French energy major Total has decided to sell its 26 pct equity stake in Hazira LNG regasification terminal in India to Shell which holds 74 pct in the facility.
The duo signed a binding Letter of Intent (LOI) for the sale, which is subject to the approval of regulatory authorities.
In parallel, Total has signed an agreement to sell 0.5 million tons of LNG per year to Shell over 5 years, on a delivery basis to supply the markets of India 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, President of Total’s Gas, Renewables and Power. “We remain committed to supply the Indian subcontinent, which is a key market experiencing strong growth in LNG demand.”
Until now, Shell and Total have a shareholding of 74 pct and 26 pct respectively in each of the companies that comprise the Hazira LNG Terminal and Port project and are collectively known as Hazira Group Companies (HGC).