French oil major TotalEnergies is deepening its ties with India's Adani Green Energy Ltd. through a new joint venture, solidified by a $444 million investment from TotalEnergies. The move marks a significant step forward in the companies' collaborative efforts to expand renewable energy capacities in India.
The partnership, initially announced in September 2023 with an estimated value of $300 million, has now increased in scope and investment. This new venture will grant TotalEnergies "direct access to ownership of assets" contributed by Adani Green, primarily focusing on wind and solar farms across India—a country still heavily reliant on coal for its energy needs.
A spokesperson for TotalEnergies confirmed the board's approval of the deal on Monday, with a formal announcement expected on Tuesday. However, both companies have refrained from disclosing why the investment amount has risen.
Joint Venture to Manage 1.15 GW of Solar Projects in India
The 50/50 joint venture will manage a portfolio of 1.15 gigawatts (GW) of solar electricity installations, encompassing both operational sites and those under construction. While TotalEnergies has committed $444 million to the project, Adani Green has not disclosed its financial contribution. The deal involves TotalEnergies Renewables Singapore, further highlighting the French company's global renewable energy ambitions.
The establishment of this joint venture represents the first major cooperation between the two businesses since TotalEnergies withdrew from its relationship with the Adani Group in the early months of 2023 due to claims made by American short-seller Hindenburg Research about unethical behaviour and the use of tax havens. The market value of the Adani Group's shares fell by $150 billion as a result of these accusations.
Move Aligns with TotalEnergies' 2030 Renewable Energy Goals
Despite the controversy, TotalEnergies CEO Patrick Pouyanne has defended the company’s investments in Adani, which include a 37.4% stake in Adani Total Gas and a 19.75% stake in Adani Green Energy. Pouyanne emphasised that these investments remain valuable even after the share price decline.
TotalEnergies, which primarily profits from oil and gas production and sales, is aiming to achieve 45 GW of renewable energy capacity by 2030 as part of its broader strategy to diversify into greener energy sources. Shares of Adani Green closed 5.9% higher on Monday, reflecting market optimism about the renewed partnership. This positive response from investors indicates confidence in TotalEnergies' long-term vision for sustainability and growth in the renewable energy sector. The partnership with Adani continues to be a key component of this strategy moving forward.
Inputs by Agencies
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