.1900
|
16.5717
|
18.6490
|
||||||||||||
2018
|
41.2500
|
18.4100
|
28.1313
|
37.7000
|
|
• |
inflation, which remains and may continue to be high in the future;
|
|
• |
volatility in real GDP, which according to the restated information released by INDEC grew by 2.4% in 2013, decreased by 2.5% in 2014, grew by 2.7% in 2015, decreased by
1.8% in 2016, grew by 2.9% in 2017 and decreased by 2.5% in 2018;
|
|
• |
Argentina’s public debt as a percentage of GDP, which remains high and as of December 31, 2018, represented approximately 86.2% of the GDP;
|
|
• |
the discretionary increase in public expenditures that has resulted and continues to result in a fiscal deficit;
|
|
• |
high unemployment and informal employment rates;
|
|
• |
high exchange rate volatility;
|
|
• |
high fiscal and trade deficit; and
|
|
• |
limited access to funding in the international capital markets.
|
|
• |
Reforms in the energy system and tariff increase
. Pursuant to Decree No.
134/2015, the Macri administration declared a state of emergency with respect to the national electricity system, effective until December 31, 2017. In order to reassess the then-current subsidy policy, the former Ministry of Energy
issued Resolution No. 28/2016 (
“Resolution 28”
) and Resolution No. 31/2016, pursuant to which it fixed the prices of natural gas at the supply
point (“
PIST
”) and the tariffs on distribution and transportation of natural gas that will reach residential and commercial users throughout the
country, affecting the supply of compressed natural gas (
“CNG”
) servicing stations and electricity generating plants and instructing ENARGAS to
carry out an integral tariff review (“
RTI
”) process, to determine the tariffs on distribution and transportation of natural gas applicable
throughout the country. The RTI concluded on March 27, 2018, and a new tariff schedule applicable to the transportation and distribution of natural gas has been published and will be in effect during the five-year period from April
2017 to March 2022.
|
|
• |
INDEC reforms
. On January 8, 2016, based on its determination that the INDEC had
failed to produce reliable statistical information, particularly with respect to CPI, GDP, poverty and foreign trade data, the Macri administration declared the national statistical system and the INDEC in a state of administrative
emergency through December 31, 2016. Since the date of such declaration, the INDEC interrupted the publication of statistical information until the reorganization of its technical and administrative structure was completed. In 2016,
the INDEC implemented certain methodological reforms and adjusted macroeconomic statistics based on these reforms. For additional information see
“—High
levels of inflation and the lack of credibility regarding Argentina’s official inflation statistics could negatively affect our business, results of operations, financial condition, the value of our securities, and our ability to
meet our financial obligations.”
|
|
• |
Foreign exchange reforms
. In the past, through a series of exchange and tax
regulations, the national government significantly limited the access of entities and individuals to the foreign exchange market. The Macri administration has implemented important changes in the existing exchange regulations, with
the main objective of gradually eliminating such restrictions imposed on the exchange market in prior years. For additional information see “
Item 10.
Additional Information—D. Exchange Controls.
”
|
|
• |
Tax reform
.
On December 27, 2017, the Argentine executive branch (
Poder Ejecutivo Nacional
, the “
Executive Branch
”) enacted
Decree No. 1,112/2017, which introduced many changes to the tax regime (the “
Tax Reform
”) in accordance with
the
Tax Reform issued by the Congress. The reforms intended to eliminate certain existing complexities and inefficiencies of the Argentine tax regime, diminish evasion, increase the coverage
of income tax as applied to individuals and encourage investment. Moreover, the reforms aim to sustain Argentina’s medium and long term efforts to reduce the fiscal deficit. The reforms will gradually come into effect over the next
five years. The reforms belong to a larger program announced by President Macri intended to increase the competitiveness of the Argentine economy by reducing the fiscal deficit, increasing employment and diminishing poverty on a
sustainable basis.
|
|
• |
Fiscal consensus
.
On December 22, 2017, the Argentine Chamber of
Deputies passed into law the Fiscal Agreement (
Ley de Consenso Fiscal
), also known as the Fiscal Consensus (
Consenso Fiscal
). This law was based on an agreement signed on November 16, 2017 between the Government and representatives from Argentine provinces, with the goal of
implementing measures that favor sustained growth in economic activity, productivity and employment. The Fiscal Consensus includes a commitment to lowering distortive taxes by 1.5% of GDP over the next five years, a waiver of lawsuits
against the Government and a Ps. 21,000 million payment to the province of Buenos Aires for the year 2018 (which will increase over the next five years) as a partial and progressive solution to the conflict related to the Buenos Aires
Metropolitan Area Fund (
Fondo del Conurbano Bonaerense
). The Fiscal Consensus also set the basis for other policy reforms that were implemented
by the Macri administration in December 2017, such as tax reform, pension system reform and the Fiscal Responsibility Act (
Ley de Responsabilidad
Fiscal
). The Argentine national budget for the year 2019 is projected at a fiscal balance and a fiscal surplus of 1% of the GDP by 2020.
|
|
• |
Foreign trade reforms
. The Macri administration eliminated export duties on
wheat, corn, beef, mining, oil, and regional products, and reduced the duty on soybean exports by 5%, from 35% to 30%. Further, a 5% export duty on most industrial exports was also eliminated. With respect to payments for imports of
goods and services to be performed abroad, the current administration eliminated the restrictions on access to the Foreign Exchange Market of Argentina (
Mercado Libre de Cambios
(“
MELI
”)). Importers were offered short‑term debt securities issued by Argentina to be used to repay
outstanding commercial debt for the import of goods. In addition, the import system was modified by the replacement of the
Declaraciones Juradas
Anticipadas de Importación
system with a new import procedure that requires certain filings and import licenses for certain goods (including textiles, footwear, toys, domestic appliances and automobile parts), which, unlike
the previous system, does not contemplate discretionary federal government approval of payments for the import of products through the MELI. By Decree No. 893/2017, published in the Official Gazette on November 2, 2017, the Government
repealed article 1 of Decree No. 2581/1964, article 10 of Decree No. 1555/1986 and Decree No. 1638/2001. This action eliminated the obligation of Argentine exporters to repatriate and settle for pesos in the MELI foreign currency
proceeds derived from the export of goods. On January 2, 2017, the Government enacted a further reduction of the export duties rate set for soybean and soybean products, setting a monthly 0.5% reduction on the export duties rate
beginning in January 2018 and continuing until December 2019. In addition, importers were offered short-term debt securities issued by the Government to repay outstanding commercial debt for the importation of goods. On September 4,
2018, the Executive Branch issued Decree No. 793/18 (“
Decree 793
”) by means of which the Government imposed an exportation tariff of 12% on all
merchandise contained in the
Mercosur Common Nomenclature (
Nomenclatura Común del
Mercosur,
“
NCM
”) until December 31, 2020. Generally, this tariff cannot exceed Ps. 4 for each U.S. dollar of the imposed value or the
official free on board price, as applicable, except for the merchandise contained in the NCM, which tariff cannot exceed Ps. 3 for each U.S. dollar of the imposed value or the official free on board price, as applicable.
|
|
• |
Corporate Criminal Liability Act (
Ley de Responsabilidad Penal Empresaria
)
. On March 1, 2018, the Corporate
Criminal Liability Act No. 27,401 (“
Act 27,401
”) came into effect, providing for the criminal liability of corporate entities for offenses
against the public administration and cross-border bribery committed by, among others, their shareholders, attorneys-in-fact, directors, managers, employees, or representatives. A company found liable under this law may be subject to
various sanctions, including, among others, fines from two to five times the undue benefit obtained or that could have been obtained and the partial or total suspension of activities for up to ten years. In addition, this law extended
the criminal liability under the Argentine Criminal Code to actions committed outside Argentina by Argentine citizens or companies domiciled in Argentina. On April 6, the Government issued Decree No. 277/18 (“
Decree 277/18
”) that regulates Act 27,401. Pursuant to this decree the Anticorruption Office of the Ministry of Justice and Human Rights (
Oficina Anticorrupción del Ministerio de Justicia y Derechos Humanos
) will establish the guidelines that are necessary for compliance with the provisions of Law 27,401
related to the so-called “
Integrity Program
.” Also, the decree establishes that the consideration of the contracts with the Government referred
to in subsection a) of article 24 of Act No. 27,401 is determined by article 9 of the Regulations for Contracting with the National Administration (
Reglamento
del Régimen de Contrataciones de la Administración Nacional
) and its Annex, approved by Decree No. 1030/16. Decree No. 1030/16, as amended or restated, sets forth relevant procedures and mechanics to award contracts by
Ministers, officials with equivalent rank to Ministers, the Secretary General of the Presidency of the Nation or authorities with high rank of the decentralized organisms. Finally, Decree 277/18 recognizes that the Integrity Program
in accordance with articles 22 and 23 of Act 27,401 is a necessary condition to contract with the Argentine State in all those proceedings initiated after the validity of said law. Contracts shall accredit the Integrity Program
together with the rest of the documentation including the offer, in the form and in terms that each bidding process provides. On October 4, 2018, through Resolution No. 27/2018 of the Anticorruption Office of the Ministry of Justice
and Human Rights, the Ministry of Public Ethics, Transparency, against Corruption approved the Integrity Guidelines for Compliance pursuant to articles 22 and 23 of Act 27,401, referred to in the Integrity Program, with the objective
of providing technical guidance to have interpretation tools that will allow adjusting structure and processes in order to prevent, detect and remedy acts of corruption, as well as to implement appropriate Integrity Programs and
evaluate them according to the technical guidelines. On October 11, 2018 our Board of Directors approved TGS’ integrity program in order to comply with the above mentioned regulation.
|
|
• |
Bill for the development of the capital market of Argentina
. On November 13,
2017, the Executive Branch presented to Congress a bill that aims to develop an internal capital market in Argentina. On May 9, 2018, the Argentine Congress approved the Act on Productive Financing, which introduces significant
reforms to the Capital Markets Law of Argentina, the Law on Common Investment Funds No. 24,083, the Negotiable Obligations Law, and other regulations, with the objective of promoting the development of the local capital market. Among
other items, the new law seeks to broaden the base of investors and companies that can participate in the capital market, promoting productive financing, especially with respect to micro, small and medium enterprises, creating a
regime that promotes and facilitates their access to financing. Likewise, this law provides for the modification of certain tax provisions, tax regulations, regulations related to derivative instruments and a program for the promotion
of financial inclusion. The reforms also establish some limitations to the powers granted to the CNV by the Capital Markets Law of Argentina.
|
|
• |
Project to amend the labor system
. The Macri administration published a project
to amend the labor system. The project’s main purpose is to improve the efficiency and productivity of different productive sectors, increase employment, attract investment and reduce employment costs.
|
|
• |
Pension Reform Act (
Ley de Reforma Previsional
)
. On December 28, 2017, the Congress passed the Pension Reform Act,
with the goal of improving the sustainability and predictability of Argentina’s pension program, while still protecting the most vulnerable persons. To that effect, the Pension Reform Law modified the basic formula for the periodic
adjustment of retirements, pensions and the Universal Child Allowance (
Asignación Universal por Hijo
).
|
|
• |
Tax on financial transactions (
impuesto al cheque
)
. On December 27, 2017, the Argentine Congress extended the tax
on financial transactions through 2022, and earmarked amounts collected for the Argentine integrated pension system.
|
|
• |
IMF
. On June 16, 2018, the Government announced that it obtained a stand-by
agreement with the IMF for an amount of U.S.$50,000 million. Subsequently, on September 26, 2018, the Government and the IMF negotiated a new agreement that will expand the original program of U.S.$50 billion with an extra amount of
U.S.$7.1 billion. As a result, the IMF advanced funds to the Government that was supposed to be disbursed during the following administration, pursuant to the original agreement. As such, Argentina will receive U.S.$18.8 billion more
than originally agreed. For the remainder of 2018, the disbursements rose from U.S.$6 billion to U.S.$13.4 billion, for 2019 the funds will rise from U.S.$11.4 billion to U.S.$22.8 billion. These funds no longer have a precautionary
character as established in the original agreement, and can be fully disposed as budgetary support. On October 30, 2018, Argentina received U.S.$ 5,631 million corresponding to the first disbursement made by the IMF. On December 19,
2018, the IMF completed the second review of Argentina’s economic performance under the 36-month stand-by arrangement that was approved on June 20, 2018. The completion of the review allows the authorities to draw the equivalent of
U.S.$7.6 billion. Additionally, after the third review of the stand-by arrangement, the IMF agreed to disburse U.S.$10,870 million to Argentina in April 2019. We cannot predict exactly what measures will be adopted to comply with the
agreements concluded with the IMF or their consequences on the Argentine economy, in general and if this could generate an adverse change in our financial condition and result of our operations. Additionally, the inflation targeting
system, which was a mechanism implemented by Argentina to avoid price rising, was terminated. Now, Argentina will focus on inflation control and setting monetary base targets (current assets plus bank deposits). See “
—Failure to comply with the terms of the agreement with the IMF may adversely affect the Argentine economy and, as a result, our business
” below. To
that end and with the aim of reversing the adverse macroeconomic situation that Argentina has been going through since April 2018, on September 3, 2018, the Argentine Government announced a series of measures aiming to achieve a
primary fiscal deficit of 0% for the fiscal year 2019.
|
|
• |
Argentine Purchase and Supplier Development Law
. On May 10, 2018, the Argentine
Purchase and Development of Suppliers Law No. 27,437 was enacted and entered into force on August 8, 2018. Pursuant to this law, preference should be given to the acquisition, lease or leasing of goods of national origin. This law
governs legal persons to whom the Government has granted licenses, concessions, permits or authorizations for the provision of public works and services as well as direct contractors of such persons. The aforementioned law was
regulated by Decree No. 800/2018 and Resolution No. 91/2018 of the Argentine Secretary of Industry, in its capacity as the authority in charge of applying the Argentine Regime of Buyer and Supplier Development. The aforementioned
resolution determines that the minimum amount at which the Argentine scheme becomes mandatory is Ps. 1,300,000.
|
|
• |
Restore market confidence
. The Government has committed to an economic program
that reduces the need for federal financing and places the public debt in a firm downward trajectory. This will help establish a path towards sustained growth and job creation. This effort is anchored in a fiscal adjustment that
ensures that the Government will reach a primary equilibrium by 2020, with a significant initial adjustment to achieve a primary deficit of 1.3% of the GDP in 2019.
|
|
• |
Protect the most vulnerable segments of society
. Measures will be taken to
strengthen the social protection network, including restructuring programs and implementing measures aimed to increase the participation of women in the labor force. The budget for social protection will be established in the program.
If necessary, an additional amount will be allocated to social assistance projects. The ultimate purpose is to reduce poverty rates throughout the duration of the agreement, even if the economic rebound is slower than expected.
|
|
• |
Strengthen the credibility of the BCRA inflation targeting framework
. The
government has committed to provide autonomy to the BCRA to effectively achieve the inflation targets. In addition, the BCRA has adopted a new path for disinflation to bring down inflation to single-digit levels by the time the
three-year stand-by agreement with the IMF comes to an end. Likewise, the Argentine Government committed to present before the Argentine Congress a bill that would modify the charter of the monetary authority in order to achieve the
desired restructuring of the BCRA’s balance sheet. The plan also contemplates the mitigation of the BCRA’s vulnerability derived from the large stock of BCRA bills.
|
|
• |
Progressively reduce impossibility of payment
. This would imply reconstituting
international reserves and mitigating Argentina’s economic vulnerability.
|
|
• |
limitations on our ability to increase prices or to reflect the effects of higher domestic taxes, increases in operating costs or increases in international prices of
natural gas and other hydrocarbon fuels and exchange rate fluctuations on our domestic prices;
|
|
• |
in connection with the former and current incentive programs established by the Government for the oil and gas industry, such as the Natural Gas Additional Injection
Stimulus Program and cash collection of balances with the Government;
|
|
• |
legislation and regulatory initiatives relating to hydraulic stimulation and other drilling activities for unconventional oil and gas hydrocarbons, which could increase
our cost of doing business or cause delays and adversely affect our operations; and
|
|
• |
the implementation or imposition of stricter quality requirements for hydrocarbon products in Argentina.
|
|
• |
repeated failure to comply with the obligations of our License and failure to remedy a significant breach of an obligation in accordance with specified procedures;
|
|
• |
total or partial interruption of service for reasons attributable to us that affects transportation capacity during the periods stipulated in our License;
|
|
• |
sale, assignment or transfer of our essential assets or the placing of encumbrances thereon without ENARGAS’ prior authorization, unless such encumbrances serve to
finance extensions and improvements to the gas pipeline system;
|
|
• |
our bankruptcy, dissolution or liquidation;
|
|
• |
ceasing and abandoning the provision of the licensed service, attempting to assign or unilaterally transfer our License in full or in part without the prior authorization
of ENARGAS, or giving up our License, other than in the cases permitted therein; and
|
|
• |
delegation of the functions granted in such contract without the prior authorization of ENARGAS, or the termination of such agreement without regulatory approval of a new
contract.
|
|
• |
Argentine natural gas transportation regulations;
|
|
• |
international oil and gas prices;
|
|
• |
timing, volume and location of new market demand;
|
|
• |
competition from alternative energy sources;
|
|
• |
supply and price of natural gas in Argentina;
|
|
• |
demand for natural gas in the markets we serve; and
|
|
• |
availability and competitiveness of alternative gas transportation infrastructure in the markets we serve.
|
|
• |
incur or permit to exist certain liens;
|
|
• |
incur additional indebtedness;
|
|
• |
pay dividends or make other restricted payments;
|
|
• |
make capital investments and other investments;
|
|
• |
enter into sale and lease-back transactions;
|
|
• |
enter into transactions with affiliates;
|
|
• |
sell, transfer or otherwise dispose of assets; and
|
|
• |
consolidate, amalgamate, merge or sell all or substantially all of our assets.
|
|
• |
fluctuations in our periodic operating results;
|
|
• |
changes in financial estimates, recommendations or projections by securities analysts;
|
|
• |
changes in conditions or trends in our industry;
|
|
• |
events affecting equities markets in Argentina;
|
|
• |
legal or regulatory measures affecting our financial conditions;
|
|
• |
departures of management and key personnel; or
|
|
• |
potential litigation or the adverse resolution of pending litigation against us or our subsidiaries.
|
Company
|
Annual
deliveries (Bcf)
|
Volume of market
served (in %)
|
No. of end-users
(in millions)
|
Deliveries received
from us (in %)
|
||||||||||||
Metrogas
(1)
|
252.9
|
22.6
|
%
|
2.4
|
87
|
%
|
||||||||||
Camuzzi Pampeana
(1)
|
190.2
|
17.0
|
%
|
1.4
|
98
|
%
|
||||||||||
Camuzzi Sur
|
158.3
|
14.2
|
%
|
0.7
|
100
|
%
|
||||||||||
Naturgy Argentina
(1)
|
123.0
|
11.0
|
%
|
1.7
|
63
|
%
|
||||||||||
64.8
|
%
|
6.2
|
(1) |
Also connected to the TGN system.
Source
: ENARGAS
|
For the years ended December 31,
|
||||||||||||||||||||||||
2018
|
2017
|
2016
|
||||||||||||||||||||||
Average firm
contracted capacity
(MMcf/d)
|
Net revenues
(millions of
pesos)
|
Average firm
contracted capacity
(MMcf/d)
|
Net revenues
(millions of
pesos) |
Average firm
contracted capacity
(MMcf/d)
|
Net revenues
(millions of
pesos)
|
|||||||||||||||||||
Firm:
|
||||||||||||||||||||||||
Metrogas
|
590
|
3,894.5
|
590
|
1,912.7
|
639
|
1,157.4
|
||||||||||||||||||
Camuzzi Pampeana
|
558
|
2,838.0
|
558
|
1,384.4
|
516
|
657.8
|
||||||||||||||||||
Naturgy Argentina
|
417
|
2,323.9
|
364
|
1,009.9
|
357
|
510.7
|
||||||||||||||||||
Camuzzi Sur
|
388
|
582.2
|
388
|
288.2
|
388
|
109.0
|
||||||||||||||||||
Pampa Energía
(1)
|
92
|
424.2
|
49
|
33.4
|
39
|
36.0
|
||||||||||||||||||
Others
|
840
|
2,180.9
|
844
|
1,203.3
|
837
|
517.3
|
||||||||||||||||||
Total firm
|
2,885.0
|
12,243.7
|
2,793
|
5,831.9
|
2,776
|
2,988.2
|
||||||||||||||||||
Interruptible and
others
:
|
3,218.4
|
1,624.1
|
1,174.0
|
|||||||||||||||||||||
Total
|
2,885.0
|
15,462.1
|
2,793
|
7,456.0
|
2,776
|
4,162.2
|
(1) |
Until July 27, 2016, the average firm contracted capacity and the net revenues included Petrobras Argentina. From that date, as a consequence of the merger between Pampa
Energía and Petrobras Argentina, includes the average firm contracted capacity and net revenues correspond exclusively to Pampa Energía.
|
For the year ended December 31,
|
||||||||||||
2018
|
2017
|
2016
|
||||||||||
Firm:
|
Average daily deliveries
(MMcf/d)
|
Average daily deliveries
(MMcf/d)
|
Average daily deliveries
(MMcf/d)
|
|||||||||
Metrogas
|
487
|
533
|
544
|
|||||||||
Camuzzi Pampeana
|
371
|
378
|
371
|
|||||||||
Camuzzi Sur
|
244
|
247
|
240
|
|||||||||
Naturgy Argentina
|
223
|
208
|
229
|
|||||||||
Others
|
569
|
512
|
505
|
|||||||||
Subtotal firm
|
1,893
|
1,879
|
1,889
|
|||||||||
Subtotal interruptible
|
569
|
448
|
466
|
|||||||||
Total
|
2,462
|
2,327
|
2,355
|
|||||||||
Average annual load factor
(1)
|
85
|
%
|
83
|
%
|
76
|
%
|
||||||
Average winter heating season load factor
(1)
|
98
|
%
|
90
|
%
|
93
|
%
|
(1) |
Average daily deliveries for the period divided by average daily firm contracted capacity for the period, expressed as a percentage.
|
|
• |
creation of Integración Energética Argentina S.A. (
“IEASA,”
formerly ENARSA) in
2004 for the purposes of restoring levels of reserves, production and supply of natural gas and meeting the infrastructure needs of the natural gas transportation and electricity industries;
|
|
• |
creation of the Gas Plus Program (the
“
Gas Plus Program
”
) in 2008, which aims to encourage producers to make further investments in natural gas infrastructure by allowing
them to sell the resulting production of natural gas from new fields and fields that require more expensive extraction techniques at higher prices than the current authorized prices. In 2010, the Government increased the price paid
to natural gas producers who invest in new fields, shale and tight natural gas under the Gas Plus Program;
|
|
• |
hiring of two re-gasifying LNG tankers through IEASA, in Bahía Blanca (2008) and Escobar (2011), to inject natural gas into the pipeline. The tanker located at Bahía
Blanca, which was retired in November 2018, was connected to our pipeline, and the tanker at Escobar is connected to TGN’s pipeline;
|
|
• |
establishment of a framework for the constitution of Gas Trusts to finance natural gas pipeline expansions;
|
|
• |
the passage of Law No. 26,741, which declares that hydrocarbons self-sufficiency, as well as their production, industrialization, transport and marketing, are activities
of public interest and primary goals of Argentina, empowering the Government to take the necessary measures to achieve such goals;
|
|
• |
creation of trust funds (Resolution No. 185/04 of the former MPFIPyS) in order to finance infrastructure works in transportation and distribution of natural gas;
|
|
• |
importation of natural gas from Bolivia and Chile, which has increased significantly over the past two years;
|
|
• |
creation of tariff charges to be paid by all consumers other than residential consumers in order to finance natural gas and electricity expansions and the import of
natural gas;
|
|
• |
approval of Law No. 26,741 in May 2012, which declares the achievement of hydrocarbon self-sufficiency to be in the national public interest; and
|
|
• |
under the aforementioned law, a stimulus program was created to encourage new investments in exploration and exploitation.
|
|
• |
resolving appeals filed against ENARGAS resolutions;
|
|
• |
acting as the enforcement authority of Laws No. 17,319 and No. 26,020;
|
|
• |
managing the investment projects included in the framework of the programs created under Decree No. 1,277/2012, modified by Decree No. 272/2015; and
|
|
• |
acting as the enforcement authority regarding import and export of fuels.
|
|
• |
the completion of the RTI processes were prioritized to provide a framework of certainty to the operation of public utility companies;
|
|
• |
the Ministry of Energy and the
Unidad de Renegociación y Análisis de Contratos de
Servicios Públicos
(“
UNIREN
”) were reorganized in order to streamline the aforementioned efforts; and
|
|
• |
the increase of the
PIST
and the
tariffs of the public transport and distribution of natural gas service have been propitiated in order to correct the deterioration in the supply of this fluid and to reduce the burden that the public subsidies have on the national
budget.
|
|
• |
fixes the natural gas prices in PIST;
|
|
• |
establishes that the total amount of natural gas prices in PIST shall not exceed certain limits according to the type of customer;
|
|
• |
maintains the social tariff for the protection of the most vulnerable sectors;
|
|
• |
establishes the new propane prices for the distribution under the Propane Networks Agreement, settling at Ps. 800/Tn for Residential Users and General Service P1 and P2,
and Ps. 2,100/Tn for General Service P3 users; and
|
|
• |
provides that adjustments will be implemented in the months of April and October of each year, until the total elimination of the subsidies in 2019, at which point PIST
is expected to reach market prices.
|
|
• |
an agreement with unions to amend current existing collective bargaining agreements for the sector;
|
|
• |
the elimination of the obligation of repatriation of funds due to oil and gas exports currently regulated by Decree No. 1,722/11;
|
|
• |
the creation of a program (regulated by Resolution No. 46-E/2017), the Investment in Natural Gas Production from Non-Conventional Reservoirs Stimulus Program, which
establishes a support price for the volume of non-conventional natural gas production from concessions located in the Neuquina Basin included in the program. This program will be effective until December 31, 2021 and includes a
sliding-scale schedule for the minimum price to be paid per MMBtu: U.S.$7.50 for 2018, U.S.$7.00 for 2019, U.S.$6.50 for 2020 and U.S.$6.00 for 2021. Recently, this program was modified by the Energy Secretary, which has caused the
existence of certain conflicts between the national government and natural gas producers.
|
2003
|
2014
|
2015
|
2016
|
2017
|
2018
|
|||||||||||||||||||
Residential
(2)
|
704.3
|
1,074.8
|
1,091.0
|
1,153.8
|
1,030.4
|
992.5
|
||||||||||||||||||
Commercial
|
98.8
|
128.3
|
129.1
|
132.4
|
123.0
|
115.1
|
||||||||||||||||||
Industries
(3)
|
1,033.6
|
1,207.2
|
1,222.2
|
1,169.2
|
1,210.9
|
1,033.3
|
||||||||||||||||||
Power plants
|
846.7
|
1,407.1
|
1,443.2
|
1,548.3
|
1,671.7
|
1,538.5
|
||||||||||||||||||
CNG
Others
(4)
|
255.4
37.7
|
276.0
42.7
|
288.4
41.7
|
273.5
46.3
|
246.9
43.1
|
212.3
38.6
|
||||||||||||||||||
Total
|
2,976.5
|
4,136.1
|
4,215.5
|
4,323.4
|
4,326.0
|
3,930.3
|
(1) |
Includes distribution users, commercial by-pass, by-pass physical and off system users.
|
(2) |
Includes subdistributors.
|
(3) |
Includes shrinkage natural gas from the Cerri Complex, which is included in Others.
|
(4) |
Includes governmental bodies.
|
Basin
|
Location by province
|
Proved Gas
Reserves(Bcf)
(1)(2)
|
Production (Bcf)
|
Reserve Life
(years)
(3)
|
||||||||||||||||||||||
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
|||||||||||||||||||||
Neuquina
|
Neuquén, Río Negro, La Pampa, Mendoza (south)
|
5,826.7
|
5,507.3
|
924.4
|
917.1
|
6
|
6
|
|||||||||||||||||||
Austral
|
Tierra del Fuego, Santa Cruz (south), and offshore
|
3,871.8
|
4,014.7
|
377.2
|
374.1
|
11
|
10
|
|||||||||||||||||||
San Jorge Gulf
|
Chubut, Santa Cruz (north)
|
1,501.9
|
1,625.3
|
188.9
|
201.4
|
8
|
8
|
|||||||||||||||||||
Cuyo
|
Mendoza (north)
|
8.2
|
21.1
|
1.7
|
1.8
|
5
|
11
|
|||||||||||||||||||
Northwest
|
Salta, Jujuy, Formosa
|
539.6
|
715.9
|
84.8
|
94.3
|
6
|
8
|
|||||||||||||||||||
Total
|
11.748.2
|
11,884.2
|
1.577.0
|
1,588.7
|
7
|
9
|
(1) |
Estimated as of December 31, 2017 and 2016, respectively. There are numerous uncertainties inherent in estimating quantities of proved natural gas reserves. The accuracy
of any reserve estimate is a function of the quality of available data, and engineering and geological interpretation and judgment. Results of drilling, testing and production after the date of the estimate may require substantial
upward or downward revisions. Accordingly, the reserve estimates could be materially different from the quantity of natural gas that ultimately will be recovered.
|
(2) |
Reserve figures do not include significant reserves located in certain Bolivian basins to which TGN is connected.
|
(3) |
Weighted average reserve life for all basins, at the 2017 or 2016 production levels, respectively.
|
|
• |
operating and safety standards;
|
|
• |
terms of service, including general service conditions such as specifications regarding the quality of gas transported, major equipment requirements, invoicing and
payment procedures, imbalances and penalties, and guidelines for dispatch management;
|
|
• |
contract requirements, including the basis for the provision of service, e.g., “firm” or “interruptible”;
|
|
• |
mandatory capital investments to be made over the first five years of the license term; and
|
|
• |
applicable rates based on the type of transportation service and the area serviced.
|
|
• |
repeated failure to comply with the obligations of our License and failure to remedy a significant breach of an obligation in accordance with specified procedures;
|
|
• |
total or partial interruption of the service for reasons attributable to us, affecting completely or partially transportation capacity during the periods stipulated in
our License;
|
|
• |
sale, assignment or transfer of our essential assets or otherwise encumbering such assets without ENARGAS’s prior authorization, unless such encumbrances serve to
finance expansions and improvements to the gas pipeline system;
|
|
• |
bankruptcy, dissolution or liquidation; and
|
|
• |
ceasing and abandoning the provision of the licensed service, attempting to assign or unilaterally transfer our License in full or in part without the prior
authorization of ENARGAS, or giving up our License, other than in the cases permitted therein.
|
From May 1, 2015 to March 31, 2016 | ||||||||
Firm | Interruptible | |||||||
Rate Zones |
Reservation
Charge
(1)
(Ps. m3/d)
|
Minimum
Charge
(2)
(Ps. 1,000 m3)
|
Compression
Fuel and Losses
(3)
(%)
|
|||||
Receipt | Delivery | |||||||
From Tierra del Fuego to:
|
Tierra del Fuego
|
0.131975
|
4.399134
|
0.49
|
||||
Santa Cruz Sur
|
0.266133
|
8.871204
|
0.98
|
|||||
Chubut Sur
|
0.678868
|
22.628940
|
3.38
|
|||||
Buenos Aires Sur
|
0.799800
|
26.659990
|
5.60
|
|||||
Bahía Blanca
|
1.225104
|
40.836798
|
8.40
|
|||||
La Pampa Norte
|
1.220760
|
40.691977
|
8.60
|
|||||
Buenos Aires
|
1.433385
|
47.779485
|
10.35
|
|||||
Greater Buenos Aires
|
1.608257
|
53.608587
|
11.27
|
|||||
From Santa Cruz Sur to:
|
Santa Cruz Sur
|
0.133755
|
4.458469
|
0.49
|
||||
Chubut Sur
|
0.545894
|
18.196467
|
2.89
|
|||||
Buenos Aires Sur
|
0.667085
|
22.236149
|
5.11
|
|||||
Bahía Blanca
|
1.094595
|
36.486487
|
7.91
|
|||||
La Pampa Norte
|
1.094399
|
36.479918
|
8.11
|
|||||
Buenos Aires
|
1.303557
|
43.451887
|
9.86
|
|||||
Greater Buenos Aires
|
1.478968
|
49.298969
|
10.78
|
|||||
From Chubut to:
|
Chubut Sur
|
0.132655
|
4.421810
|
0.49
|
||||
Buenos Aires Sur
|
0.248731
|
8.290891
|
2.71
|
|||||
Bahía Blanca
|
0.663275
|
22.109043
|
5.51
|
|||||
La Pampa Norte
|
0.696439
|
23.214493
|
5.71
|
|||||
Buenos Aires
|
0.862256
|
28.741753
|
7.46
|
|||||
Greater Buenos Aires
|
1.028073
|
34.269013
|
8.38
|
|||||
From Neuquén to:
|
Neuquén
|
0.117873
|
4.041345
|
0.49
|
||||
Bahía Blanca
|
0.572524
|
19.078504
|
2.80
|
|||||
La Pampa Norte
|
0.616671
|
20.550184
|
3.15
|
|||||
Buenos Aires
|
0.775363
|
25.839833
|
3.91
|
|||||
Greater Buenos Aires
|
0.949709
|
31.713533
|
4.86
|
|||||
From Bahía Blanca to:
|
Bahía Blanca
|
0.132654
|
4.421810
|
0.49
|
||||
La Pampa Norte
|
0.033164
|
1.105450
|
0.20
|
|||||
Buenos Aires
|
0.198980
|
6.632710
|
1.95
|
|||||
Greater Buenos Aires
|
0.364798
|
12.159971
|
2.87
|
(1) |
Monthly charge for every cubic meter per day of reserved transportation capacity.
|
(2) |
Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor.
|
(3) |
Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering
transportation services.
|
Between April 1, 2016 and March 31,2017 | ||||||||
Firm | Interruptible | |||||||
Rate Zones |
Reservation
Charge
(1)
(Ps. m3/d)
|
Minimum
Charge
(2)
(Ps. 1,000 m3)
|
Compression
Fuel and Losses
(3)
(%)
|
|||||
Receipt | Delivery | |||||||
From Tierra del Fuego to:
|
Tierra del Fuego
|
0.396058
|
13.201800
|
0.49
|
||||
Santa Cruz Sur
|
0.798666
|
26.622484
|
0.98
|
|||||
Chubut Sur
|
2.037282
|
67.909449
|
3.38
|
|||||
Buenos Aires Sur
|
2.400200
|
80.006630
|
5.60
|
|||||
Bahía Blanca
|
3.676537
|
122.551231
|
8.40
|
|||||
La Pampa Norte
|
3.663501
|
122.116622
|
8.60
|
|||||
Buenos Aires
|
4.301588
|
143.386234
|
10.35
|
|||||
Greater Buenos Aires
|
4.826380
|
160.879368
|
11.27
|
|||||
From Santa Cruz Sur to:
|
Santa Cruz Sur
|
0.401399
|
13.379866
|
0.49
|
||||
Chubut Sur
|
1.638228
|
54.607597
|
2.89
|
|||||
Buenos Aires Sur
|
2.001922
|
66.730682
|
5.11
|
|||||
Bahía Blanca
|
3.284880
|
109.495948
|
7.91
|
|||||
La Pampa Norte
|
3.284290
|
109.476235
|
8.11
|
|||||
Buenos Aires
|
3.911976
|
130.399113
|
9.86
|
|||||
Greater Buenos Aires
|
4.438382
|
147.946205
|
10.78
|
|||||
From Chubut to:
|
Chubut Sur
|
0.398098
|
13.269851
|
0.49
|
||||
Buenos Aires Sur
|
0.746441
|
24.880963
|
2.71
|
|||||
Bahía Blanca
|
1.990488
|
66.349237
|
5.51
|
|||||
La Pampa Norte
|
2.090013
|
69.666693
|
5.71
|
|||||
Buenos Aires
|
2.587629
|
86.254000
|
7.46
|
|||||
Greater Buenos Aires
|
3.085246
|
102.841307
|
8.38
|
|||||
From Neuquén to:
|
Neuquén
|
0.353737
|
12.128076
|
0.49
|
||||
Bahía Blanca
|
1.718143
|
57.254592
|
2.80
|
|||||
La Pampa Norte
|
1.850629
|
61.671103
|
3.15
|
|||||
Buenos Aires
|
2.326864
|
77.545340
|
3.91
|
|||||
Greater Buenos Aires
|
2.850076
|
95.172312
|
4.86
|
|||||
From Bahía Blanca to:
|
Bahía Blanca
|
0.398096
|
13.269853
|
0.49
|
||||
La Pampa Norte
|
0.099524
|
3.317455
|
0.20
|
|||||
Buenos Aires
|
0.597139
|
19.904763
|
1.95
|
|||||
Greater Buenos Aires
|
1.094759
|
36.492072
|
2.87
|
(1) |
Monthly charge for every cubic meter per day of reserved transportation capacity.
|
(2) |
Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor.
|
(3) |
Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering
transportation services.
|
Between April 1, 2017 and November 30, 2017
|
||||||||||||||
Firm
|
Interruptible
|
|||||||||||||
Rate Zones
|
Reservation
Charge
(1)
(Ps. m3/d)
|
Minimum
Charge
(2)
(Ps. 1,000 m3)
|
Compression
Fuel and Losses
(3)
(%)
|
|||||||||||
Receipt
|
Delivery
|
|||||||||||||
From Tierra del Fuego to:
|
Tierra del Fuego
|
0.650525
|
21.683927
|
0.49
|
||||||||||
|
Santa Cruz Sur |
1.311808
|
43.727372
|
0.98
|
||||||||||
|
Chubut Sur |
3.346231
|
111.541121
|
3.38
|
||||||||||
|
Buenos Aires Sur |
3.942323
|
131.410716
|
5.60
|
||||||||||
|
Bahía Blanca |
6.038705
|
201.290128
|
8.40
|
||||||||||
|
La Pampa Norte |
6.017293
|
200.576284
|
8.60
|
||||||||||
|
Buenos Aires |
7.065348
|
235.511576
|
10.35
|
||||||||||
|
Greater Buenos Aires |
7.927318
|
264.244011
|
11.27
|
||||||||||
From Santa Cruz Sur to:
|
Santa Cruz Sur
|
0.659297
|
21.976401
|
0.49
|
||||||||||
|
Chubut Sur |
2.690787
|
89.692859
|
2.89
|
||||||||||
|
Buenos Aires Sur |
3.288153
|
109.605000
|
5.11
|
||||||||||
|
Bahía Blanca |
5.395408
|
179,846855
|
7.91
|
||||||||||
|
La Pampa Norte |
5.394439
|
179.814476
|
8.11
|
||||||||||
|
Buenos Aires |
6.425412
|
214.180259
|
9.86
|
||||||||||
|
Greater Buenos Aires |
7.290033
|
243.001319
|
10.78
|
||||||||||
From Chubut to:
|
Chubut Sur
|
0.653875
|
21.795701
|
0.49
|
||||||||||
|
Buenos Aires Sur |
1.226027
|
40.866927
|
2.71
|
||||||||||
|
Bahía Blanca |
3.269373
|
108.978477
|
5.51
|
||||||||||
|
La Pampa Norte |
3.432841
|
114.427392
|
5.71
|
||||||||||
|
Buenos Aires |
4.250176
|
141.672007
|
7.46
|
||||||||||
|
Greater Buenos Aires |
5.067510
|
168.916622
|
8.38
|
||||||||||
From Neuquén to:
|
Neuquén
|
0.581012
|
19.920338
|
0.49
|
||||||||||
|
Bahía Blanca |
2.822047
|
94.040542
|
2.80
|
||||||||||
|
La Pampa Norte |
3.039654
|
101.294653
|
3.15
|
||||||||||
|
Buenos Aires |
3.821870
|
127.368051
|
3.91
|
||||||||||
|
Greater Buenos Aires |
4.681244
|
156.320314
|
4.86
|
||||||||||
From Bahía Blanca to:
|
Bahía Blanca
|
0.653875
|
21.795701
|
0.49
|
||||||||||
|
La Pampa Norte |
0.163469
|
5.448915
|
0.20
|
||||||||||
|
Buenos Aires |
0.980803
|
32.693530
|
1.95
|
||||||||||
|
Greater Buenos Aires |
1.798138
|
59.938145
|
2.87
|
(1) |
Monthly charge for every cubic meter per day of reserved transportation capacity.
|
(2) |
Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor.
|
(3) |
Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering
transportation services.
|
Between December 1, 2017 and March 31, 2018
|
||||||||||||||
Firm
|
Interruptible
|
|||||||||||||
Rate Zones
|
Reservation
Charge
(1)
(Ps. m3/d)
|
Minimum
Charge
(2)
(Ps. 1,000 m3)
|
Compression
Fuel and Losses
(3)
(%)
|
|||||||||||
Receipt
|
Delivery
|
|||||||||||||
From Tierra del Fuego to:
|
Tierra del Fuego
|
1.178272
|
39.275298
|
0.49
|
||||||||||
|
Santa Cruz Sur
|
2.376029
|
79.201776
|
0.98
|
||||||||||
|
Chubut Sur
|
6.060905
|
202.030320
|
3.38
|
||||||||||
|
Buenos Aires Sur
|
7.140583
|
238.019383
|
5.60
|
||||||||||
|
Bahía Blanca
|
10.937683
|
364.589386
|
8.40
|
||||||||||
|
La Pampa Norte
|
10.898901
|
363.296426
|
8.60
|
||||||||||
|
Buenos Aires
|
12.797205
|
426.573433
|
10.35
|
||||||||||
|
Greater Buenos Aires
|
14.358459
|
478.615432
|
11.27
|
||||||||||
From Santa Cruz Sur to:
|
Santa Cruz Sur
|
1.194161
|
39.805045
|
0.49
|
||||||||||
|
Chubut Sur
|
4.873723
|
162.457367
|
2.89
|
||||||||||
|
Buenos Aires Sur
|
5.955710
|
198.523493
|
5.11
|
||||||||||
|
Bahía Blanca
|
9.772503
|
325.749975
|
7.91
|
||||||||||
|
La Pampa Norte
|
9.770749
|
325.691329
|
8.11
|
||||||||||
|
Buenos Aires
|
11.638111
|
387.936804
|
9.86
|
||||||||||
|
Greater Buenos Aires
|
13.204167
|
440.139326
|
10.78
|
||||||||||
From Chubut to:
|
Chubut Sur
|
1.184339
|
39.477749
|
0.49
|
||||||||||
|
Buenos Aires Sur
|
2.220658
|
74.020757
|
2.71
|
||||||||||
|
Bahía Blanca
|
5.921694
|
197.388697
|
5.51
|
||||||||||
|
La Pampa Norte
|
6.217779
|
207.258114
|
5.71
|
||||||||||
|
Buenos Aires
|
7.698187
|
256.605281
|
7.46
|
||||||||||
|
Greater Buenos Aires
|
9.178595
|
305.952447
|
8.38
|
||||||||||
From Neuquén to:
|
Neuquén
|
1.052366
|
36.080973
|
0.49
|
||||||||||
|
Bahía Blanca
|
5.111469
|
170.332165
|
2.80
|
||||||||||
|
La Pampa Norte
|
5.505614
|
183.471269
|
3.15
|
||||||||||
|
Buenos Aires
|
6.922412
|
230.697053
|
3.91
|
||||||||||
|
Greater Buenos Aires
|
8.478965
|
283.137219
|
4.86
|
||||||||||
From Bahía Blanca to:
|
Bahía Blanca
|
1.184334
|
39.477755
|
0.49
|
||||||||||
|
La Pampa Norte
|
0.296083
|
9.869416
|
0.20
|
||||||||||
|
Buenos Aires
|
1.776485
|
59.216586
|
1.95
|
||||||||||
|
Greater Buenos Aires
|
3.256902
|
108.563756
|
2.87
|
(1) |
Monthly charge for every cubic meter per day of reserved transportation capacity.
|
(2) |
Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor.
|
(3) |
Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering
transportation services.
