The project aims to accelerate the region's energy transition and will reduce the carbon footprint by up to 7.4 million tonnes of CO2 equivalent per year, the companies said.

French energy company Engie has agreed to partner with Australian infrastructure investor Macquarie Asset Management to expand the Mayakan gas pipeline in Mexico, the two companies said in a statement on Thursday.

The project aims to accelerate the region's energy transition and will reduce the carbon footprint by up to 7.4 million tonnes of CO2 equivalent per year, the companies said.

The partnership involves Macquarie acquiring a 50% stake for $360 million in the construction of a 700-kilometer gas pipeline in the Yucatan Peninsula, according to a source with knowledge of the deal.

The enterprise value of the project will be up to $3 billion upon completion and the two companies will share management of the company that manages the asset, known as Mayakan System, the person said.

The new gas pipeline will double the natural gas transportation capacity for the Yucatán Peninsula and will pass through the states of Chiapas, Tabasco, Campeche and Yucatán.

The Mexican state electricity company, CFE, signed an agreement with Engie in November 2022 to expand the Mayakan gas pipeline in the Yucatán Peninsula.

BofA Securities and Sumitomo Mitsui Banking Corporation acted as financial advisors to Engie, while Rothschild advised Macquarie.