The French energy giant Total will buy a 37% stake in Adani Gas
MUMBAI: Total agreed to buy a 37.4 percent stake in India Adani gas , the two companies said on Monday, with the French giant spending $ 600 million to expand their access to the energy-hungry country.
The Indian firm, part of the Adani Group conglomerate, is one of the city's four main gas distributors in the country, and plans to increase its coverage to six million homes and 1,500 points of sale to supply vehicles in the next decade.
Under the terms of the deal, Total will make an open offer to Adani gas shareholders to purchase up to 25.2 percent before buying the remaining equity from the company, leaving the French and Indian firms with an equal share.
The energy needs in India are immense and the Indian energy mix is key to the challenge of climate change, said Patrick Pouyanne, president and CEO of Total, in a statement.
The natural gas market in India will have strong growth and is an attractive outlet for the second largest global LNG player that Total has become, he added.
Natural gas currently represents a fraction of India's energy consumption, about seven percent, while a June report from the Center for Science and Environment studies found that the country's gas-based power plants They were running at 24 percent capacity.
New Delhi has set a goal to increase natural gas consumption to 15 percent by 2030.
"Total's investment in Adani gas reinforces India's natural gas and demand potential. We look forward to working together towards delivering India's vision for clean and green energy," said Gautam Adani, founder of the mining-to-logistics conglomerate.
The Indian group has faced strong criticism for the environmental impact of a huge coal mine scheduled for construction in Australia, and conservationists say it will increase global warming, threaten local vulnerable species and damage the Great Barrier Reef.