|
Since April 1, 2018 to September 30, 2018
|
||||||||||||||
Firm
|
Interruptible
|
|||||||||||||
Rate Zones
|
Reservation
Charge
(1)
(Ps. m3/d)
|
Minimum
Charge
(2)
(Ps. 1,000 m3)
|
Compression
Fuel and Losses
(3)
(%)
|
|||||||||||
Receipt
|
Delivery
|
|||||||||||||
From Tierra del Fuego to:
|
Tierra del Fuego
|
1.767514
|
58.916471
|
0.49
|
||||||||||
|
Santa Cruz Sur
|
3.564256
|
118.809770
|
0.98
|
||||||||||
|
Chubut Sur
|
9.091901
|
303.063605
|
3.38
|
||||||||||
|
Buenos Aires Sur
|
10.711516
|
357.050429
|
5.60
|
||||||||||
|
Bahía Blanca
|
16.407506
|
546.916789
|
8.40
|
||||||||||
|
La Pampa Norte
|
16.349329
|
544.977233
|
8.60
|
||||||||||
|
Buenos Aires
|
19.196955
|
639.898420
|
10.35
|
||||||||||
|
Greater Buenos Aires
|
21.538977
|
717.966088
|
11.27
|
||||||||||
From Santa Cruz Sur to:
|
Santa Cruz Sur
|
1.791349
|
59.711139
|
0.49
|
||||||||||
|
Chubut Sur
|
7.311021
|
243.700626
|
2.89
|
||||||||||
|
Buenos Aires Sur
|
8.934100
|
297.803051
|
5.11
|
||||||||||
|
Bahía Blanca
|
14.659632
|
488.654189
|
7.91
|
||||||||||
|
La Pampa Norte
|
14.657000
|
488.566215
|
8.11
|
||||||||||
|
Buenos Aires
|
17.458211
|
581.940011
|
9.86
|
||||||||||
|
Greater Buenos Aires
|
19.807436
|
660.248478
|
10.78
|
||||||||||
From Chubut to:
|
Chubut Sur
|
1.776614
|
59.220165
|
0.49
|
||||||||||
|
Buenos Aires Sur
|
3.331187
|
111.037777
|
2.71
|
||||||||||
|
Bahía Blanca
|
8.883072
|
296.100754
|
5.51
|
||||||||||
|
La Pampa Norte
|
9.327226
|
310.905767
|
5.71
|
||||||||||
|
Buenos Aires
|
11.547971
|
384.930944
|
7.46
|
||||||||||
|
Greater Buenos Aires
|
13.768715
|
458.956121
|
8.38
|
||||||||||
From Neuquén to:
|
Neuquén
|
1.578643
|
54.124697
|
0.49
|
||||||||||
|
Bahía Blanca
|
7.667662
|
255.513529
|
2.80
|
||||||||||
|
La Pampa Norte
|
8.258915
|
275.223364
|
3.15
|
||||||||||
|
Buenos Aires
|
10.384239
|
346.066277
|
3.91
|
||||||||||
|
Greater Buenos Aires
|
12.719209
|
424.731232
|
4.86
|
||||||||||
From Bahía Blanca to:
|
Bahía Blanca
|
1.776607
|
59.220174
|
0.49
|
||||||||||
|
La Pampa Norte
|
0.444152
|
14.805009
|
0.20
|
||||||||||
|
Buenos Aires
|
2.664887
|
88.830192
|
1.95
|
||||||||||
|
Greater Buenos Aires
|
4.885645
|
162.855375
|
2.87
|
(4) |
Monthly charge for every cubic meter per day of reserved transportation capacity.
|
(5) |
Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor.
|
(6) |
Maximum percentage of total transported gas which customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering
transportation services.
|
Since October 1, 2018 to March 31, 2019
|
||||||||||||||
Firm
|
Interruptible
|
|||||||||||||
Rate Zones
|
Reservation
Charge
(1)
(Ps. m3/d)
|
Minimum
Charge
(2)
(Ps. 1,000 m3)
|
Compression
Fuel and Losses
(3)
(%)
|
|||||||||||
Receipt
|
Delivery
|
|||||||||||||
From Tierra del Fuego to:
|
Tierra del Fuego
|
2.115187
|
70.505443
|
0.49
|
||||||||||
|
Santa Cruz Sur
|
4.265351
|
142.179858
|
0.98
|
||||||||||
|
Chubut Sur
|
10.880293
|
362.676743
|
3.38
|
||||||||||
|
Buenos Aires Sur
|
12.818489
|
427.282869
|
5.60
|
||||||||||
|
Bahía Blanca
|
19.634891
|
654.496272
|
8.40
|
||||||||||
|
La Pampa Norte
|
19.565270
|
652.175202
|
8.60
|
||||||||||
|
Buenos Aires
|
22.973029
|
765.767552
|
10.35
|
||||||||||
|
Greater Buenos Aires
|
25.775731
|
859.191266
|
11.27
|
||||||||||
From Santa Cruz Sur to:
|
Santa Cruz Sur
|
2.143710
|
71.456424
|
0.49
|
||||||||||
|
Chubut Sur
|
8.749112
|
291.636962
|
2.89
|
||||||||||
|
Buenos Aires Sur
|
10.691453
|
356.381429
|
5.11
|
||||||||||
|
Bahía Blanca
|
17.543207
|
584.773317
|
7.91
|
||||||||||
|
La Pampa Norte
|
17.540057
|
584.668038
|
8.11
|
||||||||||
|
Buenos Aires
|
20.892272
|
696.408622
|
9.86
|
||||||||||
|
Greater Buenos Aires
|
23.703593
|
790.120501
|
10.78
|
||||||||||
From Chubut to:
|
Chubut Sur
|
2.126078
|
70.868874
|
0.49
|
||||||||||
|
Buenos Aires Sur
|
3.986437
|
132.879101
|
2.71
|
||||||||||
|
Bahía Blanca
|
10.630388
|
354.344287
|
5.51
|
||||||||||
|
La Pampa Norte
|
11.161907
|
372.061471
|
5.71
|
||||||||||
|
Buenos Aires
|
13.819476
|
460.647529
|
7.46
|
||||||||||
|
Greater Buenos Aires
|
16.477046
|
549.233587
|
8.38
|
||||||||||
From Neuquén to:
|
Neuquén
|
1.889165
|
64.771119
|
0.49
|
||||||||||
|
Bahía Blanca
|
9.175905
|
305.773484
|
2.80
|
||||||||||
|
La Pampa Norte
|
9.883458
|
329.360278
|
3.15
|
||||||||||
|
Buenos Aires
|
12.426836
|
414.138116
|
3.91
|
||||||||||
|
Greater Buenos Aires
|
15.221099
|
508.276603
|
4.86
|
||||||||||
From Bahía Blanca to:
|
Bahía Blanca
|
2.126068
|
70.868885
|
0.49
|
||||||||||
|
La Pampa Norte
|
0.531517
|
17.717180
|
0.20
|
||||||||||
|
Buenos Aires
|
3.189075
|
106.303245
|
1.95
|
||||||||||
|
Greater Buenos Aires
|
5.846660
|
194.889310
|
2.87
|
(7) |
Monthly charge for every cubic meter per day of reserved transportation capacity.
|
(8) |
Minimum charge equal to the unit rate of the firm reservation charge at a 100% load factor.
|
(9) |
Maximum percentage of total transported gas that customers are required to replace in-kind to make up for gas used by us for compressor fuel or losses in rendering
transportation services.
|
|
• |
the net book value of the essential assets determined on the basis of the price paid by CIESA for shares of our common stock plus the original cost of subsequent
investments carried in U.S. dollars in each case adjusted by the PPI, net of accumulated depreciation in accordance with the calculation rules to be determined by ENARGAS (since the enactment of the Public Emergency Law, this
provision may no longer be valid); or
|
|
• |
the net proceeds of a new competitive bidding (the “
New Bidding
”).
|
|
• |
submit a bid computed at an equal and not lower price than the appraisal value determined by an investment bank selected by ENARGAS, which represents the value of the
business providing the licensed service at the valuation date, as a going concern and without regard to the debts;
|
|
• |
match the best bid submitted by third parties in the New Bidding, if it would be higher than our bid mentioned above, paying the difference between both values to
obtain a new license;
|
|
• |
if we have participated in the New Bidding but are unwilling to match the best bid made by a third party, receive the appraisal value as compensation for the transfer
of the essential assets to the new licensee, with any excess paid by the third party remaining for the grantor.
|
|
• |
Liquids production and commercialization for our own account
: Under this type of
arrangement, we own the Liquids products obtained at our Cerri Complex. We purchase natural gas in order to replace thermal units consumed in the liquids production process. These natural gas purchases are negotiated with certain
natural gas distributors, traders and producers. This category of our liquids business is most important in terms of revenue, percentage of transactions and profit.
|
|
• |
Liquids production and commercialization on behalf of third parties
: We also process
natural gas and market the Liquids products in exchange for a commission based on a percentage of the sale price. In some cases, we process the natural gas and deliver the Liquids products to the natural gas producers who pay us a
percentage of the average monthly sale price obtained from our sales in the domestic and/or international markets (depending on the contract).
|
2018
|
2017
|
2016
|
||||||||||
Ethane
|
437,362
|
311,786
|
305,861
|
|||||||||
Propane
|
334,852
|
353,561
|
345,577
|
|||||||||
Butane
|
260,761
|
260,171
|
244,814
|
|||||||||
Natural Gasoline
|
132,311
|
133,802
|
108,741
|
|||||||||
Total
|
1,165,286
|
1,059,319
|
1,004,992
|
(1) |
Incorporated in Argentina.
|
(2) |
Incorporated in Uruguay.
|
Major Pipeline
|
Length
(miles)
|
Diameter (inches)
|
Maximum
Pressure
(pound/inch)
|
Compressor
Units
|
Operative
Compressor
Plants
|
HP
Output
|
||||||||||||||||||
General San Martín
|
2,939
|
30
(2
|
)
|
853/995
|
59
|
17
|
517,300
|
|||||||||||||||||
Neuba I/Loop Sur
|
1,217
|
24/30
|
853
|
15
|
5
|
61,300
|
||||||||||||||||||
Neuba II
|
1,307
|
30/36
|
975/995
|
21
|
7
|
194,000
|
||||||||||||||||||
Other
(1)
|
243
|
Various
|
Various
|
6
|
3
|
7,500
|
||||||||||||||||||
Total
|
5,706
|
101
|
32
|
780,100
|
(1) |
Includes 247miles of transfer pipelines throughout the pipeline system, as well as the Cordillerano pipeline, with a length of 239miles, and the Chelforó-Conesa
pipeline and other minor pipelines.
|
(2) |
Includes two tranches of 24 inches, which correspond to the “Estrecho de Magallanes” natural gas pipeline.
|
Treatment
capacity
(in MMcf/d)
|
Compression
capacity (in HP)
|
|||||||
Río Neuquén
|
166.0
|
36,540
|
||||||
Plaza Huincul
|
28.3
|
5,160
|
||||||
Total
|
194.3
|
41,700
|
|
• |
inventory of gaseous emissions;
|
|
• |
monitoring of gaseous emissions from the Cerri Complex;
|
|
• |
zero effluence in Cerri Complex;
|
|
• |
diagnosis of energy efficiency in Cerri Complex, Puerto Galván and our headquarters;
|
|
• |
measurement of the vents generated by the use of seals; and
|
|
• |
sewage effluent treatment plant in Plaza Huincul.
|
|
• |
impairment of property, plant and equipment (
“PPE”
);
|
|
• |
provisions for legal claims and others; and
|
|
• |
income tax – deferred tax assets and tax credits.
|
|
• |
whether significant decreases in the market values of PPE elements took place;
|
|
• |
whether prices of the main products and services that are marketed decreased;
|
|
• |
whether significant changes in the regulatory framework were introduced;
|
|
• |
whether operating costs suffered a material increase;
|
|
• |
whether evidence of obsolescence or physical damage has occurred; and
|
|
• |
whether the macroeconomic situation in which we carry out our activities, including significant variations in the sale prices of products, raw materials, interest
rates, etc., has worsened.
|
|
• |
it requires our management to make estimates and assumptions that are highly susceptible to change from period to period; and
|
|
• |
the impact that recognizing or reversing provisions for legal claims and others would have on our consolidated balance sheet as well as on the results of our operations
could be material.
|
2018
|
2017
|
2016
|
2015
|
2014
|
||||||||||||||||
WPI
(1)
|
73.5
|
18.8
|
34.6
|
10.6
|
28.3
|
|||||||||||||||
CPI
(2)
|
47.6
|
24.8
|
36.1
|
23.6
|
23.9
|
|||||||||||||||
Devaluation of pesos vs. dollar (in %)
|
102.2
|
17.4
|
9.3
|
52.5
|
31.1
|
|||||||||||||||
Real GDP (pesos of 2004) (% change)
|
2.5
|
3.9
|
(2.3
|
)
|
2.6
|
(2.6
|
)
|
|||||||||||||
Industrial production (% change)
|
(5.0
|
)
|
1.8
|
(4.6
|
)
|
0.1
|
(2.5
|
)
|
||||||||||||
Transportation services tariffs increase
|
79.5
|
182.0
|
200.1
|
44.3
|
20.0
|
(1) |
For the year 2015, the latest information published by the INDEC refers to October 2015. This rate (which contains ten months accumulated), was complemented with CPI
average rates as of November and December 2015 published by the Province of San Luis and the City of Buenos Aires (7.8%).
|
(2) |
Since June 2016, the INDEC began to gradually publish CPI information for the period commencing in May 2016 and concluding in December 2016. As of the date of issuance
of this Annual Report the CPI for the first four months of 2016 has not been published. As a consequence of the lack of information, we completed the missing information with Consumer Price Index average rates for these four months
published by the Province of San Luis and the City of Buenos Aires (16.6%).
|
|
• |
the volume of liquids products we produce and sell;
|
|
• |
changes in international prices of LPG and natural gasoline;
|
|
• |
regulation affecting our liquids business, including Law No. 26,020 (which requires us to meet domestic demand before exporting LPG);
|
|
• |
changes in the input costs related to the liquids production and commercialization segment, including the Gas Charge Resolutions;
|
|
• |
the availability of natural gas and its richness;
|
|
• |
fluctuation in the Argentine peso / U.S. dollar exchange rate;
|
|
• |
the tariffs we are permitted to charge in our Natural Gas Transportation business segment;
|
|
• |
local inflation and its impact on costs expressed in Argentine pesos; and
|
|
• |
other changes in laws or regulations affecting our operations, including tax matters.
|
|
• |
The components of the capital stock were restated from the dates they were contributed;
|
|
• |
Reserved earnings were maintained at the date of transition at their nominal value (legal amount without restatement);
|
|
• |
The restated unallocated results were determined by the difference between the net assets restated at the transition date and the rest of the initial equity components
expressed as indicated in the preceding paragraphs; and
|
|
• |
After the restatement at the transition date, all the components of the equity are restated by applying the general price index from the beginning of the period, and
each variation of those components is restated from the date of contribution or from the moment in which the variation is added by any other means.
|
Balances as of
01/01/2016
|
Balances as of
12/31/2016
|
Balances as of
12/31/2017
|
||||||||||
Total equity according to financial statements approved on 04/13/2018
|
1,695,434
|
2,526,378
|
5,319,640
|
|||||||||
Increase due to adjustment of common stock
|
17,321,734
|
17,321,734
|
17,321,734
|
|||||||||
(Decrease) / increase in accumulated retained earnings
|
(368,161
|
)
|
(319,709
|
)
|
2,638,215
|
|||||||
Total equity after the application of IAS 29
|
18,649,007
|
19,528,403
|
25,279,589
|
2016
|
2017
|
|||||||
Total comprehensive income for the year ended December 31, 2016 and 2017 according to financial
statements approved on 04/13/2018
|
930,678
|
2,793,266
|
||||||
Gain on net monetary position
|
1,038,647
|
465,975
|
||||||
Restatement of income / (expense) items including income tax
|
(863,030
|
)
|
2,491,952
|
|||||
Total comprehensive income after the application of IAS 29
|
1,106,295
|
5,751,193
|
Year ended December 31,
|
||||||||||||||||
2018
|
2017
|
Variation
|
Percentage of
change
|
|||||||||||||
(in millions of pesos)
|
||||||||||||||||
Revenues
|
34,062.7
|
19,953.3
|
14,109.4
|
70.7
|
%
|
|||||||||||
Operating costs
|
(14,232.7
|
)
|
(10,040.7
|
)
|
(4,192.0
|
)
|
41.8
|
%
|
||||||||
Depreciation
|
(1,955.6
|
)
|
(1,894.9
|
)
|
(60.6
|
)
|
3.2
|
%
|
||||||||
Costs of sales
|
(16,188.3
|
)
|
(11,935.7
|
)
|
(4,252.6
|
)
|
35.6
|
%
|
||||||||
Gross profit
|
17,874.4
|
8,017.6
|
9,856.8
|
122.9
|
%
|
|||||||||||
Administrative and selling expenses
|
(2,726.5
|
)
|
(1,541.2
|
)
|
(1,185.3
|
)
|
76.9
|
%
|
||||||||
Other operating loss
|
(890,8
|
)
|
(271.6
|
)
|
(619.2
|
)
|
228.0
|
%
|
||||||||
Operating profit
|
14.257,1
|
6,204.8
|
8,052.3
|
129.8
|
%
|
|||||||||||
Net financial results
|
(2.846,3
|
)
|
(528.3
|
)
|
(2,318.0
|
)
|
438.7
|
%
|
||||||||
Share of profit from associates
|
18.2
|
21.6
|
(3.4
|
)
|
(15.7
|
%)
|
||||||||||
Income tax (expense) / gain
|
(13.2
|
)
|
53.1
|
(66.3
|
)
|
n/a
|
||||||||||
Total net income and total comprehensive income
|
11,415.8
|
5,751.2
|
5,664.6
|
98.5
|
%
|
|
• |
Net revenues reached Ps. 34,062.7 million, an increase of Ps. 14,109.4 million compared to the 2017 fiscal year. This increase was mainly due to higher net revenues
from the Natural Gas Transportation and Liquids Production and Commercialization segments, which grew by 108.6% or Ps. 8,359.9 million and 48.8% or Ps. 5,453.5 million, respectively.
|
|
• |
Operating costs, including depreciation of fixed assets, increased by Ps. 4,252.6 million, or 35.6% over 2017 fiscal year, primarily as a result of: (i) the increase in
the price and volumes of natural gas used as RTP totaling Ps. 2,612.5 million, (ii) more third parties services and higher fees at Ps. 918.5 million, (iii) higher charges for the preservation of fixed assets, including depreciation
of Ps. 315.1 million and (iv) labor costs of Ps. 139.0 million.
|
|
• |
Administrative and selling expenses rose by Ps. 1,185.3 million, or 76.9% over 2017 fiscal year, as a result of: (i) the increase in the turnover tax and tax on exports
of Ps 747.8 million, (ii) higher doubtful accounts charges by Ps. 120.9 million and (iii) higher depreciations of Ps. 142.0 million.
|
Year ended December 31,
|
||||||||
2018
|
2017
|
|||||||
(in millions of pesos)
|
||||||||
Financial income
|
||||||||
Interest income
|
1,345.3
|
133.1
|
||||||
Fair value gains on financial instruments through profit and loss
|
1,372.9
|
442.5
|
||||||
Foreign exchange gain
|
8,164.2
|
561.6
|
||||||
Derivative financial instruments results
|
106.1
|
-
|
||||||
Subtotal
|
10,988.5
|
1,137.2
|
||||||
Financial expenses
|
||||||||
Interest expense
|
(1,675.4
|
)
|
(846.4
|
)
|
||||
Foreign exchange loss
|
(13,122.0
|
)
|
(1,117.2
|
)
|
||||
Other financial charges
|
(243.6
|
)
|
(167.9
|
)
|
||||
Subtotal
|
(15,041.0
|
)
|
(2,131.5
|
)
|
||||
Gain on monetary position
|
1,206.2
|
466.0
|
||||||
Total
|
(2,846.3
|
)
|
(528.3
|
)
|
Year ended December 31,
|
Year ended December 31, 2018
compared to year ended December
31, 2017
|
|||||||||||||||
2018
|
2017
|
Variation
|
Percentage
Change |
|||||||||||||
Natural Gas Transportation
|
||||||||||||||||
Revenues (1)
|
16,060.5
|
7,701.2
|
8,359.3
|
108.6
|
%
|
|||||||||||
Cost of sales
|
(5,164.3
|
)
|
(4,178.9
|
)
|
(985.4
|
)
|
23.6
|
%
|
||||||||
Gross profit
|
10,896.2
|
3,522.3
|
7,373.8
|
209.4
|
%
|
|||||||||||
Administrative and selling expenses
|
(1,788.9
|
)
|
(1,016.7
|
)
|
(772.2
|
)
|
76.0
|
%
|
||||||||
Other operating expense
|
(156.3
|
)
|
(327.2
|
)
|
171.0
|
(52.3
|
%)
|
|||||||||
Operating profit
|
8,951.1
|
2,178.4
|
6,772.6
|
310.9
|
%
|
|||||||||||
Liquids Production and Commercialization
|
||||||||||||||||
Revenues
|
16,627.4
|
11,174.0
|
5,453.5
|
48.8
|
%
|
|||||||||||
Cost of sales
|
(10,486.0
|
)
|
(7,271.6
|
)
|
(3,214.4
|
)
|
44.2
|
%
|
||||||||
Gross profit
|
6,141.4
|
3,902.4
|
2,239.0
|
57.4
|
%
|
|||||||||||
Administrative and selling expenses
|
(724.2
|
)
|
(359.1
|
)
|
(365.2
|
)
|
101.7
|
%
|
||||||||
Other operating (expense) / income
|
(726.7
|
)
|
64.7
|
(791.4
|
)
|
n/a
|
||||||||||
Operating profit
|
4,690.5
|
3,608.1
|
1,082.4
|
30.0
|
%
|
|||||||||||
Other services
|
||||||||||||||||
Revenues
|
1,810.1
|
1,199.2
|
610.9
|
50.9
|
%
|
|||||||||||
Cost of sales
|
(1,054.2
|
)
|
(655.8
|
)
|
(398.4
|
)
|
60.8
|
%
|
||||||||
Gross profit
|
755.9
|
543.3
|
212.5
|
39.1
|
%
|
|||||||||||
Administrative and selling expenses
|
(179.4
|
)
|
(143.4
|
)
|
(36.0
|
)
|
25.1
|
%
|
||||||||
Other operating expense
|
(5.4
|
)
|
(9.2
|
)
|
3.8
|
(41.3
|
%)
|
|||||||||
Operating profit
|
571.0
|
390.8
|
180.2
|
46.1
|
%
|
|||||||||||
Telecommunications
|
||||||||||||||||
Revenues
|
163.1
|
124.1
|
39.0
|
31.4
|
%
|
|||||||||||
Cost of sales
|
(82.2
|
)
|
(74.6
|
)
|
(7.6
|
)
|
10.5
|
%
|
||||||||
Gross profit
|
80.9
|
49.5
|
31.4
|
62.9
|
%
|
|||||||||||
Administrative and selling expenses
|
(34.0
|
)
|
(22.0
|
)
|
(12.0
|
)
|
54.6
|
%
|
||||||||
Other operating (expense) / income
|
(2.3
|
)
|
0.2
|
(2.5
|
)
|
-n/
|
a
|
|||||||||
Operating profit
|
44.6
|
27.6
|
17.0
|
60.4
|
%
|
(1) |
Includes of intersegment revenues of Ps. 598.4 million and 245.2 million for the fiscal years 2018 and 2017, respectively.
|
|
• |
Revenues from the Natural Gas Transportation business segment increased by Ps. 8,359.3 million for the year 2018 compared to 2017;
|
|
• |
Revenues related to natural gas firm transportation contracts for the years ended December 31, 2018, increased by Ps. 6,411.8 million. The increase is mainly due to the
combined effect of: (i) the full application during fiscal year 2018 of the tariff increases granted by Resolutions 4362 and 120 of 58% and 78%, respectively, (ii) the application starting April 1, 2018 of Resolution 310 including a
tariff increase equivalent to 50%; and, (iii) the application starting October 1, 2018 of Resolution 265 including a tariff increase equivalent to 19.7%. See “
Item 4. Our Information—B. Business Overview—Natural Gas Transportation—Regulatory Framework—Regulation of Transportation Rates-Actual Rates
” for additional information;
|
|
• |
Revenues related to interruptible natural gas transportation service increased by Ps. 1,462.0 million. The increase mainly resulted from the tariff increase discussed
above,
|
|
• |
Revenues relating to the CAU increased by Ps. 132.2 million. The value of the CAU is much less than the transportation tariff we are permitted to charge for our natural
gas transportation services, because we were not required to make any investment in the construction and expansion of the assets to which the CAU relates. See “
Item 4. Our Information—B. Business Overview—Natural Gas Transportation—Pipeline Operations—Pipeline Expansions
” for additional information regarding the CAU,
|
|
• |
Intersegment sales increased by Ps. 353.2 million given larger volumes of natural gas transported to Cerri Complex and tariff increases,
|
|
• |
During 2018, we received nominal tariff increases totaling 79.5%;
|
|
• |
Costs of sales and administrative and selling expenses for the year ended December 31, 2018 increased by Ps. 1,757.6 million, from Ps. 5,195.6 million to Ps. 6,953.2
million, as compared to the year ended December 31, 2017. This increase was mainly attributable to: (i) a higher technical assistance fee accrued of Ps. 578.0 million, (ii) an increase of Ps. 247.6 million in ordinary maintenance
expenses for the pipelines and other fixed assets and (iii) higher tax on sale of Ps. 407.2 million, (iv) higher depreciations amounting to Ps. 185.3 million and (v) a higher charge in doubtful accounts by Ps. 155.9 million; and
|
|
• |
The positive variation in other operating expenses mainly resulted from a Ps. 109.5 million decrease in certain non-financial assets.
|
Years ended December 31,
|
Year ended December 31, 2018
compared to year ended
December 31, 2017
|
|||||||||||||||
(volumes in short tons)
|
(volumes in short tons)
|
|||||||||||||||
2018
|
2017
|
Increase/
(Decrease)
|
Percentage
Change
|
|||||||||||||
Local Market
|
||||||||||||||||
Ethane
|
437,362
|
311,786
|
125,576.0
|
40.3
|
%
|
|||||||||||
Propane
|
172,834
|
194,665
|
(21,830.9
|
)
|
(11.2
|
%)
|
||||||||||
Butane
|
171,889
|
156,912
|
14,976.9
|
9.5
|
%
|
|||||||||||
Subtotal
|
782,085
|
663,363
|
118,722.1
|
17.9
|
%
|
|||||||||||
Exports
|
||||||||||||||||
Propane
|
162,018
|
158,895
|
3,122.8
|
2.0
|
%
|
|||||||||||
Butane
|
88,872
|
103,259
|
(14,386.7
|
)
|
(13.9
|
%)
|
||||||||||
Natural Gasoline
|
132,311
|
133,802
|
(1,490.0
|
)
|
(1.1
|
%)
|
||||||||||
Subtotal
|
383,201
|
395,956
|
(12,753.9
|
)
|
(3.2
|
%)
|
||||||||||
Total Liquids
|
1,165,286
|
1,059,319
|
105,968.2
|
14.7
|
%
|
|
• |
Segment revenue increased by Ps. 5,453.4 million in 2018, compared with the previous year. This increase is mainly due to increases of: (i) Ps. 2,624.1 million as a
result of depreciation of the Argentine peso against the U.S. dollar, (ii) Ps. 1,435.4 million resulting from higher international reference prices and the increase in the price of the butane received under the Households with
Bottles Program and (iii) Ps. 1,381.0 million resulting from higher volumes sold;
|
|
• |
In 2018 propane, butane and natural gasoline export prices recorded increases of 8.1%, 1.0% and 26.3%, respectively, although with some volatility. In spite of that, in
line with the developments in the oil prices, significant drops were recorded as from October and therefore prices as of December 2018 were 30% lower than in October;
|
|
• |
Notwithstanding the changes made to the Households with Bottles Program to supply butane to the domestic market described above, our obligations under this program
continues to have an adverse impact on this segment, resulting in a negative operating margin on domestic sales of LPG;
|
|
• |
Costs of sales, administrative and selling expenses for the year ended December 31, 2018 increased by Ps. 3,579.5 million, from Ps. 7,630.7 million to Ps. 11,210.2
million, as compared to the year ended December 31, 2018. This increase was mainly due to: (i) the rise in the price of natural gas that we are required to purchase in as RTP as part of the Liquids processing business of Ps. 2,612.5
million, (ii) higher taxes, mainly due to tax on exports, of Ps. 247.6 million and (iii) higher technical assistance fee of Ps. 149.3 million; and
|
|
• |
Other operating expenses increased by Ps. 791.4 million mainly resulting from the Ps. 685.4 million (US$ 21.3 million) payment made, on June 14, 2018, as part of the
resolution of the arbitration initiated by Pan American Energy LLC Argentine Branch and Pan American Sur S.A. before the International Court of Arbitration on May 8, 2015, against the Company for US$ 306.3 million.
|
|
• |
Net revenues increased by Ps. 610.9 million primarily due to the higher sales associated with: (i) the effect of the depreciation of the Argentine peso against the US
dollar of Ps. 217.3 million, (ii) higher construction works performed by the UT of Ps. 314.5 million, (iii) higher natural gas compression and treatment services of Ps. 72.2 million.
|
|
• |
Costs of sales, administrative and selling expenses increased by Ps. 434.4 million, mainly due to increases in: (i) professional services fees (Ps. 125.0 million), (ii)
property, plant and equipment maintenance (Ps. 21.4 million), (iii) labor costs (Ps. 99.4 million), (iv) costs of services rendered to third parties (Ps. 51.2 million) and (v) turnover tax (Ps. 40.7 million).
|
|
• |
Net revenues increased by Ps. 39.0 million in the year ended December 31, 2018 when compared to 2017. The positive variation was mainly due to the increase in the
foreign exchange rate of the Argentine peso compared to the U.S. dollar; and
|
|
• |
Costs of sales, administrative and selling expenses increased by Ps. 19.6 million.
|
Year ended December 31,
|
||||||||||||||||
2017
|
2016
|
Variation
|
Percentage
change
|
|||||||||||||
(in millions of pesos)
|
||||||||||||||||
Revenues
|
19,953.3
|
14,645.5
|
5,307.8
|
36.2
|
%
|
|||||||||||
Operating costs
|
(10,040.7
|
)
|
(8,286.6
|
)
|
(1,754.2
|
)
|
21.2
|
%
|
||||||||
Depreciation
|
(1,894.9
|
)
|
(1,738.9
|
)
|
(156.1
|
)
|
9.0
|
%
|
||||||||
Costs of sales
|
(11,935.7
|
)
|
(10,025.4
|
)
|
(1,910.3
|
)
|
19.1
|
%
|
||||||||
Gross profit
|
8,017.6
|
4,620.1
|
3,397.5
|
73.5
|
%
|
|||||||||||
Administrative and selling expenses
|
(1,541.2
|
)
|
(1,576.6
|
)
|
35.5
|
(2.3
|
%
)
|
|||||||||
Other operating loss
|
(271.6
|
)
|
(130.6
|
)
|
(141.0
|
)
|
108.0
|
%
|
||||||||
Operating profit
|
6,204.8
|
2,912.8
|
3,292.0
|
113.0
|
%
|
|||||||||||
Net financial results
|
(528.3
|
)
|
(709.3
|
)
|
181.0
|
(25.5
|
%
)
|
|||||||||
Share of profit from associates
|
21.6
|
5.1
|
16.6
|
325.5
|
%
|
|||||||||||
Income tax expense
|
53.1
|
(1,102.3
|
)
|
1,155.4
|
(104.8
|
%
)
|
||||||||||
Total net income and total comprehensive income
|
5,751.2
|
1,106.3
|
4,644.9
|
419.9
|
%
|
|
• |
Net revenues reached Ps. 19,953.3 million, an increase of Ps. 5,307.8 million compared to the 2016 fiscal year. This increase was mainly due to higher net revenues from
the Natural Gas Transportation and Liquids Production and Commercialization segments, which grew by 79.1% or Ps. 3,400.5 million and 18.8% or Ps. 1,769.2 million, respectively;
|
|
• |
Operating costs, including depreciation of fixed assets, increased by Ps. 1,910.3 million, or 19.1% over 2016 fiscal year, primarily as a result of an increase in the
price of natural gas used as replacement for thermal plant reduction at the Cerri Complex combined with butane purchases made to supply the local market, higher charges for maintenance of fixed assets and depreciation and an
increase in labor costs; and
|
|
• |
Administrative and selling expenses decreased by Ps. 35.5 million, or 2.3% over 2016 fiscal year.
|
Year ended December 31,
|
||||||||
2017
|
2016
|
|||||||
(in millions of pesos)
|
||||||||
Financial income
|
||||||||
Interest income
|
133.1
|
206.4
|
||||||
Fair value gains on financial instruments through profit and loss
|
442.5
|
329.4
|
||||||
Foreign exchange gain
|
561.6
|
281.0
|
||||||
Subtotal
|
1,137.2
|
816.8
|
||||||
Financial expenses
|
||||||||
Interest expense
|
(846.4
|
)
|
(937.4
|
)
|
||||
Foreign exchange loss
|
(1,117.2
|
)
|
(1,486.4
|
)
|
||||
Derivative financial instruments results
|
-
|
(9.4
|
)
|
|||||
Other financial charges
|
(167.9
|
)
|
(131.5
|
)
|
||||
Subtotal
|
(2,131.5
|
)
|
(2,564.8
|
)
|
||||
Gain on monetary position
|
466.0
|
1,038.6
|
||||||
Total
|
(528.3
|
)
|
(709.3
|
)
|
Year ended December 31,
|
Year ended December 31,
2017 compared to year
ended December 31, 2016
|
|||||||||||||||
2017
|
2016
|
Variation
|
Percentage
Change
|
|||||||||||||
Natural Gas Transportation
|
||||||||||||||||
Revenues
|
7,701.2
|
4,300.7
|
3,400.5
|
79.1
|
||||||||||||
Cost of sales
|
(4,178.9
|
)
|
(3,259.7
|
)
|
(919.2
|
)
|
28.2
|
|||||||||
Gross profit
|
3,522.3
|
1,041.0
|
2,481.3
|
238.4
|
||||||||||||
Administrative and selling expenses
|
(1,016.7
|
)
|
(1,024.2
|
)
|
7.5
|
(0.7
|
)
|
|||||||||
Other operating expense
|
(327.2
|
)
|
(90.0
|
)
|
(237.2
|
)
|
263.6
|
|||||||||
Operating profit
|
2,178.4
|
(73.2
|
)
|
2,251.6
|
n/a
|
|||||||||||
Liquids Production and Commercialization
|
||||||||||||||||
Revenues
|
11,174.0
|
9,404.8
|
1,769.2
|
18.8
|
||||||||||||
Cost of sales
|
(7,271.6
|
)
|
(6,407.9
|
)
|
(863.7
|
)
|
13.5
|
|||||||||
Gross profit
|
3,902.4
|
2,996.9
|
905.5
|
30.2
|
||||||||||||
Administrative and selling expenses
|
(359.1
|
)
|
(415.5
|
)
|
56.4
|
-13.6
|
||||||||||
Other operating expense
|
64.7
|
(37.4
|
)
|
102.1
|
-273.0
|
|||||||||||
Operating profit
|
3,608.1
|
2,544.0
|
1,064.0
|
41.8
|
||||||||||||
Other services
|
||||||||||||||||
Revenues
|
1,199.2
|
956.9
|
242.2
|
25.3
|
||||||||||||
Cost of sales
|
(655.8
|
)
|
(433.9
|
)
|
(222.0
|
)
|
51.2
|
|||||||||
Gross profit
|
543.3
|
523.1
|
20.3
|
3.9
|
||||||||||||
Administrative and selling expenses
|
(143.4
|
)
|
(115.6
|
)
|
(27.8
|
)
|
24.1
|
|||||||||
Other operating (expense) / income
|
(9.2
|
)
|
(2.4
|
)
|
(6.8
|
)
|
283.3
|
|||||||||
Operating profit
|
390.8
|
405.1
|
(14.4
|
)
|
-3.6
|
|||||||||||
Telecommunications
|
||||||||||||||||
Revenues
|
124.1
|
121.5
|
2.5
|
2.1
|
||||||||||||
Cost of sales
|
(74.6
|
)
|
(62.5
|
)
|
(12.1
|
)
|
19.8
|
|||||||||
Gross profit
|
49.5
|
59.5
|
(9.6
|
)
|
(16.3
|
)
|
||||||||||
Administrative and selling expenses
|
(22.0
|
)
|
(21.4
|
)
|
(0.7
|
)
|
3.3
|
|||||||||
Other operating expense
|
0.2
|
(0.8
|
)
|
1.0
|
(125.0
|
)
|
||||||||||
Operating profit
|
27.6
|
36.8
|
(9.2
|
)
|
(25.0
|
)
|
(1) |
Net of intersegment revenues of Ps. 245.2 million and Ps. 138.5 million for the fiscal years 2017 and 2016, respectively.
|
|
• |
Segment revenue increased by Ps. 3,400.5 million in 2017, compared with the previous year;
|
|
• |
Revenues related to natural gas firm transportation contracts for the years ended December 31, 2017 and 2016, respectively, amounted to Ps. 5,831.9 million and
Ps. 2,988.2 million. The increase is mainly due to the combined effect of: (i) the full application during the 2017 fiscal year of the tariff increase granted by Resolution 3724, later complemented by Resolution 4054, both
issued by ENARGAS, which established a nominal tariff increase of 200.1%, (ii) the nominal 64.2% increase granted by Resolution 4362 and (iii) to a lesser extent of the 81.1% nominal tariff increase granted by ENARGAS
Resolution 120 effective as of December 1, 2017;
|
|
• |
Revenues related to interruptible natural gas transportation service increased by Ps. 437.5 million, from Ps. 753.1 million to Ps. 1,190.5 million. The increase mainly
resulted from the tariff increase discussed above,
|
|
• |
Revenues relating to the CAU amounted to Ps. 433.6 million and Ps. 420.9 million for the years ended December 31, 2017 and 2016, respectively; and
|
|
• |
During 2017, we received transitory nominal tariff increases totaling 182%.
|
|
• |
Costs of sales and administrative and selling expenses for the year ended December 31, 2017 increased by Ps. 911.7 million, from Ps. 4,283.9 million to Ps. 5,195.6
million, as compared to the year ended December 31, 2016. This increase was mainly attributable to: (i) an increase of Ps. 572.4 million in ordinary maintenance expenses for the pipeline and other fixed assets, (ii) higher taxes of
Ps. 217.6 million, principally as a consequence of the turnover tax, (iii) a higher technical assistance fee accrued of Ps. 154.1 million, (iv) higher labor costs relating to the joint negotiations with trade unions during 2017,
amounting to Ps. 71.2 million. These effects were partially offset by the decrease of Ps. 189.4 million in the PPE depreciations as a consequence of the disposal of certain assets in 2017.
|
Years ended December 31,
|
Year ended December 31, 2017
compared to year ended
December 31, 2016
|
|||||||||||||||
(volumes in short tons)
|
(volumes in short tons)
|
|||||||||||||||
2017
|
2016
|
Increase/
(Decrease)
|
Percentage
Change
|
|||||||||||||
Local Market
|
||||||||||||||||
Ethane
|
311,786
|
305,861
|
5,925
|
1.9
|
||||||||||||
Propane
|
194,665
|
194,447
|
217
|
0.1
|
||||||||||||
Butane
|
156,912
|
155,842
|
1,070
|
0.7
|
||||||||||||
Subtotal
|
663,363
|
656,151
|
7,212
|
0.1
|
||||||||||||
Exports
|
||||||||||||||||
Propane
|
158,895
|
151,129
|
7,767
|
5.1
|
||||||||||||
Butane
|
103,259
|
88,972
|
14,287
|
16.1
|
||||||||||||
Natural Gasoline
|
133,802
|
108,741
|
25,061
|
23.0
|
||||||||||||
Subtotal
|
395,956
|
348,842
|
47,114
|
13.5
|
||||||||||||
Total Liquids
|
1,059,319
|
1,004,992
|
54,327
|
5.4
|
|
• |
Segment revenue increased by Ps. 1,769.2 million in 2017, compared with the previous year. This increase is mainly due to increases of Ps. 1,295.9 million as a result
higher reference international prices (net of the negative impact of the decrease in the variation of exchange rate, net of the effect of inflation) and Ps. 590.3 million resulting from higher volumes sold for our own account.
|
|
• |
In 2017 propane, butane and natural gasoline average prices recorded year-over-year increases of 58.5%, 42.0% and 25.7%, respectively. This growth was followed by a
downward trend, in particular during the end of the fourth quarter of 2017 and the first months of 2018.
|
|
• |
Notwithstanding the changes made to the Households with Bottles Program to supply butane to the domestic market described above, our obligations under this program
continues to have an adverse impact on this segment, which may result in a negative operating margin on domestic sales of LPG.
|
|
• |
Costs of sales, administrative and selling expenses for the year ended December 31, 2017 increased by Ps. 807.3 million, from Ps. 6,823.4 million to Ps. 7,630.7
million, as compared to the year ended December 31, 2016. This increase was mainly due to: (i) the rise in the price of natural gas that we are required to RTP of Ps. 618.2 million, (ii) labor costs of Ps. 126.0 million, (iii)
repair and maintenance cost of PPE increased by Ps. 91.0 million, and (iv) higher technical assistance fee of Ps. 84.0 million.
|
|
• |
Net revenues increased by Ps. 242.2 million primarily due to the higher sales associated with: (i) natural gas compression and treatment services of Ps. 168.3 million,
(ii) operation and maintenance services of Ps. 91.3 million and (iii) construction engineering works of Ps. 64.4 million. On the other hand, the exchange rate variation, net of the effect of inflation had a negative effect of Ps.
66.4 million.
|
|
• |
Costs of sales, administrative and selling expenses increased by Ps. 249.8 million, mainly due to increases in: (i) depreciations (Ps. 106.9 million), (ii) repair and
maintenance expenses (Ps. 34.4 million), (iii) costs of services rendered to third parties (Ps. 29.8 million), (iv) turnover tax (Ps. 23.0 million), and (v) labor costs (Ps. 13.8 million).
|
|
• |
Net revenues remained almost flat.
|
|
• |
Costs of sales, administrative and selling expenses increased by Ps. 13.0 million, due mainly to higher labor cost of Ps. 9.0 million.
|
Years ended December 31,
|
||||||||||||
2018
|
2017
|
2016
|
||||||||||
(in millions of pesos)
|
||||||||||||
Cash and cash equivalents at the beginning of the year
|
3,916.7
|
2,870.4
|
2,163.7
|
|||||||||
Cash flows provided by operating activities
|
12,796.6
|
5,556.7
|
4,126.2
|
|||||||||
Cash flows used in investing activities
|
(4,731.3
|
)
|
(3,877.7
|
)
|
(898.1
|
)
|
||||||
Cash flows provided by / (used in) financing activities
|
2,049.1
|
(59.9
|
)
|
(1,998.9
|
)
|
|||||||
Net increase in cash and cash equivalents
|
10,114.4
|
1,619.1
|
1,229.2
|
|||||||||
Foreign exchange gains on cash and cash equivalents……...
|
6,687.7
|
225.0
|
176.8
|
|||||||||
Monetary results effect on Cash and cash equivalents
|
(4,074.0
|
)
|
(797.8
|
)
|
(699.3
|
)
|
||||||
Cash and cash equivalents at the end of the year
|
16,644.8
|
3,916.7
|
2,870.4
|
2018
|
2018
|
2017
|
||||||||||
(in millions of
U.S. dollars)
(2)
|
(in millions of pesos)
|
|||||||||||
Current loans:
|
||||||||||||
2014 Notes
|
-
|
-
|
1,758.4
|
|||||||||
Interest payable
|
6.0
|
227.1
|
55.6
|
|||||||||
Financial Leasing
|
5.7
|
215.7
|
148.6
|
|||||||||
Total current loans
|
11.7
|
442.8
|
1,962.6
|
|||||||||
Non-current loans:
|
||||||||||||
2014 Notes
|
-
|
-
|
3,512.5
|
|||||||||
2018 Notes
|
496.4
|
18,714.5
|
-
|
|||||||||
Financial Leasing
|
38.2
|
1,439.7
|
1,167.5
|
|||||||||
Total non-current loans
|
534.6
|
20,154.2
|
4,680.0
|
|||||||||
Total loans
(1)
|
546.3
|
20,597.1
|
6,642.6
|
|
(1) |
Issuance expenses net.
|
|
(2) |
Converted at the exchange rate of Ps. 37.7 per U.S.$1.00, which was the selling exchange rate as of December 31, 2018.
|
Amount in U.S.
$
|
|
500.000.000
|
||
Interest Rate
|
6,75% annual
|
|||
Pricing
|
99,725
|
%
|
Date of
Payment
|
Percentage on the
Principal Amount to be
Paid
|
|
Amortization
|
May 2, 2025
|
100%
|
Frequency of Interest Payment
|
Biannual, payable on May 2 and November 2 of each year.
|
|
Guarantor
|
None.
|
2019
|
2020
|
2021
|
Total
|
|||||||||||||
Natural Gas transportation
|
||||||||||||||||
Reliability and others
|
92.9
|
95.0
|
98.0
|
285.9
|
||||||||||||
Total
|
92.9
|
95.0
|
98.0
|
285.9
|
||||||||||||
Liquids production and commercialization
|
||||||||||||||||
Reliability and others
|
19.9
|
20.7
|
10.9
|
51.5
|
||||||||||||
Operational efficiencies
|
6.2
|
-
|
-
|
6.2
|
||||||||||||
Expansions
|
4.0
|
8.0
|
-
|
12.0
|
||||||||||||
Total
|
30.1
|
28.7
|
10.9
|
69.7
|
||||||||||||
Vaca Muerta Project
|
187.1
|
-
|
-
|
187.1
|
||||||||||||
Other services
|
6.5
|
3.5
|
0.9
|
10.9
|
||||||||||||
Total Capital Expenditures
|
316.6
|
127.2
|
109.8
|
553.6
|
Period
|
Propane
|
Butane
|
Natural
gasoline
|
|||||||||
October 2018 – April 2019
|
6,663
|
4,967
|
2,976
|
|||||||||
May 2019 – September 2019
|
-
|
-
|
4,519
|
|||||||||
October 2019
|
9,996
|
7,727
|
4,630
|
|||||||||
November 2019 – April 2020
|
14,438
|
11,038
|
6,614
|
Payment due by period (in millions of argentine pesos)
|
||||||||||||||||||||||||
Total
|
Due less
than 1 year
|
Less than 1
year
|
1-3 years
|
3-5 years
|
More than
5 years
|
|||||||||||||||||||
Long-Term Debt Obligations
(1)(2)
|
27,120.4
|
-
|
1,272.4
|
3,817.1
|
2,544.8
|
19,486.2
|
||||||||||||||||||
Purchase Obligations
(3)
|
4,836.6
|
-
|
3,396.3
|
1,440.3
|
-
|
-
|
||||||||||||||||||
Leasing
(4)
|
2,199.6
|
56.9
|
282.0
|
564.1
|
564.1
|
732.6
|
||||||||||||||||||
Total
|
34,156.6
|
56.9
|
4,950.7
|
5,821.5
|
3,108.9
|
20,218.8
|
(1) |
Refers to amortization and interest payments on the 2018 Notes as described in “
Item
5. Operating and Financial Review of Prospects F. Tabular Disclosure of Contractual Obligations——Description of indebtedness
” and “
Item 10.
