Adani ties up with French energy major Total to enter petrol retail biz

Adani ties up with French energy major Total to enter petrol retail biz
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New Delhi, Oct 18: Gautam Adani-led Adani Group will enter the petroleum retail business with French energy major Total SA. The two have signed an agreement to invest in downstream. This will include a foray into retail, with the duo opening 1,500 outlets to supply compressed natural gas (CNG) and develop various liquefied natural gas (LNG) projects.
Both the companies have set a target of developing re-gasification terminals, including one at Dhamra LNG. “It will be a big stride towards India’s vision of achieving a healthier energy mix through promotion of LNG,” the companies said in a joint statement on Wednesday.
Total and Adani will also create a joint venture with the objective of building a retail network over 10 years. These retail outlets will be on highways and intercity connections to supply CNG for vehicles.
The French government was a majority stakeholder in Total till 1996, but has reduced its stake considerably since then.
Earlier this month, the Indian government had set up a committee led by economist Kirit Parikh to review the current marketing guidelines, so that more private players can enter the business. Currently, companies need to make an investment of Rs 20 billion on petroleum infrastructure, or submit a bank guarantee of equal value.
Sources said the panel may make suggestions to facilitate the entry of multinational companies into the fuel retail space by removing entry barriers.
The two companies said they wanted to tap the domestic fuel market, currently growing at 4 per cent per year. Development of road infrastructure and higher purchasing power with the people have been cited as reasons for growth by experts. The Adani-Total retail outlets will offer customers the latter’s full line-up of fuels, lubricants, as well other products and services.
Adani Chairman Gautam Adani said, “The synergy between the two groups presents widespread benefits and long-term value for the economy and the people. We are looking forward to this opportunity to touch millions of lives by leveraging our collective footprint and domain expertise in the energy sector. It also enables the Adani Group to be part of the country’s vision in adopting cleaner energy.”