 "Total SA in talks with Indian firms for stake in LNG terminals, retail: CEO")
French energy giant Total SA Tuesday said it is in discussions with multiple Indian companies to acquire a stake in LNG import terminals and city gas distribution projects and is also interested in setting up petrol pumps in the world's fastest-growing energy consuming nation.
Total Chairman and CEO Patrick Pouyanne said the French company is "very interested" in investing in downstream sectors in India.
"We are in discussion with many players (for a stake in liquefied natural gas import terminals)," he told reporters.
Refusing to give details, he said Total was interested in selling LNG into India as well as retailing to consumers. It wants to do that through a partnership with local companies.
PTI on Sunday reported that Total is in talks to buy up to half of Adani Group's stake in LNG projects in Gujarat and Odisha, an under-construction LPG import facility and in the firm's city gas projects.
"City gas is interesting business" that can use the imported LNG, he said.
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Pouyanne said Total was also interested in fuel retailing in the country but hasn't yet qualified for a license for that.
"We need to have a license for that (petrol, diesel retailing). We need to get a license, so we are working on that," he said.
A license to set up petrol pumps in India is contingent upon a company investing Rs 20 billion in oil and gas infrastructure like refineries, pipelines, import terminals and oil and gas fields.
He said, Total's investment in a LPG import terminal in Andhra Pradesh doesn't qualify it for a retailing licence.
Sources said the French firm is keen on investing in the fast growing gas market in India and finds Adani a suitable vehicle as it owns the crucial downstream infrastructure.
Adani holds a 25 per cent stake in just-completed 5 million tonnes a year liquefied natural gas (LNG) import terminal at Mundra. It is also building a similar capacity LNG import terminal at Dhamra in Odisha at a cost of Rs 51 billion.
Sources said Total is in talks to buy half of Adani's stake in the two terminals.
It is also looking at buying a 50 per cent stake in 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, they said adding 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 per cent in the next few years and is giving a major push to city gas distribution projects. It imports half of its gas needs, which are projected to rise exponentially as it shifts from polluting liquid fuels to environment friendly natural gas.
While the Mundra LNG terminal has Gujarat State Petroleum Corp (GSPC) as the lead partner, 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 to be completed by next month.
Adani Gas, a subsidiary of Adani Enterprises Ltd, is developing city gas distribution (CGD) networks to supply the piped natural gas (PNG) to the industrial, commercial, domestic (residential) and Compressed Natural Gas (CNG) to the transport sector.
It already has set up city gas distribution networks in Ahmedabad and Vadodara in Gujarat, Faridabad in Haryana and Khurja in Uttar Pradesh.
It in the recently concluded CGD bid round won rights to 13 cities on its own and another 9 in a joint venture with state-owned Indian Oil Corp (IOC). 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.
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 per cent stake in the project to Shell.