Additional Information—C. Material Contracts
,” respectively.
|
(2) |
The total amount of interest payments includes Ps. 8,058.4 million of estimated interest payments not accrued according to the 2018 Notes.
|
(3) |
Refers to agreements for the purchase of natural gas used in our liquids production and commercialization activities.
|
(4) |
Corresponds to the financial leasing arrangement entered with Pampa Energía. The total amount includes estimated interest payment not accrued as of December 31, 2018
for Ps. 544.2 million. For additional information see “
Item 5. Operating and Financial Review of Prospects F. Tabular Disclosure of Contractual
Obligations——Description of indebtedness”
and
“Item 10.C. Financial Lease with Pampa Energía
.”
|
|
a) |
Is also a member of the management body of the controlling entity or another company belonging to the same economic group by a relationship existing at the time of its
election or that there ceased during the three years immediately preceding.
|
|
b) |
Is linked to the issuer or its shareholders that hold directly or indirectly “significant shareholding” or with companies in which these also have direct or indirectly
“significant shareholding”, or if it was linked to them by a contract of employment during the last three years.
|
|
c) |
Provides, or belongs to a professional corporation or association, which renders professional services to or receives any form of remuneration or fees (other than the
corresponding remuneration for its position in the administration body) from the issuer, or those shareholders that have any direct or indirect “significant shareholding” in us or from corporations in which shareholders also have
any direct or indirect “significant shareholding”
|
|
d) |
Directly or indirectly, holds five percent or more of shares entitled to vote of our capital or in a company which holds “significant shareholding” in the latter.
|
|
e) |
Directly or indirectly, sells or provides goods or services to the company or its shareholders, who hold direct or indirect “significant shareholding” for an amount
substantially higher that the compensation received form the position as members of the administration body. This prohibition covers commercial relations that take place during the last three years prior to the appointment as
director.
|
|
f) |
Has been a director, manager, administrator or principal executive of NGOs that have received funds, for amounts exceeding Ps. 800.000 from the company, its controlling
and other companies of the group of which TGS is a part.
|
|
g) |
Receives some payment, including participation in stock option plans, from the company or of the companies of its same group, other than the fees to be received under
his position as director. He has served as director at the company, its controlling or another company belonging to the same economic group for more than ten years. The condition of independent director will be recovered after at
least three years have elapsed since the cessation of his position as director.
|
|
h) |
Is a husband or wife, close relative up to third degree of consanguinity or second degree of relationship that, in case of being a member of the administrative body,
would not be independent as set forth in the CNV regulations.
|
Name
|
Date of
Appointment
|
Term
Expires
|
Position
|
Position in Other Company
|
||||
Luis Alberto Fallo
|
4/11/2019
|
2020
|
Chairman
|
Director of Sagua Argentina S.A.
|
||||
Gustavo Mariani
|
4/11/2019
|
2020
|
Vice Chairman
|
Chief Executive Officer at Pampa Energía
|
||||
Mariano Batistella
|
4/11/2019
|
2020
|
Director
|
Executive director of planning, strategy, downstream and affiliates at Pampa Energía
|
||||
Gregorio Werthein
|
4/11/2019
|
2020
|
Director
|
Executive Director at Werthein Group
|
||||
Luis Rodolfo Secco
|
4/11/2019
|
2020
|
Independent Director
|
Economist
|
||||
Carlos Alberto Olivieri
|
4/11/2019
|
2020
|
Independent Director
|
Independent Consultant
|
||||
Carlos Alberto Di Brico
|
4/11/2019
|
2020
|
Independent Director
|
Public Accountant
|
||||
Sergio Benito Patrón Costas
|
4/11/2019
|
2020
|
Independent Director
|
Head in Labor Relations at Macro Bank
|
||||
Mauricio Edgardo Szmulewiez
|
4/11/2019
|
2020
|
Independent Director
|
Legal and accounting advisor
|
||||
Jorge Romualdo Sampietro
|
4/11/2019
|
2020
|
Alternate Director
|
Senior Director at Petroquímica Cuyo
|
||||
Nicolás Mindlin
|
4/11/2019
|
2020
|
Alternate Director
|
Executive vice president, procurement, assets security and marketing director at Pampa Energia
|
||||
Horacio Jorge Tomás Turri
|
4/11/2019
|
2020
|
Alternate Director
|
Executive director oil and gas at Pampa Energía
|
||||
Pablo Rodrigo Tarantino
|
4/11/2019
|
2020
|
Alternate Director
|
Lawyer
|
||||
Enrique Llerena
|
4/11/2019
|
2020
|
Independent Alternate Director
|
Partner at Llerena – Amadeo law firm
|
||||
Santiago Alberto Fumo
|
4/11/2019
|
2020
|
Independent Alternate Director
|
Independent consultant
|
||||
Pablo Fabiam Waisberg
|
4/11/2019
|
2020
|
Independent Alternate Director
|
Accounting and tax advisor
|
||||
Ignacio Gustavo Álvarez Pizzo
|
4/11/2019
|
2020
|
Independent Alternate Director
|
Lawyer at the Directors and Corporate Affairs department in the FGS
|
||||
Hernán Castrogiovanni
|
4/11/2019
|
2020
|
Independent Alternate Director
|
Financial analyst at FGS
|
Name
|
Year of
Appointment
|
Position
|
||
Javier Gremes Cordero
*
|
2012
|
General Director and CEO
|
||
Oscar Jose Sardi
**
|
2016
|
Operations Director
|
||
Carlos Hector Sidero
|
2013
|
Human Resources Director
|
||
Alejandro Mario Basso
|
2016
|
CFO and Services Director
|
||
Hernan Diego Flores Gomez
|
2017
|
Legal Affairs Director
|
||
Néstor Hugo Martín
|
2013
|
Business Director
|
||
Rubén De Muria
|
2018
|
Institutional and Regulatory Affairs Director
|
*
|
Mr. Gremes Cordero presented his resignation effective April 30, 2019.
|
**
|
In the Board of Directors meeting held on April 16, 2019, Mr. Sardi was appointed in the position of CEO effective April 30, 2019.
|
|
As of the date of this Annual Report, no person has been appointed as Operations Director after Mr. Sardi assumes the role as CEO
|
|
• |
supervise the internal control and accounting systems as well as the reliability of the latter and all the financial information and other significant issues that
are to be submitted to the SEC, CNV and BYMA in compliance with the applicable disclosure policies;
|
|
• |
supervise the application of information policies regarding our risk management;
|
|
• |
ensure that the market is informed about those operations where there may be a conflict of interest with one or more members of the Board of Directors, controlling
shareholders or other parties as defined by the applicable regulations;
|
|
• |
express its view on the reasonableness of fees and stock option plans for directors submitted by the Board of Directors;
|
|
• |
express its view as to compliance with laws and regulations and the reasonableness of the conditions of an issuance of shares (or convertible securities), in the
case of a capital increase excluding or limiting preferential rights;
|
|
• |
oversee compliance with the Code of Ethics (see
Item 16.B. “Code of Ethics”
);
and other relevant rules;
|
|
• |
issue a well-founded opinion on whether the terms and conditions of relevant transactions with related parties are according to market practice, within five
business days from the receipt of a petition issued by the Board of Directors, and at any other time at which a conflict of interest exists or might exist;
|
|
• |
prepare an annual working plan for the fiscal year and notify the Board of Directors and the Statutory Committee within 60 days from the beginning of the period;
|
|
• |
fulfill all the obligations stated in our By-laws and applicable laws and regulations;
|
|
• |
express its view on the Board of Directors’ proposals on whether to appoint the external auditors to be hired and monitor the auditors’ independence;
|
|
• |
establish procedures for: (i) the receipt, treatment, investigation and administration of the complaints received by us regarding accounting, internal accounting
controls or auditing matters; and (ii) the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters.
|
|
• |
review their plans; and
|
|
• |
evaluate their performance, and give an opinion on their performance when issuing the annual Financial Statements.
|
|
• |
analyze the different services rendered by the external auditors as well as their independence, according to Technical Resolution (“
TR
”) No. 34 of the FACPCE, any other related regulations issued by professional councils;
|
|
• |
report separately the fees billed as follows: (i) fees for external audit and other related services meant to provide reliability to third parties (e.g., special
reports about internal controls, shareholding prospectuses, certifications and special reports requested by regulators, etc.); and (ii) fees related to other special services different from those mentioned above; and
|
|
• |
review independence policies of the external auditors in order to verify its fulfillment.
|
|
• |
Give a prior assessment, that shall be used by the CNV to require us to designate an external auditor as requested by minority shareholders, as long as such
shareholders represent at least 5% of our common stock and provide a justified request (in those cases in which the minority shareholders’ rights might be affected) and if CNV understand the credibility of the damage invoked by
said shareholders in order to carry out one or more specific reviews. The charges of such reviews shall be borne by the petitioning shareholders (Act No. 26,381, article 108.f)
|
|
• |
provide a well-founded assessment about an acquiring tender offer if by withdrawing the public offering we would cease to be a public company or our stock cease to
be traded (Act No. 26,381, article 98); and
|
|
• |
issue a report supporting a Board of Directors’ resolution to buy back our shares (Act No. 26,381, article 64).
|
Name
|
Member
since
|
Term
Expires
|
Position
|
|||
José Daniel Abelovich
|
11/4/2019
|
2020
|
Syndic
|
|||
Gerardo Prieto
|
11/4/2019
|
2020
|
Syndic
|
|||
Walter Antonio Pardi
|
11/4/2019
|
2020
|
Syndic
|
|||
Marcelo Héctor Fuxman
|
11/4/2019
|
2020
|
Alternate Syndic
|
|||
Agustin Griffi
|
11/4/2019
|
2020
|
Alternate Syndic
|
|||
Raquel Inés Orozco
|
11/4/2019
|
2020
|
Alternate Syndic
|
Number of Employees as of December 31,
|
||||||||||||
Department
|
2018
|
2017
|
2016
|
|||||||||
General
|
2
|
2
|
2
|
|||||||||
Administration, Finance and Services
|
103
|
98
|
98
|
|||||||||
Human Resources
|
23
|
22
|
21
|
|||||||||
Control and Corporate Governance
(1)
|
-
|
-
|
-
|
|||||||||
Legal Affairs
|
10
|
9
|
10
|
|||||||||
Public and Regulatory Affairs
|
8
|
7
|
6
|
|||||||||
Safety and Environmental
|
28
|
27
|
26
|
|||||||||
Business
|
72
|
69
|
70
|
|||||||||
Internal Audit
|
4
|
3
|
4
|
|||||||||
Operations
|
747
|
688
|
689
|
|||||||||
Trainees program
|
7
|
7
|
-
|
|||||||||
Total
|
1,004
|
932
|
926
|
(1) |
Since October 2016, these employees are part of the Administration, Finance and Services Department.
|
Number of Employees as of December 31,
|
||||||||||||
Location
|
2018
|
2017
|
2016
|
|||||||||
City of Buenos Aires
|
239
|
237
|
239
|
|||||||||
Province of Buenos Aires
|
427
|
406
|
392
|
|||||||||
Province of Chubut
|
61
|
53
|
59
|
|||||||||
Province of La Pampa
|
14
|
12
|
13
|
|||||||||
Province of Neuquén
|
114
|
91
|
90
|
|||||||||
Province of Río Negro
|
58
|
49
|
49
|
|||||||||
Province of Santa Cruz
|
88
|
82
|
82
|
|||||||||
Province of Tierra del Fuego
|
3
|
2
|
2
|
|||||||||
Total
|
1,004
|
932
|
926
|
Name of Beneficial Owner
|
Number of Shares
(1)
|
Percent of Total
Common Shares
|
Class
|
|||
CIESA
|
405,192,594
|
51.00%
|
A
|
|||
FGS
|
183,618,632
|
23.11%
|
B
|
|||
Holders through BYMA
|
52,095,877
|
6.56%
|
B
|
|||
Treasury shares
|
13,600,780
|
1.71%
|
||||
ADRs through Citi
|
139,987,400
(1)
|
17.62%
|
B
|
|||
Total
|
794,495,283
|
100.00%
|
--
|
(1) |
Equivalent to 27,997,480 ADRs.
|
|
• |
On July 27, 2016, Pampa Energía acquired from Petrobras Internacional Braspetro B.V. all the stock and voting rights of Petrobras Participaciones S.L., the holder
of the 67.1933% of the capital stock and voting rights of Petrobras Argentina and, consequently, the indirect control of Petrobras Hispano Argentina.
|
|
• |
On the same day, (i) Pampa Energía and its subsidiary Pampa Participaciones S.A. sold all of the capital stock and voting rights of PEPCA to GIP by 51%, WST by
45.8% and PCT L.L.C. by 3.2% and (ii) Pampa Inversiones S.A. transferred its status as beneficiary of the Trust to GIP and PCT, in a proportion of 55% and 45%, respectively. This transaction was authorized by ENARGAS on August
9, 2016 through Resolution No. I / 3939.
|
|
• |
On January 17, 2017, CIESA was informed of the exercise of the swap option agreed among Pampa Energía, GIP, WST and PCT. Pursuant to such option, (i) GIP and PCT
transferred to Petrobras Hispano Argentina their position as beneficiary of the CIESA Trust owning of 40% of the stock and voting rights of CIESA; and (ii) Pampa Energía and Petrobras Hispano Argentina transferred to GIP and PCT
shares representative of 40% of the capital and voting rights of CIESA, while Pampa Energía kept a direct participation in CIESA of 10% of its capital and voting rights.
|
|
• |
Public takeover bids addressed to all holders of such shares at a fair price authorized by the CNV, under the terms of Chapters II, III and IV of Title III of Law
26,831.
|
|
• |
Exchange of shares for other shares of the same or another company in the context of a merger, split or corporate reorganization processes.
|
Shareholder
|
Number of shares
|
Class of
shares
|
Ownership
(%)
|
Group
|
||||
Pampa Energía
|
63,881,869
|
B1
|
10%
|
Pampa Group
|
||||
0.5
|
A1
|
|||||||
0.5
|
A2
|
|||||||
CIESA Trust
(Petrobras Hispano Argentina)
|
0.5
|
A1
|
40%
|
|||||
0.5
|
A2
|
|||||||
162,898,766
|
A2
|
|||||||
92,628,711
|
B2
|
|||||||
PEPCA S.A. (WST, GIP y PCT)
|
63,881,870
|
B3
|
10%
|
GIP/PCT/WST Group
|
||||
GIP
|
89,594,322
|
A1
|
22%
|
|||||
50,945,792
|
B1
|
|||||||
PCT
|
73,304,444
|
A1
|
18%
|
|||||
41,682,920
|
B1
|
|||||||
Total
|
638,818,696
|
100%
|
|
• |
agreements for the purchase of natural gas used as RTP;
|
|
• |
natural gas transportation services;
|
|
• |
liquids sales; and
|
|
• |
compression and treatment of natural gas services. On November 1, 2016, Pampa Energía assigned the operation of the Río Neuquén area and its related contracts to
YPF. Until that date, our transactions under those contracts were reported as transactions with related parties of our other services business segment.
|
Revenues
|
Costs
|
Financial
results
|
||||||||||||||||||||||||||
Company
|
Natural Gas
Transportation
|
Production and
commercialization
of Liquids
|
Other
services
|
Gas purchase
and others
|
Compensation
for
technical
assistance
|
Revenues for
administrative
services
|
Interests
expenses
|
|||||||||||||||||||||
(in thousands of pesos)
|
||||||||||||||||||||||||||||
Controlling shareholder:
|
||||||||||||||||||||||||||||
CIESA
|
-
|
-
|
-
|
-
|
-
|
146
|
-
|
|||||||||||||||||||||
Associate which exercises joint control on the controlling shareholder:
|
||||||||||||||||||||||||||||
Pampa Energía
|
439,556
|
1,323
|
230,930
|
617,089
|
1,317,176
|
-
|
125,467
|
|||||||||||||||||||||
Associate with significant influence:
|
||||||||||||||||||||||||||||
Link
|
-
|
-
|
8,589
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Other related companies:
|
||||||||||||||||||||||||||||
Petrolera Entre Lomas S.A.
(1)
|
-
|
-
|
-
|
2,017
|
-
|
-
|
-
|
|||||||||||||||||||||
Oleoductos del Valle S.A.
|
6,149
|
-
|
8,277
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Pampa Comercializadora S.A.
|
26,869
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Central Piedra Buena S.A.
|
67,175
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Transener S.A.
|
-
|
-
|
12,014
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Experta ART
|
-
|
-
|
-
|
11,910
|
-
|
-
|
-
|
|||||||||||||||||||||
Total
|
539,749
|
1,323
|
259,810
|
631,016
|
1,317,176
|
146
|
125,467
|
(1) |
As from April 1, 2018, Petrolera Entre Lomas S.A. is no longer a related party.
|
|
a) |
Turnover tax calculated on the natural gas price consumed by us as fuel
|
|
b) |
Action for annulment of ENARGAS Resolutions
|
|
c) |
Recovery action of VAT and income tax
|
|
d) |
Turnover tax withholding in the Province of Buenos Aires
|
|
a) |
Environmental matters
|
|
b) |
Arbitral claim
|
|
c) |
Others
|
|
• |
According to law No. 25,063, the dividends paid in cash or in kind, in excess of the tax profit, will be subject to a 35% withholding tax of the income tax, as sole
and only payment. As a result of the Tax Reform, this restriction will no longer apply to dividends attributable to profits accrued in fiscal years beginning on or after January 1, 2018.
|
|
• |
Per the Tax Reform, for fiscal periods beginning on January 1, 2018, distribution of dividends made to human persons and foreign beneficiaries are subject to a tax
withholding which the Company must withhold and enter to the Tax authority as a single and definitive payment when the dividends are paid. This additional tax will be 7% or 13%, depending on whether the dividends distributed
correspond to earnings of a fiscal period at the enacted income tax rate of 30% or 25%, respectively. For these purposes it is considered, without admitting proof to the contrary, that the dividends that are made available
correspond, firstly, to the oldest accumulated earnings.
|
|
• |
The acquisition of treasury shares in accordance with CNV rules, restricts the amount of the retained earnings that the Company may distribute. See
Item 7. Major Shareholders and Related Party Transactions—A. Major Shareholders—Repurchase of Shares.
|
|
• |
Furthermore, we are subject to certain restrictions for the payment of dividends, which were contemplated in the outstanding debt agreements (
Item 10 – “Additional Information”
).
|
Date of approval
|
Amount in
thousands of Ps.
|
Amount per share
|
06/07/2018
|
1,125,562
|
1.4167
|
08/08/2018
|
1,449,300
|
1.8242
|
06/09/2018
|
1,754,326
|
2.2081
|
|
• |
Promoting the participation of small investors, union associations, industry groups and trade associations, professional associations and all public savings
entities in the capital market, particularly encouraging mechanisms designed to promote domestic savings and channel such funds towards the development of production;
|
|
• |
Strengthening mechanisms for the protection of and prevention of abuses against small investors and for the protection of consumers’ rights;
|
|
• |
Promoting access of small and medium-sized companies to the capital market;
|
|
• |
Fostering the creation of a federally integrated capital market through mechanisms designed to achieve an interconnection of computer systems from different trading
markets, with the use of state-of-the-art technology; and
|
|
• |
Encouraging simpler trading procedures available to users to attain greater liquidity and competitiveness in order to provide the most favorable conditions for the
implementation of transactions.
|
|
a) |
issue regulations that allow stock brokers and brokerage firms authorized by the CNV to perform their duties;
|
|
b) |
authorize, suspend and cancel the listing and/or trading of negotiable securities pursuant to the provisions set forth in its bylaws;
|
|
c) |
issue regulations that ensure veracity in the record of prices and trades;
|
|
d) |
issue the regulations and policies deemed necessary to ensure transparency in the trades conducted by member stock brokers;
|
|
e) |
fix the margins that member brokers are to comply with for each type of trade BYMA guarantees; and
|
|
f) |
set up arbitration tribunals.
|
2014
|
2015
|
2016
|
2017
|
2018
|
||||||||||||||||
Market capitalization (U.S.$ in billions)
|
455.4
|
336.8
|
282.9
|
356.9
|
279.2
|
|||||||||||||||
Number of listed companies
|
101
|
99
|
99
|
97
|
95
|
|
• |
Subject to the approval of the annual shareholders meeting, the number of members of the Board of Directors may vary between nine and eleven directors and an equal
number of alternate directors.
|
|
• |
The Board of Directors meetings may be held not only with the members present, but also with the members communicating remotely. Under our By-laws, all members will
have the same power to vote on a proposal and will be considered to constitute a quorum.
|
|
• |
The Audit Committee duties, which are in line with those requirements stipulated in the Capital Markets Law of Argentina, were incorporated to our By-laws. For
additional information regarding Audit Committee duties, see “
Item 6. Directors, Senior Management and Employees—C. Board Practices—Audit
Committee.
”
|
|
• |
limitations on our ability to terminate our License or take any action that, in our reasonable opinion, would result in the termination of the License. We may not
agree to amend or waive any terms of the License unless such amendment or waiver would not, in our reasonable opinion, adversely affect (i) our ability to meet our obligations under the 2018 Notes on a timely basis or (ii) any
material rights or interest of the trustee or the holders under the indenture or the 2018 Notes;
|
|
• |
a requirement that we not enter into or consent to any amendment, restatement or modification of the SAFTO or any successor agreement thereto, other than an
amendment, restatement or modification that is not materially adverse to us and our subsidiaries, taken as a whole;
|
|
• |
a limitation on our and our subsidiaries’ ability to create liens on our property, assets or revenues, other than certain permitted liens;
|
|
• |
a limitation on our and our subsidiaries’ ability to incur additional indebtedness unless we meet certain financial ratios and no event of default exists, other
than certain permitted indebtedness;
|
|
• |
a limitation on our and our subsidiaries’ ability to pay dividends and make certain other restricted payments and investments with respect to any fiscal year or
fiscal semester unless: (i) no event of default or potential event of default shall have occurred and be continuing and (ii) immediately after giving effect to such restricted payment, we would be able to incur at least
U.S.$1.00 of additional indebtedness pursuant to the limitation on indebtedness covenant;
|
|
• |
limitations on our and our subsidiaries’ ability to enter into sale-leaseback transactions;
|
|
• |
limitations on our and our subsidiaries’ ability to enter into a transaction with an affiliate, unless such transaction is on terms that are not materially less
favorable to us or our subsidiary than we or such subsidiary would obtain in a comparable arm’s-length transaction with a non-affiliate;
|
|
• |
a limitation on our and our subsidiaries’ ability to sell our assets; and
|
|
• |
a limitation on our and our subsidiaries’ ability to enter into a merger, consolidation or similar transaction.
|
|
• |
default in the payment of principal, interest or any other amount due under the terms of the 2018 Notes after a specified grace period with respect to payments
other than principal;
|
|
• |
breach of obligations contained in the 2018 Notes after a specified cure period;
|
|
• |
cross default and cross acceleration with respect to other debt obligations with an aggregate principal amount equal to or exceeding U.S.$50 million;
|
|
• |
the occurrence of certain bankruptcy events or enforcement proceedings;
|
|
• |
enforcement of monetary judgments exceeding U.S.$50 million; and
|
|
• |
the occurrence of certain material adverse events with respect to our License, such as the revocation, suspension for a period of greater than 180 days or
termination of the License.
|
1.
|
The principle of freedom of exchange: Argentine residents, as well as non-Argentine residents, may freely access the MELI.
|
|
2.
|
The obligation of carrying out any exchange transaction through an entity authorized by the BCRA has been maintained.
|
|
3.
|
Time restrictions to trade in the MELIfor carrying out foreign exchange transactions have been eliminated.
|
|
4.
|
The mandatory inflow and settlement of export proceeds through the MELI within the applicable term.
|
|
5.
|
The obligation of Argentine residents to comply with the “
Review of
Debt Securities and External Liabilities Issued by the Financial Sector and the Non-Financial Private Sector
” (Communication “A” 3602 and its complementary provisions)
and the “Review on direct investments” (Communication “A” 4237 and its complementary provisions), even though there has not been an income of funds to the
MELI
nor any future access through the transactions to be declared has been maintained.
|
|
• |
Any individual or entity may freely conduct operations through MELI.
|
|
• |
All transactions involving foreign exchange must be carried out through an authorized financial entity.
|
|
• |
Timing restrictions to operate in MELI were eliminated.
|
|
• |
Persons subjects to these regulations must comply with the information requirements of the “Foreign Assets and Liabilities Survey”, even in those cases where they
have not deposited any amounts through MELI or if they do not anticipate accessing such market for any transactions subject to reporting.
|
|
• |
The obligation to settle foreign exchange transactions was eliminated; however, the intervening financial entity must continue to keep records thereof.
|
|
• |
The intervening financial entities must satisfy the applicable regulations relating to anti-money laundering, financing of terrorist activities and other illegal
activities.
|
|
• |
Foreign exchange transactions shall be conducted at the exchange rate determined by the applicable parties.
|
|
• |
Crimes related to illegal trafficking and commercialization of narcotics;
|
|
• |
Crimes related to arms trafficking;
|
|
• |
Crimes related to the activities of an illegal association as defined in Article 210 bis of the Penal Code;
|
|
• |
Illegal acts committed by illegal associations organized to commit crimes with political or racial objectives;
|
|
• |
Crimes of fraud against the Public Administration;
|
|
• |
Crimes against the Public Administration;
|
|
• |
Crimes of underage prostitution and child pornography; and
|
|
• |
Crimes related to terrorism financing.
|
Minimum threshold above which tax applies
Tax period
Applicable Tax Rate
|
||
Over Ps. 1,050,000
|
|
2018 and subsequent periods
|
|
|
0.25% |
|
• |
Income tax would be assessed on 110% of the amount of funds transferred;
|
|
• |
VAT would be assessed on 110% of the amount of funds transferred. Even though the concept “income arising from” is not clear, it could be construed as any fund
transfer;
|
|
• |
from an account in a non-cooperative jurisdiction, or from a bank account opened outside of a non-cooperative jurisdiction but owned by an entity located in a
non-cooperative jurisdiction; or
|
|
• |
to a bank account located in Argentina or to a bank account opened outside of Argentina but owned by an Argentina tax resident.
|
Financial assets
(1)
|
Financial liabilities
(2)
|
|||||||
Fixed interest rate
|
8,525,212
|
18,941,643
|
||||||
Variable interest rate
|
14,473
|
-
|
||||||
Total
|
8,539,685
|
18,941,643
|
(1) |
Includes short-term investments, fixed term investments and bank accounts. Most of our trade receivables do not accrue interest.
|
(2) |
Includes loans, excluding issuance expenses.
|
Expected maturity date
|
||||||||||||||||||||||||||||
Overdue
|
2019
|
2020
|
2021
|
Thereafter
|
Total
(6)
|
Fair
value
(2)
|
||||||||||||||||||||||
(in millions of pesos)
(1)
|
||||||||||||||||||||||||||||
Debt denominated in
U.S. dollars
(1)
(4)
(5)
|
||||||||||||||||||||||||||||
Fixed rate
|
-
|
1,272.4
|
1,272.4
|
1,272.4
|
23,303.2
|
27,120.4
|
17,200.1
|
|||||||||||||||||||||
Interest rate
(3)
|
-
|
6.875
|
%
|
6.875
|
%
|
6.875
|
%
|
-
|
-
|
-
|
||||||||||||||||||
Financial lease in
U.S. dollars
(1)
(4)(5)
|
||||||||||||||||||||||||||||
Fixed rate
|
56.9
|
282.0
|
282.0
|
282.0
|
1,296.6
|
2,199.5
|
1,655.4
|
(1) |
Converted at the exchange rate as of December 31, 2018: Ps. 37.70 per U.S.$1.00.
|
(2) |
For a detailed description of 2018 Notes, see “
Item 10. Additional Information—C.
Material contracts—Debt Obligations.
”
|
(3) |
For further information about limitations on our ability to make payments on our debt denominated in U.S. dollars see “
Item 3. D. Risk Factors. - The Argentine economy can be adversely affected by economic developments in other markets and by more general “contagion” effects, which could have a material
adverse effect on Argentina’s economic growth.
”
|
(4) |
Includes future interest payment not accrued as of December 31, 2018.
|
(5) |
Contracted undiscounted cash flows. Thus, they do not reconcile to the amount disclosed on the statement of financial position.
|
Service
|
Rate
|
By Whom Paid
|
|||
Issuance of ADSs (
e.g.
, an issuance upon a
deposit of Shares, upon a change in the ADS(s)-to-Share(s) ratio, or for any other reason), excluding issuances as a result of distributions described in the Deposit Agreement.
|
Up to U.S. $5.00 per 100 ADSs (or fraction thereof) issued.
|
Person receiving ADSs.
|
|||
Cancellation of ADSs (
e.g.
, a cancellation of
ADSs for delivery of deposited Shares, upon a change in the ADS(s)-to-Share(s) ratio, or for any other reason).
|
Up to U.S. $5.00 per 100 ADSs (or fraction thereof) canceled.
|
Person whose ADSs are being canceled.
|
|||
Distribution of cash dividends or other cash distributions (
e.g.
, upon a sale of rights and other entitlements).
|
Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held.
|
Person to whom the distribution is made.
|
|||
Distribution of ADSs pursuant to (i) stock dividends or other free stock distributions, or (ii) an exercise of rights to purchase
additional ADSs.
|
Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held.
|
Person to whom the distribution is made.
|
|||
Distribution of securities other than ADSs or rights to purchase additional ADSs (
e.g.
, spin-off shares).
|
Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held.
|
Person to whom the distribution is made.
|
|||
ADS Services.
|
Up to U.S. $5.00 per 100 ADSs (or fraction thereof) held on the applicable record date(s) established by the Depositary.
|
Person holding ADSs on the applicable record date(s) established by the Depositary.
|
Year ended December 31,
|
||||||||||||||||
PwC
|
EY
|
|||||||||||||||
2018
|
2017
|
2018
|
2017
|
|||||||||||||
(in thousands of pesos)
|
||||||||||||||||
Audit fees
|
8,686.1
|
7,931.7
|
9,300.2
|
7,091.7
|
||||||||||||
Audit-related fees
|
3,705.7
|
238.6
|
2,173.1
|
-
|
||||||||||||
Tax fees
|
418.7
|
-
|
-
|
-
|
||||||||||||
All other fees
|
1,444.4
|
1,361.2
|
4,477.9
|
270.8
|
||||||||||||
Total fees
|
14,254.9
|
9,531.5
|
15,951.3
|
7,362.5
|
Purchases of Registered Equity Securities of the Issuer by the Issuer and Affiliated Purchasers
|
Period
|
Total number of
ADRs purchased
|
Average price
paid per
ADRs (US$)
|
Total Number of
Shares Purchased
as Part of the
Publicly
Announced Plan
(1)
|
Maximum
Number of
Shares that may
yet be purchased
under the plan
|
||||||||||||
5/11/2018 – 5/31/2018
|
811,624
|
17.19
|
4,058,120
|
6,043,022
|
||||||||||||
6/1/2018 – 6/30/2018
|
550,175
|
15.45
|
2,750,875
|
8,441,031
|
||||||||||||
7/1/2018 – 7/31/2018
|
359,536
|
13.69
|
1,797,680
|
5,726,035
|
||||||||||||
8/1/2018 – 8/31/2018
|
316,347
|
13.18
|
1,581,735
|
4,926,463
|
||||||||||||
9/1/2018 – 9/10/2018
|
65,400
|
12.07
|
327,000
|
8,708,255
|
||||||||||||
2,103,082
|
10,515,140
|
(1)
|
Correspond to the sum of common shares and ADR’s purchased. Each ADR represents 5 common shares.
|
Period
|
Total number of
ADRs purchased
|
Average price
paid per
ADRs (US$)
|
Total Number of
Shares Purchased
as Part of the
Publicly
Announced Plan
(1)
|
Maximum
Number of
Shares that may
yet be purchased
under the plan
|
||||||||||||
10/1/2018 – 10/31/2018
|
610,974
|
13.64
|
3,054,870
|
8,095,486
|
||||||||||||
12/1/2018 – 12/31/2018
|
6,100
|
13.43
|
30,500
|
4,123,872
|
||||||||||||
617,074
|
3,085,370
|
(1)
|
Correspond to the sum of common shares and ADR’s purchased. Each ADR represents 5 common shares.
|
Period
|
Total number of
ADRs purchased
|
Average price
paid per
ADRs (US$)
|
Total Number of
Shares Purchased
as Part of the
Publicly
Announced Plan
(1)
|
Maximum
Number of
Shares that may
yet be purchased
under the plan
|
||||
04/1/2019 – 04/24/2019
|
341,849 |
11.16
|
1,709,245 | 7,625,980 |
|
• |
applicable Argentine law (particularly, the General Corporations Law),
|
|
• |
the standards of BYMA;
|
|
• |
Capital Markets Law of Argentina and Decree No. 1,023/2013,
|
|
• |
the standards of the CNV,
|
|
• |
our By-laws,
|
|
• |
our Integrity Program and other internal control policies and procedures, and
|
|
• |
certain rules of the NYSE applicable to listed foreign private issuers.
|
Exhibit No
.
|
|
Corporate Charter and By-laws.
|
|
By-laws Amendments.
(1)
|
|
Indenture dated May 2, 2018, entered into among TGS, Delaware Trust Company as trustee, co-registrar, paying agent and transfer agent, and
Banco Santander Rio S.A., as registrar, Argentine paying agent, Argentine transfer agent and representative of the trustee in Argentina, relating to the issuance of TGS’s Class 2, 6.750% senior notes due 2025.
|
|
Officers’ Certificate establishing the terms of TGS’ 6.750% Notes Due 2025.
|
|
CIESA Shareholders’ Agreement.
(2)
|
|
CIESA’s Fourth Amendment to the Restructuring Agreement.
(4)
|
|
CIESA’s Settlement Agreement.
(3)
|
|
Technical Assistance Service Agreement between TGS and Pampa Energía, dated December 26, 2017.
|
|
Financial lease agreement between Petrobras Argentina and TGS, dated July 25, 2016.
(6)
|
|
List of TGS’s Subsidiaries.
|
|
Code of Ethics.
(2)
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
|
|
Audit Committee Charter.
(6)
|
(1) |
Amendment incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2014
(Commission File No. 1-13396), and (ii) amendment previously filed with the Securities and Exchange Commission pursuant to current report on form 6-K, dated April 12, 2017 (Commission File No. 1-13.396).
|
(2) |
Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2005 (Commission File
No. 1-13396).
|
(3) |
Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2012 (Commission File
No. 1-13396).
|
(4) |
Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2010 (Commission File
No. 1-13396).
|
(5) |
Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2017
(Commission File No. 1-13396).
|
(6) |
Incorporated by reference to our Annual Report on Form 20-F filed with the Securities and Exchange Commission for the year ended December 31, 2003
(Commission File No. 1-13396).
|
/s/ Price Waterhouse & Co. S.R.L.
|
/s/ Pistrelli, Henry Martin y Asociados S.R.L
|
||
P
ISTRELLI, HENRY MARTIN Y ASOCIADOS S.R.L
|
|||
/s/ Fernando Alberto Rodriguez
|
Member of Ernst & Young Global
|
/s/ Price Waterhouse & Co. S.R.L.
|
/s/ Pistrelli, Henry Martin y Asociados S.R.L
|
||
P
ISTRELLI, HENRY MARTIN Y ASOCIADOS S.R.L
|
|||
/s/ Fernando Alberto Rodriguez
|
Member of Ernst & Young Global
|
Notes
|
2018
|
2017
*
|
|
2016
*
|
|
|||||||||||
Revenues
|
8.i.
|
34,062,670
|
19,953,266
|
14,645,510
|
||||||||||||
Cost of sales
|
8.j.
|
(16,188,310
|
)
|
(11,935,682
|
)
|
(10,025,424
|
)
|
|||||||||
Gross profit
|
17,874,360
|
8,017,584
|
4,620,086
|
|||||||||||||
Administrative expenses
|
8.k.
|
(961,813
|
)
|
(733,874
|
)
|
(880,767
|
)
|
|||||||||
Selling expenses
|
8.k.
|
(1,764,701
|
)
|
(807,296
|
)
|
(695,858
|
)
|
|||||||||
Other operating expenses
|
8.m.
|
(890,787
|
)
|
(271,595
|
)
|
(130,644
|
)
|
|||||||||
Operating profit
|
14,257,059
|
6,204,819
|
2,912,817
|
|||||||||||||
Net financial results
|
||||||||||||||||
Financial income
|
8.l.
|
10,988,538
|
1,137,168
|
816,791
|
||||||||||||
Financial expenses
|
8.l.
|
(15,040,992
|
)
|
(2,131,487
|
)
|
(2,564,772
|
)
|
|||||||||
Gain on net monetary position
|
1,206,195
|
465,975
|
1,038,647
|
|||||||||||||
Total
|
(2,846,259
|
)
|
(528,344
|
)
|
(709,334
|
)
|
||||||||||
Share of profit from associates
|
11
|
18,207
|
21,641
|
5,089
|
||||||||||||
Net income before income tax
|
11,429,007
|
5,698,116
|
2,208,572
|
|||||||||||||
Income tax (expense) / gain
|
14
|
(13,171
|
)
|
53,077
|
(1,102,277
|
)
|
||||||||||
Total comprehensive income for the year
|
11,415,836
|
5,751,193
|
1,106,295
|
|||||||||||||
Total comprehensive income attributable to:
|
||||||||||||||||
Owners of the Company
|
11,415,832
|
5,751,191
|
1,106,293
|
|||||||||||||
Non-controlling interests
|
4
|
2
|
2
|
|||||||||||||
11,415,836
|
5,751,193
|
1,106,295
|
||||||||||||||
Weighted average of outstanding ordinary shares **
|
788,405,563
|
794,495,283
|
794,495,283
|
|||||||||||||
Basic and diluted earnings per share
|
14.48
|
7.24
|
1.39
|
Notes
|
2018
|
2017
*
|
|
|||||||||
ASSETS
|
||||||||||||
Non-current assets
|
||||||||||||
Property, plant and equipment
|
12
|
38,685,519
|
34,160,708
|
|||||||||
Investments in associates
|
9
|
72,670
|
55,924
|
|||||||||
Other financial assets at amortised cost
|
8.o.
|
8,760
|
21,369
|
|||||||||
Deferred income tax asset
|
14
|
4,529
|
4,245
|
|||||||||
Other receivables
|
8.a.
|
8,233
|
17,874
|
|||||||||
Trade receivables
|
8.b.
|
-
|
4,511
|
|||||||||
Total non-current assets
|
38,779,711
|
34,264,631
|
||||||||||
Current assets
|
||||||||||||
Other receivables
|
8.a.
|
2,663,058
|
1,026,603
|
|||||||||
Inventories
|
360,274
|
183,745
|
||||||||||
Trade receivables
|
8.b.
|
3,114,499
|
3,002,432
|
|||||||||
Contract assets
|
156,672
|
-
|
||||||||||
Derivative financial instruments
|
16.1.3
|
218,272
|
-
|
|||||||||
Other financial assets at amortised cost
|
8.o.
|
5,714
|
2,134,111
|
|||||||||
Other financial assets at fair value through profit or loss
|
8.n.
|
-
|
325,158
|
|||||||||
Cash and cash equivalents
|
8.c.
|
16,644,827
|
3,916,747
|
|||||||||
Total current assets
|
23,163,316
|
10,588,796
|
||||||||||
Total assets
|
61,943,027
|
44,853,427
|
||||||||||
EQUITY
|
||||||||||||
Common stock
|
18,347,477
|
18,667,034
|
||||||||||
Treasury shares
|
319,557
|
-
|
||||||||||
Cost of adquisition of treasury shares
|
(1,420,926
|
)
|
-
|
|||||||||
Legal reserve
|
650,221
|
650,221
|
||||||||||
Future capital expenditures reserve
|
69,851
|
69,851
|
||||||||||
Future dividends reserve
|
991,627
|
1,557,240
|
||||||||||
Accumulated retained earnings
|
11,987,488
|
4,335,231
|
||||||||||
Non-controlling interests
|
10
|
12
|
||||||||||
Total equity
|
30,945,305
|
25,279,589
|
||||||||||
LIABILITES
|
||||||||||||
Non-current liabilities
|
||||||||||||
Deferred income tax liabilities
|
14
|
2,228,094
|
6,460,995
|
|||||||||
Advances from customers
|
8.e.
|
-
|
1,535,140
|
|||||||||
Contract liabilities
|
8.d.
|
1,469,051
|
-
|
|||||||||
Loans
|
13
|
20,154,216
|
4,680,011
|
|||||||||
Total non-current liabilities
|
23,851,361
|
12,676,146
|
||||||||||
Current liabilities
|
||||||||||||
Provisions
|
15
|
371,168
|
289,901
|
|||||||||
Contract liabilities
|
8.d.
|
129,578
|
-
|
|||||||||
Advances from customers
|
8.e.
|
-
|
216,820
|
|||||||||
Other payables
|
8.f.
|
80,674
|
49,531
|
|||||||||
Taxes payables
|
8.g.
|
202,222
|
142,562
|
|||||||||
Income tax payable
|
2,444,210
|
1,743,257
|
||||||||||
Payroll and social security taxes payable
|
8.
p
|
|
383,636
|
347,274
|
||||||||
Loans
|
13
|
442,836
|
1,962,609
|
|||||||||
Trade payables
|
8.h.
|
3,092,037
|
2,145,738
|
|||||||||
Total current liabilities
|
7,146,361
|
6,897,692
|
||||||||||
Total liabilities
|
30,997,722
|
19,573,838
|
||||||||||
Total equity and liabilities
|
61,943,027
|
44,853,427
|
Shareholders Contributions
|
Retained Earnings
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding shares
|
Treasury shares
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common
stock
|
Inflation
adjustment
to common
stock
|
Common
stock
(1)
|
Inflation
adjustment
to common
stock
(1)
|
Acquisition cost
of treasury
shares
(1)
|
Total
common
stock
|
Legal
reserve
|
Future
dividends
reserve
|
Future capital
expenditures
reserve
|
Accumulated
retained earnings
|
Subtotal
|
Total
|
Non-Controlling
interests
|
Total
|
|||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2015*
|
794,495
|
17,872,539
|
-
|
-
|
-
|
18,667,034
|
613,770
|
247,320
|
433,973
|
(1,313,105
|
)
|
(18,042
|
)
|
18,648,992
|
15
|
18,649,007
|
||||||||||||||||||||||||||||||||||||||||
Resolutions of the Board of Directors’ Meeting
held on January 13, 2016
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash dividends distribution
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(226,899
|
)
|
-
|
-
|
(226,899
|
)
|
(226,899
|
)
|
-
|
(226,899
|
)
|
||||||||||||||||||||||||||||||||||||||
Resolutions of the Extraordinary and Ordinary Shareholders’
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Meeting held on April 20, 2016
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Future dividends reserve
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
6,027
|
(6,027
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||
Derecognition of reserves
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(364,822
|
)
|
364,822
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||
Comprehensive income for the year
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
1,106,293
|
1,106,293
|
1,106,293
|
2
|
1,106,295
|
||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2016*
|
794,495
|
17,872,539
|
-
|
-
|
-
|
18,667,034
|
613,770
|
20,421
|
75,178
|
151,983
|
861,352
|
19,528,386
|
17
|
19,528,403
|
||||||||||||||||||||||||||||||||||||||||||
Resolutions of the Ordinary and Extraordinay Shareholders´
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Meeting held on April 26, 2017
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
- Legal reserve
|
-
|
-
|
-
|
-
|
-
|
-
|
36,451
|
-
|
-
|
(36,451
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||
- Future dividends reserve
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
1,536,819
|
-
|
(1,536,819
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||
- Derecognition of reserves
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(5,327
|
)
|
5,327
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||
Dividends payment to non-controlling interest
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(7
|
)
|
(7
|
)
|
||||||||||||||||||||||||||||||||||||||||
Comprehensive income for the year
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
5,751,191
|
5,751,191
|
5,751,191
|
2
|
5,751,193
|
||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2017 *
|
794,495
|
17,872,539
|
-
|
-
|
-
|
18,667,034
|
650,221
|
1,557,240
|
69,851
|
4,335,231
|
6,612,543
|
25,279,577
|
12
|
25,279,589
|
||||||||||||||||||||||||||||||||||||||||||
Resolutions of the Ordinary and Extraordinay Shareholders´
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Meeting held on April 10, 2018
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
- Future Dividends reserve
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
3,763,575
|
-
|
(3,763,575
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||||||||||||||||||||||
Cash dividends distribution (Note 19.b)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(4,329,188
|
)
|
-
|
-
|
(4,329,188
|
)
|
(4,329,188
|
)
|
-
|
(4,329,188
|
)
|
||||||||||||||||||||||||||||||||||||||
Treasury shares purchase (Note 19.c)
|
(13,601
|
)
|
(305,956
|
)
|
13,601
|
305,956
|
(1,420,926
|
)
|
(1,420,926
|
)
|
-
|
-
|
-
|
-
|
-
|
(1,420,926
|
)
|
-
|
(1,420,926
|
)
|
||||||||||||||||||||||||||||||||||||
Cash dividends distribution to non-controlling interest
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(6
|
)
|
(6
|
)
|
||||||||||||||||||||||||||||||||||||||||
Comprehensive income for the year
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
11,415,832
|
11,415,832
|
11,415,832
|
4
|
11,415,836
|
||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2018
|
780,894
|
17,566,583
|
13,601
|
305,956
|
(1,420,926
|
)
|
17,246,108
|
650,221
|
991,627
|
69,851
|
11,987,488
|
13,699,187
|
30,945,295
|
10
|
30,945,305
|
*
|
The Company has applied IFRS 15 and IFRS 9 for the first time on January 1, 2018. In accordance with the transition methods
chosen, the comparative information has not been modified. See Note 4.a)
|
(1)
|
Corresponds to 13,600,780 shares of par value Ps. 1 each, equivalent to 1.71% of the share capital. The acquisition cost of these
shares amounted to Ps. 1,420,926. See Note 19.c - Acquisition of treasury shares to the consolidated financial statements.
