Adani Group’s Rs 6,000-crore Dhamra LNG project in Odisha. (Source: Adani Group’s official website)

Total In Talks To Buy Stake In Adani’s LNG, City Gas Projects

French energy giant Total is in talks to buy up to half of Adani Group's stake in LNG projects in Gujarat and Odisha. The group will also buy stake in an under-construction LPG import facility and in its city gas projects, sources privy to the development said.

Total SA is keen on investing in fast growing gas market in India and finds Adani as a suitable vehicle since it owns crucial downstream infrastructure, they said.

Adani holds 25 percent stake in the just-completed 5 million tonnes per year liquefied natural gas import terminal at Mundra. It is also building a similar capacity LNG import terminal at Dhamra in Odisha for Rs 5,100 crore.

Total is looking at buying 50 percent stake in the under-construction LPG import terminal that Adani is building at Mundra in Gujarat as well as a stake in Adani’s flourishing city gas distribution projects, the sources said. The source added that a preliminary pact may be signed this week during the visit of Total CEO Patrick Pouyanne to India.

India is looking at more than doubling the share of natural gas in its energy basket to 15 percent in the next few years and is giving major push to city gas distribution projects. It imports half of its gas needs, which are projected to rise exponentially as it shifts to environment friendly natural gas.

An e-mail sent to Total for comments remained unanswered and an Adani Group spokesperson wasn't immediately available for comments.

Also read: Adani Gas’ Plea Challenging Bidding Process For PNG, CNG Distribution In Ahmedabad Dismissed

The Mundra LNG terminal has Gujarat State Petroleum Corp as the lead partner, and Adani is building a new LPG import facility at the same port with a total capacity to 3.56 million tonnes per annum. The LPG terminal is set to be completed by November.

Adani Gas, a subsidiary of Adani Enterprises Ltd, is developing city gas distribution networks to supply the piped natural gas to the industrial, commercial, domestic (residential) units and compressed natural gas to the transport sector.

It has already set up city gas distribution networks in Ahmedabad and Vadodara in Gujarat, Faridabad in Haryana and Khurja in Uttar Pradesh.

Adani won rights to 13 cities on its own in the recently concluded city gas distribution bid round. The company, along with none others, will enter a joint venture with state-owned Indian Oil Corporation Ltd. These are in addition to the 50:50 Adani-IOC joint venture winning rights to develop CGD network in Allahabad, Chandigarh, Ernakulam, Panipat, Daman, Dharwad, and Udhamsingh Nagar in previous bid rounds.

Also read: Adani Walks Away With Gas Rights In 21 Cities; BPCL Bags 11 Cities

Sources said Total is looking at buying half of Adani's stake all the CGD networks.

The development comes weeks after Total announced its exit from Royal Dutch Shell-operated Hazira LNG terminal in Gujarat. It sold its 26 percent stake in the project to Shell.

Total in March 2004 had picked up a 26 percent stake in the 2.5 million tonnes a year Hazira liquefied natural gas import terminal in Gujarat. The terminal capacity was later doubled to five million tonne in 2013. Shell held the remaining 74 percent stake in the company.