To­tal part­ners Adani Group to fuel its larger In­dia play

Chemical Industry Digest - - News & Views -

French oil and gas gi­ant To­tal SA will run liq­ue­fied nat­u­ral gas (LNG) re­gasi­fi­ca­tion ter­mi­nals at Mun­dra and Dhamra and will roll out 1,500 fuel sta­tions over 10 years in part­ner­ship with the Adani Group as it looks to tap the de­mand in the world’s fastest-grow­ing en­ergy market.

To­tal and Adani Group did not dis­close the fi­nan­cial de­tails of the agree­ment, but per­sons briefed on the deal said the Euronext and New York-Stock Ex­change­listed French multi-na­tional would in­vest more than 2,000 crore in a joint ven­ture to de­velop multi-en­ergy of­fer­ings to the In­dian market such as LNG and fuel re­tail­ing.

This is be­cause a firm look­ing to get a li­cence to re­tail fuel should have a min­i­mum in­vest­ment of 2,000 crore in ex­plo­ration or pro­duc­tion, re­fin­ing, gas or prod­uct pipe­line, or ter­mi­nals, ac­cord­ing to gov­ern­ment pol­icy. To­tal, the world’s sec­ond-largest LNG player, is ex­pected to own as much as 50 per cent in the JV, which will ac­com­mo­date the Adani Group’s in­ter­ests in LNG re­gasi­fi­ca­tion fa­cil­i­ties, LPG ter­mi­nals and city gas distri­bu­tion net­works. It will also mark the Adani Group’s en­try into fuel re­tail­ing in In­dia.

The part­ner­ship with Adani Group will help To­tal emerge as the big­gest pri­vate player in In­dia’s LNG sec­tor, over­tak­ing Petronet LNG. To­tal picked Adani Group for a larger In­dia play be­cause the Ahmed­abad­based con­glom­er­ate has the down­stream in­fra­struc­ture crit­i­cal to its plans. This also ex­plains why To­tal ex­ited from the 5-mt LNG re­gasi­fi­ca­tion ter­mi­nal at Hazira in Gu­jarat in Au­gust by sell­ing its 26 per cent stake to the ter­mi­nal’s ma­jor­ity part­ner, Shell Gas BV, a unit of Royal Dutch Shell plc. To­tal had bought the Hazira stake in 2004.

The re­tail fuel out­lets will of­fer In­dian cus­tomers To­tal’s full range of fuels, lu­bri­cants and other prod­ucts and ser­vices.

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