French company TotalEnergies agrees to buy 25% stake in Adani New Industries

AHMEDABAD: Business conglomerate Adani Group and France’s TotalEnergies have entered into a new agreement to jointly create the world’s largest green hydrogen system. As part of this strategic tie-up, TotalEnergies will acquire 25% minority interest in Adani New Industries Ltd (ANIL) from Adani Enterprises Ltd (AEL), according to a media statement by the Indian establishment.

ANIL aims to invest over $50 billion over the next 10 years in green hydrogen and its associated ecosystem. In the initial phase, the company will develop green hydrogen production capacity of 1 million tonne per annum before 2030.

“The strategic value of the Adani-TotalEnergies relationship is immense at both the business level and ambition level,” said Gautam Adani, chairman of Adani Group.

“In our journey to become the largest green hydrogen player in the world, the partnership with TotalEnergies adds several dimensions that include R&D (research and development), market reach and an understanding of the end consumer. This fundamentally allows us to shape market demand. This is why I find the continued extension of our partnership to hold such great value. Our confidence in our ability to produce the world’s least expensive electron is what will drive our ability to produce the world’s least expensive green hydrogen. This partnership will open up a number of exciting downstream pathways,” Adani said in a statement.

The value of the deal and other financial details have not been disclosed.

“TotalEnergies’ entry into ANIL is a major milestone in implementing our renewable and low carbon hydrogen strategy, where we want to not only decarbonise the hydrogen used in our European refineries by 2030, but also pioneer the mass production of green hydrogen to meet demand, as the market will take off by the end of this decade.” said Patrick Pouyanné, chairman and CEO of TotalEnergies in a statement.

The partnership builds on the synergies between the two platforms. While Adani is expected to bring in its deep knowledge of the Indian market, rapid execution capabilities, operations excellence and capital management philosophy to the partnership, TotalEnergies will bring to the table its understanding of the global and European market, credit enhancement and financial strength to lower the financing costs, and expertise in underlying technologies.

The complementary strengths of the partners will help ANIL deliver the largest green hydrogen ecosystem in the world, which, in turn, will deliver the lowest cost of green hydrogen to the consumer and help accelerate the global energy transition.

ANIL aims to be the largest fully integrated green hydrogen player in the world, with presence across the entire value chain, from manufacturing of renewables and green hydrogen equipment (solar panels, wind turbines, electrolysers, etc.), to large scale generation of green hydrogen, and downstream facilities producing green hydrogen derivatives.

With this investment in ANIL, the strategic alliance between the Adani Group and TotalEnergies now covers LNG terminals, the gas utility business, renewables business and green hydrogen production.