GRAND FORKS — Claims that a Chinese sovereign wealth fund owns a significant portion of the multinational parent company of the Whiskey Creek wind farm development project are false, a Herald investigation has concluded.
Based on a review of publicly available data on Engie’s financial and shareholder structure, China Investment Corporation does not own a significant portion of Engie SA, a French multinational utility company. Engie SA is the parent company of Engie North America, which counts Whiskey Creek LLC as a subsidiary.
Concerns about Chinese investment in Engie SA led the Grand Forks County Commission to suspend wind farm development in April, which was later extended to September.
Although the moratorium has ended, Engie North America has since said the Whiskey Creek project could be delayed by two to four years as further studies need to be conducted at the proposed wind farm site. suggested.
On April 25, members of the Grand Forks County Commission announced that Tom Ford, County Executive Director, told the committee that China Investment Corporation (a country’s sovereign wealth fund valued at approximately $1.35 trillion in 2023) ) and passed a 90-day moratorium on the Whiskey Creek development. It held a 49% ownership interest in Engie SA. The Herald published this claim in an article published the same day.
Last month, Engie North America asked the Herald to publish a correction. According to an email from the company to the Herald, ENGIE SA “is not owned in whole or in part by China Investment Corporation. Additionally, ENGIE SA is not owned in whole or in part by China Investment Corporation. Additionally, ENGIE Currently, only three companies are based in China.” ENGIE has a minority interest in its subsidiaries. ENGIE’s international business activities in China are small; We are planning to sell them all at once, so the number continues to decline.”
From the beginning, there was confusion among county officials between Engie North America and its French parent company.
“When we first learned about Engie, we didn’t know there was a difference between Engie and Engie North America,” Ford told the Herald this month. “And county officials were concerned that (Engie SA) had some ties to (China Investment Corporation) on paper.”
Ford said he based his assessment on an article published by Reuters Business in 2017 and several oil and gas magazines published in 2017 and 2018.
These articles state that at the time, China Investment Corporation held a 30% stake in Engie SA’s exploration and production assets, but as part of negotiations with Neptune Energy, as Neptune Energy was seeking to acquire Engie’s E&P assets. discusses how CIC expanded its stake to 49%.
Exploration and production (E&P) is a term used in the oil and gas industry to refer to the process of identifying fossil fuel deposits and extracting them.
Press releases dated back to 2015 on Engie SA’s website also indicate that the multinational’s relationship with China Investment Corporation began as early as 2011. Engie SA held stakes in several Chinese companies as recently as 2015, according to the company’s website.
The Herald was unable to conduct a full investigation of Engie SA’s corporate portfolio, which includes dozens of subsidiaries around the world and employs approximately 94,000 people.
But a review of Reuters and trade publication articles by the Herald found that Ford misunderstood the scope of CIC’s relationship with Engie SA and the nature of the purchase agreement between Engie SA, Neptune Energy and CIC. It suggests.
What actually happened in 2017 and 2018 was that Neptune, a joint venture formed by two private equity firms, successfully acquired Engie SA’s E&P assets from a French company. As part of these negotiations, CIC acquired a 49% stake in Neptune Energy and now fully owns his Engie SA’s former E&P assets.
A spokesperson for Neptune Energy confirmed this.
“CIC previously owned a stake in the E&P assets held by Engie, and Neptune purchased the E&P assets from Engie. CIC now holds a 49% stake in Neptune,” Global Communications said. manager Gavin Roberts wrote in an email.
Even if the sale did not go through, CIC did not own anything close to 49% of Engie SA at any point in time. According to public shareholder data, the company’s largest individual stakeholder is the French government, with a 23.6% stake, but internal regulations prohibit any other company from owning more than 5% of Engie SA. I can’t. There is no Chinese person among the largest shareholders.
Furthermore, the €4 billion worth of assets sold to Neptune in 2018 dwarfs the €153 billion in assets that Engie SA reported at the end of 2018. The company had assets of €235 billion at the end of 2022. .
Engie North America representatives told Ford in an August email that the parent company still holds minority stakes in three Chinese companies and has divested from five others in the past two and a half years. , said there are plans to sell it completely.
“The fact we were trying to share is that Engie’s business presence in China is small and actually decreasing,” said Julie Vitek, vice president of government and regulatory affairs for Engie North America. states.
Ford and the county’s concerns didn’t come out of thin air. Ford told the Herald that he became concerned about Whiskey Creek’s parent company after Air Force officials contacted him in March to express concerns about the wind farm’s development due to its proximity to Grand Forks. Told. air force base.
That official, Dan Burke, Director of Foreign Investment Risk Review, later wrote in an April 21 email to Ford and Secretary David Engen that “there are potential national security concerns associated with the location of the Whiskey Creek wind project.” warned of the above concerns.
Burke’s warning comes as the Grand Forks City Council voted 5-0 to block development of a Chinese-owned wet corn mill after the U.S. Air Force described the project as a “serious threat to national security.” The announcement was made just a few months after the decision was made.
Ford said he and county commissioners are already on high alert for any signs of Chinese involvement in regional development.
Mr. Burke did not respond to requests for comment.
“My understanding is that the only way he and his office can come to a conclusion is if they go through the entire (Committee on Foreign Investment in the United States) process,” Ford said.
In August, the Committee on Foreign Investment in the United States designated Grand Forks Air Force Base as a “highly sensitive facility,” giving CFIUS jurisdiction over real estate purchases by foreigners within 99 miles of the base.
Vitek said he does not expect the new designation to affect the Whiskey Creek development because Engie North America remains a U.S. company, and that the project is unlikely to be designated as critical infrastructure. He said he thought about it.
Documents provided by Engie North America to Ford and county commissioners show the company has been in regular contact with Air Force bases and the Defense Department’s Military Aviation and Facilities Location Information Center dating back to 2017. .
John Fournier, a representative for Engie Canada, told the Herald that the company had determined that the existing power lines at the proposed site would require “exorbitant” modifications, so it was not possible to add the wind farm to the grid. He said he is conducting further research on how to connect it.
In a November email to the Herald requesting a correction, the company said it “continues to move forward with the Whiskey Creek project for the benefit of local landowners and all who call Grand Forks County home. We look forward to resolving these interconnection issues.”