|
1.
|
BUSINESS DESCRIPTION
|
2.
|
CONSOLIDATED FINANCIAL STATEMENTS
|
3.
|
BASIS OF PRESENTATION
|
4.
|
SIGNIFICANT ACCOUNTING POLICIES
|
a)
|
New accounting standards
|
Balances as of
31/12/2017
|
IFRS 15 impact
|
Balances as of
01/01/2018
|
|
Current liabilities
|
|
|
|
Advances from customers
|
216,820
|
(216,820)
|
-
|
Contract liabilities
|
-
|
216,820
|
216,820
|
Total
|
216,820
|
-
|
216,820
|
|
|
|
|
Non current liabilities
|
|
|
|
Advances from customers
|
1,535,140
|
(1,535,140)
|
-
|
Contract liabilities
|
-
|
1,535,140
|
1,535,140
|
Total
|
1,535,140
|
-
|
1,535,140
|
a)
|
Classification and measurement of financial assets and financial liabilities
|
Financial instrument
|
|
Classification under IAS 39
|
Classification under IFRS 9
|
|
|
|
|
Cash and banks
|
|
Loans and other receivables
|
Amortized cost
|
Mutual funds
|
|
Fair value through profit or loss
|
Fair value through profit or loss
|
Bank accounts
|
|
Loans and other receivables
|
Amortized cost
|
Government bonds (BONAR 2020)
|
|
Fair value through profit or loss
|
Fair value through profit or loss
|
Private bonds
|
|
Fair value through profit or loss
|
Fair value through profit or loss
|
Government bonds (LETES)
|
|
Held to maturity
|
Amortized cost
|
Government bonds (Central Bank Notes)
|
|
Held to maturity
|
Amortized cost
|
VRD bonds
|
|
Loans and other receivables
|
Amortized cost
|
Trade receivables
|
|
Loans and other receivables
|
Amortized cost
|
Other receivables
|
|
Loans and other receivables
|
Amortized cost
|
b)
|
Impairment of financial assets
|
|
• |
If the entity concludes that it is probable that a particular tax
treatment is accepted, the entity has to determine taxable profit consistently with this tax treatment.
|
|
• |
If the entity concludes that it is not probable that a particular
tax treatment is accepted, the entity has to use the most likely amount or the expected value of the tax treatment when determining taxable profit. The decision should be based on which method provides better
predictions of the resolution of the uncertainty.
|
b)
|
Consolidation
|
Company
|
% of shareholding
and votes
|
Country
|
Closing date
|
Main activity
|
Telcosur
|
99.98
|
Argentina
|
December 31
|
Telecommunication Services
|
CTG
(1)
|
100.00
|
Argentina
|
December 31
|
Electricity related services
|
Company
|
% of
shareholding
and voting
|
Country
|
Main activity
|
Closing date
|
TGU
|
49.00
|
Uruguay
|
Pipeline maintenance
|
December 31
|
EGS (“in liquidation”)
|
49.00
|
Argentina
|
Pipeline exploitation and construction
|
December 31
|
Link
|
49.00
|
Argentina
|
Pipeline exploitation and construction
|
December 31
|
c)
|
Foreign currency translation
|
d)
|
Restatement to constant currency - Comparative Information
|
Balances as of
01/01/2016
|
Balances as of
12/31/2016
|
Balances as of
12/31/2017
|
||||||||||
Total equity according to financial statements approved on 04/13/2018
|
1,695,434
|
2,526,378
|
5,319,640
|
|||||||||
Increase due to adjustment of common stock
|
17,321,734
|
17,321,734
|
17,321,734
|
|||||||||
(Decrease) / increase in accumulated retained earnings
|
(368,161
|
)
|
(319,709
|
)
|
2,638,215
|
|||||||
Total equity after the application of IAS 29
|
18,649,007
|
19,528,403
|
25,279,589
|
|||||||||
2016
|
2017
|
|||||||||||
Total comprehensive income for the year ended December 31, 2016 and 2017 according to
financial statements approved on 04/13/2018
|
930,678
|
2,793,266
|
||||||||||
Gain on net monetary position
|
1,038,647
|
465,975
|
||||||||||
Restatement of income / (expense) items including income tax
|
(863,030
|
)
|
2,491,952
|
|||||||||
Total comprehensive income after the application of IAS 29
|
1,106,295
|
5,751,193
|
e)
|
Financial instruments
|
i. |
Financial assets subsequently measured at amortized cost, and
|
ii. |
Financial assets subsequently measured at fair value (either with changes in other comprehensive income or with changes in results).
|
• |
The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and
|
• |
The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the
principal amount outstanding.
|
• |
Expected credit losses within of 12 months: these are expected credit losses that result from possible default events within 12 months after the filing
date; and
|
• |
Expected credit losses during the life of the asset: these are expected credit losses that result from possible events of default during the expected life
of a financial instrument.
|
|
1. |
Financial assets at fair value through profit or loss
:
Includes financial assets held for trading or selling in the near future or designated by the management upon initial recognition.
|
|
2. |
Financial assets held to maturity
: TGS includes
non-derivative financial assets with fixed or determinable payments and fixed maturities that the Company has the intent and ability to hold to maturity.
|
|
3. |
Loans and other receivables
: The Company includes financial
assets with fixed or determinable payments that are not quoted in an active market. Current assets are included, except those whose maturity exceeds twelve months, which are included as non-current assets.
|
|
4. |
Financial assets available for sale
. Financial assets
available for sale are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless the investment matures or management
intends to dispose of it within 12 months of the end of the reporting period. As of December 31, 2017, there are no instruments classified in this category.
|
f)
|
Derivative financial instruments
|
g)
|
Inventories
|
h)
|
Trade receivables and other receivables
|
i)
|
Cash and cash equivalents
|
j)
|
Property, plant and equipment (“PPE”)
|
- |
Assets transferred from the privatization of GdE:
The value of these assets was
determined based on the price paid for the acquisition of 70% of the Company’s common stock, which amounted to U.S.$ 561.2 million. This price was the basis to determine a total value of common stock of U.S.$ 801.7
million, which, when added to the debt assumed under the Company’s privatization agreement (the “Transfer Agreement”) of US$ 395.0 million, resulted in a total value for PPE of U.S.$ 1,196.7 million. Such value,
converted at the exchange rate in effect as of the date of the Transfer Agreement, has been restated for the effects of inflation as mentioned in Note 4.d, and less accumulated depreciation.
|
- |
Line pack
: It represents the natural gas in the transportation system that is
necessary to keep the system at operating capacity, valued at acquisition cost and restated for the effects of inflation as mentioned in Note 4.d.
|
- |
Other items of PPE
: have been valued at acquisition cost restated for the
effects of inflation as mentioned in Note 4.d, and net of accumulated depreciation. They include, mainly, all the investments made to achieve system integrity and public safety equal to those required by international
standards. Such investments included, among others, the costs of survey programs related to internal and external pipeline inspection, cathodic protection, pipeline replacement and recoating, and the facilities affected
to the Production and Commercialization of Liquids and Other Services segment.
|
- |
Impairment of non-financial assets
: The Company assesses at
each reporting period whether there is an indication that an individual component or a group of PPE may be impaired.
|
k)
|
Financial leases
|
l)
|
Loans
|
m)
|
Trade payables
|
n)
|
Income tax and deferred income tax
|
o)
|
Provisions
|
p)
|
Revenue recognition from contract with customers
|
q)
|
Contract liabilities (until December 31, 2017 Advances from customers)
|
r) |
Equity accounts
|
s) |
Basic and diluted earnings per share
|
2018
|
2017
|
2016
|
||||||||||
Net income attributable to owners of the Company
|
11,415,836
|
5,751,193
|
1,106,295
|
|||||||||
Average number of outstanding shares
|
788,405,563
|
794,495,283
|
794,495,283
|
|||||||||
Basic and diluted earnings per share
|
14.48
|
7.24
|
1.39
|
5. |
CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS
|
• |
Whether significant decreases in the market values of PPE elements took place.
|
|
• |
Whether prices of the main products and services that are marketed decreased.
|
|
• |
Whether significant changes in the regulatory framework were introduced.
|
|
• |
Whether operating costs suffered a materially increase.
|
|
• |
Whether evidence of obsolescence or physical damage has occurred.
|
|
• |
Whether the macroeconomic situation in which TGS carries out ou activities, including significant variations in the sale prices of products, raw
materials, interest rates, etc, has worsen.
|
6.
|
SUPPLEMENTAL CASH FLOW INFORMATION
|
2018
|
2017
|
2016
|
||||||||||
Unpaid acquisition of PPE
|
307,746
|
299,598
|
47,198
|
|||||||||
Principal payment of financial lease
(1)
|
101,965
|
66,075
|
271,843
|
|||||||||
Leasing for PPE acquisition
|
-
|
1,429,713
|
(1)
|
Cancelled through compensation with trade receivables with the creditor. See Note 13.
|
7. |
CONSOLIDATED BUSINESS SEGMENT INFORMATION
|
• |
Reported revenues of the operating segments are 10% or more of the combined revenue, internal and external, of all operating segments;
|
|
• |
The absolute amount of reported profit or loss is 10% or more of the greater, in absolute amount, of (i) the combined reported profit of all operating
segments that did not report a loss and (ii) the combined reported loss of all operating segments that reported a loss.
|
|
• |
Assets are 10% or more of the combined assets of all operating segments
|
Year ended December 31, 2018
|
||||||||||||||||||||||||
Natural Gas
Transportation
|
Production and
Commercialization
of Liquids
|
Other
Services
|
Telecommunications
|
Eliminations
|
Total
|
|||||||||||||||||||
Revenues
|
15,462,061
|
16,627,429
|
1,810,109
|
163,071
|
-
|
34,062,670
|
||||||||||||||||||
Intercompany revenues
|
598,414
|
-
|
-
|
-
|
(598,414
|
)
|
-
|
|||||||||||||||||
Cost of sales
|
(5,164,278
|
)
|
(10,485,998
|
)
|
(1,054,245
|
)
|
(82,203
|
)
|
598,414
|
(16,188,310
|
)
|
|||||||||||||
Administrative expenses
|
(835,134
|
)
|
(84,062
|
)
|
(35,980
|
)
|
(6,637
|
)
|
-
|
(961,813
|
)
|
|||||||||||||
Selling expenses
|
(953,729
|
)
|
(640,173
|
)
|
(143,451
|
)
|
(27,348
|
)
|
-
|
(1,764,701
|
)
|
|||||||||||||
Other operating expenses
|
(156,283
|
)
|
(726,732
|
)
|
(5,445
|
)
|
(2,327
|
)
|
-
|
(890,787
|
)
|
|||||||||||||
Operating profit
|
8,951,051
|
4,690,464
|
570,988
|
44,556
|
-
|
14,257,059
|
||||||||||||||||||
Depreciation of property, plant and equipment
|
(1,880,377
|
)
|
(113,737
|
)
|
(228,969
|
)
|
-
|
-
|
(2,223,083
|
)
|
Natural Gas
Transportation
|
Production and
Commercialization
of Liquids
|
Other
Services
|
Telecommunications
|
Total
|
||||||||||||||||
Identifiable assets
|
45,246,427
|
9,040,987
|
7,554,646
|
100,967
|
61,943,027
|
|||||||||||||||
Identifiable Liabilities
|
16,738,045
|
1,496,225
|
12,717,432
|
46,020
|
30,997,722
|
Year ended December 31, 2017
|
||||||||||||||||||||||||
|
Natural Gas
Transportation
|
Production and
Commercialization
of Liquids
|
Other
Services
|
Telecommunications
|
Eliminations
|
Total
|
||||||||||||||||||
Revenues
|
7,456,052
|
11,173,975
|
1,199,170
|
124,069
|
-
|
19,953,266
|
||||||||||||||||||
Intercompany revenues
|
245,161
|
-
|
-
|
-
|
(245,161
|
)
|
-
|
|||||||||||||||||
Cost of sales
|
(4,178,865
|
)
|
(7,271,556
|
)
|
(655,830
|
)
|
(74,592
|
)
|
245,161
|
(11,935,682
|
)
|
|||||||||||||
Administrative expenses
|
(597,122
|
)
|
(93,720
|
)
|
(36,475
|
)
|
(6,557
|
)
|
-
|
(733,874
|
)
|
|||||||||||||
Selling expenses
|
(419,570
|
)
|
(265,336
|
)
|
(106,916
|
)
|
(15,474
|
)
|
-
|
(807,296
|
)
|
|||||||||||||
Other operating expenses
|
(327,245
|
)
|
64,694
|
(9,198
|
)
|
154
|
-
|
(271,595
|
)
|
|||||||||||||||
Operating profit
|
2,178,411
|
3,608,057
|
390,751
|
27,600
|
-
|
6,204,819
|
||||||||||||||||||
Depreciation of property, plant and equipment
|
(1,695,112
|
)
|
(95,318
|
)
|
(229,786
|
)
|
-
|
-
|
(2,020,216
|
)
|
Natural Gas
Transportation
|
Production and
Commercialization
of Liquids
|
Other
Services
|
Telecommunications
|
Total
|
||||||||||||||||
Identifiable assets
|
34,792,004
|
6,846,690
|
3,069,476
|
145,257
|
44,853,427
|
|||||||||||||||
Identifiable Liabilities
|
15,451,091
|
2,176,705
|
1,907,129
|
38,913
|
19,573,838
|
Year ended December 31, 2016
|
||||||||||||||||||||||||
Natural Gas
Transportation
|
Production and
Commercialization
of Liquids
|
Other
Services
|
Telecommunications
|
Eliminations
|
Total
|
|||||||||||||||||||
Revenues
|
4,162,220
|
9,404,793
|
956,948
|
121,549
|
-
|
14,645,510
|
||||||||||||||||||
Intercompany revenues
|
138,502
|
-
|
-
|
-
|
(138,502
|
)
|
-
|
|||||||||||||||||
Cost of sales
|
(3,259,674
|
)
|
(6,407,872
|
)
|
(433,877
|
)
|
(62,503
|
)
|
138,502
|
(10,025,424
|
)
|
|||||||||||||
Administrative expenses
|
(784,885
|
)
|
(61,573
|
)
|
(27,850
|
)
|
(6,459
|
)
|
-
|
(880,767
|
)
|
|||||||||||||
Selling expenses
|
(239,294
|
)
|
(353,913
|
)
|
(87,741
|
)
|
(14,910
|
)
|
-
|
(695,858
|
)
|
|||||||||||||
Other operating expenses
|
(90,032
|
)
|
(37,417
|
)
|
(2,350
|
)
|
(845
|
)
|
-
|
(130,644
|
)
|
|||||||||||||
Operating profit
|
(73,163
|
)
|
2,544,018
|
405,130
|
36,832
|
-
|
2,912,817
|
|||||||||||||||||
Depreciation of property, plant and equipment
|
(1,884,543
|
)
|
(87,926
|
)
|
(122,949
|
)
|
-
|
-
|
(2,095,418
|
)
|
8. |
DETAIL OF SIGNIFICANT STATEMENT OF FINANCIAL POSITION AND STATEMENT
OF COMPREHENSIVE INCOME CAPTIONS
|
a) |
Other receivables
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
VAT credit balance
|
300,272
|
-
|
155,570
|
-
|
||||||||||||
Other tax receivables
|
9,988
|
2,044
|
10,674
|
3,786
|
||||||||||||
Prepaid expenses
|
47,756
|
-
|
32,162
|
-
|
||||||||||||
Advances to suppliers
|
1,850,997
|
-
|
554,417
|
-
|
||||||||||||
Subsidies receivables
|
292,866
|
-
|
255,886
|
-
|
||||||||||||
Guaranteed deposits
|
1,139
|
-
|
-
|
-
|
||||||||||||
Other Receivables UT
|
29,706
|
-
|
3,318
|
-
|
||||||||||||
Others
|
130,334
|
6,189
|
14,576
|
14,088
|
||||||||||||
Total
|
2,663,058
|
8,233
|
1,026,603
|
17,874
|
b) |
Trade receivables
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
Commons
|
2,898,908
|
-
|
2,965,995
|
4,511
|
||||||||||||
UT
|
20,442
|
-
|
225,565
|
-
|
||||||||||||
Natural Gas Transportation
|
1,657,456
|
-
|
1,314,592
|
-
|
||||||||||||
Production and Commercialization of Liquids
|
1,092,536
|
-
|
1,342,194
|
-
|
||||||||||||
Other services
|
128,474
|
-
|
83,644
|
4,511
|
||||||||||||
Related parties (Note 21)
|
348,112
|
-
|
36,437
|
-
|
||||||||||||
Natural Gas Transportation
|
73,243
|
-
|
14,302
|
-
|
||||||||||||
Production and Commercialization of Liquids
|
8,124
|
-
|
-
|
-
|
||||||||||||
Other services
|
266,745
|
-
|
22,135
|
-
|
||||||||||||
Allowance for doubtful accounts
|
(132,521
|
)
|
-
|
-
|
-
|
|||||||||||
Total
|
3,114,499
|
-
|
3,002,432
|
4,511
|
For doubtful accounts
|
||||
Balances as of 12/31/2016
|
36,304
|
|||
Inflation adjustment restatement
|
(12,909
|
)
|
||
Additions
|
-
|
|||
Applications
|
-
|
|||
Decreases
(1)
|
(23,395
|
)
|
||
Balances as of 12/31/2017
|
-
|
|||
Additions
(1)
|
132,521
|
|||
Applications
|
-
|
|||
Decreases
|
-
|
|||
Balances as of 12/31/2018
|
132,521
|
(1)
|
The total amount is recorded in Selling Expenses
|
c) |
Cash and cash equivalents
|
2018
|
2017
|
|||||||
Cash and banks
|
5,964,008
|
981,710
|
||||||
UT Cash and banks
|
153
|
695
|
||||||
Mutual funds
|
610,108
|
-
|
||||||
Bank account
|
2,146,801
|
1,866,194
|
||||||
Interest-bearing accounts
|
7,909,391
|
973,646
|
||||||
UT Mutual funds
|
14,366
|
94,502
|
||||||
Total
|
16,644,827
|
3,916,747
|
d) |
Contract liabilities
|
12/31/2018
|
1/1/2018
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
Natural Gas Transportation
|
67,978
|
1,198,855
|
101,990
|
1,257,599
|
||||||||||||
Production and Commercialization of Liquids
|
25,514
|
255,075
|
14,546
|
269,614
|
||||||||||||
Other services
|
2,018
|
15,121
|
11,888
|
7,927
|
||||||||||||
UT
|
34,068
|
-
|
88,396
|
-
|
||||||||||||
Total
|
129,578
|
1,469,051
|
216,820
|
1,535,140
|
e) |
Advances from customers
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
Natural Gas Transportation
|
-
|
-
|
101,990
|
1,257,599
|
||||||||||||
Production and Commercialization of Liquids
|
-
|
-
|
14,546
|
269,614
|
||||||||||||
Other Services
|
-
|
-
|
11,888
|
7,927
|
||||||||||||
UT
|
-
|
-
|
88,396
|
-
|
||||||||||||
Total
|
-
|
-
|
216,820
|
1,535,140
|
f) |
Other payables
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
UT Other liabilities
|
73,621
|
-
|
-
|
-
|
||||||||||||
Provision for compensation for the Board of Directors and Supervisory Committee
Supervisory Commitee
|
5,409
|
-
|
-
|
-
|
||||||||||||
Justice fee payable
|
-
|
-
|
47,072
|
-
|
||||||||||||
Others
|
1,644
|
-
|
2,459
|
-
|
||||||||||||
Total
|
80,674
|
-
|
49,531
|
-
|
g) |
Taxes payables
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
Withholdings for income tax made to third parties
|
110,623
|
-
|
79,749
|
-
|
||||||||||||
Health and safety tax
|
8,790
|
-
|
-
|
-
|
||||||||||||
Turnover Tax
|
62,714
|
-
|
42,613
|
-
|
||||||||||||
UT Others
|
2,752
|
-
|
-
|
-
|
||||||||||||
Others
|
17,343
|
-
|
20,200
|
-
|
||||||||||||
Total
|
202,222
|
-
|
142,562
|
-
|
h) |
Trade payables
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
Suppliers
|
2,798,453
|
-
|
1,967,080
|
-
|
||||||||||||
UT Suppliers
|
90,252
|
-
|
11,236
|
-
|
||||||||||||
Customers (credit balances)
|
2,235
|
-
|
15,851
|
-
|
||||||||||||
Related parties (Note 21)
|
201,097
|
-
|
151,571
|
-
|
||||||||||||
Total
|
3,092,037
|
-
|
2,145,738
|
-
|
i)
|
Revenues
|
2018
|
2017
|
2016
|
||||||||||
Sales of goods and services
|
33,655,943
|
19,605,611
|
14,331,482
|
|||||||||
Subsidies
|
406,727
|
347,655
|
314,028
|
|||||||||
Total
|
34,062,670
|
19,953,266
|
14,645,510
|
Year ended December 31, 2018
|
||||||||||||||||||||
Natural gas
transportation
|
Production and
commercialization of
liquids
|
Other services
|
Telecommunications
|
Total
|
||||||||||||||||
Primary geographical market:
|
||||||||||||||||||||
External market
|
-
|
6,025,445
|
-
|
-
|
6,025,445
|
|||||||||||||||
Domestic market
|
15,462,061
|
10,601,984
|
1,810,109
|
163,071
|
28,037,225
|
|||||||||||||||
Total
|
15,462,061
|
16,627,429
|
1,810,109
|
163,071
|
34,062,670
|
|||||||||||||||
Timing of revenue recognition:
|
||||||||||||||||||||
Over the time
|
15,462,061
|
705,309
|
1,810,109
|
163,071
|
18,140,550
|
|||||||||||||||
At a point in time
|
-
|
15,922,120
|
-
|
-
|
15,922,120
|
|||||||||||||||
Total
|
15,462,061
|
16,627,429
|
1,810,109
|
163,071
|
34,062,670
|
Year ended December 31, 2017
|
||||||||||||||||||||
Natural gas
transportation
|
Production and
commercialization of
liquids
|
Other services
|
Telecommunications
|
Total
|
||||||||||||||||
Primary geographical market:
|
||||||||||||||||||||
External market
|
-
|
4,332,548
|
-
|
-
|
4,332,548
|
|||||||||||||||
Domestic market
|
7,456,052
|
6,841,427
|
1,199,170
|
124,069
|
15,620,718
|
|||||||||||||||
Total
|
7,456,052
|
11,173,975
|
1,199,170
|
124,069
|
19,953,266
|
|||||||||||||||
Timing of revenue recognition:
|
||||||||||||||||||||
Over the time
|
7,456,052
|
570,904
|
1,199,170
|
124,069
|
9,350,195
|
|||||||||||||||
At a point in time
|
-
|
10,603,071
|
-
|
-
|
10,603,071
|
|||||||||||||||
Total
|
7,456,052
|
11,173,975
|
1,199,170
|
124,069
|
19,953,266
|
Year ended December 31, 2016
|
||||||||||||||||||||
Natural gas
transportation
|
Production and
commercialization of
liquids
|
Other services
|
Telecommunications
|
Total
|
||||||||||||||||
Primary geographical market:
|
||||||||||||||||||||
External market
|
-
|
2,841,403
|
-
|
-
|
2,841,403
|
|||||||||||||||
Domestic market
|
4,162,220
|
6,563,390
|
956,948
|
121,549
|
11,804,107
|
|||||||||||||||
Total
|
4,162,220
|
9,404,793
|
956,948
|
121,549
|
14,645,510
|
|||||||||||||||
Timing of revenue recognition:
|
||||||||||||||||||||
Over the time
|
4,162,220
|
570,904
|
956,948
|
121,549
|
5,811,621
|
|||||||||||||||
At a point in time
|
-
|
8,833,889
|
-
|
-
|
8,833,889
|
|||||||||||||||
Total
|
4,162,220
|
9,404,793
|
956,948
|
121,549
|
14,645,510
|
i. |
Natural Gas Transportation:
|
2018
|
2017
|
2016
|
||||||||||
Firm
|
12,243,699
|
5,831,927
|
2,988,232
|
|||||||||
Access and Charge
|
565,809
|
433,575
|
420,897
|
|||||||||
Interruptible and Others
|
2,652,553
|
1,190,550
|
753,091
|
|||||||||
Total
|
15,462,061
|
7,456,052
|
4,162,220
|
ii. |
Production and Commercialization of Liquids:
|
2018
|
2017
|
2016
|
||||||||||
Product
|
15,515,393
|
10,255,416
|
8,062,864
|
|||||||||
Services
|
705,309
|
570,904
|
1,027,901
|
|||||||||
Government grants
|
406,727
|
347,655
|
314,028
|
|||||||||
Total
|
16,627,429
|
11,173,975
|
9,404,793
|
iii. |
Other services:
|
2018
|
2017
|
2016
|
||||||||||
Conditioning and treatment
|
735,099
|
546,758
|
410,644
|
|||||||||
Operation and maintenance
|
480,112
|
414,576
|
328,975
|
|||||||||
Steam sales
|
136,764
|
96,587
|
106,212
|
|||||||||
Construction
|
21,321
|
138,638
|
100,543
|
|||||||||
UT Construction
|
433,200
|
-
|
-
|
|||||||||
Others
|
3,613
|
2,611
|
10,574
|
|||||||||
Total
|
1,810,109
|
1,199,170
|
956,948
|
j)
|
Cost of sales
|
2018
|
2017
|
2016
|
||||||||||
Inventories at the beginning of the year
|
183,745
|
241,477
|
240,933
|
|||||||||
Purchases |
8,860,447
|
6,013,669
|
5,453,359
|
|||||||||
Operating costs (Note 8.k.)
|
7,504,392
|
5,864,281
|
4,572,609
|
|||||||||
Inventories at the end of the year
|
(360,274
|
)
|
(183,745
|
)
|
(241,477
|
)
|
||||||
Total
|
16,188,310
|
11,935,682
|
10,025,424
|
k)
|
Expenses by nature – Information required under art. 64 paragraph I, clause B) Commercial Companies Law
|
2018
|
||||||||||||||||||||||||
Operating expenses
|
||||||||||||||||||||||||
Accounts
|
Total |
Regulated
Activities
|
Non Regulated
Activities |
Administrative
expenses
|
Selling
expenses
|
Financial
expenses
|
||||||||||||||||||
Salaries, wages and other compensations
|
1,912,950
|
891,140
|
567,798
|
356,913
|
97,099
|
-
|
||||||||||||||||||
Social security taxes
|
320,232
|
144,748
|
84,940
|
69,616
|
20,928
|
-
|
||||||||||||||||||
Compensation to Directors and Supervisory Committee
|
25,819
|
-
|
-
|
25,819
|
-
|
-
|
||||||||||||||||||
Professional services fees
|
274,697
|
7,047
|
135,626
|
125,232
|
6,792
|
-
|
||||||||||||||||||
Technical operator assistance fees
|
1,317,176
|
838,032
|
479,144
|
-
|
-
|
-
|
||||||||||||||||||
Materials
|
223,940
|
68,688
|
155,252
|
-
|
-
|
-
|
||||||||||||||||||
Third parties services
|
261,779
|
102,315
|
130,258
|
19,790
|
9,416
|
-
|
||||||||||||||||||
Telecommunications and post expenses
|
21,776
|
4,196
|
2,857
|
14,258
|
465
|
-
|
||||||||||||||||||
Rents
|
24,786
|
7,657
|
10,301
|
5,946
|
882
|
-
|
||||||||||||||||||
Transports and freight
|
68,094
|
42,231
|
22,984
|
2,879
|
-
|
-
|
||||||||||||||||||
Easements
|
54,076
|
54,076
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Offices supplies
|
6,997
|
2,371
|
861
|
3,130
|
635
|
-
|
||||||||||||||||||
Travels expenses
|
85,273
|
38,173
|
26,740
|
16,396
|
3,964
|
-
|
||||||||||||||||||
Insurance
|
66,269
|
38,167
|
23,695
|
4,404
|
3
|
-
|
||||||||||||||||||
Property, plant and equipment maintenance
|
1,265,254
|
1,105,531
|
144,116
|
15,607
|
-
|
-
|
||||||||||||||||||
Depreciation of property, plant and equipment
|
2,223,083
|
1,612,884
|
342,706
|
267,493
|
-
|
-
|
||||||||||||||||||
Taxes and contributions
|
1,675,901
|
170,521
|
20,082
|
2,128
|
1,483,170
|
(1)
|
-
|
|||||||||||||||||
Advertising
|
4,856
|
-
|
-
|
-
|
4,856
|
-
|
||||||||||||||||||
Doubtful accounts
|
132,521
|
-
|
-
|
-
|
132,521
|
-
|
||||||||||||||||||
Banks expenses
|
12,150
|
-
|
-
|
12,150
|
-
|
-
|
||||||||||||||||||
Interests expense
|
1,675,437
|
-
|
-
|
-
|
-
|
1,675,437
|
||||||||||||||||||
Foreign exchange loss
|
13,122,031
|
-
|
-
|
-
|
-
|
13,122,031
|
||||||||||||||||||
Other financial charges
|
243,524
|
-
|
-
|
-
|
-
|
243,524
|
||||||||||||||||||
Costs of services rendered to third parties
|
165,277
|
-
|
165,277
|
-
|
-
|
-
|
||||||||||||||||||
Other expenses
|
88,000
|
36,501
|
27,477
|
20,052
|
3,970
|
-
|
||||||||||||||||||
Total 2018
|
25,271,898
|
5,164,278
|
2,340,114
|
961,813
|
1,764,701
|
15,040,992
|
(1)
|
Includes tax on exports for Ps.
248,883
for the year ended
December 31, 2018.
|
2017
|
||||||||||||||||||||||||
Operating expenses
|
||||||||||||||||||||||||
Accounts
|
Total
|
Regulated
Activities
|
Non Regulated
Activities
|
Administrative
expenses
|
Selling
expenses
|
Financial
expenses
|
||||||||||||||||||
Salaries, wages and other compensations
|
1,791,444
|
864,168
|
469,199
|
357,902
|
100,175
|
-
|
||||||||||||||||||
Social security taxes
|
308,469
|
135,826
|
80,500
|
70,258
|
21,885
|
|||||||||||||||||||
Compensation to Directors and Supervisory Committee
|
13,816
|
-
|
-
|
13,816
|
-
|
-
|
||||||||||||||||||
Professional services fees
|
99,599
|
2,409
|
4,931
|
83,979
|
8,280
|
-
|
||||||||||||||||||
Technical operator assistance fees
|
577,187
|
260,036
|
317,151
|
-
|
-
|
-
|
||||||||||||||||||
Materials
|
97,057
|
29,979
|
67,078
|
-
|
-
|
-
|
||||||||||||||||||
Third parties services
|
206,456
|
85,959
|
103,408
|
17,089
|
-
|
-
|
||||||||||||||||||
Telecommunications and post expenses
|
16,093
|
2,150
|
1,972
|
11,196
|
775
|
-
|
||||||||||||||||||
Rents
|
10,939
|
3,161
|
1,581
|
5,442
|
755
|
-
|
||||||||||||||||||
Transports and freight
|
57,869
|
34,450
|
19,772
|
3,614
|
33
|
-
|
||||||||||||||||||
Easements
|
35,265
|
35,265
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Offices supplies
|
5,612
|
1,665
|
585
|
2,618
|
744
|
-
|
||||||||||||||||||
Travels expenses
|
31,035
|
13,879
|
5,113
|
8,991
|
3,052
|
-
|
||||||||||||||||||
Insurance
|
52,660
|
30,744
|
17,527
|
3,909
|
480
|
-
|
||||||||||||||||||
Property, plant and equipment maintenance
|
1,005,258
|
865,572
|
129,280
|
8,639
|
1,767
|
-
|
||||||||||||||||||
Depreciation of property, plant and equipment
|
2,020,216
|
1,569,839
|
325,104
|
125,273
|
-
|
-
|
||||||||||||||||||
Taxes and contributions
|
918,821
|
213,123
|
13,395
|
1,186
|
691,117
|
(1)
|
-
|
|||||||||||||||||
Advertising
|
767
|
-
|
3
|
-
|
764
|
-
|
||||||||||||||||||
Doubtful accounts
|
(23,395
|
)
|
-
|
-
|
-
|
(23,395
|
)
|
-
|
||||||||||||||||
Banks expenses
|
7,217
|
-
|
-
|
7,217
|
-
|
-
|
||||||||||||||||||
Interests expense
|
846,366
|
-
|
-
|
-
|
-
|
846,366
|
||||||||||||||||||
Foreign exchange loss
|
1,117,201
|
-
|
-
|
-
|
-
|
1,117,201
|
||||||||||||||||||
Other financial charges
|
167,920
|
-
|
-
|
-
|
-
|
167,920
|
||||||||||||||||||
Costs of services rendered to third parties
|
115,272
|
-
|
115,272
|
-
|
-
|
-
|
||||||||||||||||||
Other expenses
|
57,794
|
30,640
|
13,545
|
12,745
|
864
|
-
|
||||||||||||||||||
Total 2017
|
9,536,938
|
4,178,865
|
1,685,416
|
733,874
|
807,296
|
2,131,487
|
(1)
|
Includes tax on exports for Ps.
1,286
for the year ended December
31, 2017
|
2016
|
||||||||||||||||||||||||
Operating expenses
|
||||||||||||||||||||||||
Accounts
|
Total
|
Regulated
Activities
|
Non Regulated
Activities
|
Administrative
expenses
|
Selling
expenses
|
Financial
expenses
|
||||||||||||||||||
Salaries, wages and other contributions
|
1,603,431
|
796,925
|
393,027
|
321,349
|
92,130
|
-
|
||||||||||||||||||
Social security taxes
|
276,390
|
128,245
|
66,702
|
61,543
|
19,900
|
-
|
||||||||||||||||||
Compensation to Directors and Supervisory Committee
|
12,345
|
-
|
-
|
12,345
|
-
|
-
|
||||||||||||||||||
Professional services fees
|
80,706
|
2,580
|
7,002
|
64,122
|
7,002
|
-
|
||||||||||||||||||
Technical operator assistance fees
|
329,826
|
105,950
|
223,876
|
-
|
-
|
-
|
||||||||||||||||||
Materials
|
85,497
|
28,376
|
57,121
|
-
|
-
|
-
|
||||||||||||||||||
Third parties services
|
183,154
|
72,598
|
95,078
|
15,478
|
-
|
-
|
||||||||||||||||||
Telecommunications and post expenses
|
9,766
|
553
|
2,211
|
6,818
|
184
|
-
|
||||||||||||||||||
Rents
|
6,818
|
1,658
|
737
|
4,054
|
369
|
-
|
||||||||||||||||||
Transports and freight
|
54,541
|
33,904
|
19,347
|
1,290
|
-
|
-
|
||||||||||||||||||
Easements
|
38,326
|
38,326
|
-
|
-
|
-
|
-
|
||||||||||||||||||
Offices supplies
|
5,159
|
1,843
|
737
|
2,395
|
184
|
-
|
||||||||||||||||||
Travels expenses
|
19,533
|
9,582
|
2,764
|
5,344
|
1,843
|
-
|
||||||||||||||||||
Insurance
|
51,962
|
29,666
|
18,242
|
3,501
|
553
|
-
|
||||||||||||||||||
Property, plant and equipment maintenance
|
408,504
|
294,447
|
102,080
|
9,766
|
2,211
|
-
|
||||||||||||||||||
Depreciation of property, plant and equipment
|
2,095,419
|
1,527,999
|
210,876
|
356,544
|
-
|
-
|
||||||||||||||||||
Taxes and contributions
|
703,136
|
160,122
|
17,320
|
1,474
|
524,220
|
(1)
|
-
|
|||||||||||||||||
Advertising
|
737
|
-
|
-
|
-
|
737
|
-
|
||||||||||||||||||
Doubtful accounts
|
38,142
|
-
|
-
|
-
|
38,142
|
-
|
||||||||||||||||||
Banks expenses
|
4,054
|
-
|
-
|
4,054
|
-
|
-
|
||||||||||||||||||
Interests expense
|
937,454
|
-
|
-
|
-
|
-
|
937,454
|
||||||||||||||||||
Foreign exchange loss
|
1,486,399
|
-
|
-
|
-
|
-
|
1,486,399
|
||||||||||||||||||
Other financial charges
|
131,536
|
-
|
-
|
-
|
-
|
131,536
|
||||||||||||||||||
Derivate financial instruments
|
9,383
|
-
|
-
|
-
|
-
|
9,383
|
||||||||||||||||||
Costs of services rendered to third parties
|
84,207
|
-
|
84,207
|
-
|
-
|
-
|
||||||||||||||||||
Other expenses
|
57,581
|
26,900
|
11,608
|
10,690
|
8,383
|
-
|
||||||||||||||||||
Year ended Deccember 31, 2016
|
8,714,006
|
3,259,674
|
1,312,935
|
880,767
|
695,858
|
2,564,772
|
(1)
|
Includes tax on exports of Ps. 11,081 for the year ended
December 31, 2016.
|
l)
|
Net financial results
|
2018
|
2017
|
2016
|
||||||||||
Financial income
|
||||||||||||
Derivative financial instrument results
|
106,084
|
-
|
-
|
|||||||||
Interest income
|
1,345,278
|
133,116
|
206,402
|
|||||||||
Fair value gains on financial instruments through profit or loss
|
1,372,933
|
442,480
|
329,401
|
|||||||||
Foreign exchange gain
|
8,164,243
|
561,572
|
280,988
|
|||||||||
Subtotal
|
10,988,538
|
1,137,168
|
816,791
|
|||||||||
Financial expenses
|
||||||||||||
Interest expense
|
(1,675,437
|
)
|
(846,366
|
)
|
(937,454
|
)
|
||||||
Foreign exchange loss
|
(13,122,031
|
)
|
(1,117,201
|
)
|
(1,486,399
|
)
|
||||||
Derivative financial instrument results
|
-
|
-
|
(9,383
|
)
|
||||||||
Other financial charges
|
(243,524
|
)
|
(167,920
|
)
|
(131,536
|
)
|
||||||
Less: C
apitalized
borrowing costs
|
-
|
-
|
-
|
|||||||||
Subtotal
|
(15,040,992
|
)
|
(2,131,487
|
)
|
(2,564,772
|
)
|
||||||
Gain on net monetary position
|
1,206,195
|
465,975
|
1,038,647
|
|||||||||
Total
|
(2,846,259
|
)
|
(528,344
|
)
|
(709,334
|
)
|
m)
|
Other operating expenses
|
2018
|
2017
|
2016
|
||||||||||
Disposal of property, plant and equipment
|
(158,516
|
)
|
(131,419
|
)
|
(16,368
|
)
|
||||||
Net increase in provisions
(1)
|
(770,802
|
)
|
(228,196
|
)
|
(124,437
|
)
|
||||||
Recovery of insurance
|
23,874
|
194,689
|
-
|
|||||||||
Write off of other receivables
|
-
|
(105,047
|
)
|
-
|
||||||||
Others |
14,657
|
(1,622
|
)
|
10,161
|
||||||||
Total
|
(890,787
|
)
|
(271,595
|
)
|
(130,644
|
)
|
(1)
|
Includes judicial costs
|
n)
|
Other financial assets at fair value through profit or loss
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
Government bonds
|
-
|
-
|
218,707
|
-
|
||||||||||||
Private bonds
|
-
|
-
|
106,451
|
-
|
||||||||||||
Total
|
-
|
-
|
325,158
|
-
|
o)
|
Other financial assets at amortized cost
|
2018
|
2017
|
|||||||||||||||
Current
|
Non Current
|
Current
|
Non Current
|
|||||||||||||
VRD bonds
|
5,714
|
8,760
|
10,499
|
21,369
|
||||||||||||
Government Bonds (Argentine National Treasury Notes)
|
-
|
-
|
1,361,756
|
-
|
||||||||||||
Government Bonds (Central Bank Notes)
|
-
|
-
|
761,856
|
-
|
||||||||||||
Total
|
5,714
|
8,760
|
2,134,111
|
21,369
|
p)
|
Payroll and social security taxes payable
|
2018
|
2017
|
|||||||||||||||
|
Current
|
Non Current
|
Current
|
Non Current
|
||||||||||||
Vacation benefit payable
|
170,690
|
-
|
154,643
|
-
|
||||||||||||
Annual bonus payable
|
133,365
|
-
|
125,344
|
-
|
||||||||||||
Social security taxes payable
|
67,381
|
-
|
67,287 |
-
|
||||||||||||
UT
|
12,200 |
-
|
-
|
-
|
||||||||||||
Total
|
371,436
|
-
|
347,274
|
-
|
9.
|
INVESTMENTS IN ASSOCIATES
|
|
2018
|
2017
|
||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||
|
Issuer Information
|
|||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||
|
Description of securities
|
Last financial statemets issued
|
|
|||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||
Name and issuer
|
Face
value
|
Amount
|
Cost
|
Book value
|
Main
business
|
Date
|
Common
stock
|
Net (loss) /
income for
the year / period
|
Shareholders’
equity
|
% of Common
Stock
|
Book value
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||
Transporte y Servicios de
Gas en Uruguay S.A.
|
Ps. Uru. 1
|
196,000
|
118
|
5,798
|
Pipeline maintenance
|
09/30/2018
|
28
|
(689
|
)
|
11,832
|
49.00
|
3,981
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||
Emprendimientos de Gas del Sur S.A. (in liquidation)
|
$
|
1
|
116,130
|
116
|
324
|
Pipeline
construction and operation services
|
09/30/2018
|
237
|
(70
|
)
|
661
|
49.00
|
543
|
|||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||||||
Gas Link S.A.
|
$
|
1
|
502,962
|
5,587
|
66,548
|
Pipeline
construction and operation services
|
09/30/2018
|
1,026
|
30,918
|
145,949
|
49.00
|
51,400
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||||||||||||
Total
|
72,670
|
|
|
55,924
|
10.
|
JOINT ARRANGEMENTS
|
2018
|
2017
|
|||||||
Consolidated Statements of financial position
|
||||||||
Non Current assets
|
-
|
-
|
||||||
Current Assets
|
195,439
|
99,816
|
||||||
Total
|
195,439
|
99,816
|
||||||
Non Current Liabilities
|
-
|
-
|
||||||
Current Liabilities
|
169,843
|
99,726
|
||||||
Total
|
169,843
|
99,726
|
||||||
2018
|
2017
|
|||||||
Consolidated Statements of comprehensive income
|
||||||||
Gross profit
|
33,876
|
797
|
||||||
Operating profit / (loss)
|
24,388
|
(25
|
)
|
|||||
Net Financial results
|
1,047
|
226
|
||||||
Comprehensive income
|
25,435
|
201
|
11.
