French hydrocarbon giant Total in talks for stakes in LNG import terminals in India

By: | Published: October 17, 2018 2:01 AM

This comes close after Total agreeing to sell its 26% stake in the Hazira LNG regassification terminal in Gujarat to Shell India. Both companies signed a letter of intent regarding this in August.

The hydrocarbon major is also planning to invest in city gas distribution and fuel retailing

French hydrocarbon major Total is in talks with various companies to pick up stake in liquefied natural gas (LNG) import terminals in India and is also planning to invest in city gas distribution, (CGD) as well fuel retailing, said the company’s chairman and chief executive officer Patrick Pouyanne on Tuesday in New Delhi.

This comes close after Total agreeing to sell its 26% stake in the Hazira LNG regassification terminal in Gujarat to Shell India. Both companies signed a letter of intent regarding this in August.

Total has also signed an agreement to sell 0.5 million tonne (mt) of LNG per year to Shell for the next five years on delivery basis, so that the latter can supply to the Indian market as well as the neighbouring countries.

While speaking at the India Energy Forum by CERAWEEK, Pouyanne said access to the Indian LNG sector is not a problem as there are multiple projects in the pipeline. However, he did not divulge details of projects that the company is eyeing. India already has four LNG terminals and at least 10 more LNG projects are coming up, which will likely take the total capacity of terminals in the country to around 72.5 million tonne per annum (mtpa).

Experts believe that one of the reasons for Total exiting the Hazira project may be its minority shareholding in the project.

As per recent reports, Total is keen to pick up stakes in Adani Group’s two LNG projects and attached CGD projects. Earlier this year, India’s Petroleum and Natural Gas Regulatory Board signed letters of intent with various companies for supply of piped cooking gas and compressed natural gas for vehicles for 84 geographical areas under the ninth round of city gas distribution (CGD) bidding. Of these, 13 licences were by Adani on its own and nine others in consortium with state-run Indian Oil.

A total of 4,346 CNG stations are to be set in these 84 geographical areas and 2.1 crore households are to be provided piped cooking gas, as per the commitment made by the licence winners.

Total’s interest in the fuel retailing segment comes at a time when the country is reeling under skyrocketing auto fuel prices. As per reports, India has set up a committee led by Kirit Parikh to liberalise the fuel retail market in order to bring in private participation. The committee has been tasked to rework the current architecture and identify, if any, barriers for private players to enter the sector. It may also asses the need to liberalise existing guidelines for authorisation of private sector companies.

The government recently asked the state-run oil marketing companies to absorb `1 per litre of diesel and petrol they sell in order to provide relief to customers.

India at present has 63,275 retail outlets, of which 56,999 belong to state-run companies. Private companies so far have only 6,276 outlets across the country — 4,756 outlets by Nayara, 1,400 by Reliance Industries, 114 by Shell and around six outlets by other private operators.

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