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Total to exit Hazira LNG, sell 26% stake to Shell

Press Trust of India  |  New Delhi 

French will exit the Indian venture by selling 26 per cent stake to its partner Royal Dutch Shell, the two companies announced today.

Total had in March 2004 picked up 26 per cent stake in the 2.5 million tonnes a year liquefied (LNG) import terminal in The terminal capacity was later doubled to 5 million tonnes.

terminal was commissioned in 2005 and expanded to 5 million tonnes in 2013.

Shell holds the remaining 74 per cent stake in

"Total has signed a binding Letter of Intent (LOI) with Shell for the sale of its 26 per cent minority equity stake in Hazira LNG terminal in India," the company said in a statement.

The transaction remains subject to the approval of regulatory authorities.

Shell in a separate statement said its subsidiary, has entered into an agreement with to acquire its 26 per cent equity in the Hazira LNG and Port venture located in

Neither company disclosed financial details of the deal.

In parallel, Total signed an agreement to sell 0.5 million tonne LNG per year to Shell over 5 years, on a delivery basis to supply the markets of and neighboring countries. The deliveries will be sourced from Total's global LNG portfolio and are expected to begin in 2019.

"This deal enables Total to capture value through an asset disposal, while the LNG sales contract allows us to maintain the balance of our LNG portfolio," said Philippe Sauquet, Gas, Renewables and Power. "We remain committed to supply the Indian subcontinent, which is a key market experiencing strong growth in LNG demand."

Hazira LNG & Port venture comprises two companies -- which operates LNG terminal and Pvt Ltd that manages a direct berthing multi-cargo port at Hazira.

"The move would allow Shell commercial and operational flexibility over Hazira to maximise integrated value and offer creative customer value propositions," the company said.

The move, it said, is consistent with Shell's strategy to deepen its presence in the in India, the fourth largest LNG consumer in the world.

Shell aims to contribute in bridging the and further augment in India, the statement said.

"Today marks an important milestone," said Maarten Wetselaar, Shell's Integrated Gas & New

He added: "This purchase creates a fully-owned and integrated Shell value chain supply from our global LNG portfolio, at the Hazira facility, and downstream customer sales. It enables Shell to better serve Indian customers and meet the country's long-term need for more and This also significantly strengthens the connection of the fastest growing in the world, India, and Shell's unrivaled portfolio of competitive "

(SEI) was established in 2017, to aggregate demand from downstream customers and secure competitive international supply to meet such demand and will market and sell that gas to customers across

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, August 27 2018. 20:00 IST