|
PROFIT FROM ASSOCIATES
|
2018
|
2017
|
2016
|
||||||||||
EGS (in liquidation)
|
3,101
|
21
|
175
|
|||||||||
TGU
|
(42
|
)
|
285
|
236
|
||||||||
Link
|
15,148
|
21,335
|
4,678
|
|||||||||
Total
|
18,207
|
21,641
|
5,089
|
2018
|
||||||||||||||||||||||||||||||||||||||||||||
C o s t
|
D e p r e c i a t i o n
|
|||||||||||||||||||||||||||||||||||||||||||
Account
|
Beginning
of the year
|
Additions
|
Retirements
|
Transfers
|
End of
the year
|
Accumulated at
the beginning
of the year
|
Retirements
|
For the year
|
Rate %
|
Accumulated at
at the end
of the year
|
Net
book value
|
|||||||||||||||||||||||||||||||||
Pipelines
|
39,112,667
|
-
|
18,101
|
831,882
|
39,926,448
|
18,606,656
|
300
|
959,389
|
2.2
|
19,565,745
|
20,360,703
|
|||||||||||||||||||||||||||||||||
Compressor plants
|
14,541,520
|
-
|
308,660
|
1,023,210
|
15,256,070
|
9,981,767
|
278,943
|
629,861
|
3,3 a 25
|
10,332,685
|
4,923,385
|
|||||||||||||||||||||||||||||||||
Other plants
|
17,219
|
-
|
-
|
-
|
17,219
|
4,642
|
-
|
584
|
3.3
|
5,226
|
11,993
|
|||||||||||||||||||||||||||||||||
Stations of regulation and/or
measurement of pressure
|
1,360,656
|
1,081
|
5,948
|
4,001
|
1,359,790
|
1,053,505
|
5,163
|
36,195
|
4.0
|
1,084,537
|
275,253
|
|||||||||||||||||||||||||||||||||
Other technical installations
|
264,962
|
-
|
1,330
|
5,308
|
268,940
|
225,092
|
1,330
|
5,742
|
6.7
|
229,504
|
39,436
|
|||||||||||||||||||||||||||||||||
Subtotal assets related to natural gas transportation service
|
55,297,024
|
1,081
|
334,039
|
1,864,401
|
56,828,467
|
29,871,662
|
285,736
|
1,631,771
|
31,217,697
|
25,610,770
|
||||||||||||||||||||||||||||||||||
Assets related to natural gas
upstream service
|
3,489,476
|
5,971
|
197,269
|
(32,913
|
)
|
3,265,265
|
1,330,045
|
177,846
|
207,557
|
3,3 a 25
|
1,359,756
|
1,905,509
|
||||||||||||||||||||||||||||||||
Assets related to liquids
production and commercialization service
|
7,030,019
|
-
|
474,602
|
434,953
|
6,990,370
|
5,958,293
|
440,455
|
97,677
|
3.3
|
5,615,515
|
1,374,855
|
|||||||||||||||||||||||||||||||||
Lands
|
71,837
|
35,511
|
-
|
-
|
107,348
|
-
|
-
|
-
|
-
|
-
|
107,348
|
|||||||||||||||||||||||||||||||||
Buildings and constructions
|
1,985,027
|
-
|
48,091
|
90,998
|
2,027,934
|
1,147,560
|
38,159
|
35,802
|
2.0
|
1,145,203
|
882,731
|
|||||||||||||||||||||||||||||||||
Fittings and features in building
|
165,920
|
-
|
11,752
|
17,252
|
171,420
|
67,417
|
6,123
|
7,209
|
4.0
|
68,503
|
102,917
|
|||||||||||||||||||||||||||||||||
Machinery, equipment and tools
|
513,762
|
129,963
|
47,758
|
10,981
|
606,948
|
396,215
|
47,588
|
27,234
|
6,7 a 10
|
375,861
|
231,087
|
|||||||||||||||||||||||||||||||||
UT Machinery, equipment and tools
|
-
|
591
|
-
|
-
|
591
|
-
|
-
|
446
|
6,7 a 10
|
446
|
145
|
|||||||||||||||||||||||||||||||||
Computers and Telecommunication systems
|
3,745,839
|
168
|
1,355,581
|
325,263
|
2,715,689
|
3,382,394
|
1,350,936
|
192,240
|
6,7 a 20
|
2,223,698
|
491,991
|
|||||||||||||||||||||||||||||||||
Vehicles
|
263,745
|
38,089
|
5,817
|
-
|
296,017
|
191,683
|
5,503
|
22,310
|
20
|
208,490
|
87,527
|
|||||||||||||||||||||||||||||||||
Furniture
|
148,460
|
-
|
-
|
104
|
148,564
|
143,026
|
-
|
837
|
10
|
143,863
|
4,701
|
|||||||||||||||||||||||||||||||||
Materials
|
1,572,902
|
572,326
|
35,953
|
(572,902
|
)
|
1,536,373
|
-
|
-
|
-
|
-
|
-
|
1,536,373
|
||||||||||||||||||||||||||||||||
Line pack
|
153,720
|
-
|
-
|
222,473
|
376,193
|
17,971
|
-
|
-
|
-
|
17,971
|
358,222
|
|||||||||||||||||||||||||||||||||
Works in progress
|
2,229,243
|
6,122,710
|
-
|
(2,360,610
|
)
|
5,991,343
|
-
|
-
|
-
|
-
|
-
|
5,991,343
|
||||||||||||||||||||||||||||||||
Total
|
76,666,974
|
6,906,410
|
2,510,862
|
-
|
81,062,522
|
42,506,266
|
2,352,346
|
2,223,083
|
42,377,003
|
38,685,519
|
2017
|
||||||||||||||||||||||||||||||||||||||||||||
C o s t
|
D e p r e c i a t i o n
|
|||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||
Account
|
Beginning
of the year
|
Additions
|
Retirements
|
Transfers
|
End of
the year
|
Accumulated at
the beginning
|
Retirements
|
For the year
|
Rate %
|
Accumulated at
at the end
|
Net
book value
|
|||||||||||||||||||||||||||||||||
Pipelines
|
38,613,449
|
-
|
17,399
|
516,617
|
39,112,667
|
17,678,180
|
63
|
928,539
|
2.2
|
18,606,656
|
20,506,011
|
|||||||||||||||||||||||||||||||||
Compressor plants
|
14,181,525
|
2,660
|
189,100
|
546,435
|
14,541,520
|
9,508,571
|
102,860
|
576,056
|
3,3 a 25
|
9,981,767
|
4,559,753
|
|||||||||||||||||||||||||||||||||
Other plants
|
17,219
|
-
|
-
|
-
|
17,219
|
4,058
|
-
|
584
|
3.3
|
4,642
|
12,577
|
|||||||||||||||||||||||||||||||||
Stations of regulation and/or measurement of pressure
|
1,350,336
|
-
|
-
|
10,320
|
1,360,656
|
1,002,347
|
-
|
51,158
|
4.0
|
1,053,505
|
307,151
|
|||||||||||||||||||||||||||||||||
Other technical installations
|
259,919
|
-
|
11,194
|
16,237
|
264,962
|
219,216
|
187
|
6,063
|
6.7
|
225,092
|
39,870
|
|||||||||||||||||||||||||||||||||
Subtotal assets related to natural gas transportation service
|
54,422,448
|
2,660
|
217,693
|
1,089,609
|
55,297,024
|
28,412,372
|
103,110
|
1,562,400
|
29,871,662
|
25,425,362
|
||||||||||||||||||||||||||||||||||
Assets related to natural gas upstream service
|
3,231,072
|
-
|
2,815
|
261,219
|
3,489,476
|
1,123,382
|
100
|
206,763
|
3,3 a 25
|
1,330,045
|
2,159,431
|
|||||||||||||||||||||||||||||||||
Assets related to liquids production and commercialization service
|
6,839,452
|
-
|
3,922
|
194,489
|
7,030,019
|
5,878,107
|
36
|
80,222
|
3.3
|
5,958,293
|
1,071,726
|
|||||||||||||||||||||||||||||||||
Lands
|
71,830
|
7
|
-
|
-
|
71,837
|
-
|
-
|
-
|
-
|
-
|
71,837
|
|||||||||||||||||||||||||||||||||
Buildings and constructions
|
1,945,894
|
-
|
1,027
|
40,160
|
1,985,027
|
1,112,381
|
5
|
35,184
|
2.0
|
1,147,560
|
837,467
|
|||||||||||||||||||||||||||||||||
Fittings and features in building
|
165,425
|
-
|
-
|
495
|
165,920
|
60,396
|
-
|
7,021
|
4.0
|
67,417
|
98,503
|
|||||||||||||||||||||||||||||||||
Machinery, equipment and tools
|
430,019
|
82,172
|
-
|
1,571
|
513,762
|
382,173
|
-
|
14,042
|
6,7 a 10
|
396,215
|
117,547
|
|||||||||||||||||||||||||||||||||
UT Machinery, equipment and tools
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
6,7 a 10
|
-
|
-
|
|||||||||||||||||||||||||||||||||
Computers and Telecommunication systems
|
3,672,719
|
-
|
-
|
73,120
|
3,745,839
|
3,286,123
|
-
|
96,271
|
6,7 a 20
|
3,382,394
|
363,445
|
|||||||||||||||||||||||||||||||||
Vehicles
|
235,191
|
49,029
|
20,475
|
-
|
263,745
|
194,679
|
20,475
|
17,479
|
20
|
191,683
|
72,062
|
|||||||||||||||||||||||||||||||||
Furniture
|
148,206
|
-
|
-
|
254
|
148,460
|
142,192
|
-
|
834
|
10
|
143,026
|
5,434
|
|||||||||||||||||||||||||||||||||
Materials
|
1,118,657
|
514,263
|
9,213
|
(50,805
|
)
|
1,572,902
|
-
|
-
|
-
|
-
|
-
|
1,572,902
|
||||||||||||||||||||||||||||||||
Line pack
|
153,720
|
-
|
-
|
-
|
153,720
|
17,971
|
-
|
-
|
-
|
17,971
|
135,749
|
|||||||||||||||||||||||||||||||||
Works in progress
|
2,190,845
|
1,648,510
|
-
|
(1,610,112
|
)
|
2,229,243
|
-
|
-
|
-
|
-
|
-
|
2,229,243
|
||||||||||||||||||||||||||||||||
Total
|
74,625,478
|
2,296,641
|
255,145
|
-
|
76,666,974
|
40,609,776
|
123,726
|
2,020,216
|
42,506,266
|
34,160,708
|
2018
|
2017
|
|||||||
Cost – Capitalized financial leasing
|
1,429,713
|
1,429,713
|
||||||
Accumulated depreciation
|
(222,649
|
)
|
(130,518
|
)
|
||||
Total
|
1,207,064
|
1,299,195
|
13. |
LOANS
|
2018
|
2017
|
|||||||
Current Loans
|
||||||||
2014 Notes
|
-
|
1,758,428
|
||||||
2018 Notes Interest
|
227,114
|
55,614
|
||||||
Financial Leasing (Note 22)
|
215,722
|
148,567
|
||||||
Total Current loans
|
442,836
|
1,962,609
|
||||||
Non Current Loans
|
||||||||
2014 Notes
|
-
|
3,512,517
|
||||||
2018 Notes Interest
|
18,714,529
|
-
|
||||||
Financial Leasing (Note 22)
|
1,439,687
|
1,167,494
|
||||||
Total non current loans
|
20,154,216
|
4,680,011
|
||||||
Total
(1)
|
20,597,052
|
6,642,620
|
(1)
|
Issuance expenses net for Ps. 120,420 and Ps. 12,584 as of December 31, 2018 and 2017, respectively.
|
2018
|
2017
|
|||||||
Beginning balance
|
6,642,620
|
7,217,464
|
||||||
Inflation adjustment restatement
|
(7,106,426
|
)
|
(1,478,063
|
)
|
||||
Accrued interest
|
1,498,556
|
619,727
|
||||||
Effect of foreign exchange rate change
|
12,848,796
|
781,956
|
||||||
VAT unpaid installments
|
19,104
|
7,210
|
||||||
Proceeds from loans
|
13,821,521
|
-
|
||||||
Payment of loans
(1)
|
(1,328,029
|
)
|
(125,951
|
)
|
||||
Payment of redemption of loans
|
(4,796,243
|
)
|
-
|
|||||
Interest paid
(2)
|
(1,002,847
|
)
|
(379,723
|
)
|
||||
Ending balance
|
20,597,052
|
6,642,620
|
(1)
|
For the years ended on December 31, 2018 and 2017, Ps. 101,968 and Ps. 66,075 respectively were cancelled through the
offseting of debit balances maintained with the creditor (Pampa Energía).
|
(2)
|
For the years ended on December 31, 2018 and 2017, Ps. 97,101 and Ps. 77,565, respectively, were cancelled through
the offseting of debit balances maintained with the creditor (Pampa Energía).
|
Less than one year
|
212,063
|
|||
From 1/01/2020 to 12/31/2020
|
-
|
|||
From 1/01/2021 to 12/31/2021
|
-
|
|||
From 1/01/2022 onwards
|
18,850,000
|
|||
Ending balance
|
19,062,063
|
Due:
|
||||
as of 12/31/2018
|
56,892
|
|||
To due
|
||||
From 1/01/2019 to 12/31/2019
|
158,830
|
|||
From 1/01/2020 to 12/31/2020
|
172,178
|
|||
From 1/01/2021 to 12/31/2021
|
186,635
|
|||
From 1/01/2022 to 12/31/2022
|
202,306
|
|||
From 1/01/2023 onwards
|
878,568
|
|||
Ending balance
|
1,655,409
|
As of 12/31/2019
|
338,887
|
|||
From 1/01/2020 to 12/31/2020
|
282,034
|
|||
From 1/01/2021 to 12/31/2021
|
282,034
|
|||
From 1/01/2022 to 12/31/2022
|
282,034
|
|||
From 1/01/2023 onwards
|
1,014,583
|
|||
Total minimum future payments
|
2,199,572
|
|||
Future financial charges on financial leases
|
(544,163
|
)
|
||
Book Value financial leases
|
1,655,409
|
2014 Notes
|
||
Amount in U.S.$
|
255,451,506
|
|
Interest rate
|
9.625% anual
|
|
Scheduled
payment date
|
Percentage of
original principal
amount
|
|
Amortization
|
May 14, 2014
|
25%
|
May 14, 2018
|
25%
|
|
May 14, 2019
|
25%
|
|
May 14, 2020
|
25%
|
|
Frequency of Interest
payment
|
Semiannual, payable el May 14 and
November 14 of each year.
|
|
Guarantor
|
None
|
14. |
INCOME TAX AND DEFERRED TAX
|
2018
|
2017
|
2016
|
||||||||||
Current income tax
|
(3,198,356
|
)
|
(2,442,608
|
)
|
(931,568
|
)
|
||||||
Special revaluation tax
|
(1,048,000
|
)
|
-
|
-
|
||||||||
Deferred income tax
|
4,233,185
|
2,495,685
|
(170,709
|
)
|
||||||||
Total income tax
|
(13,171
|
)
|
53,077
|
(1,102,277
|
)
|
2018
|
2017
|
|||||||
Deferred tax assets:
|
||||||||
Deferred tax assets to be recovered after more than 12 months
|
725,558
|
619,101
|
||||||
Deferred tax assets to be recovered after less than 12 months
|
103,566
|
112,834
|
||||||
Deferred tax liabilities:
|
||||||||
Deferred tax liabilities to be recovered after more than 12 months
|
(2,949,051
|
)
|
(7,164,720
|
)
|
||||
Deferred tax liabilities to be recovered after less than 12 months
|
(103,638
|
)
|
(23,965
|
)
|
||||
Deferred tax liabilities, net
|
(2,223,565
|
)
|
(6,456,750
|
)
|
Deferred tax assets
|
Allowance for
doubtful
accounts
|
Tax credits
discounted
value loss
|
Account
receivables
discounted
value
|
Provisions for
legal claims and
other provisions
|
Financial lease
|
Contract
liabilities
|
Total
|
|||||||||||||||||||||
As of December 31, 2016
|
12,294
|
2,815
|
70
|
180,950
|
518,070
|
281,232
|
995,431
|
|||||||||||||||||||||
Charge in results
|
(12,294
|
)
|
(2,815
|
)
|
(70
|
)
|
(68,116
|
)
|
(182,606
|
)
|
2,405
|
(263,496
|
)
|
|||||||||||||||
As of December 31, 2017
|
-
|
-
|
-
|
112,834
|
335,464
|
283,637
|
731,935
|
|||||||||||||||||||||
Charge in results
|
-
|
387
|
2,273
|
(11,928
|
)
|
72,110
|
34,347
|
97,189
|
||||||||||||||||||||
As of December 31, 2018
|
-
|
387
|
2,273
|
100,906
|
407,574
|
317,984
|
829,124
|
Deferred tax liabilities
|
Deferred sales
|
Loans
|
Property,
plant and
equipment
|
Cash and cash
equivalents
|
Inventaries
|
Total
|
||||||||||||||||||
As of December 31, 2016
|
85
|
(8,756
|
)
|
(9,915,672
|
)
|
(14,373
|
)
|
(9,150
|
)
|
(9,947,866
|
)
|
|||||||||||||
Charge in results
|
(85
|
)
|
5,094
|
2,754,614
|
(2,090
|
)
|
1,648
|
2,759,181
|
||||||||||||||||
As of December 31, 2017
|
-
|
(3,662
|
)
|
(7,161,058
|
)
|
(16,463
|
)
|
(7,502
|
)
|
(7,188,685
|
)
|
|||||||||||||
Charge in results
|
2,839
|
(27,419
|
)
|
4,243,088
|
(78,451
|
)
|
(4,061
|
)
|
4,135,996
|
|||||||||||||||
As of December 31, 2018
|
2,839
|
(31,081
|
)
|
(2,917,970
|
)
|
(94,914
|
)
|
(11,563
|
)
|
(3,052,689
|
)
|
2018
|
2017
|
2016
|
||||||||||
Pre tax income
|
11,429,007
|
5,698,116
|
2,208,572
|
|||||||||
Statutory income tax rate
|
30
|
%
|
35
|
%
|
35
|
%
|
||||||
Pre tax income at statutory income tax rate
|
(3,428,702
|
)
|
(1,994,341
|
)
|
(773,000
|
)
|
||||||
Tax effects due to:
|
||||||||||||
- Inflation effect
(1)
|
4,432,884
|
(187,006
|
)
|
(321,584
|
)
|
|||||||
- Special revaluation tax
|
(1,048,000
|
)
|
-
|
-
|
||||||||
-Change in the tax rate
(2)
|
-
|
2,234,656
|
-
|
|||||||||
-Non taxable income or non deductible expenses
|
44,482
|
428
|
(7,693
|
)
|
||||||||
-Others
|
(13,835
|
)
|
(660
|
)
|
-
|
|||||||
Total income tax
|
(13,171
|
)
|
53,077
|
(1,102,277
|
)
|
(1)
|
Corresponds to the inflation effect on non-deferred tax assests and liabilities.
|
(2)
|
Corresponds to the effect of the reduction in the enacted tax rate on the net deferred tax liability according to the
aforementioned.
|
For legal
claims and
others
(1)
|
|||||
Balances as of 12/31/2016
|
408,002
|
||||
Inflation adjustment restatement
|
(80,163
|
)
|
|||
Additions
|
225,887
|
´(1)
|
|||
Uses
|
(254,858
|
)
|
|||
Reversals
|
(8,967
|
)
|
´(3)
|
||
Balances as of 12/31/2017
|
289,901
|
||||
Inflation adjustment restatement
|
(112,740
|
)
|
|||
Additions
|
195,156
|
´(1)
|
|||
Uses
|
(787
|
)
|
|||
Reversals
|
(362
|
)
|
´(2)
|
||
Balances as of 12/31/2018
|
371,168
|
(1)
|
Ps. 107,419 and Ps. 152,635 are included in “Other operating expenses” and Ps. 118,468 and Ps. 77,472 in “Financial expenses”
for the years ended on December 31, 2018 and 2017, respectively.
|
(2)
|
The total amount is recorded in “Other operating income”
|
(3)
|
Ps. 2,263, are included in “Other operating expenses” and Ps. 6,704
in “Financial expenses” for the year 2017.
|
16. |
FINANCIAL RISK MANAGEMENT
|
1. |
Financial risk factors
|
1.1 |
Foreign exchange risk
|
Net assets / liabilities position in USD
|
2018
|
2017
|
2016
|
|||||||||
Assets
|
394,369
|
192,764
|
88,463
|
|||||||||
Liabilities
|
(588,525
|
)
|
(286,129
|
)
|
(317,952
|
)
|
||||||
Total
|
(194,156
|
)
|
(93,365
|
)
|
(229,489
|
)
|
||||||
Effect on financial results in $
|
||||||||||||
Pesos
|
739,849
|
259,923
|
365,543
|
|||||||||
Total
|
739,849
|
259,923
|
365,543
|
1.2 |
Interest rate risk
|
Financial assets
(1)
|
Financial liabilities
(2)
|
|||||||||||||||
2018
|
2017
|
2018
|
2017
|
|||||||||||||
Fix interest rate
|
8,525,212
|
3,097,259
|
18,941,643
|
5,326,559
|
||||||||||||
Variable interest rate
|
14,473
|
31,868
|
-
|
-
|
||||||||||||
Total
|
8,539,685
|
3,129,127
|
18,941,643
|
5,326,559
|
(1)
|
Includes mutual funds, LETES, Lebacs and bank accounts. Trade receivables do no bear interests, except for Ps. 14,473
and Ps. 31,868, which bears CER plus a spread of 8% as of December 31, 2018 and 2017, respectively.
|
(2)
|
Includes loans, issuance expenses and financial leasing
|
1.3 |
Commodity price risk
|
Period
|
Propane
|
Butane
|
Natural
gasoline
|
|||||||||
October 2018 – April 2019
|
6,045
|
4,506
|
2,700
|
|||||||||
May 2019 – September 2019
|
-
|
-
|
4,100
|
|||||||||
October 2019
|
9,068
|
7,010
|
4,200
|
|||||||||
November 2019 – April 2020
|
13,098
|
10,014
|
6,000
|
1.4 |
Credit risk
|
2018
|
2017
|
|||||||
Current trade receivables
|
3,247,020
|
3,002,432
|
||||||
Non-current trade receivables
|
-
|
4,511
|
||||||
Allowances for doubful accounts
|
(132,521
|
)
|
-
|
|||||
Total
|
3,114,499
|
3,006,943
|
2018
|
2017
|
2016
|
||||||||||||||||||
Revenues
|
Trade
receivables
|
Revenues
|
Trade
receivables
|
Revenues
|
||||||||||||||||
MetroGas
|
3,222,608
|
375,580
|
1,916,408
|
309,208
|
1,166,861
|
|||||||||||||||
Camuzzi Gas Pampeana S.A.
|
2,393,722
|
279,663
|
1,408,811
|
226,138
|
702,375
|
|||||||||||||||
Naturgy Argentina
|
1,931,580
|
239,730
|
1,012,029
|
172,665
|
524,030
|
|||||||||||||||
CAMMESA
|
1,337,714
|
183,249
|
889,716
|
232,175
|
651,592
|
|||||||||||||||
Pampa Energía
|
439,556
|
91,684
|
44,683
|
1,302
|
43,034
|
|||||||||||||||
Camuzzi Gas del Sur S.A.
|
534,462
|
56,928
|
310,222
|
46,319
|
156,503
|
2018
|
2017
|
2016
|
||||||||||||||||||
Revenues
|
Trade
receivables
|
Revenues
|
Trade
receivables
|
Revenues
|
||||||||||||||||
PBB Polisur
|
5,267,302
|
708,797
|
3,683,956
|
520,645
|
3,565,562
|
|||||||||||||||
Petredec
|
858,846
|
-
|
1,377,647
|
433,916
|
-
|
|||||||||||||||
Geogas Trading S.A.
|
1,102,307
|
-
|
571,260
|
-
|
931,432
|
|||||||||||||||
Shell Trading (US) Company
|
89,868
|
-
|
1,425,123
|
276,932
|
-
|
|||||||||||||||
Petrobras Global Trading BV
|
1,743,806
|
137,413
|
-
|
-
|
-
|
|||||||||||||||
Petroleo Brasileiro
|
-
|
-
|
-
|
-
|
546,476
|
|||||||||||||||
Braskem Netherlands B.V.
|
-
|
-
|
-
|
-
|
42,611
|
December 31-2018
|
||||||||||||
Cash and cash
equivalents
|
Other financial
assets
|
Receivables
(1) (2)
|
||||||||||
Without specified maturity
|
14,485,525
|
-
|
467
|
|||||||||
With specified maturity
|
||||||||||||
Overdue
|
||||||||||||
Until 12-31-2017
|
-
|
-
|
133,771
|
|||||||||
From 01-01-18 to 03-31-18
|
-
|
-
|
310
|
|||||||||
From 04-01-18 to 06-30-18
|
-
|
-
|
4,020
|
|||||||||
From 07-01-18 to 09-30-18
|
-
|
-
|
11,400
|
|||||||||
From 10-01-18 to 12-31-18
|
-
|
-
|
535,609
|
|||||||||
Total overdue
|
-
|
-
|
685,110
|
|||||||||
Non-due
|
||||||||||||
From 01-01-19 to 03-31-19
|
2,159,302
|
219,767
|
2,945,285
|
|||||||||
From 04-01-19 to 06-30-19
|
-
|
1,495
|
41,157
|
|||||||||
From 07-01-19 to 09-30-19
|
-
|
1,495
|
-
|
|||||||||
From 10-01-19 to 12-31-19
|
-
|
1,229
|
-
|
|||||||||
During 2020
|
-
|
3,357
|
5,529
|
|||||||||
During 2021
|
-
|
3,044
|
-
|
|||||||||
During 2022
|
-
|
1,911
|
-
|
|||||||||
During 2023
|
-
|
448
|
-
|
|||||||||
From 2024 onwards
|
-
|
-
|
-
|
|||||||||
Total non-due
|
2,159,302
|
232,746
|
2,991,971
|
|||||||||
Total with specified maturity
|
2,159,302
|
232,746
|
3,677,081
|
|||||||||
Total
|
16,644,827
|
232,746
|
3,677,548
|
December 31-2017
|
||||||||||||
Cash and
cash
equivalents
|
Other
financial
assets
|
Receivables
(1) (2)
|
||||||||||
Without specified maturity
|
2,943,101
|
-
|
685
|
|||||||||
With specified maturity
|
||||||||||||
Overdue
|
||||||||||||
Until 12-31-2016
|
-
|
-
|
2,990
|
|||||||||
From 01-01-17 to 03-31-17
|
-
|
-
|
202
|
|||||||||
From 04-01-17 to 06-30-17
|
-
|
-
|
2,637
|
|||||||||
From 07-01-17 to 09-30-17
|
-
|
-
|
18,736
|
|||||||||
From 10-01-17 to 12-31-17
|
-
|
-
|
220,135
|
|||||||||
Total overdue
|
-
|
-
|
244,700
|
|||||||||
Non-Due
|
||||||||||||
From 01-01-18 to 03-31-18
|
973,646
|
591,525
|
3,017,756
|
|||||||||
From 04-01-18 to 06-30-18
|
-
|
1,533,148
|
3,703
|
|||||||||
From 07-01-18 to 09-30-18
|
-
|
332,232
|
3,188
|
|||||||||
From 10-01-18 to 12-31-18
|
-
|
2,364
|
3,839
|
|||||||||
During 2019
|
-
|
8,436
|
17,624
|
|||||||||
During 2020
|
-
|
4,954
|
-
|
|||||||||
During 2021
|
-
|
4,494
|
-
|
|||||||||
During 2022
|
-
|
2,822
|
-
|
|||||||||
From 2023 onwards
|
-
|
663
|
-
|
|||||||||
Total non-due
|
973,646
|
2,480,638
|
3,046,110
|
|||||||||
Total with specified maturity
|
973,646
|
2,480,638
|
3,290,810
|
|||||||||
Total
|
3,916,747
|
2,480,638
|
3,291,495
|
1.5 |
Liquidity risk
|
December 31, 2018
|
||||||||||||
Loans
|
Other
financial
liabilities
|
Financial Leases
|
||||||||||
Without specified maturity
|
-
|
-
|
-
|
|||||||||
With specified maturity
|
||||||||||||
Overdue
|
||||||||||||
Until 12-31-2017
|
-
|
103,597
|
-
|
|||||||||
From 01-01-18 to 03-31-18
|
-
|
311
|
-
|
|||||||||
From 04-01-18 to 06-30-18
|
-
|
311
|
-
|
|||||||||
From 07-01-18 to 09-30-18
|
-
|
311
|
-
|
|||||||||
From 10-01-18 to 12-31-18
|
-
|
311
|
56,891
|
|||||||||
Total overdue
|
-
|
104,841
|
56,891
|
|||||||||
Non-due
|
||||||||||||
From 01-01-19 to 03-31-19
|
-
|
3,352,746
|
70,499
|
|||||||||
From 04-01-19 to 06-30-19
|
636,188
|
21,739
|
70,499
|
|||||||||
From 07-01-19 to 09-30-19
|
-
|
-
|
70,499
|
|||||||||
From 10-01-19 to 12-31-19
|
636,188
|
-
|
70,499
|
|||||||||
During 2020
|
1,272,375
|
-
|
282,034
|
|||||||||
During 2021
|
1,272,375
|
-
|
282,034
|
|||||||||
During 2022
|
1,272,375
|
-
|
282,034
|
|||||||||
During 2023
|
1,272,375
|
-
|
282,034
|
|||||||||
From 2024 onwards
|
20,758,563
|
-
|
732,549
|
|||||||||
Total non-due
|
27,120,439
|
3,374,485
|
2,142,681
|
|||||||||
Total with specified maturity
|
27,120,439
|
3,479,326
|
2,199,572
|
|||||||||
Total
|
27,120,439
|
3,479,326
|
2,199,572
|
December 31, 2017
|
||||||||||||
Loans
|
Other
financial
liabilities
|
Financial Leases
|
||||||||||
Without specified maturity
|
-
|
-
|
-
|
|||||||||
With specified maturity
|
||||||||||||
Overdue
|
||||||||||||
Until 12-31-2016
|
-
|
109,528
|
-
|
|||||||||
From 01-01-17 to 03-31-17
|
-
|
459
|
-
|
|||||||||
From 04-01-17 to 06-30-17
|
-
|
459
|
-
|
|||||||||
From 07-01-17 to 09-30-17
|
-
|
459
|
-
|
|||||||||
From 10-01-17 to 12-31-17
|
-
|
459
|
41,545
|
|||||||||
Total overdue
|
-
|
111,364
|
41,545
|
|||||||||
Non-Due
|
||||||||||||
From 01-01-18 to 03-31-18
|
-
|
2,300,495
|
51,490
|
|||||||||
From 04-01-18 to 06-30-18
|
2,012,300
|
125,344
|
51,490
|
|||||||||
From 07-01-18 to 09-30-18
|
-
|
-
|
51,490
|
|||||||||
From 10-01-18 to 12-31-18
|
169,249
|
-
|
51,490
|
|||||||||
During 2019
|
2,012,300
|
-
|
205,985
|
|||||||||
During 2020
|
1,843,053
|
-
|
205,985
|
|||||||||
During 2021
|
-
|
-
|
205,985
|
|||||||||
During 2022
|
-
|
-
|
205,985
|
|||||||||
From 2023 onwards
|
-
|
-
|
741,035
|
|||||||||
Total non-due
|
6,036,902
|
2,425,839
|
1,770,935
|
|||||||||
Total with specified maturity
|
6,036,902
|
2,537,203
|
1,812,480
|
|||||||||
Total
|
6,036,902
|
2,537,203
|
1,812,480
|
1.6 |
Capital risk management
|
|
2018
|
2017
|
||||||
Total debt (Note 13)
|
20,597,052
|
6,642,620
|
||||||
Total Equity
|
30,945,305
|
25,279,589
|
||||||
Total Capital
|
51,542,357
|
31,922,209
|
||||||
Gearing Ratio
|
0.40
|
0.21
|
2 |
FINANCIAL INSTRUMENTS BY CATEGORY AND HIERARCHY
|
2.1 |
Financial instrument categories
|
December 31, 2018
|
||||||||||||
Financial assets at fair
value
|
Financial assets held to
maturity
|
Total
|
||||||||||
CURRENT ASSETS
|
||||||||||||
Trade receivables
|
-
|
3,114,499
|
3,114,499
|
|||||||||
Other receivables
|
-
|
424,339
|
424,339
|
|||||||||
Derivative financial instruments
|
218,272
|
-
|
218,272
|
|||||||||
Other financial assets at amortized cost
|
-
|
5,714
|
5,714
|
|||||||||
Cash and cash equivalents
|
2,161,167
|
14,483,660
|
16,644,827
|
|||||||||
Total current assets
|
2,379,439
|
18,028,212
|
20,407,651
|
|||||||||
NON-CURRENT ASSETS
|
||||||||||||
Other receivables
|
-
|
6,189
|
6,189
|
|||||||||
Other financial assets at amortized cost
|
-
|
8,760
|
8,760
|
|||||||||
Total non-current assets
|
-
|
14,949
|
14,949
|
|||||||||
Total assets
|
2,379,439
|
18,043,161
|
20,422,600
|
Financial liabilities at
fair value
|
Other financial
liabilities
|
Total
|
||||||||||
CURRENT LIABILITIES
|
||||||||||||
Trade payables
|
-
|
3,092,037
|
3,092,037
|
|||||||||
Loans
|
-
|
442,836
|
442,836
|
|||||||||
Payroll and social security taxes payables
|
-
|
309,351
|
309,351
|
|||||||||
Other payables
|
-
|
80,674
|
80,674
|
|||||||||
Total current liabilities
|
-
|
3,924,898
|
3,924,898
|
|||||||||
NON-CURRENT LIABILITIES
|
||||||||||||
Loans
|
-
|
20,154,216
|
20,154,216
|
|||||||||
Total non-current liabilities
|
-
|
20,154,216
|
20,154,216
|
|||||||||
Total liabilities
|
-
|
24,079,114
|
24,079,114
|
December 31, 2017
|
||||||||||||||||
Financial assets at fair
value
|
Financial assets held
to maturity
|
Loans and other
receivables
|
Total
|
|||||||||||||
CURRENT ASSETS
|
||||||||||||||||
Trade receivables
|
-
|
-
|
3,002,432
|
3,002,432
|
||||||||||||
Other receivables
|
-
|
-
|
270,464
|
270,464
|
||||||||||||
Other financial assets at amortized cost
|
-
|
2,123,611
|
10,500
|
2,134,111
|
||||||||||||
Other financial assets at fair value through profit or loss
|
325,158
|
-
|
-
|
325,158
|
||||||||||||
Cash and cash equivalents
|
1,960,696
|
-
|
1,956,051
|
3,916,747
|
||||||||||||
Total current assets
|
2,285,854
|
2,123,611
|
5,239,447
|
9,648,912
|
||||||||||||
NON-CURRENT ASSETS
|
||||||||||||||||
Trade receivables
|
-
|
-
|
4,511
|
4,511
|
||||||||||||
Other receivables
|
-
|
-
|
14,088
|
14,088
|
||||||||||||
Other financial assets at fair value through profit or loss
|
-
|
-
|
21,369
|
21,369
|
||||||||||||
Total non-current assets
|
-
|
-
|
39,968
|
39,968
|
||||||||||||
Total assets
|
2,285,854
|
2,123,611
|
5,279,415
|
9,688,880
|
Financial liabilities at
fair value
|
Other financial
liabilities
|
Total
|
||||||||||
CURRENT LIABILITIES
|
||||||||||||
Trade payables
|
-
|
2,145,738
|
2,145,738
|
|||||||||
Loans
|
-
|
1,962,609
|
1,962,609
|
|||||||||
Payroll and social security taxes payables
|
-
|
282,973
|
282,973
|
|||||||||
Other payables
|
-
|
49,531
|
49,531
|
|||||||||
Total current liabilities
|
-
|
4,440,851
|
4,440,851
|
|||||||||
NON-CURRENT LIABILITIES
|
||||||||||||
Loans
|
-
|
4,680,011
|
4,680,011
|
|||||||||
Total non-current liabilities
|
-
|
4,680,011
|
4,680,011
|
|||||||||
Total liabilities
|
-
|
9,120,862
|
9,120,862
|
2.2 |
Fair value measurement hierarchy and estimates
|
• |
Level 1: includes financial assets and liabilities whose fair values are estimated using quoted prices (unadjusted) in active markets for identical assets
and liabilities. The instruments included in this level primarily include balances in mutual funds and public or private bonds listed on the BYMA. The mutual funds mainly carry out their placements in bonds issued by the
Central Bank of the Argentine Republic.
|
• |
Level 2: includes financial assets and liabilities whose fair value is estimated using different assumptions quoted prices included within Level 1 that are
observable for the asset or liability, either directly (i.e. as prices) or indirectly (for example, derived from prices). Within this level, the Company includes those derivate financial instruments for which it was not
able to find an active market.
|
• |
Level 3: includes financial instruments for which the assumptions used in estimating fair value are not based on observable market information.
|
December 31, 2018
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Financial assets at fair value
|
||||||||||||||||
Cash and cash equivalents
|
2,161,167
|
-
|
-
|
2,161,167
|
||||||||||||
Derivative financial instruments
|
-
|
218,272
|
-
|
218,272
|
||||||||||||
Total
|
2,161,167
|
218,272
|
-
|
2,379,439
|
December 31, 2017
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Financial assets at fair value
|
||||||||||||||||
Cash and cash equivalents
|
1,960,696
|
-
|
-
|
1,960,696
|
||||||||||||
Other current financial assets at fair value through profit or loss
|
325,158
|
-
|
-
|
325,158
|
||||||||||||
Total
|
2,285,854
|
-
|
-
|
2,285,854
|
Carrying amount
|
Fair value
|
|||||||
2018notes
|
18,941,643
|
17,200,060
|
17. |
REGULATORY FRAMEWORK
|
a) |
General framework of the natural gas transportation segment
:
|
|
• |
The RTI Process,
which will culminate in the signing of the integral agreement, was
approved. As a result of this RTI, a new tariff schedule was also approved. This new tariff schedule applicable to the Company determined a total tariff increase of 214.2% and 37%, in the event that it had been granted
in a single installment as of April 1, 2017, on the tariff of the natural gas transportation service and the CAU, respectively.
|
|
• |
The Five-Year Plan was approved.
Resolution 4362 obliged TGS for the execution of the
Five-Year Plan, which requires a high level of essential investments for the operation and maintenance of the pipeline system, to provide quality, safe and reliable service. The Five-Year Plan shall be for the period
from April 1, 2017 to March 31, 2022 and will
amount to Ps. 6,786,543,expressed in December 31, 2016 currency terms
.
|
|
• |
A non-automatic six-month adjustment mechanism for the natural gas transportation tariff and the investment commitments were approved. This adjustment must
be approved by ENARGAS and for its calculation, the evolution of the WPI published by INDEC will be considered.
|
|
• |
TGS and its shareholders must withdraw any claim against the Government related to the natural gas transportation business, including the arbitration
proceedings before the ICSID. The Company desisted from it on June 26, 2018.
|
|
• |
Effective as of April 1, 2017, 64.2% of the tariff for the natural gas transport service, the CAU not being adjusted, in accordance with the provisions of
Resolution No. 4362/2017 (“Resolution 4362 “).
|
|
• |
Effective as of December 1, 2017, after the issuance of Resolution 120, 81.1% on the tariff for the natural gas transport service and 29.7% on the CAU,
which includes the first adjustment by WPI.
|
|
• |
Effective as of April 1, 2018, an increase of 50% over the tariff for the natural gas transport service and the CAU within the framework of the provisions
of Resolution No. 310/2018 issued by ENARGAS.
|
|
• |
Through Resolution ENARGAS I-2852/2014 (“Resolution I-2852”) on April 7, 2014, a staggered increase of 8% was established as of April 1, 2014, from 14%
accumulated since 1 June 2014 and 20% accumulated since August 1, 2014.
|
|
• |
On June 5, 2015, ENARGAS issued Resolution No. I-3347/2015 (“Resolution I-3347”), which complements Resolution I-2852, which approved an increase in the
tariffs applicable to the natural gas transportation service from May 1, 2015. This increase represented for TGS a transitional increase of 44.3% in the price of the natural gas transport service and 73.2% in the CAU.
|
|
• |
Effective since April 1, 2016, an increase of 200.1% on the rates applicable to the public service of Natural Gas Transportation and to the CAU (the “2016
Increase”) in accordance with the provisions of Resolution No. I-3724/2016 of ENARGAS (“Resolution 3724”), which could only be invoiced in full from October 7, 2016 after the ruling issued by the Supreme Court of
Justice of the Nation (“CSJN”) that determined the nullity of Resolutions No. 28/2016 and 31/2016 (jointly “Resolutions 28 and 31”) of the former Ministry of
MINEM.
|
b)
|
Regulatory Framework for non-regulated segments
|
c)
|
Essential assets
|
i) |
the net book value of the essential assets determined on the basis of the price paid by the acquiring joint arrangements, and the original cost of
subsequent investments carried in US dollars and adjusted by the PPI, net of accumulated depreciation according to the calculation rules to be determined by ENARGAS; or
|
ii) |
the net proceeds of a new competitive bidding (the “New Bidding”).
|
18. |
ASSETS AND LIABILITIES IN FORREIGN CURRENCY
|
19. |
COMMON STOCK AND DIVIDENDS
|
a) |
Common stock structure and shares’ public offer
|
Amount of common stock, subscribed, issued, paid in, and authorized for
public offer
|
||||||||||||
Common Shares Class
(Face value $ 1, 1 vote)
|
Outstanding shares
|
Treasury Shares
|
Common Stock
|
|||||||||
Class “A”
|
405,192,594
|
-
|
405,192,594
|
|||||||||
Class “B”
|
375,701,909
|
13,600,780
|
389,302,689
|
|||||||||
Total
|
780,894,503
|
13,600,780
|
794,495,283
|
b) |
Dividends distribution
|
Approval date
|
Amount
|
Amount per
share
|
||||||
07/06/2018
|
1,125,562
|
1.4167
|
||||||
08/08/2018
|
1,449,300
|
1.8242
|
||||||
09/06/2018
|
1,754,326
|
2.2081
|
c)
|
Acquisition of treasury shares
|
20. |
LEGAL CLAIMS AND OTHER MATTERS
|
a)
|
Turnover tax calculated on the natural gas price consumed by
TGS
|
b) |
Action for annulment of ENARGAS Resolutions No. I-1,982/11 and No. I-1,991/11 (the
“Resolutions”)
|
c) |
Recovery action of VAT and income tax
|
d) |
Turnover tax withholding in the Province of Buenos Aires
|
e) |
Environmental matters
|
f) |
Arbitral claim
|
g) |
Others
|
21. |
BALANCES AND TRANSACTIONS WITH RELATED COMPANIES
|
2018
|
2017
|
|||||||||||||||
Company
|
Accounts
receivable
|
Accounts
payable
|
Accounts
receivable
|
Accounts
payable
|
||||||||||||
Controlling shareholder:
|
||||||||||||||||
CIESA
|
-
|
-
|
58
|
-
|
||||||||||||
Associate which exercises joint control on the
controlling shareholder:
|
- |
-
|
||||||||||||||
Pampa Energía
(1)
|
91,684
|
1,850,505
|
23,152
|
1,457,352
|
||||||||||||
Associate which exercises significant influence
on the controlling shareholder:
|
- |
-
|
||||||||||||||
Link
|
6,482
|
-
|
768
|
-
|
||||||||||||
EGS
|
-
|
-
|
-
|
679
|
||||||||||||
TGU
|
-
|
6,001
|
-
|
4,383
|
||||||||||||
Other related companies:
|
-
|
-
|
||||||||||||||
Refinor S.A.
|
-
|
-
|
-
|
5,218
|
||||||||||||
SACDE
|
214,148
|
-
|
-
|
-
|
||||||||||||
Pampa Comercializadora S.A.
|
7,113
|
-
|
2,779
|
-
|
||||||||||||
Oleoductos del Valle S.A.
|
3,131
|
-
|
1,975
|
-
|
||||||||||||
Central Piedra Buena S.A.
|
25,463
|
-
|
7,661
|
-
|
||||||||||||
Transener S.A.
|
91
|
-
|
44
|
-
|
||||||||||||
Total
|
348,112
|
1,856,506
|
36,437
|
1,467,632
|
Revenues
|
Costs
|
Financial
results
|
||||||||||||||||||||||||||
Company
|
Natural Gas
Transportation
|
Production and
commercialization
of liquids
|
Other services
|
Gas purchase
and others
|
Compensation
for
technical
assistance
|
Revenues for
administrative
services
|
Interest
expense
|
|||||||||||||||||||||
Controlling shareholder:
|
||||||||||||||||||||||||||||
CIESA
|
-
|
-
|
-
|
-
|
-
|
146
|
-
|
|||||||||||||||||||||
Associate which exercises joint control on the
controlling shareholder:
|
||||||||||||||||||||||||||||
Pampa Energía
|
439,556
|
1,323
|
230,930
|
617,089
|
1,317,176
|
-
|
125,467
|
|||||||||||||||||||||
Associates with significant influence:
|
||||||||||||||||||||||||||||
Link
|
-
|
-
|
8,589
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Other related companies:
|
||||||||||||||||||||||||||||
Petrolera Entre Lomas S.A.
