Adani Total Gas secures $375M funding to expand city gas network

Adani Total Gas Ltd, the city gas joint venture of Adani group and French energy giant TotalEnergies, has secured $375 million funding from global lenders for expansion of its business.

"The maiden financing of $375 million executed with international lenders include an initial commitment of $315 million with accordion feature to enhance the commitments," the firm said in a statement.

Five international lenders participated in the initial financing: BNP Paribas, DBS Bank, Mizuho Bank, MUFG Bank, and Sumitomo Mitsui Banking Corporation.

"The facility will fast track the capital expenditure programme, enabling Adani Total Gas to rapidly expand its city gas distribution network into its 34 authorised geographical areas across 13 states," said the company.

This shall cater to up to 14% of India's population, covering more than 200 million people.

The expansion will deepen the penetration of piped natural gas (PNG) and compressed natural gas (CNG) infrastructure, creating an ecosystem for a gas-based economy.

Adani Total Gas remains steadfast in its approach to lead the energy transition in India by fuelling increased usage of PNG and CNG to replace high carbon intensive conventional fuel sources and thereby creating a positive impact on the environment, said the company.

PNG and CNG usage offer a convenient, cost-effective, reliable and eco-friendly fuel and will further support the government's vision of increasing the share of natural gas in the energy basket from 6% to 15% by 2030, it said.

"Participation from the global lenders reinforces the potential of city gas distribution in its role as transition fuel," said Parag Parikh, CFO of Adani Total Gas.

"This financing framework will drive Adani Total Gas's sustained growth and will be a stepping-stone for future financing based on its capital management plan which will create a long-term value for all our stakeholders," Parikh added.

Adani Total Gas has been instrumental in creating a transition energy platform for its large consumer base by providing network infrastructure across multiple geographical areas and also promoting sustainable energy in the form of e-mobility, LNG for transport and biomass to lead the charge of India's energy transition.

Latham & Watkins LLP and Saraf & Partners were the borrower's counsel and Linklaters and Cyril Amarchand Mangaldas were the lender's counsel for this financing.