Spain's Enagas plans multibillion-euro investment in hydrogen infrastructure

By Pietro Lombardi

MADRID (Reuters) - Spanish gas grid operator Enagas plans to invest more than 4 billion euros ($4.18 billion) by the end of the decade, with more than three quarters of that earmarked for hydrogen infrastructure.

With Spanish gas demand falling, Enagas has sold assets, reduced dividends and cut debt to fund plans to diversify into managing a network of hydrogen infrastructure. It is also targeting ammonia and CO2 capture.

Hydrogen will be "the driving force to advance towards the Enagas of the future", Chief Executive Arturo Gonzalo said on Tuesday.

Of the planned 4.04 billion euros in net investment between 2025 and 2030, hydrogen infrastructure will account for 3.13 billion euros, Gonzalo told analysts as he presented the company's strategic update.

Enagas, in which the state owns a 5% stake, is part of a consortium working on the planned trans-European H2Med corridor aimed at connecting Iberia's hydrogen networks with northwest Europe. It also plans to build a hydrogen network in Spain.

The company expects to invest 520 million euros in gas networks and a further 225 million euros in a new company, Scale Green Energy, focused on infrastructure and services in businesses such as CO2 capture.

The company expects core profit of about 875 million euros in 2030. The hydrogen business is expected to contribute about 290 million euros, with its other gas business contributing 400 million euros.

This year's core profit is forecast to fall to 670 million euros from 760.7 million euros last year, the company said, with net debt remaining around 2.4 billion euros.

($1 = 0.9561 euros)

(Reporting by Pietro Lombardi; Editing by Inti Landauro, Kirsten Donovan and David Goodman)