(1)
|
-
|
-
|
-
|
2,017
|
-
|
-
|
-
|
|||||||||||||||||||||
Oleoductos del Valle S.A.
|
6,149
|
-
|
8,277
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Pampa Comercializadora S.A.
|
26,869
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Central Piedra Buena S.A.
|
67,175
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Transener S.A.
|
-
|
-
|
12,014
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Experta ART
|
-
|
-
|
-
|
11,910
|
-
|
-
|
-
|
|||||||||||||||||||||
Total
|
539,749
|
1,323
|
259,810
|
631,016
|
1,317,176
|
146
|
125,467
|
Revenues
|
Costs
|
Financial
results
|
||||||||||||||||||||||||||
Company
|
Natural Gas
Transportation
|
Production and
commercialization
of liquids
|
Other services
|
Gas purchase
and others
|
Compensation
for technical
assistance
|
Revenues for
administrative
services
|
Interest
expense
|
|||||||||||||||||||||
Controlling shareholder:
|
||||||||||||||||||||||||||||
CIESA
|
-
|
-
|
-
|
-
|
-
|
154
|
-
|
|||||||||||||||||||||
Associate which exercises joint control on
the controlling shareholder:
|
||||||||||||||||||||||||||||
Pampa Energía
|
44,683
|
93,573
|
116,186
|
227,044
|
577,187
|
-
|
107,731
|
|||||||||||||||||||||
Jointly control entity:
|
||||||||||||||||||||||||||||
UT
|
-
|
-
|
-
|
-
|
-
|
2,115
|
-
|
|||||||||||||||||||||
Associates with significant influence:
|
||||||||||||||||||||||||||||
Link
|
-
|
-
|
7,486
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Other related companies:
|
||||||||||||||||||||||||||||
Oleoductos del Valle S.A.
|
7,460
|
-
|
1,700
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Refinor S.A.
|
-
|
-
|
-
|
5,350
|
-
|
-
|
-
|
|||||||||||||||||||||
Petrolera Pampa S.A.
|
-
|
-
|
-
|
40,344
|
-
|
-
|
-
|
|||||||||||||||||||||
Petrolera Entre Lomas S.A.
|
-
|
-
|
-
|
17,801
|
-
|
-
|
-
|
|||||||||||||||||||||
Pampa Comercializadora S.A.
|
10,775
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Central Piedra Buena S.A.
|
13,160
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Central Térmica Loma La Lata S.A.
|
-
|
-
|
389
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Experta ART
|
-
|
-
|
-
|
11,949
|
-
|
-
|
-
|
|||||||||||||||||||||
Total
|
76,078
|
93,573
|
125,761
|
302,488
|
577,187
|
2,269
|
107,731
|
Revenues
|
Costs
|
Financial
results
|
||||||||||||||||||||||||||
Company
|
Natural Gas
Transportation
|
Production and
commercialization
of liquids
|
Other services
|
Gas purchase
and others
|
Compensation
for technical
assistance
|
Revenues for
administrative
services
|
Interest
expense
|
|||||||||||||||||||||
Controlling shareholder:
|
||||||||||||||||||||||||||||
CIESA
|
-
|
-
|
-
|
-
|
-
|
244
|
-
|
|||||||||||||||||||||
Associate which exercises joint control on
the controlling shareholder:
|
||||||||||||||||||||||||||||
Pampa Energía
|
43,034
|
2,317
|
354,464
|
163,345
|
329,826
|
-
|
50,145
|
|||||||||||||||||||||
Associates with significant influence:
|
||||||||||||||||||||||||||||
Link
|
-
|
-
|
7,787
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Other related companies:
|
||||||||||||||||||||||||||||
Compañía Mega
|
3,325
|
176,841
|
35
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Braskem
|
-
|
42,611
|
-
|
4,361
|
-
|
-
|
-
|
|||||||||||||||||||||
Petroleo Brasileiro
|
-
|
546,476
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Petrolera Pampa S.A.
|
-
|
-
|
-
|
333,944
|
-
|
-
|
-
|
|||||||||||||||||||||
Oleoductos del Valle S.A.
|
4,715
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Pampa Comercializadora S.A.
|
7,009
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Petrouruguay
|
722
|
95
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
WEB SA
|
220
|
-
|
-
|
7,262
|
-
|
-
|
-
|
|||||||||||||||||||||
Petrolera entre Lomas S.A.
|
-
|
-
|
350
|
50,356
|
-
|
-
|
-
|
|||||||||||||||||||||
Central Piedrabuena S.A.
|
14,162
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Experta ART
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||||||||
Total
|
73,187
|
768,340
|
362,636
|
559,268
|
329,826
|
244
|
50,145
|
22.
|
CONTRACTUAL OBLIGATIONS
|
Estimated maturity date
|
||||||||||||||||||||||||
Total
|
Due less than
one year
|
Less than one
year
|
1-2 years
|
3-5 years
|
More than
5 years
|
|||||||||||||||||||
Financial indebtedness
(1)
|
27,120,439
|
-
|
1,272,376
|
3,817,125
|
2,544,750
|
19,486,188
|
||||||||||||||||||
Purchase obligations
(2)
|
4,836,612
|
-
|
3,396,343
|
1,440,269
|
-
|
-
|
||||||||||||||||||
Financial Leases
|
2,199,572
|
56,892
|
281,995
|
564,068
|
564,050
|
732,567
|
||||||||||||||||||
Total
|
34,156,623
|
56,892
|
4,950,714
|
5,821,462
|
3,108,800
|
20,218,755
|
(a) |
Guarantees granted and goods of restricted availability
|
23.
|
ASSOCIATES AND JOINT ARRANGEMENTS
|
24.
|
SUBSEQUENT EVENTS
|
1
|
Definitions and Other Provisions of General Application
|
2
|
|
1.1
|
Definitions
|
2
|
|
1.2
|
Compliance Certificates and Opinions
|
21
|
|
1.3
|
Form of Documents Delivered to Trustee
|
21
|
|
1.4
|
Acts of Holders; Record Dates
|
21
|
|
1.5
|
Notices, Etc., to Trustee and Company
|
23
|
|
1.6
|
Notice to Holders; Waiver
|
23
|
|
1.7
|
Effect of Headings and Table of Contents
|
24
|
|
1.8
|
Successors and Assigns
|
24
|
|
1.9
|
Separability Clause
|
24
|
|
1.10
|
Benefits of Indenture
|
24
|
|
1.11
|
Governing Law
|
24
|
|
1.12
|
Legal Holidays
|
24
|
|
1.13
|
Waiver of Jury Trial
|
25
|
|
1.14
|
Currency of Payment
|
25
|
|
1.15
|
Consent to Jurisdiction and Service of Process
|
25
|
|
1.16
|
Resignation and Appointment of Agents
|
26
|
|
1.17
|
Force Majeure
|
26
|
|
2.
|
Form of Notes
|
27
|
|
2.1
|
Forms Generally
|
27
|
|
2.2
|
Regulation S Global Note
|
27
|
|
2.3
|
Restricted Global Note
|
27
|
|
2.4
|
Form of Trustee’s Certificate of Authentication
|
27
|
|
3. |
The Notes
|
28
|
|
3.1
|
Amount Issuable in Series
|
28
|
|
3.2
|
Denominations
|
29
|
|
3.3
|
Execution, Authentication, Delivery and Dating
|
29
|
|
3.4
|
Temporary Notes
|
30
|
|
3.5
|
Global Notes
|
31
|
|
3.6
|
Registration, Registration of Transfer and Exchange
Generally; Certain Transfers and Exchanges; Securities Act Legends
|
32
|
|
3.7
|
Mutilated, Destroyed, Lost and Stolen Notes
|
36
|
|
3.8
|
Payment of Interest; Interest Rights Preserved
|
37
|
|
3.9
|
Persons Deemed Owners
|
37
|
|
3.10
|
Cancellation
|
37
|
|
3.11
|
CUSIP Numbers
|
38
|
|
3.12
|
Payments and Paying Agents
|
38
|
|
3.13
|
Computation of Interest
|
39
|
|
4. |
Satisfaction and Discharge
|
39
|
|
4.1
|
Satisfaction and Discharge of Indenture
|
39
|
|
4.2
|
Application of Trust Money
|
40
|
|
5. |
Remedies
|
40
|
|
5.1
|
Events of Default
|
40
|
|
5.2
|
Acceleration of Maturity; Rescission and Annulment
|
41
|
|
5.3
|
Collection of Indebtedness and Suits for Enforcement by
Trustee
|
42
|
|
5.4
|
Trustee May File Proofs of Claim
|
42
|
|
5.5
|
Trustee May Enforce Claims Without Possession of Notes
|
43
|
|
5.6
|
Application of Money Collected
|
43
|
|
5.7
|
Limitation on Suits
|
43
|
|
5.8
|
Unconditional Right of Holders to Receive Principal, Premium
and Interest
|
44
|
|
5.9
|
Restoration of Rights and Remedies
|
44
|
|
5.10
|
Rights and Remedies Cumulative
|
44
|
|
5.11
|
Delay or Omission Not Waiver
|
44
|
|
5.12
|
Control by Holders
|
44
|
5.13
|
Waiver of Past Defaults
|
44
|
|
5.14
|
Undertaking for Costs
|
45
|
|
5.15
|
Waiver of Usury, Stay or Extension Laws
|
45
|
|
5.16
|
Currency Indemnity
|
45
|
|
6. |
The Trustee
|
45
|
|
6.1
|
Certain Duties and Responsibilities
|
45
|
|
6.2
|
Notice of Defaults
|
46
|
|
6.3
|
Certain Rights of Trustee
|
46
|
|
6.4
|
Not Responsible for Recitals or Issuance of Notes
|
47
|
|
6.5
|
May Hold Notes
|
47
|
|
6.6
|
Money Held in Trust
|
48
|
|
6.7
|
Compensation and Reimbursement
|
48
|
|
6.8
|
Conflicting Interests
|
48
|
|
6.9
|
Corporate Trustee Required; Eligibility
|
48
|
|
6.10
|
Resignation and Removal; Appointment of Successor
|
49
|
|
6.11
|
Acceptance of Appointment by Successor
|
49
|
|
6.12
|
Merger, Conversion, Consolidation or Succession to Business
|
50
|
|
6.13
|
Preferential Collection of Claims Against Company
|
50
|
|
6.14
|
Appointment of Authenticating Agent
|
50
|
|
6.15
|
Other Capacities
|
51
|
|
6.16
|
Certain Duties and Responsibilities of the Trustee’s
Representative
|
52
|
|
7. |
Holders’ Lists and Reports by Trustee and Company
|
52
|
|
7.1
|
Company to Furnish Trustee Names and Addresses of Holders
|
52
|
|
7.2
|
Preservation of Information; Communications to Holders
|
53
|
|
7.3
|
Reports by Trustee
|
53
|
|
7.4
|
Reports by Company
|
53
|
|
8. |
Consolidation, Merger, Conveyance, Transfer or Lease
|
53
|
|
8.1
|
Consolidation, Merger and Sale of Assets
|
53
|
|
8.2
|
Successor Substituted
|
54
|
|
9.
|
Supplemental Indentures
|
54
|
|
9.1
|
Supplemental Indentures Without Consent of Holders
|
54
|
|
9.2
|
Supplemental Indentures With Consent of Holders
|
55
|
|
9.3
|
Execution of Supplemental Indentures
|
56
|
|
9.4
|
Effect of Supplemental Indentures
|
56
|
|
9.5
|
Reference in Notes to Supplemental Indentures
|
56
|
|
9.6
|
Meetings of Holders; Modification and Waiver
|
56
|
|
9.7
|
Actions to Be Taken without a Meeting
|
58
|
|
10. |
Covenants
|
58
|
|
10.1
|
Payment of Principal, Premium and Interest
|
58
|
|
10.2
|
Payment of Additional Amounts
|
58
|
|
10.3
|
Maintenance of Office or Agency
|
59
|
|
10.4
|
Money for Notes Payments to Be Held in Trust
|
60
|
|
10.5
|
Pari Passu
|
61
|
|
10.6
|
Reporting; Statements by Officers as to Default
|
61
|
|
10.7
|
Existence
|
61
|
|
10.8
|
Further Assurances
|
61
|
|
10.9
|
Limitation on Transactions with Affiliates
|
61
|
|
10.10
|
Limitation on Indebtedness
|
63
|
|
10.11
|
Limitation on Restricted Payments
|
66
|
|
10.12
|
Limitation on Asset Sales
|
67
|
|
10.13
|
Limitation on Liens
|
69
|
|
10.14
|
Limitation on Sale and Lease-Back Transactions
|
72
|
|
10.15
|
Limitation on Designation of Unrestricted Subsidiaries
|
72
|
|
10.16
|
Waiver of Certain Covenants
|
73
|
|
10.17
|
Release of Covenants
|
73
|
|
11. |
Redemption and Repurchase of Notes
|
74
|
11.1
|
Applicability of Article
|
74
|
|
11.2
|
Redemption for Tax Reasons
|
74
|
|
11.3
|
Optional Redemption
|
75
|
|
11.4
|
Optional Redemption Procedures
|
76
|
|
11.5
|
Purchase of Notes Upon Change of Control Event
|
78
|
|
11.6
|
Open Market Purchases of Notes
|
78
|
|
12. |
Sinking Funds
|
79
|
|
12.1
|
Applicability of Article
|
79
|
|
12.2
|
Satisfaction of Sinking Fund Payments with Notes
|
79
|
|
12.3
|
Redemption of Notes for Sinking Fund
|
79
|
|
13. |
Defeasance and Covenant Defeasance
|
79
|
|
13.1
|
Company’s Option to Effect Defeasance or Covenant Defeasance
|
79
|
|
13.2
|
Defeasance and Discharge
|
79
|
|
13.3
|
Covenant Defeasance
|
80
|
|
13.4
|
Conditions to Defeasance or Covenant Defeasance
|
80
|
|
13.5
|
Deposited Money and U.S. Government Obligations to Be Held in
Trust; Miscellaneous Provisions
|
81
|
|
13.6
|
Reinstatement
|
81
|
Schedule I
|
Schedule II
|
Annex A – Form of Regulation S Certificate
|
Annex B – Form of Restricted Notes Certificate
|
Annex C – Form of Unrestricted Notes Certificate
|
(A) |
Pursuant to the Shareholders’ resolutions dated April 25, 2013 and April 26, 2017 and resolutions of the Board of Directors of the Company dated July 23, 2013 and
June 29, 2017, the Company has duly authorized a Medium-Term Note Program for the issuance from time to time of up to an aggregate principal amount Outstanding at any time of US$700,000,000 (or its equivalent in other currencies
or composite currencies) of medium-term notes (the “
Notes
”) in one or more series in such minimum amount, if any, as may be set forth by the
Company from time to time (the “
Program
”).
|
(B) |
Pursuant to the resolution of the Board of Directors of the Company dated March 27, 2018, the Company has duly authorized the execution and delivery of this Indenture
and the issuance of up to US$500,000,000 aggregate principal amount of the Company’s Notes under the Program.
|
(C) |
The Notes will constitute
obligaciones negociables simples no convertibles en
acciones
issued pursuant to Argentine Law No. 23,576, as amended by Argentine Law No. 23,962 (the “
Negotiable Obligations Law
”), and
the regulations issued thereunder, and will be issued and placed in accordance with such law, the Argentine Capital Markets Law (as defined herein), the CNV Rules (as defined herein) and any other Argentine applicable laws and
regulations.
|
(D) |
The CNV (as defined herein) has authorized the establishment of the Program pursuant to Resolutions No. 17,262 and 18,938 under which 6.750% Senior Notes Due 2025
will be issued, and authorization for the listing and trading of the Notes has been requested from the BYMA (as defined herein) and the
Mercado
Abierto Electronico
(“
MAE
”), which authorization is still pending.
|
(E) |
In order to provide, among other things, for the authentication, delivery and administration of the Notes, the Company has duly authorized the execution and delivery
of this Indenture.
|
(F) |
All things necessary to make this Indenture a valid Indenture and agreement according to its terms have been done.
|
(G) |
In 2014, the Company issued US$255,451,506 principal amount of its Series 1 Notes due May 14, 2020 under the Program (the “
2020 Notes
”), pursuant to an indenture dated February 11, 2014. As of the date hereof, US$191,588,630 of the 2020 Notes remain outstanding (without considering the results of the
offer to purchase any and all of the 2020 Notes dated April 19, 2018). In addition, as of the date of this Indenture, the Company had no secured indebtedness.
|
1. |
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
|
1.1 |
Definitions
|
|
(1) |
the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;
|
|
(2) |
all other terms used herein which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein;
|
|
(3) |
all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles (whether or not such
is indicated herein), and, except as otherwise herein expressly provided, the term “
IFRS
” with respect to any computation required or
permitted hereunder shall mean such accounting principles applicable to the Company as are generally accepted in Argentina, consistently applied as required by the CNV, at the date of such computation;
|
|
(4) |
unless the context otherwise requires, any reference to an “
Article
” or a “
Section
” refers to an Article or a Section, as the case may be, of this Indenture; and
|
|
(5) |
the words “
herein
,” “
hereof
”
and “
hereunder
” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other
subdivision.
|
|
(1) |
any shares of Capital Stock of a Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than
the Company or a Restricted Subsidiary);
|
|
(2) |
all or substantially all the assets (other than Cash and Cash Equivalents) of any division or line of business of the Company or any Restricted Subsidiary; or
|
|
(3) |
any other assets of the Company or any Restricted Subsidiary (other than Cash or Cash Equivalents) outside of the ordinary course of business of the Company or such
Subsidiary;
|
|
(a) |
a disposition by the Company or a Restricted Subsidiary to the Company or to any other Restricted Subsidiary;
|
|
(b) |
a disposition of assets with a Fair Market Value of less than US$40 million in the aggregate in any fiscal year of the Company or such Restricted Subsidiary;
|
|
(c) |
an expenditure of cash or liquidation of Cash and Cash Equivalents or disposition of Temporary Cash Investments or goods held for sale and assets sold in the ordinary
course of business;
|
|
(d) |
the sale of property or equipment that, in the reasonable determination of the Company, has become worn out, obsolete or damaged or otherwise unused in connection
with the business of the Company or any Restricted Subsidiary or the transfer of any property, right or asset upon expiration and in accordance with the terms of any permit, license or concession;
|
|
(e) |
sales or other dispositions of equipment, inventory, accounts receivable or other assets in the ordinary course of business;
|
|
(f) |
the disposition of all or substantially all of the Company’s assets in a manner permitted under Section 8.1;
|
|
(g) |
the licensing, sublicensing, lease, assignment or sublease of any real or personal property in the ordinary course of business;
|
|
(h) |
the disposition of assets in a Sale and Lease-Back Transaction;
|
|
(i) |
the incurrence of any Lien permitted by Section 10.13;
|
|
(j) |
for purposes of Section 10.12 only, the making of a Restricted Payment permitted under Section 10.11; or
|
|
(k) |
the discounting, factoring or securitization of receivables in the ordinary course of business.
|
|
(a) |
in proportion to the percentage of the total Capital Stock of such Restricted Subsidiary held directly or indirectly by the Company at the date of determination, and
|
|
(b) |
to the extent that a corresponding amount would be permitted at the date of determination to be distributed to the Company by such Restricted Subsidiary pursuant to
its charter and bylaws (estatutos sociales), or applicable organizational documents, and each law, regulation, agreement or judgment applicable to such distribution.
|
|
(a) |
for purposes of the calculation of the Consolidated Coverage Ratio, Argentine peso amounts referred to in the preceding clauses (i) and (ii) shall be converted into
U.S. dollars at the average of the daily seller’s exchange rates for wire transfers (divisas) published by the Banco de la Nación Argentina on each day during such Four Quarter Period.
|
|
(b) |
if the Company or any Restricted Subsidiary has:
|
|
(i) |
Incurred any Indebtedness since the beginning of such Four Quarter Period that remains outstanding on such date of determination or if the transaction giving rise to
the need to calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness, then Consolidated Interest Expense and Consolidated Adjusted EBITDA for such Four Quarter Period will be calculated after giving effect on a
pro forma basis to such Indebtedness as if such Indebtedness had been Incurred on the first day of such Four Quarter Period; or
|
|
(ii) |
repaid, repurchased, defeased or otherwise discharged any Indebtedness since the beginning of such Four Quarter Period or if any Indebtedness is to be repaid,
repurchased, defeased or otherwise discharged (in each case, other than Indebtedness Incurred under any revolving credit facility unless such Indebtedness has been permanently repaid and has not been replaced) on the date of the
transaction giving rise to the need to calculate the Consolidated Coverage Ratio, then Consolidated Interest Expense and Consolidated Adjusted EBITDA for such Four Quarter Period shall be calculated on a pro forma basis as if such
repayment, repurchase, defeasance or discharge of Indebtedness had occurred on the first day of such Four Quarter Period;
|
|
(c) |
if, since the beginning of such Four Quarter Period, the Company or any Restricted Subsidiary of the Company has made any Asset Sale, then, giving pro forma effect to
such Asset Sale during such period on the Consolidated Interest Expense and Consolidated Adjusted EBITDA;
|
|
(d) |
if, since the beginning of such Four Quarter Period, the Company or any other Restricted Subsidiary, by merger or otherwise, shall have made an Investment in any
Person that is merged with or into the Company or any Restricted Subsidiary (or any Person that becomes a Restricted Subsidiary) or an acquisition of assets, including any acquisition of assets occurring in connection with a
transaction causing a calculation to be made hereunder, which constitutes all or substantially all of an operating unit of a business, then, giving pro forma effect to such Investment or acquisition on the Consolidated Interest
Expense and Consolidated Adjusted EBITDA for such Four Quarter Period as if such transaction occurred on the first day of such period; and
|
|
(e) |
if, since the beginning of such Four Quarter Period, any Person (that subsequently became a Restricted Subsidiary of the Company or was merged with or into the
Company or any Restricted Subsidiary of the Company since the beginning of such period) shall have Incurred any Indebtedness or discharged any Indebtedness or made any Asset Sale or any Investment or acquisition of assets that
would have required an adjustment pursuant to clauses (b), (c) or (d) above had been made during such period, then Consolidated Interest Expense and Consolidated Adjusted EBITDA for such Four Quarter Period shall be calculated
after giving pro forma effect thereto as if such transaction occurred on the first day of such period.
|
|
(a) |
for purposes of the calculation of the Consolidated Debt Ratio, Argentine peso amounts referred to in the preceding clauses (1) and (2) shall be converted into U.S.
dollars as follows:
|
|
(i) |
Consolidated Total Indebtedness and Cash and Cash Equivalents denominated in Argentine pesos as of the relevant balance sheet date shall be converted into U.S.
dollars at the seller’s exchange rate for wire transfers (
divisas
) published by the Banco de la Nación Argentina as of the date of such
balance sheet; and
|
|
(ii) |
Consolidated Adjusted EBITDA for such Four Quarter Period shall be converted into U.S. dollars at the average of the daily seller’s exchange rates for wire transfers
(divisas) published by the Banco de la Nación Argentina on each day during such Four Quarter Period.
|
|
(b) |
if the Company or any Restricted Subsidiary has:
|
|
(i) |
Incurred any Indebtedness since the beginning of such Four Quarter Period that remains outstanding on such date of determination or if the transaction giving rise to
the need to calculate the Consolidated Debt Ratio is an Incurrence of Indebtedness, then Consolidated Total Indebtedness at the balance sheet date shall be calculated after giving effect on a pro forma basis to such Indebtedness
as if such Indebtedness had been Incurred on the balance sheet date; or
|
|
(ii) |
repaid, repurchased, defeased or otherwise discharged any Indebtedness since the beginning of such Four Quarter Period or if any Indebtedness is to be repaid,
repurchased, defeased or otherwise discharged (in each case, other than Indebtedness Incurred under any revolving credit facility unless such Indebtedness has been permanently repaid and has not been replaced) on the date of the
transaction giving rise to the need to calculate the Consolidated Debt Ratio, then Consolidated Total Indebtedness as of the balance sheet date shall be calculated on a pro forma basis as if such repayment, repurchase, defeasance
or discharge of Indebtedness had occurred on the balance sheet;
|
|
(c) |
if, since the beginning of such Four Quarter Period, the Company or any Restricted Subsidiary of the Company has made any Asset Sale, then, giving pro forma effect to
such Asset Sale during such period on the Consolidated Adjusted EBITDA;
|
|
(d) |
if, since the beginning of such Four Quarter Period, the Company or any other Restricted Subsidiary, by merger or otherwise, shall have made an Investment in any
Person that is merged with or into the Company or any Restricted Subsidiary (or any Person that becomes a Restricted Subsidiary) or an acquisition of assets, including any acquisition of assets occurring in connection with a
transaction causing a calculation to be made hereunder, which constitutes all or substantially all of an operating unit of a business, then, giving pro forma effect to such Investment or acquisition on the Consolidated Adjusted
EBITDA for such Four Quarter Period as if such transaction occurred on the first day of such period; and
|
|
(e) |
if, since the beginning of such Four Quarter Period, any Person (that subsequently became a Restricted Subsidiary of the Company or was merged with or into the
Company or any Restricted Subsidiary of the Company since the beginning of such period) shall have Incurred any Indebtedness or discharged any Indebtedness or made any Asset Sale or any Investment or acquisition of assets that
would have required an adjustment pursuant to clauses (b), (c) or (d) above had been made during such period, then Consolidated Adjusted EBITDA for such Four Quarter Period shall be calculated after giving pro forma effect thereto
as if such transaction occurred on the first day of such period.
|
1 |
CNV regulations indicate “Euroclear Operations Centre” as authroized entity.
|
|
(a) |
Temporary Cash Investments;
|
|
(b) |
Investments in Marketable Securities;
|
|
(c) |
any Investments in the Company or in any Restricted Subsidiary;
|
|
(d) |
any Investment in any Person (other than a Restricted Subsidiary) that is directly or indirectly engaged in a Related Business;
|
|
(e) |
Investments in existence as of the date of this Indenture and set forth in Schedule I hereto;
|
|
(f) |
loans and advances to employees of the Company or any Subsidiary in the ordinary course of business and on terms consistent with the Company’s or such Subsidiary’s
practice in effect prior to the date of this Indenture;
|
|
(g) |
loans or advances to vendors, suppliers or contractors of the Company or a Subsidiary in the ordinary course of business that are recorded as accounts receivable on
the balance sheet of the Company or such Subsidiary and on terms consistent with the Company’s or such Subsidiary’s practice in effect prior to the date of this Indenture;
|
|
(h) |
stock, obligations or securities received in the ordinary course of business in settlement of debts owing to the Company or a Subsidiary as a result of foreclosure,
perfection or enforcement of Liens or received in satisfaction of judgements;
|
|
(i) |
Investment by the Company in a Subsidiary the proceeds of which are used to fund capital expenditures that relate to the unscheduled emergency repair and maintenance
of the Company’s or such Subsidiary’s fixed or capital assets or other property, plant and equipment;
|
|
(j) |
Investments consisting of prepaid expenses, negotiable instruments held for collection and lease, utility and workers’ compensation, performance and other similar
deposits made in the ordinary course of business by the Company or any Subsidiary;
|
|
(k) |
Investments in Hedging Agreements or Currency Agreements;
|
|
(l) |
Investments received by the Company or any Restricted Subsidiary as consideration for Asset Sales or Investments made with the proceeds of such Asset Sales;
provided
that such Asset Sale or Investment is consummated in accordance with Section 10.12;
|
|
(m) |
Investments made by way of repurchase or redemption of Indebtedness of the Company outstanding as of the date of this Indenture;
|
|
(n) |
Investments in existence on, or made pursuant to legally binding commitments in existence on, the Issue Date and any extension, modification or renewal of any
Investments existing as of the Issue Date (but not Investments involving additional advances, contributions or other investments of cash or property or other increases thereof, other than as a result of the accrual or accretion of
interest or original issue discount or payment-in-kind securities, in each case pursuant to the terms of such Investment as of the Issue Date);
|
|
(o) |
receivables owing to the Company or any Subsidiary created or acquired in the ordinary course of business;
|
|
(p) |
Investments consisting of equity investment, equity commitment, completion guaranty, funded debt investment or debt funding commitment in any Person that incurs
Project Financing, which Investments shall have an aggregate Fair Market Value (taken together with all other Investments made pursuant to this clause (p) that are, at the time outstanding) not to exceed US$60 million (or the
equivalent in other currencies);
|
|
(q) |
(x) Investments in Unrestricted Subsidiaries made with the net proceeds of (1) a substantially concurrent capital contribution to the Company, or issue or sale of
Capital Stock (other than Disqualified Capital Stock) of the Company or (2) an Asset Sale of Investments in one or more Unrestricted Subsidiaries and (y) Investments in any Person made with the net proceeds of an Asset Sale of
Investments in one or more Persons that are not a Subsidiaries;
|
|
(r) |
payments of dividends or other distributions of Capital Stock, Indebtedness or other securities received from Unrestricted Subsidiaries (other than Unrestricted
Subsidiaries the primary assets of which are Cash and Cash Equivalents);
|
|
(s) |
the payment of Management Fees in accordance with the provisions of the Technical Assistance Agreement; and
|
|
(t) |
additional Investments having an aggregate Fair Market Value, taken together with all other Investments made pursuant to this clause (t) not to exceed the greater of
(x) US$50 million (or its equivalent in any other currency) and (y) 5% of the Consolidated Total Assets of the Company and its Subsidiaries at the time of such Investment (with the Fair Market Value of each Investment being
measured at the time made and without giving effect to subsequent changes in value).
|
|
(1) |
all legal, accounting, investment banking, broker, consultant and advisory fees and expenses, title and recording tax expenses, commissions and other fees and
expenses Incurred, and all federal, state, provincial, foreign and local taxes required to be paid or accrued as a liability in accordance with IFRS, as a consequence of such Asset Sale;
|
|
(2) |
all payments, including any prepayment premiums or penalties, made on any Indebtedness that is secured by any assets subject to such Asset Sale, in accordance with
the terms of any Lien upon or other security agreement of any kind with respect to such assets, or which must by its terms, or in order to obtain a necessary consent to such Asset Sale, or by applicable law be repaid out of the
proceeds from such Asset Sale;
|
|
(3) |
all distributions and other payments required to be made to minority interest holders in Subsidiaries or joint ventures as a result of such Asset Sale;
|
|
(4) |
appropriate amounts to be provided by the seller as a reserve, in accordance with IFRS, against any liabilities associated with the property or other assets disposed
of in such Asset Sale and retained by the Company or any Subsidiary after such Asset Sale;
|
|
(5) |
taxes paid or payable in respect of Asset Sales; and
|
|
(6) |
repayment of Indebtedness secured by a Lien on the asset or assets that were the subject of such Asset Sale.
|
|
(a) |
Notes of that series theretofore canceled by the Trustee or delivered to the Trustee for cancellation;
|
|
(b) |
Notes of that series, or portions thereof, for the payment or redemption of which moneys in the necessary amount shall have been deposited in trust with the Trustee
or with any paying agent (other than the Company) or shall have been set aside, segregated and held in trust by the Company for the Holders of such Notes (if the Company shall act as its own paying agent),
provided that
if such Notes, or portions thereof, are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as provided in
this Indenture, or provision satisfactory to the Trustee shall have been made for giving such notice;
|
|
(c) |
Notes of that series with respect to which the Company has effected defeasance or covenant defeasance as provided in this Indenture; and
|
|
(d) |
Notes of that series in substitution for which other Notes shall have been authenticated and delivered or which shall have been paid, pursuant to this Indenture;
|
|
(1) |
the aggregate principal amount (or initial accreted value, if applicable) of such new Indebtedness as of the date of such proposed Refinancing does not exceed the
aggregate principal amount (or initial accreted value, if applicable) of the Indebtedness being Refinanced (plus the amount of any premium required to be paid under the terms of the instrument governing such Indebtedness and the
amount of reasonable expenses incurred by the Company in connection with such Refinancing);
|
|
(2) |
such new Indebtedness has a Weighted Average Life to Maturity that is equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being
Refinanced;
|
|
(3) |
if the Indebtedness being Refinanced is:
|
|
(a) |
Indebtedness of the Company, then such Refinancing Indebtedness shall be Indebtedness of the Company, as the case may be;
|
|
(b) |
Indebtedness of a Restricted Subsidiary, then such Refinancing Indebtedness shall be Indebtedness of the Company and/or such Restricted Subsidiary; and
|
|
(c) |
Subordinated Indebtedness or Deferred Interest Subordinated Indebtedness, then such Refinancing Indebtedness shall be subordinate to the Notes at least to the same
extent and in the same manner as the Indebtedness being Refinanced.
|
|
(1) |
any investment in direct obligations of the United States or any agency thereof or obligations guaranteed by the United States or any agency thereof;
|
|
(2) |
investments in time deposit accounts, certificates of deposit and money market deposits issued by a bank or trust company that is organized under the laws of the
United States, any state thereof or any foreign country recognized by the United States (in all events not excluding Argentina) having capital, surplus and undivided profits aggregating in excess of US$50.0 million (or the foreign
currency equivalent thereof) and whose long-term debt is rated “A” (or such similar equivalent rating, including similar equivalent ratings in foreign countries) or higher by at least one Nationally Recognized Statistical Rating
Organization;
|
|
(3) |
(a) demand deposits, (b) time deposits and certificates of deposit with maturities of one year or less from the date of acquisition, (c) bankers’ acceptances with
maturities not exceeding one year from the date of acquisition, and (d) overnight bank deposits, in each case with any bank or trust company organized or licensed under the laws of the United States or any state thereof or under
the laws of any member state of the European Union, or under the laws of any country in which the Company has operations in each case whose head office’s senior short term debt is rated “BBB+” or higher or such similar equivalent
or higher rating by at least one Rating Agency or whose local national scale rating for senior short term debt is BBB+ or higher or such similar equivalent or higher rating; and
provided
,
further
, that in the event that no bank or trust company in such country
has a local rating of BBB+ or higher or such similar equivalent or higher rating, then this clause shall apply to the three highest rated banks in the relevant country;
|
|
(4) |
repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (1) above entered into with a bank meeting the
qualifications described in clause (2) above;
|
|
(5) |
investments in commercial paper, maturing not more than 90 days after the date of acquisition, issued by a corporation (other than an Affiliate of the Company)
organized and in existence under the laws of the United States, Argentina or any other foreign country recognized by the United States with a rating at the time as of which any investment therein is made of “P-1” (or higher)
according to Moody’s or “A-1” (or higher) according to S&P (or such similar equivalent rating, including similar equivalent ratings in foreign countries);
|
|
(6) |
investments in securities with maturities of six months or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the
United States or any member of the Organization for Economic Co-operation and Development, or by any political subdivision or taxing authority thereof, and rated at least “A” by S&P or “A” by Moody’s (or such similar
equivalent rating);
|
|
(7) |
investments in securities with maturities of six months or less from the date of acquisition issued or fully guaranteed by Argentina; and
|
|
(8) |
investments in money market funds substantially all the assets of which are comprised of investments of the types described in clauses (1) through (7) above.
|
|
(i) |
the then outstanding aggregate principal amount or liquidation preference, as the case may be, of such Indebtedness into;
|
|
(ii) |
the sum of the products obtained by multiplying:
|
|
(a) |
the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal or liquidation preference, as the case may be,
including payment at final maturity, in respect thereof, by
|
|
(b) |
the number of years (calculated to the nearest one-twelfth) which shall elapse between such date and the making of such payment.
|
1.2 |
Compliance Certificates and Opinions
|
(1) |
a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;
|
(2) |
a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are
based;
|
(3) |
a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion
as to whether or not such covenant or condition has been complied with; and
|
(4) |
a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.
|
1.3 |
Form of Documents Delivered to Trustee
|
1.4 |
Acts of Holders; Record Dates
|
1.5 |
Notices, Etc., to Trustee and Company
|
(1) |
the Trustee or Co-Registrar by any Holder or by the Company or the Registrar shall be sufficient for every purpose hereunder if made, given, furnished or filed in
writing to or with the Trustee or Co-Registrar at its Corporate Trust Office, Attention: Corporate Trust, or
|
(2) |
the Registrar by any Holder or by the Company, the Trustee or the Co-Registrar shall be sufficient for every purpose hereunder if made, given, furnished or filed in
writing to or with the Registrar at its principal office currently located at Bartolome Mitre 480, Buenos Aires, Argentina, or
|
(3) |
the Company by the Trustee, Co-Registrar, Registrar or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, to the Company addressed to it at the address of its principal office located at Don Bosco 3672, 5th Floor, Buenos Aires (C1206ABF), Argentina, Attention: Leandro Perez Castaño,
or at any other address previously furnished in writing to the Trustee by the Company.
|
1.6 |
Notice to Holders; Waiver
|
1.7 |
Effect of Headings and Table of Contents
|
1.8 |
Successors and Assigns
|
1.9 |
Separability Clause
|
1.10 |
Benefits of Indenture
|
1.11 |
Governing Law
|
1.12 |
Legal Holidays
|
1.13 |
Waiver of Jury Trial
|
1.14 |
Currency of Payment
|
1.15 |
Consent to Jurisdiction and Service of Process
|
1.16 |
Resignation and Appointment of Agents
|
1.17 |
Force Majeure
|
2. |
FORM OF NOTES
|
2.1 |
Forms Generally
|
2.2 |
Regulation S Global Note
|
2.3 |
Restricted Global Note
|
2.4 |
Form of Trustee’s Certificate of Authentication
|
By .
|
||
Authorized Signatory
|
3. |
THE NOTES
|
3.1 |
Amount Issuable in Series
|
(1) |
the title of the Notes of the series (which shall distinguish the Notes of the series from Notes of any other series);
|
(2) |
any limit upon the aggregate principal amount of the Notes of the series which may be authenticated and delivered under this Indenture (except for Notes authenticated
and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Notes of the series pursuant to Section 3.4, 3.5, 3.6, 3.7, 9.5 or 11.4(1) and except for any Notes which, pursuant to Section 3.3, are
deemed never to have been authenticated and delivered hereunder);
|
(3) |
the Person to whom any interest on a Note of the series shall be payable, if other than the Person in whose name that Note (or one or more Predecessor Notes) is
registered at the close of business on the Regular Record Date for such interest;
|
(4) |
the date or dates on which the principal of any Notes of the series is payable;
|
(5) |
the rate or rates at which any Notes of the series shall bear interest, if any, the date or dates from which any such interest shall accrue, the Interest Payment
Dates on which any such interest shall be payable and the Regular Record Date for any such interest payable on any Interest Payment Date;
|
(6) |
the place or places where the principal of and any premium and interest on any Notes of the series shall be payable and the manner in which any payment may be made;
|
(7) |
the period or periods within which, the price or prices at which and the terms and conditions upon which any Notes of the series may be redeemed, in whole or in part,
at the option of the Company and, if other than by a Board Resolution, the manner in which any election by the Company to redeem the Notes shall be evidenced;
|
(8) |
the obligation, if any, of the Company to redeem or purchase any Notes of the series pursuant to any sinking fund or analogous provisions or at the option of the
Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which any Notes of the series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;
|
(9) |
if other than denominations of US$150,000 and integral multiples of US$1,000 thereafter, the denominations in which any Notes of the series shall be issuable;
|
(10) |
if the amount of principal of or any premium or interest on any Notes of the series may be determined with reference to an index or pursuant to a formula, the manner
in which such amounts shall be determined;
|
(11) |
if other than the currency of the United States of America, the Specified Currency in which the principal of or any premium or interest on any Notes of the series
shall be payable and the manner of determining the equivalent thereof in the currency of the United States of America for any purpose, including for purposes of the definition of “Outstanding” in Section 1.1;
|
(12) |
if the principal of or any premium or interest on any Notes of the series is to be payable, at the election of the Company or the Holder thereof, in one or more
currencies or currency units other than that or those in which such Notes are stated to be payable, the currency, currencies or currency units in which the principal of or any premium or interest on such Notes as to which such
election is made shall be payable, the periods within which and the terms and conditions upon which such election is to be made and the amount so payable (or the manner in which such amount shall be determined);
|
(13) |
if other than the entire principal amount thereof, the portion of the principal amount of any Notes of the series which shall be payable upon declaration of
acceleration of the Maturity thereof pursuant to Section 5.2;
|
(14) |
if the principal amount payable at the Stated Maturity of any Notes of the series shall not be determinable as of any one or more dates prior to the Stated Maturity,
the amount which shall be deemed to be the principal amount of such Notes as of any such date for any purpose thereunder or hereunder, including the principal amount thereof which shall be due and payable upon any Maturity other
than the Stated Maturity or which shall be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in any such case, the manner in which such amount deemed to be the principal amount shall be determined);
|
(15) |
if applicable, that the Notes of the series, in whole or any specified part, shall be defeasible pursuant to Section 13.2 or Section 13.3 or both such Sections and,
if other than by a Board Resolution, the manner in which any election by the Company to defease such Notes shall be evidenced;
|
(16) |
if applicable, that any Notes of the series shall be issuable in whole or in part in the form of one or more Global Notes and, in such case, the respective
Depositaries for such Global Notes, the form of any legend or legends which shall be borne by any such Global Note and any circumstances in addition to or in lieu of those set forth in Section 3.6 in which any such Global Note may
be exchanged in whole or in part for Notes registered, and any transfer of such Global Note in whole or in part may be registered, in the name or names of Persons other than the Depositary for such Global Note or a nominee
thereof;
|
(17) |
any addition to or change in the Events of Default which applies to any Notes of the series and any change in the right of the Trustee or the requisite Holders of
such Notes to declare the principal amount thereof due and payable pursuant to Section 5.2;
|
(18) |
any addition to or change in the covenants set forth in Article Ten which applies to Notes of the series; and
|
(19) |
any other terms of the series (which terms shall not be inconsistent with the provisions of this Indenture, except as permitted by Section 9.1(4)).
|
3.2 |
Denominations
|
3.3 |
Execution, Authentication, Delivery and Dating
|
(1) |
if the form of such Notes has been established by or pursuant to Board Resolution as permitted by Section 2.1, that such form has been established in conformity with
the provisions of this Indenture;
|
(2) |
if the terms of such Notes have been established by or pursuant to Board Resolution as permitted by Section 3.1, that such terms have been established in conformity
with the provisions of this Indenture; and
|
(3) |
that such Notes, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions specified in such Opinion of
Counsel, shall constitute valid and legally binding obligations of the Company enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors’ rights and to general equity principles.
|
3.4 |
Temporary Notes
|
3.5 |
Global Notes
|
|
(a) |
Each Global Note authenticated under this Indenture shall be registered in the name of the Depositary designated by the Company for such Global Note or a nominee thereof
and delivered to such Depositary or a nominee thereof or custodian therefor, and each such Global Note shall constitute a single Note for all purposes of this Indenture.
|
|
(b) |
Notwithstanding any other provision in this Indenture, no Global Note may be exchanged in whole or in part for Notes registered, and no transfer of a Global Note in whole
or in part may be registered, in the name of any Person other than the Depositary for such Global Note or a nominee thereof unless (i) such Depositary (A) has notified the Company that it is unwilling or unable to continue as Depositary
for such Global Note or (B) has ceased to be a clearing agency registered as such under the Exchange Act, or (ii) there shall have occurred and be continuing an Event of Default with respect to such Global Note, and, in the case of both
(i) and (ii), the Company executes and delivers to the Trustee a Company Order stating that all Global Notes shall be exchanged in whole for Notes that are not Global Notes (in which case such exchange shall be effected by the Trustee).
|
|
(c) |
If any Global Note is to be exchanged for other Notes or cancelled in whole, it shall be surrendered by or on behalf of the Depositary or its nominee to the Trustee, as
Co-Registrar, for exchange or cancellation as provided in this Article Three. If any Global Note is to be exchanged for other Notes or cancelled in part, or if another Note is to be exchanged in whole or in part for a beneficial
interest in any Global Note, then either (i) such Global Note shall be so surrendered for exchange or cancellation as provided in this Article Three or (ii) the principal amount thereof shall be reduced or increased by an amount equal
to the portion thereof to be so exchanged or cancelled, or equal to the principal amount of such other Note to be so exchanged for a beneficial interest therein, as the case may be, by means of an appropriate adjustment made on the
records of the Trustee, as Co-Registrar, whereupon the Trustee, in accordance with the Applicable Procedures, shall instruct the Depositary or its authorized representative to make a corresponding adjustment to its records. Upon any
such surrender or adjustment of a Global Note, the Trustee shall, subject to Section 3.5(b) and as otherwise provided in this Article Three, authenticate and deliver any Notes issuable in exchange for such Global Note (or any portion
thereof) to or upon the order of, and registered in such names as may be directed by, the Depositary or its authorized representative. Upon the request of the Trustee in connection with the occurrence of any of the events specified in
the preceding paragraph, the Company shall promptly make available to the Trustee a reasonable supply of Notes that are not in the form of Global Notes. The Trustee shall be entitled to rely upon any order, direction or request of the
Depositary or its authorized representative which is given or made pursuant to this Article Three if such order, direction or request is given or made in accordance with the Applicable Procedures.
|
|
(d) |
Every Note authenticated and delivered upon registration of transfer of, or in exchange for or in lieu of, a Global Note or any portion thereof, whether pursuant to this
Article Three, Section 9.5, Section 11.4(1) or otherwise, shall be authenticated and delivered in the form of, and shall be, a Global Note, unless such Note is registered in the name of a Person other than the Depositary for such Global
Note or a nominee thereof.
|
|
(e) |
The Depositary or its nominee, as registered owner of a Global Note, shall be the Holder of such Global Note for all purposes under this Indenture and the Notes, and owners
of beneficial interests in a Global Note shall hold such interests pursuant to the Applicable Procedures. Accordingly, any such owner’s beneficial interest in a Global Note shall be shown only on, and the transfer of such interest
shall be effected only through, records maintained by the Depositary or its nominee or its Agent Members;
provided
,
however
, that, notwithstanding the foregoing, a beneficial owner of a Global Note shall have the right (i) to obtain evidence of its beneficial
ownership interest in a Global Note in accordance with section 129 of the Argentine Capital Markets Law, from any securities clearing service or collective deposit system, including DTC, Euroclear, Clearstream and Luxembourg, as
applicable, and (ii) with such evidence to pursue remedies against the Company and assert rights in a legal action brought in Argentina under Argentine law in respect of its beneficial ownership interest in such a Global Note (including
the right to initiate summary proceedings (
acción ejecutiva
) in Argentina in the manner provided by the Negotiable Obligations Law with respect
thereto), and for such purposes such beneficial owner shall be treated as the owner of that portion of the Global Note which represents its beneficial ownership interest therein.
|
3.6 |
Registration, Registration of Transfer and Exchange Generally; Certain Transfers and Exchanges; Securities Act Legends
|
|
(a) |
Registration, Registration of Transfer and Exchange Generally
|
|
(b) |
Certain Transfers and Exchanges
|
|
(i) |
Restricted Global Note to Regulation S Global Note
|
|
(ii) |
Regulation S Global Note to Restricted Global Note
|
|
(iii) |
Restricted Non-Global Note to Restricted Global Note or Regulation S Global Note
|
|
(iv) |
Regulation S Non-Global Note to Restricted Global Note or Regulation S Global Note
|
|
(v) |
Non-Global Note to Non-Global Note
|
|
(vi) |
Exchanges between Global Note and Non-Global Note
|
|
(vii) |
Regulation S Global Note to Be Held Through Euroclear or Clearstream, Luxembourg during Distribution Compliance Period
|
|
(viii) |
Miscellaneous
|
|
(c) |
Securities Act Legends
|
|
(i) |
subject to the following subclauses of this Section 3.6(c), a Non-Global Note or any portion thereof which is exchanged, upon transfer or otherwise, for a Global Note or
any portion thereof shall bear the Securities Act Legend borne by such Global Note while represented thereby;
|
|
(ii) |
subject to the following subclauses of this Section 3.6(c), a Non-Global Note issued in exchange for another Note (including a Global Note) or any portion thereof, upon
transfer or otherwise, shall bear the Securities Act Legend borne by such other Note,
provided
, that, if such new Note is required
pursuant to Section 3.6(b)(v) or (vi) to be issued in the form of a Restricted Note, it shall bear a Restricted Notes Legend and, if such new Note is so required to be issued in the form of a Regulation S Note during the Distribution
Compliance Period, it shall bear a Regulation S Legend;
|
|
(iii) |
Registered Notes shall not bear a Securities Act Legend;
|
|
(iv) |
in the event the Trustee has received a written opinion of U.S. counsel in a form satisfactory to the Trustee stating that the Notes are not “Restricted Securities” as
defined by Rule 144(a)(3) under the Securities Act, a new Note which does not bear a Securities Act Legend may be issued in exchange for or in lieu of a Note (other than a Global Note) or any portion thereof which bears such a legend,
and after such date and receipt of such opinion, the Trustee upon receipt of a Company Order shall authenticate and deliver such a new Note in exchange for or in lieu of such other Note as provided in this Article Three;
|
|
(v) |
a new Note which does not bear a Securities Act Legend may be issued in exchange for or in lieu of a Note (other than a Global Note) or any portion thereof which bears such
a legend if (a) the Holder of such Note provides the Company with an Unrestricted Notes Certificate, substantially in the form attached as Annex C hereto, satisfactory to the Company and duly executed by such Holder or his attorney duly
authorized in writing and (b) in the Company’s judgment, placing such a legend upon such new Note is not necessary to ensure compliance with the registration requirements of the Securities Act, and the Trustee, upon receipt of a Company
Order, shall authenticate and deliver such a new Note as provided in this Article Three; and
|
|
(vi) |
notwithstanding the foregoing provisions of this Section 3.6(c), a Successor Note of a Note that does not bear a particular form of Securities Act Legend shall not bear
such form of legend unless the Company has reasonable cause to believe that such Successor Note is a “Restricted Security” within the meaning of Rule 144(a)(3), in which case the Trustee, upon receipt of a Company Order, shall
authenticate and deliver a new Note bearing a Restricted Notes Legend in exchange for such Successor Note as provided in this Article Three.
