The company plans to invest some $3,000 million in developing liquefied natural gas (LNG) plants in Egypt and Oman, as well as in regassification and distribution facilities in Spain. It is looking to team up with an international partner to share some of the costs and provide technical and marketing expertise.

'We are not just looking for cash; we want a partner with a strong record in downstream marketing,' says Juan Varela, deputy general manager of Union Fenosa's gas division. 'We plan to shortlist first and then sign the deal in October or November. We are talking about selling 20 per cent of the company, but it could be as much as 50 per cent. Whatever is agreed, we want to retain management control.'

Companies that have expressed interest are said to include BPand BG Group, both of the UK, Eni of Italy, the Royal Dutch/ Shell Group, and Gaz de Franceand TotalFinaElf, both of France.

Exploratory talks have been held over the past two years with BP and Shell, which have extensive upstream gas interests in Egypt and are both active in Oman.

Goldman Sachsis advising Union Fenosa on the search for a strategic partner for the gas division (MEED 12:7:02).