|
|
(d) |
All the provisions and undertakings set forth above concerning registration of ownership, exchange and transfer of the Notes shall be, in fact, exclusively fulfilled by
Delaware Trust Company acting as Co-Registrar, Principal Paying Agent and Transfer Agent. In the event that Banco Santander Río S.A. is required to carry out any of the obligations related to the registration of ownership, or exchange
and transfer of Notes, as required by Argentine law and by the CNV, it can delegate such duties on any other entity acting in Argentina with legal capacity to carry them out in compliance with this Indenture and laws and regulations in
force in Argentina. To do so, the Registrar, Paying Agent and Transfer Agent shall promptly notify the Company and the Co-Registrar about that circumstance, in order that the Company appoints the entity it deems appropriate to assume
the Registrar’s obligations. Once the appointment is made, and such is accepted by the appointed entity, the Registrar shall not be liable for the breach of any of the obligations assumed by the delegate registrar according to this
Indenture and shall be indemnified by the Company for and held harmless against, any and all losses, damages, liabilities, judgments, claims, causes of action, costs and expenses (including fees and disbursements of legal counsel)
incurred directly or indirectly, without negligence or bad faith on their part, duly declared as such by a final resolution of a competent court, arising out of or in connection with the performance of the duties assumed by the delegate
registrar under this Indenture.
|
3.7 |
Mutilated, Destroyed, Lost and Stolen Notes
|
3.8 |
Payment of Interest; Interest Rights Preserved
|
(1) |
The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes of such series (or their respective Predecessor Notes) are
registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Note of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than ten days prior to the date of the
proposed payment and not less than ten days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be given to each Holder of Notes of such series in the manner set forth in Section 1.6, not less than ten days prior
to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Notes of such
series (or their respective Predecessor Notes) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (2).
|
(2) |
The Company may make payment of any Defaulted Interest on the Notes of any series in any other lawful manner not inconsistent with the requirements of any securities
exchange on which such Notes may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be
deemed practicable by the Trustee.
|
3.9 |
Persons Deemed Owners
|
3.10 |
Cancellation
|
3.11 |
CUSIP Numbers
|
3.12 |
Payments and Paying Agents
|
|
(a) |
The Company shall, by 10:00 AM (New York City time) at least one Business Day prior to each due date of the principal or premium of or interest on any Notes (including
Additional Amounts), deposit with the Trustee, in its capacity as Principal Paying Agent, a sum sufficient to pay such principal, premium or interest (including Additional Amounts) so becoming due;
provided
that all payments of principal, interest, premium, if any, and Additional Amounts, if any, with respect to Notes represented by one or more Global Notes
registered in the name of or held by or on behalf of DTC or its nominee will be made by wire transfer of immediately available funds to DTC.
|
|
(b) |
Each of the Paying Agents hereby agrees (and whenever the Company shall appoint a Paying Agent with respect to the Notes other than those specified in Section 10.3, it will
cause such Paying Agent to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree), subject to the provisions of this Section,
|
|
(i) |
that it will hold all sums received by it as such agent for the payment of the principal of or interest on any Notes (whether such sums have been paid to it by or on behalf
of the Company) in trust for the benefit of the Holders of such Notes or of the Trustee,
|
|
(ii) |
that it will give the Trustee notice of any failure by the Company to make any payment of the principal of or interest on any Notes (including Additional Amounts) and any
other payments to be made by or on behalf of the Company under this Indenture or such Notes when the same shall be due and payable, and
|
|
(iii) |
that it will pay any such sums so held in trust by it to the Trustee upon the Trustee’s written request at any time during the continuance of the failure referred to in
subclause (b)(ii) above.
|
3.13 |
Computation of Interest
|
4. |
SATISFACTION AND DISCHARGE
|
4.1 |
Satisfaction and Discharge of Indenture
|
(1) |
either
|
|
(A) |
all Outstanding Notes (other than (i) Notes which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 3.7 and (ii) Notes for
whose payment money has theretofore been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as provided in the last paragraph of Section 10.4) have been
delivered to the Trustee for cancellation; or
|
|
(B) |
all such Notes not theretofore delivered to the Trustee for cancellation
|
|
(i) |
have become due and payable, or
|
|
(ii) |
will become due and payable at their Stated Maturity within one year, or
|
|
(iii) |
are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the
expense, of the Company,
|
(2) |
no Default or Event of Default has occurred and is continuing on the date of the deposit or will occur as a result of the deposit and the deposit will not result in a
breach or violation of, or constitute a default under, any other material instrument to which the Company or any of its Restricted Subsidiaries are a party or by which the Company or any of its Restricted Subsidiaries are bound;
|
(3) |
the Company or any Restricted Subsidiary has paid or caused to be paid all other sums payable hereunder by the Company or such Restricted Subsidiary; and
|
(4) |
the Company has delivered irrevocable instructions to the Trustee under this Indenture to apply any deposited money toward the payment of the Notes at maturity or the
Redemption Date, as the case may be.
|
4.2 |
Application of Trust Money
|
5. |
REMEDIES
|
5.1 |
Events of Default
|
(1) |
Non-payment
. The Company fails to pay:
|
|
(a) |
any principal of, or premium on, any of the Notes when due, or
|
|
(b) |
Additional Amount or interest on, any of the Notes when due and such failure remains uncured for a period of 30 days; or
|
(2) |
Breach of other obligations
. The Company does not perform or
comply with any one or more of the Company’s other obligations in the Notes or the Indenture, and such default or breach continues for a period of 60 consecutive days after there has been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Notes a written notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a “Notice of Default” hereunder; or
|
(3) |
Cross-acceleration
. Either:
|
|
(a) |
the Company or any Significant Subsidiary shall default (as principal or guarantor or other surety) in the payment of principal of any Indebtedness in the principal amount
when due of at least US$50 million in the aggregate (or its equivalent in any other currency), such default shall have continued for more than any applicable period of grace and any time for payment of such amounts has not been
expressly extended, and such failure to pay results in the acceleration of the final scheduled maturity thereof; or
|
|
(b) |
Indebtedness of the Company or any Significant Subsidiary is accelerated by the holders thereof because of a default, and the aggregate principal amount of such accelerated
Indebtedness exceeds US$50 million; or
|
(4) |
Enforcement proceedings
. With respect to the Company, any
final and non-appealable judgment or order for the payment of money in excess of US$50 million or its equivalent in other currencies (to the extent not covered by insurance as acknowledged in writing by the insurer) is rendered against
the Company and such judgment or order remains undischarged or unstayed for a period of 90 days after such judgment becomes final and non-appealable; or
|
(5) |
Bankruptcy; insolvency; etc
. (a) A court having jurisdiction
shall enter a decree or order for the (x) relief in respect of the Company or any Significant Subsidiaries in an involuntary case under the ABL, or (y) appointment of an administrator, receiver, trustee or intervenor for the Company or
any Significant Subsidiaries for all or substantially all of the Company’s or any of its Significant Subsidiaries’ Property and, in each case, such decree or order shall remain unstayed and in effect for a period of 60 consecutive days;
(b) the Company or any of its Significant Subsidiaries (x) commences a voluntary case under the ABL including, without limitation, any out-of-court agreement (
acuerdo preventivo extrajudicial
) impairing the Notes, (y) consent to the appointment of or taking possession by an administrator, receiver, trustee or intervenor for the Company or any of its Significant Subsidiaries
for all or substantially all of the Company’s or any of its Significant Subsidiaries’ Properties or (z) effect any general assignment for the benefit of creditors; or (c) a moratorium (
estado de cesación de pagos
) is declared in respect of any of the Company or any of its Significant Subsidiaries; or
|
(6) |
Winding up
. A resolution is passed or adopted by the Company’s
Board of Directors or shareholders, or a ruling or judgment of a Governmental Authority having jurisdiction or a court of competent jurisdiction is made, that the Company be wound up or dissolved, other than pursuant to a merger,
consolidation or other transaction otherwise permitted in accordance with the terms of Section 8.1 and, in the case of any such ruling or judgment, remains unstayed and in effect for a period of 60 consecutive days; or
|
(7) |
Revocation of License
. The License is (a) permanently revoked
by an Argentine Governmental Authority (other than by expiration of its term) and such revocation has a material adverse effect on the Company or its Subsidiaries taken as a whole; or (b) suspended for a period of at least 180
consecutive days;
provided
,
further
,
that a reissuance or reauthorization of the License shall not constitute a revocation or suspension.
|
5.2 |
Acceleration of Maturity; Rescission and Annulment
|
(1) |
the Company has paid or deposited with the Trustee a sum sufficient to pay
|
|
(A) |
all overdue interest on such series of Notes,
|
|
(B) |
the principal of (and premium and Additional Amounts, if any, on) any series of Notes which have become due otherwise than by such declaration of acceleration and any
interest thereon at the rate or rates prescribed therefor in such Notes,
|
|
(C) |
to the extent that payment of such interest is lawful, interest upon overdue interest at the rate or rates prescribed therefor in such Notes, and
|
|
(D) |
all sums paid or advanced by the Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; and
|
(2) |
all Events of Default with respect to a series of Notes, other than the non-payment of the principal of a series of Notes, which have become due solely by such declaration
of acceleration, have been cured or waived as provided in Section 5.13.
|
5.3 |
Collection of Indebtedness and Suits for Enforcement by Trustee
|
(1) |
default is made in the payment of any Additional Amount or interest on any Note when such interest becomes due and payable and such default continues for a period of 30
days after the date on which such payment was due and payable, or
|
(2) |
default is made in the payment of the principal of (or premium, if any, on) any Note at the Maturity thereof,
|
5.4 |
Trustee May File Proofs of Claim
|
5.5 |
Trustee May Enforce Claims Without Possession of Notes
|
5.6 |
Application of Money Collected
|
|
FIRST: |
To the payment of all amounts due the Trustee, Co-Registrar, Principal Paying Agent and Transfer Agent under Section 6.7; and
|
|
SECOND: |
To the payment of the amounts then due and unpaid for principal of and any premium and interest on the Notes in respect of which or for the benefit of which such money has
been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Notes for principal and any premium and interest, respectively.
|
5.7 |
Limitation on Suits
|
(1) |
such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Notes of that series;
|
(2) |
the Holders of not less than 25% in principal amount of the Outstanding Notes of that series shall have made a written request to the Trustee to institute proceedings in
respect of such Event of Default in its own name as Trustee hereunder;
|
(3) |
such Holder or Holders have offered to the Trustee indemnity satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request;
|
(4) |
the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and
|
(5) |
no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of (i) in the
case of a continuing Event of Default specified in clause (1) of Section 5.1, the Outstanding Notes of that series, (ii) in the case of a continuing Event of Default with respect to any series, other than the Event of Default specified
in clause (1) of Section 5.1, the Outstanding Notes of all series affected by such Event of Default;
|
5.8 |
Unconditional Right of Holders to Receive Principal, Premium and Interest
|
5.9 |
Restoration of Rights and Remedies
|
5.10 |
Rights and Remedies Cumulative
|
5.11 |
Delay or Omission Not Waiver
|
5.12 |
Control by Holders
|
(1) |
such direction shall not be in conflict with any rule of law or with this Indenture; and
|
(2) |
the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.
|
5.13 |
Waiver of Past Defaults
|
(1) |
in the payment of the principal of or any premium or interest on any Note of such affected series, or;
|
(2) |
in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Note of such
series affected.
|
5.14 |
Undertaking for Costs
|
5.15 |
Waiver of Usury, Stay or Extension Laws
|
5.16 |
Currency Indemnity
|
6. |
THE TRUSTEE
|
6.1 |
Certain Duties and Responsibilities
|
|
(a) |
If an Event of Default with respect to a particular series has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of its own affairs.
|
|
(b) |
Except during the continuance of an Event of Default with respect to a particular series:
|
|
(i) |
the duties of the Trustee shall be determined solely by the express provisions of this Indenture and the Trustee need perform, and be liable for (as set forth herein), only
those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
|
|
(ii) |
in the absence of bad faith or its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture,
provided
, that the Trustee shall
examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture stated herein (but need not verify any mathematical calculations).
|
|
(c) |
The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:
|
|
(i) |
this paragraph does not limit the effect of paragraph (b) of this Section 6.1;
|
|
(ii) |
the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining
the pertinent facts.
|
|
(d) |
The Trustee shall only be charged with knowledge of any default or Event of Default if either (i) a Responsible Officer of the Trustee shall have actual knowledge of such
default or Event of Default or (ii) written notice of such default or Event of Default shall have been given to the Trustee by the Company or any Holder.
|
|
(e) |
Notwithstanding the foregoing, no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it. Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of
this Section.
|
6.2 |
Notice of Defaults
|
6.3 |
Certain Rights of Trustee
|
(1) |
the Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;
|
(2) |
any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order, and any resolution of the Board of Directors
shall be sufficiently evidenced by a Board Resolution;
|
(3) |
whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any
action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officers’ Certificate;
|
(4) |
the Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;
|
(5) |
the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant
to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction;
|
(6) |
the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it
may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney;
|
(7) |
the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, nominees, custodians or attorneys and
the Trustee shall not be responsible for any misconduct or negligence on the part of any agent, nominee, custodian or attorney appointed with due care by it hereunder;
|
(8) |
the permissive rights of the Trustee enumerated herein shall not be construed as duties;
|
(9) |
in no event shall the Trustee be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited
to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action;
|
(10) |
the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be
enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder, also by the Trustee´s Representative, the Registrar, the Paying agent and the Transfer Agent;
|
(11) |
in accordance with Section 326 of the U.S.A. Patriot Act, (Title III of Pub. L. 107- 56 (signed into law on October 26, 2001)) (as amended, modified or supplemented from
time to time, the “U.S.A. Patriot Act”) the Trustee is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee, and in
recognition thereof, the Company agrees to provide the Trustee with such information as the Trustee may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act;
|
(12) |
the Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified
actions pursuant to this Indenture; and
|
(13) |
the Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder.
|
6.4 |
Not Responsible for Recitals or Issuance of Notes
|
6.5 |
May Hold Notes
|
6.6 |
Money Held in Trust
|
6.7 |
Compensation and Reimbursement
|
(1) |
to pay to the Trustee such compensation as detailed in Schedule II hereto for all services rendered by it hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust);
|
(2) |
except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances properly incurred or made
by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith;
|
(3) |
to indemnify the Trustee and its officers, directors, employees and agents for, and to hold each of them harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses of enforcing this Indenture against the Company (including
this Section) and defending itself against any claim (whether asserted by the Company or any Holder) or liability in connection with the exercise or performance of any of its powers or duties hereunder;
|
(4) |
to secure the Company’s obligations under this Section 6.7, the Trustee shall have a lien prior to the Notes upon all money or property held or collected by the Trustee in
its capacity as Trustee, except for such money or property which is (A) held in trust to pay principal (and premium, if any) or interest for the benefit of Holders of particular Notes or (B) irrevocably deposited with the Trustee
pursuant to Section 13.4 in respect of any Defeasance or Covenant Defeasance;
|
(5) |
the obligations of the Company set forth in this Section 6.7 shall survive the removal and resignation of the Trustee and the satisfaction and discharge of this Indenture;
and
|
(6) |
when the Trustee incurs any expenses or renders any services after the occurrence of an Event of Default specified in Sections 5.1(6) or 5.1(7), such expenses and the
compensation for such services are intended to constitute expenses of administration under any law for the relief of debtors.
|
6.8 |
Conflicting Interests
|
6.9 |
Corporate Trustee Required; Eligibility
|
6.10 |
Resignation and Removal; Appointment of Successor
|
(1) |
the Trustee shall fail to comply with Section 6.9 after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Note for at least six
months, or
|
(2) |
the Trustee shall cease to be eligible under Section 6.9 and shall fail to resign after written request therefor by the Company or by any such Holder, or
|
(3) |
the Trustee shall become incapable of acting or shall be adjudged as bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public
officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,
|
6.11 |
Acceptance of Appointment by Successor
|
6.12 |
Merger, Conversion, Consolidation or Succession to Business
|
6.13 |
Preferential Collection of Claims Against Company
|
6.14 |
Appointment of Authenticating Agent
|
DELAWARE TRUST COMPANY
|
|
As Trustee
|
|
By:
|
|
||
As Authenticating Agent
|
|||
By:
|
|
||
Authorized Signator
y
|
6.15 |
Other Capacities
|
6.16 |
Certain Duties and Responsibilities of the Trustee’s Representative
|
7. |
HOLDERS’ LISTS AND REPORTS BY TRUSTEE AND COMPANY
|
7.1 |
Company to Furnish Trustee Names and Addresses of Holders
|
(1) |
semi-annually, not later than June 15th and December 15th in each year, commencing December 15th, 2018, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders of Notes of each series as of the preceding May 31st or November 30th, as the case may be, and
|
(2) |
at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a
date not more than 15 days prior to the time such list is furnished;
|
(3) |
immediately upon becoming aware that any Holder has instituted proceedings directly against the Company in accordance with the provisions of the Negotiable Obligations Law,
notice of such proceedings and of the certificate numbers of the Notes which form the subject matter of such proceedings (with copies thereof to each Paying Agent and each Transfer Agent), and, promptly after receipt thereof, a copy of
every document served on the Company or served or disclosed by it in connection with such proceedings, and
|
(4) |
at least five Business Days in New York prior to making any payment to any Holder who has instituted proceedings directly against the Company under the Negotiable
Obligations Law, the certificate numbers of the Notes in respect of which such payment is to be made, and the amount to be paid in respect of each such Note.
|
7.2 |
Preservation of Information; Communications to Holders
|
7.3 |
Reports by Trustee
|
7.4 |
Reports by Company
|
8. |
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
|
8.1 |
Consolidation, Merger and Sale of Assets
|
8.2 |
Successor Substituted
|
9. |
SUPPLEMENTAL INDENTURES
|
9.1 |
Supplemental Indentures Without Consent of Holders
|
(1) |
to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company herein and in the Notes in connection
with a merger, consolidation or other transaction that complies with Section 8.1; or
|
(2) |
to add to the covenants of the Company for the benefit of the Holders of all or any series of Notes; or
|
(3) |
to add any additional Events of Default for the benefit of the Holders of all or any series of Notes (and if such additional Events of Default are to be for the benefit of
less than all series of Notes, stating that such additional Events of Default are expressly being included solely for the benefit of such series); or
|
(4) |
to add to, change or eliminate any of the provisions of this Indenture in respect of one or more series of Notes,
provided
, that any such addition, change or elimination (A) shall neither (i) apply to any Note of any series created prior to the execution of such supplemental indenture and entitled to the
benefit of such provision nor (ii) modify the rights of the Holder of any such Note with respect to such provision or (B) shall become effective only when there is no such Note Outstanding; or
|
(5) |
to secure the Notes pursuant to the requirements of Section 10.13 or otherwise; or
|
(6) |
to establish the form or terms of Notes of any series as permitted by Sections 2.1 and 3.1; or
|
(7) |
to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Notes of one or more series, and to add to or change any of
the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 6.11; or
|
(8) |
to amend this Indenture with respect to the authentication and delivery of additional series of Notes; or
|
(9) |
to cure any ambiguity, to correct or supplement any provision herein which may be defective or inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Indenture;
provided
, that such action pursuant to this clause (9) shall not
adversely affect the rights or interests of any of the Holders of Notes of any series in any material respect; or
|
(10) |
to modify the restrictions on transfer of the Notes, and the procedures for resales and other transfer of the Notes, to reflect any change in applicable law or regulation
(or the interpretation thereof) or provide alternative procedures in compliance with applicable law and practices relating to the resale or other transfer of restricted securities generally; or
|
(11)
|
to comply with any requirement of the CNV, BYMA or any market on which the Notes are listed, provided that it does not adversely affect the
rights of any Holder in any material respect.
|
9.2 |
Supplemental Indentures With Consent of Holders
|
(1) |
change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Note; or
|
(2) |
reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or reduce or change any obligations to pay, any
Additional Amounts; or
|
(3) |
permit the redemption of a Note if not previously permitted; or
|
(4) |
reduce the amount of principal of an Original Issue Discount Note or any other Note which would be due and payable upon a declaration of acceleration of the Maturity
thereof pursuant to Section 5.2; or
|
(5) |
change any Place of Payment where, or the currency in which, any Note or any premium, interest or Additional Amounts thereon is payable; or
|
(6) |
impair the right to institute suit for the enforcement of any payment on or with respect to any Note on or after the maturity date thereof (or, in the case of redemption,
on or after the date of redemption); or
|
(7) |
reduce the percentage in principal amount of Outstanding Notes of any series, the consent of whose Holders is required for any such supplemental indenture; or
|
(8) |
reduce the percentage in principal amount of Outstanding Notes of any series, the consent of whose Holders is required for any waiver of compliance with certain provisions
of this Indenture or certain defaults hereunder and their consequences; or
|
(9) |
reduce the percentage in principal amount of the Outstanding Notes of any series, the consent of the Holders of which is required for the adoption of a resolution at a
meeting of Holders held pursuant to Section 9.6 of this Indenture; or
|
(10) |
reduce the percentage in principal amount of the Outstanding Notes of any series that is required for a quorum at a meeting of Holders of Notes; or
|
(11) |
reduce the percentage in principal amount of the Outstanding Notes of any series that is required to request the calling of a meeting of Holders; or
|
(12) |
modify any of the provisions of this Section 9.2, Section 5.13 or Section 10.17, except to increase the percentage provided therein or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Note affected thereby;
provided
,
however
, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to “the
Trustee” and concomitant changes in this Section 9.2 and Section 10.17, or the deletion of this proviso, in accordance with the requirements of Section 6.11 and 9.1(7); or
|
(13) |
waive or amend Section 10.5; or
|
(14) |
amend Section 1.11;
|
9.3 |
Execution of Supplemental Indentures
|
9.4 |
Effect of Supplemental Indentures
|
9.5 |
Reference in Notes to Supplemental Indentures
|
9.6 |
Meetings of Holders; Modification and Waiver
|
|
(a) |
The Trustee or the Board of Directors of the Company shall, upon the request of the Holders of at least five percent in aggregate principal amount of the Notes of all
series at the time Outstanding or of the Notes of any series at the time Outstanding, or the Company or the Trustee, at its discretion, may, call a meeting of the Holders of such Notes at any time and from time to time, to make, give or
take any request, demand, authorization, direction, notice, consent, waiver or other action provided by the Notes or the relevant series of Notes to be made, given or taken by the Holders of such Notes. With respect to all matters not
contemplated in this Indenture, meetings of Holders shall be held in accordance with the Negotiable Obligations Law. The meetings shall be held in the City of Buenos Aires, Argentina;
provided
,
however
, that, if permitted by applicable law, the Company or the Trustee may
determine to hold any such meetings simultaneously in the City of New York by any means of telecommunication which permits the participants to hear and speak to each other and such simultaneous meeting shall be deemed to constitute a
single meeting for purposes of the quorum and voting percentages applicable to such meeting. In any case, meetings shall be held at such time and at such place as the Company or the Trustee shall determine. Any resolution passed at a
meeting shall be binding on all Holders of Notes or of the relevant series of Notes, as the case may be (whether present or not at such meeting). If a meeting is being held pursuant to a request of Holders, the agenda for the meeting
shall be as determined in the request and such meeting shall be convened within 40 days from the date such request is received by the Trustee or the Company, as the case may be.
|
|
(b) |
Notice of any meeting of Holders (which shall include the date, place and time of the meeting, the agenda therefor and the requirements to attend) shall be given, at the
Company’s expense, not less than ten days nor more than 30 days prior to the date fixed for the meeting in the
Official Gazette of Argentina (Boletín
Oficial)
, in a newspaper of wide circulation in Argentina and in BYMA’s Informative Bulletin (as long as the Notes are listed and traded on BYMA), and also in the manner provided under Section 1.6, and any publication of such
notices shall be for five consecutive Business Days in each place of publication. Meetings of the Holders may be simultaneously convened for two dates, in case the initial meeting was to be adjourned for lack of quorum. However, for
meetings that include in the agenda items requiring unanimous approval by the Holders or the amendment of any of the terms and conditions of the Notes, notice of a new meeting resulting from adjournment of the initial meeting for lack
of quorum will be given not less than eight days prior to the date fixed for such new meeting and will be published for three Business Days in the Official Gazette of Argentina, a newspaper of wide circulation in Argentina and BYMA’s
Informative Bulletin (as long as the Notes are listed and traded on BYMA).
|
|
(c) |
The Trustee will designate the record date for determining the Holders of Notes entitled to vote at any meeting in accordance with Section 1.4 and in compliance with
Argentine Law, and will provide notice to such Holders in the manner set forth under Section 1.6 herein.
|
|
(d) |
To be entitled to vote at a meeting of Holders, a person shall be (i) a Holder of one or more Notes as of the relevant record date or (ii) a person appointed by an
instrument in writing as proxy by such a Holder of one or more Notes.
|
|
(e) |
The quorum at any meeting to adopt a resolution with respect to the Notes of any series will be Persons who are Holders of or who represent the majority in aggregate
principal amount of the Notes of the affected series at the time Outstanding and at any reconvened meeting adjourned for lack of the requisite quorum, the quorum will be the Person(s) present at such reconvened adjourned meeting;
provided
,
however
, that the quorum for any
meeting relating to the matters specified in Sections 9.2(1) through 9.2(14) will be persons representing 100% in aggregate principal amount of the Outstanding Notes.
|
|
(f) |
At a meeting or a reconvened adjourned meeting duly convened and at which a quorum is present, any resolution to modify or amend, or to waive compliance with, any provision
of the Notes (other than the provisions of Sections 9.2(1) through 9.2(14)) will be validly passed and decided if approved by the persons represented and voting at the meeting entitled to vote a majority in aggregate principal amount of
the Notes of the affected series at the time Outstanding. Any instrument given by or on behalf of any Holder in connection with any consent to any such modification, amendment or waiver will be irrevocable once given and will be
conclusive and binding on all subsequent Holders of such Note.
|
|
(g) |
The Holder of a Note may, at any meeting of Holders of Notes at which such Holder is entitled to vote, cast one vote for each U.S. Dollar in principal amount of the Notes
held by such Holder in which the Notes are denominated. Decisions at a meeting of Holders shall be made by the affirmative vote of a majority in aggregate principal amount of the Notes of any affected series at the time Outstanding,
voting together as a single class, present or represented at a meeting of such holders at which a quorum is present;
provided
,
however
, that the unanimous consent or the unanimous affirmative vote of the Holders shall be required to adopt a valid decision on any of the
matters listed under clauses 9.2(1) through 9.2(14) above.
|
|
(h) |
Any modifications, amendments or waivers to the Indenture, any supplemental indenture or the Notes validly decided by the requisite vote of Holders will be conclusive and
binding on all Holders of the affected series, whether or not they have given such consent or were present at any meeting, and whether or not notation of such modifications, amendments or waivers is made upon the Notes of the affected
series, if duly passed at a meeting convened and held in accordance with the provisions hereof and of the Negotiable Obligations Law. Any Notes known to a Responsible Officer of the Trustee to be held for the account of the Company or
any Affiliate of the Company shall not be considered Outstanding and Holders of such Notes will not be entitled to participate in taking any actions under the terms of the Notes.
|
9.7 |
Actions to Be Taken without a Meeting
|
10. |
COVENANTS
|
10.1 |
Payment of Principal, Premium and Interest
|
10.2 |
Payment of Additional Amounts
|
(1) |
any Taxes that would not have been so imposed, deducted or withheld but for the existence of any present or former connection between the relevant Holder or beneficial
owner of a Note (or between a fiduciary, settlor, beneficiary, member, partner or shareholder of, the relevant Holder or beneficial owner, if the relevant Holder or beneficial owner is an estate, nominee, trust, limited liability
company, partnership or corporation) and the Relevant Taxing Jurisdiction (including being a citizen or resident or national or domiciliary of, or carrying on a business or maintaining a permanent establishment that is the holder of the
Notes in the Relevant Taxing Jurisdiction), other than the mere ownership, holding, purchase or disposition of such Note or the receipt of such payment in respect thereof, or the exercise or enforcement of any rights under the Notes or
the Indenture;
|
(2) |
any Taxes which are imposed, payable or due because definitive Notes are presented for payment (where presentation is required) more than 30 days after the later of (a) the
date such payment was due and (b) if the full amount payable has not been received by the Trustee on or prior to such due date, the date on which, the full amount having been so received, notice to that effect will have been given to
the Holders by the Trustee; except for Additional Amounts with respect to Taxes that would have been imposed had the Holder presented the Note for payment during such 30-day period;
|
(3) |
any Taxes that are imposed or withheld by reason of the failure of the Holder or beneficial owner of a Note to comply, at the Company’s written request, with any
certification, identification, information, documentation or other reporting requirements if (a) such compliance is required or imposed by a statute, treaty or regulation or administrative practice of the Relevant Taxing Jurisdiction as
a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes, and (b) the Company has given the Holder or the beneficial owner at least 30 days’ notice that the Holder or beneficial owner will be
required to so comply;
|
(4) |
any Note presented for payment (where presentation is required) at an office of a paying agent in Argentina (provided that the Notes can also be presented at an office of a
paying agent outside of Argentina without any such withholding or deduction);
|
(5) |
any Taxes payable otherwise than by withholding or deduction from payments on or with respect to the Notes;
|
(6) |
any Taxes imposed pursuant to Sections 1471-1474 of the U.S. Internal Revenue Code (or any amended or successor version that is substantively comparable and not materially
more onerous to comply with), the U.S. Treasury regulations thereunder and any other official guidance thereunder (“
FATCA
”), any intergovernmental
agreement entered into with respect to FATCA, or any law, regulation or other official guidance enacted in any jurisdiction implementing, or relating to, FATCA, or any such intergovernmental agreement;
|
(7) |
any Taxes levied and/or applicable to payments made to Argentine taxpayers subject to inflation adjustment rules as provided for in Title VI of the Argentine Income Tax
Law;
|
(8) |
any estate, inheritance, gift, value added, personal property, sales, use, excise, transfer or other similar Tax imposed with respect to such payment; or
|
(9) |
any combination of (1), (2), (3), (4), (5), (6), (7) or (8) above.
|
10.3 |
Maintenance of Office or Agency
|
10.4 |
Money for Notes Payments to Be Held in Trust
|
10.5 |
Pari Passu
|
10.6 |
Reporting; Statements by Officers as to Default
|
10.7 |
Existence
|
10.8 |
Further Assurances
|
10.9 |
Limitation on Transactions with Affiliates
|
(1) |
Affiliate Transactions with or among the Company and any of its Restricted Subsidiaries or Affiliate Transactions between or among Restricted Subsidiaries;
|
(2) |
the Company or any Restricted Subsidiary from paying reasonable and customary fees to, and indemnities provided on behalf of, the Company’s directors, officers, employees
or consultants;
|
(3) |
the payment of reasonable compensation (including amounts paid pursuant to employee benefit plans, stock options and other incentive compensation), indemnification,
reimbursement or advancement of out-of-pocket expenses and provisions of liability insurance of the Company’s directors, officers and employees;
|
(4) |
the Company from making any payment described under clause (i) of the definition of Restricted Payments in compliance with Section 10.11;
|
(5) |
Affiliate Transactions undertaken pursuant to the terms of any agreement or arrangement to which the Company or any Restricted Subsidiary (including any Restricted
Subsidiary to any successor) is a party as of or on the Issue Date or, solely with respect to such Affiliate Transaction undertaken by a Restricted Subsidiary, on the date the relevant Subsidiary was designated as a Restricted
Subsidiary, as applicable, and any amendment, modification or replacement of such agreement (so long as such amendment, modification or replacement is not materially more disadvantageous to the Holders of the Notes, taken as a whole,
than the original agreement as in effect on the Issue Date or on the date the relevant Subsidiary was designated as a Restricted Subsidiary, as applicable);
|
(6) |
loans and advances to employees of the Company (including for the avoidance of doubt any successor) or any Restricted Subsidiary in the ordinary course of business in an
aggregate outstanding principal amount not exceeding US$5 million (or the equivalent in other currencies);
|
(7) |
transactions in which the Company delivers to the Trustee a written opinion from an Independent Financial Advisor stating that such transaction or series of transactions is
fair to the Company from a financial point of view or stating that the terms thereof are not materially less favorable to the Company than those that could reasonably be expected to have been obtained by the Company in a comparable
transaction at the time of the Affiliate Transaction in arm’s length dealings with a Person who is not an Affiliate;
|
(8) |
the payment of Management Fees in accordance with the provisions of the Technical Assistance Agreement;
|
(9) |
Restricted Payments permitted by the provisions hereof described under Section 10.11;
|
(10) |
transactions or payments, including grants of securities, stock options and similar rights, pursuant to any employee, officer or director compensation or benefit plans or
arrangements entered into in the ordinary course of business or approved by the Company’s Board of Directors in good faith;
|
(11) |
any employment agreements entered into by the Company or any Restricted Subsidiary in the ordinary course of business;
|
(12) |
(a) transactions with customers, clients, suppliers, or purchasers or sellers of goods or services, in each case in the ordinary course of business and otherwise in
compliance with the terms hereof or (b) contracts for (x) the sale, storage, gathering or transport of hydrocarbons, or (y) the lease or rental of office space;
provided
that, in each case, terms thereof are not materially less favorable to the Company than those that could reasonably be expected to have been obtained by the Company in a comparable transaction at the
time of the Affiliate Transaction in arm’s length dealings with a Person who is not an Affiliate, in each case as reasonably determined by the Board of Directors of the Company or its senior management;
|
(13) |
any transaction entered into in the ordinary course of business between or among the Company or any Restricted Subsidiary and any joint venture, joint arrangement (
unión transitoria
) or similar arrangement, if such transaction would constitute an Affiliate Transaction solely because the Company or a Restricted
Subsidiary owns an equity interest in or otherwise controls such joint venture or similar entity;
provided
that terms thereof are not
materially less favorable to the Company than those that could reasonably be expected to have been obtained by the Company in a comparable transaction at the time of the Affiliate Transaction in arm’s length dealings with a Person who
is not an Affiliate, in each case as reasonably determined by the Board of Directors of the Company or its senior management; and
|
(14) |
the provision of administrative services to or by any Unrestricted Subsidiary on substantially the same terms provided to or by Restricted Subsidiaries.
|
10.10 |
Limitation on Indebtedness
|
(1) |
The Company shall not, and shall not permit any Restricted Subsidiary to, Incur any Indebtedness unless: (a) on the date of such Incurrence, and after giving effect thereto
and the application of the proceeds therefrom, (i) the Consolidated Coverage Ratio would be greater than or equal to 2.00:1.00, and (ii) the Consolidated Debt Ratio would be less than or equal to 3.50:1.00, in each case determined on a
pro forma basis as if such Indebtedness had been Incurred and the proceeds therefrom applied at the beginning of the most recent four fiscal quarter period for which the Company has filed financial statements with the CNV; and (b) no
Default or Event of Default shall have occurred and be continuing at the time of, and after giving effect to, such Incurrence.
|
(2) |
Notwithstanding the above clause, the Company or any Restricted Subsidiary may Incur the following Indebtedness (“
Permitted
Indebtedness
”):
|
|
(a) |
Indebtedness in respect of the Notes;
|
|
(b) |
Indebtedness of the Company and its Restricted Subsidiaries outstanding on the Issue Date;
|
|
(c) |
Refinancing Indebtedness in respect of:
|
|
(i) |
Indebtedness (other than Indebtedness owed to the Company or any Subsidiary of the Company) Incurred pursuant to clause (1) above (it being understood that no Indebtedness
outstanding on the Issue Date is Incurred pursuant to such clause (1)); or
|
|
(ii) |
Indebtedness Incurred pursuant to subclauses (2)(b), (2)(c), and (2)(q) (excluding Indebtedness owed to the Company or any Subsidiary of the Company);
|
|
(d) |
Capitalized Lease Obligations not in excess of US$100 million at any time outstanding;
|
|
(e) |
Indebtedness of the Company and its Restricted Subsidiaries under Hedging Agreements or Currency Agreements;
|
|
(f) |
(i) Indebtedness of a Restricted Subsidiary Incurred and outstanding on or prior to the date on which such Restricted Subsidiary was acquired by the Company (other than
Indebtedness Incurred as consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary of, or was otherwise acquired by, the Company);
provided
,
however
, that on the date that such Restricted Subsidiary is acquired by the Company, the Company would have been able to Incur US$1.00 of additional Indebtedness pursuant to clause (1) above
after giving pro forma effect to the Incurrence of such Indebtedness pursuant to this subclause (f)(i) and the acquisition of such Restricted Subsidiary by the Company, as if such Indebtedness was Incurred and such acquisition
consummated at the beginning of the most recent four fiscal quarter period for which the Company has filed financial statements with the CNV; and (ii) Indebtedness Incurred by a Restricted Subsidiary or the Company to refinance the
Indebtedness Incurred pursuant to this subclause (f);
|
|
(g) |
Indebtedness arising from agreements providing for indemnification, adjustment of purchase price or similar obligations, in each case Incurred or assumed in connection with
the disposition of a business, assets or capital stock of a Restricted Subsidiary;
provided
that, in each case, only to the extent the
maximum aggregate liability in respect of such Indebtedness does not exceed the gross proceeds actually received by the Company or such Restricted Subsidiary in connection with such disposition;
|
|
(h) |
customer deposits and advance payments received from customers for the sale, lease or license of goods and services in the ordinary course of business;
|
|
(i) |
Indebtedness, the proceeds from which are applied, within 45 days following Incurrence, to the redemption of, or repayment or repurchase of principal (including any
premium) of, and interest and Additional Amounts on, Indebtedness of the Company that is outstanding as of the date of this Indenture (including Indebtedness under the Notes);
|
|
(j) |
intercompany Indebtedness among the Company and its Restricted Subsidiaries or among the Company’s Restricted Subsidiaries;
provided
,
however
, that
|
|
(i) |
any subsequent issuance or transfer of any Capital Stock or any other event that results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any
subsequent transfer of any such Indebtedness (except to the Company or a Restricted Subsidiary) shall be deemed, in each case, to constitute the Incurrence of such Indebtedness by the issuer thereof; and
|
|
(ii) |
if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the
Notes;
|
|
(k) |
Subordinated Indebtedness and Deferred Interest Subordinated Indebtedness of the Company and its Restricted Subsidiaries;
|
|
(l) |
Indebtedness consisting of guarantees of any Indebtedness permitted under subclause (2)(j);
|
|
(m) |
Indebtedness of the Company or any Restricted Subsidiary arising from the honoring by a bank or other financial institution of a check, draft or similar instrument
(including daylight overdrafts paid in full by the close of business on the day such overdraft was Incurred) drawn against insufficient funds in the ordinary course of business;
provided
that such Indebtedness is extinguished within five Business Days of Incurrence;
|
|
(n) |
Indebtedness Incurred in connection with any Project Financing;
|
|
(o) |
Indebtedness in respect of severance payments, workers’ compensation claims, payment obligations in connection with health or other social security benefits, unemployment
insurance or other self-insurance obligations for employees, letters of credit, bankers’ acceptances, payment obligations in connection with insurance premiums or similar obligations, security deposits, completion, performance, surety,
appeal, bid, customs or similar bonds and reimbursement obligations (or letters of credit in connection with, in lieu of or in respect of each of the foregoing), in each case, Incurred in the ordinary course of business and other than
Indebtedness for borrowed money by, or to the extent required by applicable Governmental Authorities in connection with the operations of, the Company or any Restricted Subsidiary;
|
|
(p) |
Indebtedness consisting of letters of credit, banker’s acceptances, performance bonds, appeal bonds, surety bonds, customs bonds and other similar bonds and reimbursement
obligations Incurred by the Company or any Restricted Subsidiary in the ordinary course of business securing the performance of contractual or license obligations of the Company or any Restricted Subsidiary (in each case, other than for
an obligation for borrowed money) or Incurred in connection with the financing of insurance premiums in the ordinary course of business;
|
|
(q) |
Acquired Indebtedness;
provided
that after giving pro forma effect to the
Incurrence thereof and the transactions related thereto, (x) the Company, as the case may be, could incur at least US$1.00 of Indebtedness pursuant to clause (1) above, or (y) the Consolidated Debt Ratio would be no greater than the
Consolidated Debt Ratio immediately prior to such transactions;
|
|
(r) |
Indebtedness arising from agreements of the Company or any Restricted Subsidiary providing for customary guarantees, indemnification, obligations in respect of earn-outs or
other adjustments of purchase price or, in each case, similar obligations, in each case, Incurred or assumed in connection with the acquisition or disposition of any business or assets or Person or any Capital Stock of a Restricted
Subsidiary (other than Guarantees of Indebtedness Incurred by any Person acquiring or disposing of such business or assets or such Restricted Subsidiary for the purpose of financing such acquisition or disposition);
provided
that:
|
|
(i) |
such Indebtedness is not reflected on the balance sheet of the Company or any Restricted Subsidiary (contingent obligations referred to in a footnote to financial
statements and not otherwise reflected on the balance sheet will not be deemed to be reflected on such balance sheet for purposes of this subclause (2)(r)(i)), and
|
|
(ii) |
the maximum liability of the Company and the Restricted Subsidiaries in respect of all such Indebtedness shall at no time exceed the gross proceeds, including non-cash
proceeds (the fair market value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Company and the Restricted Subsidiaries in connection
with such disposition;
|
|
(s) |
Indebtedness under any one or more Permitted Receivables Financings, the combined aggregate principal amount of which does not exceed US$50 million (or the equivalent in
other currencies) at any time outstanding;
|
|
(t) |
Indebtedness under one or more lines of credit or working capital facilities in an amount not to exceed US$50 million;
|
|
(u) |
Indebtedness of the Company or any Restricted Subsidiary with the Argentine Secretary of Energy and/or any other Governmental Authority involved in the Argentine energy or
oil and gas markets;
|
|
(v) |
Indebtedness of the Company or any of its Restricted Subsidiaries in an aggregate principal amount at any time outstanding not to exceed two times the aggregate Net Cash
Proceeds received by the Company or such Restricted Subsidiary after the Issue Date from the issuance of Capital Stock (other than Disqualified Capital Stock), or any contribution to the common equity;
provided
that (1) the net cash proceeds from the Incurrence of such Indebtedness, the issuance of Capital Stock (other than Disqualified Capital Stock) and such
contribution to common equity are used to finance the development of Related Business projects; and (2) such equity proceeds shall not be available to make Restricted Payments under Section 10.11 so long as such related Indebtedness
under this subclause (2)(v) remains outstanding; and
|
|
(w) |
Indebtedness in an aggregate principal amount which, when taken together with all other Indebtedness Incurred pursuant to this subclause (2)(w) and outstanding on the date
of such Incurrence, does not exceed the greater of (i) US$150 million (or its equivalent in any other currency) and (ii) 7% of Consolidated Total Assets.
|
(3) |
For purposes of determining compliance with, and the outstanding principal amount of, any particular Indebtedness Incurred pursuant to and in compliance with this Section
10.10:
|
|
(a) |
the outstanding principal amount of any item of Indebtedness will be counted only once;
|
|
(b) |
in the event that an item of Indebtedness meets the criteria of clause (1) or (2) above or more than one of the categories of Permitted Indebtedness described in subclauses
(a) through (w) of clause (2) above, the Company may, in their sole discretion, divide and classify (or at any time reclassify) such item of Indebtedness in any manner that complies with this Section 10.10;
|
|
(c) |
Indebtedness permitted by this Section 10.10 need not be permitted solely by reference to one provision permitting such Indebtedness, but may be permitted in part by such
provision and in part by one or more other provisions of this Section 10.10 permitting such Indebtedness; and
|
|
(d) |
the amount of any Indebtedness outstanding as of any date will be (i) the accreted value thereof in the case of any Indebtedness issued with original issue discount or the
aggregate principal amount outstanding in the case of Indebtedness issued with interest payable in kind and (ii) the principal amount or liquidation preference thereof, together with any interest thereon that is more than 30 days past
due, in the case of any other Indebtedness.
|
(4) |
Notwithstanding the foregoing, the Company may not Incur any Indebtedness pursuant to clause (2) above if the proceeds thereof are used, directly or indirectly, to
Refinance any Subordinated Indebtedness or Deferred Interest Subordinated Indebtedness, unless such Indebtedness will be subordinated to any obligations owed under the Notes and the Indenture to at least the same extent as such
Subordinated Indebtedness or Deferred Interest Subordinated Indebtedness, as applicable.
|
(5) |
For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S. Dollar Equivalent principal amount of
Indebtedness denominated in a non-U.S. currency will be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was Incurred or, in the case of revolving credit Indebtedness, first committed;
provided
that, if such Indebtedness is Incurred to refinance other Indebtedness denominated in a non-U.S. currency, and such refinancing would cause the applicable
U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction will be deemed not to have been exceeded so long
as the principal amount of such Refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced. Notwithstanding any other provision of this Section 10.10, the maximum amount of Indebtedness that the
Company or any Restricted Subsidiary may Incur pursuant to this Section 10.10 shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of currencies. The principal amount of any Indebtedness Incurred to
refinance other Indebtedness, if Incurred in a different currency from the Indebtedness being refinanced, will be calculated based on the currency exchange rate applicable to the currencies in which such Refinancing Indebtedness is
denominated that is in effect on the date of such refinancing.
|
10.11 |
Limitation on Restricted Payments
|
|
(a) |
no Event of Default or event which, with the giving of notice or the lapse of time will become an Event of Default shall have occurred and be continuing at the time of, or
after giving effect to such Restricted Payment; and
|
|
(b) |
immediately after giving effect to such Restricted Payment, the Company would be able to Incur at least US$1.00 of additional Indebtedness (other than Permitted
Indebtedness) pursuant to Section 10.10.
|
(i) |
the payment of any dividend within 60 days after the date of declaration of such dividend if the dividend would have been permitted on the date of declaration pursuant to
the preceding paragraph;
|
(ii) |
any Restricted Payment,
|
|
(a) |
in exchange for Capital Stock of the Company (other than Disqualified Capital Stock); or
|
|
(b) |
through the application of the net cash proceeds received by the Company from a substantially concurrent sale of Capital Stock (other than Disqualified Capital Stock) of
the Company or a contribution to the equity capital of the Company not representing an interest in Disqualified Capital Stock, in each case not received from a Restricted Subsidiary of the Company;
|
(iii) |
the voluntary prepayment, purchase, defeasance, redemption or other acquisition or retirement for value of any Subordinated Indebtedness solely in exchange for, or through
the application of net cash proceeds of a substantially concurrent sale, other than to a Restricted Subsidiary of the Company, of:
|
|
(a) |
Capital Stock (other than Disqualified Capital Stock) of the Company; or
|
|
(b) |
Refinancing Indebtedness for such Subordinated Indebtedness;
|
(iv) |
repurchases of Capital Stock deemed to occur upon the exercise of stock options, warrants or other convertible or exchangeable securities to the extent such Capital Stock
represents a portion of the exercise price thereof, and Restricted Payments by the Company to allow the payment of cash in lieu of the issuance of fractional shares upon the exercise of options or warrants or upon the conversion or
exchange of Capital Stock of the Company;
|
(v) |
repurchases by the Company of Capital Stock of the Company or options, warrants or other securities exercisable or convertible into Capital Stock of the Company from
employees or directors of the Company or any of its Restricted Subsidiaries or their authorized representatives upon the death, disability or termination of employment or directorship of the employees or directors, in an amount not to
exceed US$5 million (or the equivalent in other currencies) in the aggregate;
|
(vi) |
Capital Stock repurchased in the open market to equity-settle stock-based compensation awarded to employees or directors of the Company or its Subsidiaries in the ordinary
course of business, in an amount not to exceed US$5 million (or the equivalent in other currencies);
|
(vii) |
payments or distributions to dissenting stockholders pursuant to applicable law in connection with a merger, consolidation or transfer of all or substantially all of the
assets of the Company that complies with the provisions described under Section 8.1;
|
(viii) |
fees and compensation paid to, and any indemnity provided on behalf of, officers, directors, consultants or agents of the Company or any Restricted Subsidiary as determined
in good faith by the Company’s Board of Directors;
|
(ix) |
payments of dividends or other distributions of Capital Stock, Indebtedness or other securities received from Unrestricted Subsidiaries (other than Unrestricted
Subsidiaries the primary assets of which are Cash and Cash Equivalents); and
|
(x) |
unless an Event of Default has occurred and is continuing, Restricted Payments in an amount which, when taken together with all Restricted Payments made pursuant to this
clause (x) shall not exceed in any fiscal year 10% of Consolidated Net Income, to the extent positive (with unused amounts in any calendar year being carried over to succeeding calendar years), as set forth in the consolidated income
statement of the Company provided to the Holders pursuant to Section 10.6 for the fiscal year ended immediately prior to the date of declaration of such Restricted Payment.
|
10.12 |
Limitation on Asset Sales
|
(a) |
the Company or such Restricted Subsidiary receives consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities,
contingent or otherwise) at the time of such Asset Sale at least equal to the Fair Market Value of the shares and/or assets subject to such Asset Sale; or
|
(b) |
at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of Cash and Cash Equivalents;
provided
that the following shall be deemed to be cash for purposes of this clause (b): (i) the amount of any liabilities (as shown on the Company’s, or such
Restricted Subsidiary’s, most recent balance sheet or in the notes thereto) of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) that are assumed by the transferee of any
such assets; (ii) the amount of any Marketable Securities received by the Company or such Restricted Subsidiary from such transferee that is converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash
received) within 30 days following the closing of such Asset Sale; (iii) the Fair Market Value of any Capital Stock of a Person engaged in a Related Business that will become, upon purchase, a Restricted Subsidiary or assets (other than
current assets as determined in accordance with IFRS or Capital Stock) to be used by the Company or any Restricted Subsidiary in a Related Business; and (iv) all instruments (including, for the avoidance of doubt, promissory notes,
money market investments, marketable securities, checks and deferred payment checks (
cheques de pago diferido
)) by whomever issued which, by their
terms, are payable or may be required to be paid in cash within six months of their issuance;
provided
that (x) amounts received pursuant
to subclauses (b)(i) and (b)(iii) shall not be deemed to constitute Net Cash Proceeds for purposes of making an Asset Sale Offer; (y) Marketable Securities will constitute cash (for purposes of subclause (b)(ii)) with respect to the
Fair Market Value thereof on the date on which such Marketable Securities were received by the Company or such Restricted Subsidiary; and (z) the principal amount payable under any instrument referred to in clause (iv) above, will be
deemed to have been received as Net Cash Proceeds of the relevant Asset Sale on the date on which such instrument was received by the Company or the applicable Restricted Subsidiary.
|
(a) |
repay any of the Company’s or such Restricted Subsidiary’s Indebtedness that is
pari
passu
with the Notes (whether through optional or mandatory prepayments or redemptions, or tender offers or open market or other privately negotiated purchases, so long as such repaid Indebtedness is immediately extinguished);
provided
that in connection with any such repayment of pari passu Indebtedness the Company offers to redeem a pro rata portion of the Notes
based on the relative Outstanding principal amount of the Notes and such other Indebtedness, or
|
(b) |
make capital expenditures in a Related Business, or
|
(c) |
reinvest in or purchase Additional Assets (including by means of an investment in or purchase of Additional Assets by any Restricted Subsidiary with cash in an amount equal
to the amount of Net Available Cash or Capital Stock to be used by the Company or any Restricted Subsidiary in a Related Business), or
|
(d) |
any combination of (a), (b) or (c) above;
|
|
(a) |
accept for payment all Notes or portions thereof properly tendered pursuant to the Asset Sale Offer;
|
|
(b) |
deposit with the Paying Agent funds in an amount equal to the Asset Sale Offer Amount in respect of all Notes or portions thereof so tendered; and
|
|
(c) |
deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions
thereof being purchased by the Company.
|
10.13 |
Limitation on Liens
|
(i) |
Liens existing on the Issue Date;
|
(ii) |
any Lien created on any fixed asset securing Indebtedness incurred or assumed solely for the purpose of financing all or any part of the cost of developing, constructing or
acquiring such fixed asset, which Lien attaches to such fixed asset concurrently with or within 180 days after the acquisition thereof;
provided
,
however
, that the principal amount of Indebtedness secured by such Lien does not exceed the cost of developing, constructing or acquiring
such fixed asset. For the avoidance of doubt, for the purposes of this clause (ii) only, a Lien shall be deemed to attach as of the first date on which the Company or a Restricted Subsidiary has executed and delivered an agreement
pursuant to which such Lien purports to be created or, if earlier, the first date upon which any such agreement has been signed by the Company or such Restricted Subsidiary and delivered into escrow or any similar arrangement that would
later permit the release and delivery thereof upon the happening of some event or satisfaction of some later condition;
|
(iii) |
any Lien securing an extension, renewal or refinancing of Indebtedness secured in accordance with clauses (i) and (ii) above, and (xix) and (xx) below;
provided
that (a) the Lien is created over the original asset secured and (b) the principal amount of Indebtedness secured by the Lien prior to
such extension, renewal or refinancing is not increased, other than with respect to reasonable costs, fees and expenses incidental to such extension, renewal, or refinancing;
|
(iv) |
any Lien arising in connection with the permitted sale or other disposition of the Company’s receivables in connection with the securitization of such receivables;
provided
,
however
, that (a) no portion of the
Indebtedness incurred by any special purpose vehicle established in connection with any such securitization transaction (x) shall be guaranteed by the Company or a Restricted Subsidiary or (y) shall be recourse to or obligate the
Company or a Restricted Subsidiary in any way such that the requirements for off balance sheet treatment under Statement of Financial Accounting Standards No. 140 are not satisfied, or (b) neither the Company nor any of its Restricted
Subsidiaries assumes any obligation to maintain or preserve the financial condition or liquidity of any such special purpose vehicle or to cause such entity to achieve certain levels of operating results;
|
(v) |
Liens for taxes not yet delinquent or which are being contested in good faith by appropriate proceedings;
provided
, that appropriate reserves with respect thereto are maintained on the Company’s books or the books of any of the Company’s Restricted Subsidiaries, as the case may be, in conformity with
IFRS;
|
(vi) |
Liens arising by reason of any judgment, decree or order of any court, so long as such Lien is being contested in good faith and any appropriate legal proceedings which may
have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired;
|
(vii) |
pledges, deposits or other security in connection with workers’ compensation or other unemployment insurance or obligations arising from other social security laws or
legislation arising in the ordinary course of business;
|
(viii) |
deposits made in the ordinary course of business and in each case not Incurred or made in connection with the borrowing of money, to secure (a) the performance of tenders,
bids, trade contracts, leases, statutory obligations, surety and appeal bonds, customs duties, leases, government performance and run-of-money bonds and similar obligations or (b) the performance bonds, purchase, construction or sales
contracts and other obligations of a like nature;
|
(ix) |
Capitalized Lease Obligations;
|
(x) |
leases or subleases granted to others, easements, rights-of-way, restrictions and other similar charges or encumbrances, in each case incidental to, and not interfering
with, the ordinary conduct of the Company’s business or the business of any of its Restricted Subsidiaries;
|
(xi) |
Liens created in order to comply with any rule or regulation of a Governmental Authority;
provided
, that (a) the assets subject to such Liens are used in the Company’s gas transportation business conducted pursuant to the License, (b) such Liens are created only on the additional assets or properties
constructed or developed by the Company in connection with an expansion project mandated by a Governmental Authority, and (c) no Liens are created over the revenues generated by such assets except as otherwise permitted by clause (xxiv)
below;
provided
,
however
, that the
Indebtedness secured by such Lien has no recourse against the Company or the Company’s Properties, except in respect of the additional assets subject to such Liens;
|
(xii) |
Liens on assets securing Attributable Debt under any Sale and Lease-Back Transaction permitted to be Incurred or assumed in accordance with Section 10.14, provided that any
such Lien does not encumber any property other than the assets that are the subject of the applicable Sale and Lease-Back Transaction; and Liens on assets securing Indebtedness represented by Capitalized Lease Obligations and permitted
to be incurred or assumed under Section 10.10 (including any interest or title of a lessor under any lease the obligations under which are Capitalized Lease Obligations and covering only the assets acquired with such Indebtedness);
|
(xiii) |
statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens imposed by law incurred in the ordinary
course of business for sums not yet delinquent or being contested in good faith, if such reserve or other appropriate provision, if any, as shall be required by IFRS shall have been made in respect thereof;
|
(xiv) |
zoning restrictions, licenses, sublicenses, easements, servitudes, rights of way, title defects, covenants running with the land, and other similar charges or encumbrances
or restrictions, and leases or subleases granted by the Company or any Restricted Subsidiary to other Persons, in each case not materially interfering with the ordinary operation of any property subject thereto or the conduct of the
business of the Company or any Restricted Subsidiary or materially and adversely affecting the value of the property subject thereto;
|
(xv) |
Liens securing trade letters of credit issued in the ordinary course of business (including letters of credit issued in connection with the obligations set forth in clause
(vii) above), which Liens extend only to the goods and documents related to such letters of credit and which letters of credit were issued in compliance with Section 10.10;
|
(xvi) |
Liens arising solely by virtue of any statutory or common law provisions relating to banker’s Liens, rights of set-off or similar rights and remedies as to deposit accounts
or other funds maintained with a depositary institution;
|
(xvii) |
Liens to secure the Notes;
|
(xviii) |
Liens securing obligations under Hedging Agreements or Currency Agreements;
|
(xix) |
any Lien securing or providing for the payment of Indebtedness Incurred in connection with any Project Financing;
provided
that the properties to which any such Lien applies are (a) properties which are the subject of such Project Financing or (b) revenues or claims which arise from the operation,
failure to meet specifications, failure to complete, exploitation, sale or loss of, or damage to, such properties which are the subject of such Project Financing;
|
(xx) |
Liens securing Acquired Indebtedness Incurred in accordance with Section 10.10 not incurred in connection with, or in anticipation or contemplation of, the relevant
acquisition, merger or consolidation;
provided
that:
|
|
(a) |
such Liens secured such Acquired Indebtedness at the time of and prior to the Incurrence of such Acquired Indebtedness by the Company or a Restricted Subsidiary and were
not granted in connection with, or in anticipation of the Incurrence of such Acquired Indebtedness by the Company or a Restricted Subsidiary; and
|
|
(b) |
such Liens do not extend to or cover any property of the Company or any Restricted Subsidiary other than the property that secured the Acquired Indebtedness prior to the
time such Indebtedness became Acquired Indebtedness of the Company or a Restricted Subsidiary and are no more favorable to the lienholders than the Liens securing the Acquired Indebtedness prior to the Incurrence of such Acquired
Indebtedness by the Company or a Restricted Subsidiary;
|
(xxi) |
Liens on pipelines and pipeline facilities that arise by operation of law;
|
(xxii) |
Liens arising under joint venture agreements, partnership agreements, oil and gas leases or subleases, assignments, purchase and sale agreements, division orders, contracts
for the sale, purchasing, processing, trading, transportation or exchange of energy, oil or natural gas, unitization and pooling declarations and agreements, licenses, sublicenses, net profits interests, participation agreements,
carried working interest, joint operating, royalty, sales and similar agreements relating to the production, generation, processing, transportation, marketing or storing of oil and gas entered into in the ordinary course of business in
a Related Business;
|
(xxiii) |
any Lien on the Capital Stock of an Unrestricted Subsidiary; and
|
(xxiv) |
Liens on the Property of the Company in an aggregate principal amount which, when taken together with all other Liens on the Property of the Company Incurred pursuant to
this clause (xxiv) and outstanding on the date of such Incurrence, does not exceed the greater of (x) US$150 million (or its equivalent in any other currency) and (y) 7% of Consolidated Total Assets.
|
10.14 |
Limitation on Sale and Lease-Back Transactions
|
(i) |
the Company or such Restricted Subsidiary would be entitled to enter into such Sale and Lease-Back Transaction:
|
|
(a) |
pursuant to the provisions of Section 10.10, to Incur Indebtedness in a principal amount equal to or exceeding the Attributable Debt of such Sale and Lease-Back
Transaction; and
|
|
(b) |
pursuant to the provisions of Section 10.13, to Incur a Lien to secure such Indebtedness, or
|
(ii) |
the net proceeds received by the Company or the applicable Restricted Subsidiary in accordance with such Sale and Lease-Back Transaction are at least equal to the Fair
Market Value of such Property.
|
10.15 |
Limitation on Designation of Unrestricted Subsidiaries
|
(i) |
The Company may designate after the Issue Date any Subsidiary of the Company as an “Unrestricted Subsidiary” hereunder (a “
Designation
”)
only if:
|
|
(a) |
such Subsidiary is not a Significant Subsidiary at the time of its Designation;
|
|
(b) |
no Default or Event of Default has occurred and is continuing at the time of or after giving effect to such Designation, and any transactions between the Company or any
Restricted Subsidiary and such Unrestricted Subsidiary are in compliance with Section 10.9; and
|
|
(c) |
the Company would be permitted to make an Investment at the time of Designation (assuming the effectiveness of such Designation and treating such Designation as an
Investment at the time of Designation) as a Restricted Payment pursuant to Section 10.11.
|
(ii) |
The Company or any Restricted Subsidiary will not at any time, except as permitted by Section 10.10 and Section 10.11:
|
|
(a) |
provide credit support for, subject any of its property or assets (other than the Capital Stock of any Unrestricted Subsidiary) to the satisfaction of, or Guarantee any
Indebtedness of any Unrestricted Subsidiary (including any undertaking, agreement or instrument evidencing such Indebtedness);
|
|
(b) |
be directly or indirectly liable for any Indebtedness of any Unrestricted Subsidiary; or
|
|
(c) |
be directly or indirectly liable for any Indebtedness which provides that the holder thereof may (upon notice, lapse of time or both) declare a default thereon or cause the
payment thereof to be accelerated or payable prior to its final scheduled maturity upon the occurrence of a default with respect to any Indebtedness of any Unrestricted Subsidiary.
|
(iii) |
The Company may revoke any Designation of a Subsidiary as an Unrestricted Subsidiary (a “
Revocation
”)
only if:
|
|
(a) |
no Default or Event of Default has occurred and is continuing at the time of and after giving effect to such Revocation; and
|
|
(b) |
all Liens and Indebtedness of such Unrestricted Subsidiary outstanding immediately following such Revocation would, if Incurred at such time, have been permitted to be
Incurred for all purposes of this Indenture.
|
(iv) |
Upon a Restricted Subsidiary becoming an Unrestricted Subsidiary,
|
|
(a) |
all existing Investments of the Company and the Restricted Subsidiaries therein (valued at the Company’s proportional share of the Fair Market Value of the assets of the
Unrestricted Subsidiary less liabilities) will be deemed made at that time;
|
|
(b) |
all existing Capital Stock or Indebtedness of the Company or a Restricted Subsidiary held by it will be deemed Incurred at that time, and all Liens on property of the
Company or a Restricted Subsidiary held by it will be deemed incurred at that time;
|
|
(c) |
all existing transactions between it and the Company or any Restricted Subsidiary will be deemed entered into at that time; and
|
|
(d) |
it will cease to be subject to the provisions of this Indenture as a Restricted Subsidiary.
|
(v) |
Upon an Unrestricted Subsidiary becoming, or being deemed to become, a Restricted Subsidiary,
|
|
(a) |
all of its Indebtedness and Disqualified or Preferred Stock will be deemed Incurred at that time for purposes of Section 10.10;
|
|
(b) |
Investments therein previously charged under Section 10.11 will be credited thereunder; and
|
|
(c) |
it will be subject to the provisions of this Indenture as a Restricted Subsidiary.
|
10.16 |
Waiver of Certain Covenants
|
10.17 |
Release of Covenants
|
(i) |
with respect to any series of Notes issued under this Indenture, such series of Notes has been assigned an Investment Grade Rating by any two Nationally Recognized
Statistical Rating Organizations; and
|
(ii) |
no Default or Event of Default shall have occurred and be continuing,
|
11. |
REDEMPTION AND REPURCHASE OF NOTES
|
11.1 |
Applicability of Article
|
11.2 |
Redemption for Tax Reasons
|
11.3 |
Optional Redemption
|
(1) |
Optional redemption on or prior to May 2, 2022
.
|
(i) |
“
Comparable Treasury Issue
” means the United States Treasury security or securities
selected by an Independent Investment Banker as having an actual or interpolated maturity comparable to the term from the Redemption Date to May 2, 2022 that would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of a comparable maturity to the term from the Redemption Date to May 2, 2022.
|
(ii) |
“
Comparable Treasury Price
” means, with respect to any Redemption Date, (a) the
average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest such Reference Treasury Dealer Quotation or (b) if the Company obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such quotations.
|
(iii) |
“
Independent Investment Banker
” means one of the Reference Treasury Dealers
appointed by the Company.
|
(iv) |
“
Reference Treasury Dealers
” means each of HSBC Securities (USA) Inc., J.P. Morgan
Securities LLC, or its respective affiliates that are primary United States government securities dealers and up to three other leading primary United States government securities dealer in New York City reasonably designated by the
Company;
provided
that, if any of the foregoing shall cease to be a primary United States government securities dealer in New York City (a
“
Primary Treasury Dealer
”), the Company shall substitute therefor another Primary Treasury Dealer.
|
(v) |
“
Reference Treasury Dealer Quotation
” means, with respect to each Reference
Treasury Dealer and any Redemption Date, the average, as determined by the Independent Investment Banker, of the bid and asked price for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Independent Investment Banker by such Reference Treasury Dealer at 3:30 p.m. New York time on the third Business Day preceding such Redemption Date.
|
(vi) |
“
Treasury Rate
” means, with respect to any Redemption Date, the rate per annum
equal to the semi-annual equivalent yield to maturity or interpolated maturity (on a day count basis) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal
amount) equal to the Comparable Treasury Price for such Redemption Date. The Treasury Rate shall be calculated by the Independent Investment Banker on the third Business Day preceding the Redemption Date.
|
(2) |
Optional redemption on or after May 2, 2022
.
|
During the 12 Months Beginning on
|
Applicable Percentage
|
|||
May 2, 2022
|
103.375
|
%
|
||
May 2, 2023
|
101.688
|
%
|
||
May 2, 2024 and thereafter
|
100.000
|
%
|
(3) |
Optional Redemption upon Equity Offering
.
|
|
(a) |
at least 65% of the aggregate principal amount of the Notes originally issued hereunder on the Issue Date remain Outstanding immediately after the occurrence of such
redemption; and
|
|
(b) |
each such redemption occurs within 90 days of the date of the closing of any such Equity Offering.
|
11.4 |
Optional Redemption Procedures
|
(1) |
Notes Redeemed in Part
|
(2) |
Election to Redeem; Notices
|
|
(i) |
the Redemption Date,
|
|
(ii) |
the Redemption Price,
|
|
(iii) |
the CUSIP or other identifying number of such Notes to be redeemed,
|
|
(iv) |
if less than all of the Outstanding Notes are to be redeemed, the identification (and, in the case of partial redemption, the principal amounts) of the particular Notes to
be redeemed,
|
|
(v) |
that, on the Redemption Date, the Redemption Price shall become due and payable upon each such Note to be redeemed and, if applicable, that interest thereon shall cease to
accrue on and after said date,
|
|
(vi) |
the place or places where, and the date by which, each such Note is to be surrendered for payment of the Redemption Price, and
|
|
(vii) |
that the redemption is for a sinking fund, if such is the case.
|
(3) |
Notes Payable on the Redemption Date
|
(4) |
Deposit of Redemption Price
|
(5) |
Redemption of Outstanding Notes Following a Change of Control Offer, Asset Sale Offer or other tender
|
(6) |
Conditional Redemption
|
11.5 |
Purchase of Notes Upon Change of Control Event
|
(i) |
accept for payment all Notes or portions of Notes (of US$150,000 or in integral multiples of US$1,000 in excess thereof) properly tendered and not withdrawn pursuant to the
Change of Control Offer; and
|
(ii) |
deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the principal amount of Notes being redeemed by the
Company.
|
11.6 |
Open Market Purchases of Notes
|
12. |
SINKING FUNDS
|
12.1 |
Applicability of Article
|
12.2 |
Satisfaction of Sinking Fund Payments with Notes
|
12.3 |
Redemption of Notes for Sinking Fund
|
13. |
DEFEASANCE AND COVENANT DEFEASANCE
|
13.1 |
Company’s Option to Effect Defeasance or Covenant Defeasance
|
13.2 |
Defeasance and Discharge
|
13.3 |
Covenant Defeasance
|
13.4 |
Conditions to Defeasance or Covenant Defeasance
|
(1) |
The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee which satisfies the requirements contemplated by Section 6.9 and
agrees to comply with the provisions of this Article applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and dedicated solely to, the benefits of the Holders
of such Notes, (A) money in an amount, or (B) U.S. Government Obligations which through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one day before the
due date of any payment, money in an amount, or (C) a combination thereof, in each case sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered
to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee) to pay and discharge, the principal of and any premium and interest on such Notes on the respective Stated
Maturities, in accordance with the terms of this Indenture and such Notes.
|
(2) |
In the event of an election to have Section 13.2 apply to any Notes or any series of Notes, as the case may be, the Company shall have delivered to the Trustee an Opinion
of Counsel stating that (A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (B) since the date of this instrument, there has been a change in the applicable Federal income tax law,
in either case (A) or (B) to the effect that, and based thereon such opinion shall confirm that, the Holders of such Notes will not recognize income, gain or loss for Federal income tax purposes as a result of the deposit, Defeasance
and discharge to be effected with respect to such Notes and will be subject to Federal income tax on the same amount, in the same manner and at the same times as would be the case if such deposit, Defeasance and discharge were not to
occur.
|
(3) |
In the event of an election to have Section 13.3 apply to any Notes or any series of Notes, as the case may be, the Company shall have delivered to the Trustee an Opinion
of Counsel to the effect that the Holders of such Notes will not recognize income, gain or loss for Federal income tax purposes as a result of the deposit and Covenant Defeasance to be effected with respect to such Notes and will be
subject to Federal income tax on the same amount, in the same manner and at the same times as would be the case if such deposit and Covenant Defeasance were not to occur.
|
(4) |
The Company shall have delivered to the Trustee an Officers’ Certificate to the effect that neither such Notes nor any other Notes of the same series, if then listed on any
securities exchange, will be delisted as a result of such deposit.
|
(5) |
No event which is, or after notice or lapse of time or both would become, an Event of Default with respect to such Notes or any other Notes shall have occurred and be
continuing at the time of such deposit or, with regard to any such event specified in Section 5.1(6), at any time on or prior to the 90th day after the date of such deposit (it being understood that this condition shall not be deemed
satisfied until after such 90th day).
|
(6) |
Such Defeasance or Covenant Defeasance shall not cause the Trustee to have a conflicting interest within the meaning of the Trust Indenture Act (assuming all Notes are in
default within the meaning of such Act).
|
(7) |
Such Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any other agreement or instrument to which the Company
is a party or by which it is bound.
|
(8) |
Such Defeasance or Covenant Defeasance shall not result in the trust arising from such deposit constituting an investment company within the meaning of the Investment
Company Act unless such trust shall be registered under such Act or exempt from registration thereunder.
|
(9) |
The Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent with respect to such
Defeasance or Covenant Defeasance have been complied with and no violations under instruments or agreements governing any other outstanding Indebtedness of the Company would result therefrom.
|
13.5 |
Deposited Money and U.S. Government Obligations to Be Held in Trust; Miscellaneous Provisions
|
13.6 |
Reinstatement
|
TRANSPORTADORA DE GAS DEL SUR S.A., AS ISSUER
|
||
By:
|
|
|
Name:
|
||
Title:
|
By:
|
|
|
Name:
|
||
Title:
|
By:
|
|
|
Name:
|
||
Title:
|
||
By:
|
|
|
Name:
|
||
Title:
|
1. |
Loan by the Company to Pampa Energía S.A. in the amount of US$26 million (entered into on October 6, 2011).
|
Trustee
|
Amount of Compensation
|
|||
Delaware Trust Company
|
$
|
57,500
|
2
|
2 |
Based on $5,000 initially and $7,500 annually. This amount does not include out-of-pocket expensese or additional fees if there is an
Event of Default.
|
(1) |
Rule 904 Transfers. If the transfer is being effected in accordance with Rule 904:
|
|
(A) |
the Owner is not a distributor of the Notes, an Affiliate of the Company or any such distributor or a person acting on behalf of any of the foregoing;
|
|
(B) |
the offer of the Specified Notes was not made to a person in the United States;
|
|
(C) |
either:
|
|
(i) |
at the time the buy order was originated, the Transferee was outside the United States or the Owner and any person acting on its behalf reasonably believed that the
Transferee was outside the United States, or
|
|
(ii) |
the transaction is being executed in, on or through the facilities of the Eurobond market, as regulated by the International Securities Market Association, or another
designated offshore securities market, and neither the Owner nor any person acting on its behalf knows that the transaction has been prearranged with a buyer in the United States;
|
|
(D) |
no directed selling efforts have been made in the United States by or on behalf of the Owner or any Affiliate thereof;
|
|
(E) |
if the Owner is a dealer in securities or has received a selling concession, fee or other remuneration in respect of the Specified Notes, and the transfer is to occur
during the Distribution Compliance Period, then the requirements of Rule 904(b)(1) have been satisfied;
|
|
(F) |
the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act; and
|
|
(G) |
in the case of a transfer to a Regulation S Global Note occurring during the Distribution Compliance Period, upon completion of the transaction, the beneficial interest
being transferred will be held through an Agent Member acting for and on behalf of Euroclear or Clearstream, Luxembourg.
|
(2) |
Rule 144 Transfers. If the transfer is being effected pursuant to Rule 144:
|
|
(A) |
the transfer is occurring after [
insert date that is one year after the original issue
date of the Notes
] and is being effected in accordance with the applicable amount, manner of sale and notice requirements of Rule 144; or
|
|
(B) |
the transfer is occurring after [
insert date that is two years after the original issue
date of the Notes
] and the Owner is not, and during the preceding three months has not been, an Affiliate of the Company.
|
Dated:
|
|
(Print the name of the Undersigned, as such term
is
defined in the second paragraph of this certificate.)
|
|
[ ]
|
|
By:
|
||
Name:
|
||
Title:
|
(If the Undersigned is a corporation, partnership or fiduciary, the title of the person signing on behalf of the Undersigned must be
stated.)
|
(1) |
Rule 144A Transfers. If the transfer is being effected in accordance with Rule 144A:
|
|
(A) |
the Specified Notes are being transferred to a person that the Owner and any person acting on its behalf reasonably believe is a “qualified institutional buyer” within the
meaning of Rule 144A, acquiring for its own account or for the account of a qualified institutional buyer; and
|
|
(B) |
the Owner and any person acting on its behalf have taken reasonable steps to ensure that the Transferee is aware that the Owner may be relying on Rule 144A in connection
with the transfer.
|
(2) |
Rule 144 Transfers. If the transfer is being effected pursuant to Rule 144:
|
|
(A) |
the transfer is occurring after [
insert date that is one year after the original issue
date of the Notes
] and is being effected in accordance with the applicable amount, manner of sale and notice requirements of Rule 144; or
|
|
(B) |
the transfer is occurring after [
insert date that is two years after the original issue
date of the Notes
] and the Owner is not, and during the preceding three months has not been, an Affiliate of the Company.
|
By:
|
||
Name:
|
||
Title:
|
Dated:
|
|
(Print the name of the Undersigned, as such term
is defined in the second paragraph of this certificate.)
|
|
By:
|
||
Name:
|
||
Title:
|
(If the Undersigned is a corporation, partnership or fiduciary, the title of the person signing on behalf of the Undersigned must be stated.)
|
Dated:
|
|
(Print the name of the Undersigned, as such term
is
defined in the second paragraph of this certificate.)
|
|
[ ]
|
|
By:
|
||
Name:
|
||
Title:
|
(If the Undersigned is a corporation, partnership or fiduciary, the title of the person signing on behalf of the Undersigned must be
stated.)
|
1. |
Title
. The designation of the first series of Notes
shall be the 6.750% Senior Notes Due 2025 (the “
Notes
”).
|
2. |
Principal Amount
. The aggregate principal amount of the
Notes shall be US$500,000,000.
|
3. |
Persons Entitled to Interest Payments
. Subject to the
provisions of Section 3.8 of the Indenture, interest will be payable to the Person in whose name a Note (or any Note) is registered at the close of business on the Regular Record Date (as defined below) for such interest.
|
4. |
Stated Maturity Date
. May 2, 2025.
|
5. |
Interest Rates and Interest Payment Dates
. The Notes
shall bear interest at the rate of 6.750% per annum (the “
Interest Rate
”). The Notes will bear interest on the outstanding unpaid
principal amount thereof at the Interest Rate from the date hereof or from the most recent Interest Payment Date to which interest has been paid or duly provided for, until the principal amount of the Notes has been paid or duly
provided for. Interest on the Notes shall be paid semi-annually in arrears on May 2 and November 2 of each year (each, an “
Interest Payment
Date
”), commencing November 2, 2018. The “
Regular Record Date
” for interest payable with respect to the Notes on an Interest
Payment Date shall be the April 17 and October 17 (whether or not such date is a Business Day), as the case may be, next preceding such Interest Payment Date.
|
6. |
Place of Payment
. The principal of, and any premium
and interest on, the Notes shall be payable at the offices or agencies of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, United States and in Buenos Aires, Argentina.
|
7. |
Optional Redemption Price
. (a) Subject to and in
accordance with the provisions of Section 11.3(1) of the Indenture, at any time and from time to time prior to May 2, 2022, the Notes shall be redeemable, at the option of the Company, in whole or in part, at a redemption price equal
to the greater of (1) 100% of the principal amount of such Notes, and (2) the present value to be calculated by an Independent Investment Banker at the date of redemption (the “
Redemption Date
”) of (i) the redemption price of such Notes at May 2, 2022 (such redemption price being set forth in the table under clause (2) below)
plus,
(ii) all required interest payments thereon through
May
2, 2022 on such Notes (excluding accrued but unpaid interest to the Redemption Date), in each case, discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate
plus
50 basis points,
plus
,
in each case, Additional Amounts and accrued and unpaid interest, if any, on the principal amount of such Notes to, but excluding, the Redemption Date.
|
During the 12 Months Beginning
on
|
Price
|
May 2, 2022
|
103.375%
|
May 2, 2023
|
101.688%
|
May 2, 2024 and thereafter
|
100.000%
|
8. |
Purchase of Notes Upon Change of Control Event
. Each
Holder of Notes will be entitled to require the Company to purchase all or a portion of such Holder’s Notes upon the occurrence of a Change of Control Event as provided in, and in accordance with, Section 11.5 of the Indenture.
|
9. |
Sinking Fund
. The Company shall not be obligated to
redeem or purchase the Notes pursuant to any sinking fund or analogous provisions.
|
10. |
Defeasance
. The Notes shall be defeasible as provided
in, and in accordance with, Sections 13.2 and 13.3 of the Indenture.
|
11. |
Form of Notes
. The Notes may be issued in whole or in
part in the form of one or more Global Notes (and may be exchanged for certificated Notes only as described in the Indenture). The initial Depositary for any such Global Notes shall be The Depository Trust Company. The form of the
Regulation S Global Note for the Notes is attached hereto as Exhibit A-1, the form of the Restricted Global Note for the Notes is attached hereto as Exhibit A-2.
|
12. |
Securities Act Legends
. Section 3.6(c)(iv) of the
Indenture shall not apply to the Notes.
|
13. |
Definitions
. Unless the context shall otherwise
require, or unless otherwise defined herein or in Annex A hereto, capitalized terms used herein shall have the respective meanings specified in the Indenture.
|
Dated: May 2, 2018
|
|||
IN WITNESS WHEREOF
, the undersigned
have signed this certificate.
|
|||
/s/ Alejandro M. Basso
|
|||
Name:
|
Alejandro M. Basso
|
||
Title:
|
Chief Financial Officer
|
No. S-1
|
U.S.$294,336,000
|
TRANSPORTADORA DE GAS DEL SUR S.A.
|
||
By:
|
|
|
Name
|
||
Director
|
||
By:
|
|
|
Name
|
||
Syndic
|
DELAWARE TRUST COMPANY, not in its individual capacity but solely as Trustee
|
||
By:
|
||
|
Authorized Signatory
|
Date
|
Principal amount
of non-Global
Notes or other
Global Notes issued
in exchange for or
upon transfer of an
interest in this
Global Note
|
Principal amount
of this Global Note
redeemed, repaid
or repurchased
|
Increase in
principal amount
of this Global Note
due to the exchange
or transfer of
another Note (or an
interest therein) for
an interest in this
Note
|
Remaining
principal amount
of this
Global Note
|
Notation made on
behalf of the
Trustee by
|
|||||
During the 12 Months Beginning
|
Applicable Percentage
|
|||
May 2, 2022
|
103.375
|
%
|
||
May 2, 2023
|
101.688
|
%
|
||
May 2, 2024 and thereafter
|
100.000
|
%
|
|
(1) |
any Taxes that would not have been so imposed, deducted or withheld but for the existence of any present or former connection between the relevant
Holder or beneficial owner of a Note (or between a fiduciary, settlor, beneficiary, member, partner or shareholder of, the relevant Holder or beneficial owner, if the relevant Holder or beneficial owner is an estate, nominee, trust,
limited liability company, partnership or corporation) and the Relevant Taxing Jurisdiction (including being a citizen or resident or national or domiciliary of, or carrying on a business or maintaining a permanent establishment that
is the holder of the Notes in the Relevant Taxing Jurisdiction), other than the mere ownership, holding, purchase or disposition of such Note or the receipt of such payment in respect thereof, or the exercise or enforcement of any
rights under the Notes or the Indenture;
|
|
(2) |
any Taxes which are imposed, payable or due because definitive Notes are presented for payment (where presentation is required) more than 30 days after
the later of (a) the date such payment was due and (b) if the full amount payable has not been received by the Trustee on or prior to such due date, the date on which, the full amount having been so received, notice to that effect
will have been given to the Holders by the Trustee; except for Additional Amounts with respect to Taxes that would have been imposed had the Holder presented the Note for payment during such 30-day period;
|
|
(3) |
any Taxes that are imposed or withheld by reason of the failure of the Holder or beneficial owner of a Note to comply, at the Company’s written
request, with any certification, identification, information, documentation or other reporting requirements if (a) such compliance is required or imposed by a statute, treaty or regulation or administrative practice of the Relevant
Taxing Jurisdiction as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes, and (b) the Company has given the Holder or the beneficial owner at least 30 days’ notice that the Holder or
beneficial owner will be required to so comply;
|
|
(4) |
any Note presented for payment (where presentation is required) at an office of a paying agent in Argentina (provided that the Notes can also be
presented at an office of a paying agent outside of Argentina without any such withholding or deduction);
|
|
(5) |
any Taxes payable otherwise than by withholding or deduction from payments on or with respect to the Notes;
|
|
(6) |
any Taxes imposed pursuant to Sections 1471-1474 of the U.S. Internal Revenue Code (or any amended or successor version that is substantively
comparable and not materially more onerous to comply with), the U.S. Treasury regulations thereunder and any other official guidance thereunder (“FATCA”), any intergovernmental agreement entered into with respect to FATCA, or any law,
regulation or other official guidance enacted in any jurisdiction implementing, or relating to, FATCA, or any such intergovernmental agreement;
|
|
(7) |
any Taxes levied and/or applicable to payments made to Argentine taxpayers subject to inflation adjustment rules as provided for in Title VI of the
Argentine Income Tax Law;
|
|
(8) |
any estate, inheritance, gift, value added, personal property, sales, use, excise, transfer or other similar Tax imposed with respect to such payment;
or
|
|
(9) |
any combination of (1), (2), (3), (4), (5), (6), (7) or (8) above.
|
No. R-1
|
U.S.$205,664,000 |
TRANSPORTADORA DE GAS DEL SUR S.A.
|
||
By:
|
||
|
Name
|
|
|
Director | |
By:
|
||
|
Name
|
|
|
Syndic
|
DELAWARE TRUST COMPANY, not in its individual capacity but solely as Trustee
|
||
By:
|
||
Authorized Signatory
|
Date
|
Principal amount
of non-Global
Notes or other Global Notes issued
in exchange for or
upon transfer of an interest in this
Global Note
|
Principal amount
of this Global Note
redeemed, repaid
or repurchased
|
Increase in
principal amount
of this Global Note
due to the exchange
or transfer of
another Note (or an
interest therein) for
an interest in this
Note
|
Remaining
principal amount
of this
Global Note
|
Notation made on
behalf of the
Trustee by
|
|||||
During the 12 Months Beginning
|
Applicable Percentage
|
|||
May 2, 2022
|
103.375
|
%
|
||
May 2, 2023
|
101.688
|
%
|
||
May 2, 2024 and thereafter
|
100.000
|
%
|
|
(1) |
any Taxes that would not have been so imposed, deducted or withheld but for the existence of any present or former connection between the relevant Holder or beneficial
owner of a Note (or between a fiduciary, settlor, beneficiary, member, partner or shareholder of, the relevant Holder or beneficial owner, if the relevant Holder or beneficial owner is an estate, nominee, trust, limited liability
company, partnership or corporation) and the Relevant Taxing Jurisdiction (including being a citizen or resident or national or domiciliary of, or carrying on a business or maintaining a permanent establishment that is the holder of
the Notes in the Relevant Taxing Jurisdiction), other than the mere ownership, holding, purchase or disposition of such Note or the receipt of such payment in respect thereof, or the exercise or enforcement of any rights under the
Notes or the Indenture;
|
|
(2) |
any Taxes which are imposed, payable or due because definitive Notes are presented for payment (where presentation is required) more than 30 days after the later of (a)
the date such payment was due and (b) if the full amount payable has not been received by the Trustee on or prior to such due date, the date on which, the full amount having been so received, notice to that effect will have been
given to the Holders by the Trustee; except for Additional Amounts with respect to Taxes that would have been imposed had the Holder presented the Note for payment during such 30-day period;
|
|
(3) |
any Taxes that are imposed or withheld by reason of the failure of the Holder or beneficial owner of a Note to comply, at the Company’s written request, with any
certification, identification, information, documentation or other reporting requirements if (a) such compliance is required or imposed by a statute, treaty or regulation or administrative practice of the Relevant Taxing
Jurisdiction as a precondition to exemption from, or reduction in the rate of deduction or withholding of, such Taxes, and (b) the Company has given the Holder or the beneficial owner at least 30 days’ notice that the Holder or
beneficial owner will be required to so comply;
|
|
(4) |
any Note presented for payment (where presentation is required) at an office of a paying agent in Argentina (provided that the Notes can also be presented at an office
of a paying agent outside of Argentina without any such withholding or deduction);
|
|
(5) |
any Taxes payable otherwise than by withholding or deduction from payments on or with respect to the Notes;
|
|
(6) |
any Taxes imposed pursuant to Sections 1471-1474 of the U.S. Internal Revenue Code (or any amended or successor version that is substantively comparable and not
materially more onerous to comply with), the U.S. Treasury regulations thereunder and any other official guidance thereunder (“FATCA”), any intergovernmental agreement entered into with respect to FATCA, or any law, regulation or
other official guidance enacted in any jurisdiction implementing, or relating to, FATCA, or any such intergovernmental agreement;
|
|
(7) |
any Taxes levied and/or applicable to payments made to Argentine taxpayers subject to inflation adjustment rules as provided for in Title VI of the Argentine Income Tax
Law;
|
|
(8) |
any estate, inheritance, gift, value added, personal property, sales, use, excise, transfer or other similar Tax imposed with respect to such payment; or
|
|
(9) |
any combination of (1), (2), (3), (4), (5), (6), (7) or (8) above.
|
Alejandro Basso | Hernán Diego Flores Gomez |
Attorney in fact | Attorney in fact |
|
TRANSPORTADORA DE GAS DEL SUR S.A.
|
||
(Registrant)
|
|||
|
By:
|
||
/s/ Javier Gremes Cordero
|
|||
|
Name:
|
Javier Gremes Cordero
|
|
|
Title:
|
Chief Executive Officer
|
|
|
/s/ Alejandro M. Basso
|
||
|
Name:
|
Alejandro M. Basso
|
|
|
Title:
|
Chief Financial Officer and
|
|
|
Services Vice President
|
Company Name
|
Country of
incorporation
|
Proportion of Ownership
Interest
|
||
Telcosur S.A.
|
Argentina
|
99.98%
|
||
CTG
|
Argentina
|
100.00%
|
1. |
I have reviewed this annual report on Form 20-F for the year ended December 31, 2018, of Transportadora de Gas del Sur S.A.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light
of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition,
results of operations and cash flows of the company as of, and for, the periods presented in this report;
|
4. |
The company’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)), for the company and have:
|
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material
information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c) |
Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d) |
Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has
materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
|
5. |
The company’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors
and the audit committee of the company’s board of directors (or persons performing the equivalent function):
|
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect
the company’s ability to record, process, summarize and report financial information; and
|
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.
|
|
/s/ Javier Gremes Cordero
|
|
Oscar Javier Gremes Cordero
|
|
Chief Executive Officer
|
1. |
I have reviewed this annual report on Form 20-F for the year ended December 31, 2018, of Transportadora de Gas del Sur S.A.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light
of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition,
results of operations and cash flows of the company as of, and for, the periods presented in this report;
|
4. |
The company’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)), for the company and have:
|
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material
information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c) |
Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d) |
Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has
materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
|
5. |
The company’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors
and the audit committee of the company’s board of directors (or persons performing the equivalent function):
|
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect
the company’s ability to record, process, summarize and report financial information; and
|
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.
|
|
/s/ Alejandro M. Basso
|
|
Alejandro M. Basso
|
|
Chief Financial Officer and Services Vice President
|
|
/s/ Javier Gremes Cordero
|
|
Javier Gremes Cordero
|
|
Chief Executive Officer
|
|
/s/ Alejandro M. Basso
|
|
Alejandro M. Basso
|
|
Chief Financial Officer and Services Vice President
|