Adani Total Gas Breaks Records with Groundbreaking Global Funding
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Synopsis of the Article in Bullet Points:
- Adani Total Gas (ATGL) secures USD 375 million in global financing.
- Financing will support the expansion of the City Gas Distribution (CGD) network.
- Global lenders include BNP Paribas, DBS Bank, Mizuho Bank, MUFG Bank, and Sumitomo Mitsui Banking Corporation.
- The expansion will cover 34 Geographical Areas (GAs) in 13 states, reaching over 200 million people (14% of India’s population).
- Financing supports India’s goal of increasing natural gas consumption from 6% to 15% by 2030.
- ATGL is leading India’s energy transition by promoting Piped Natural Gas (PNG) and Compressed Natural Gas (CNG).
- ATGL also focuses on E-mobility, LNG for transport, and Biomass energy projects.
- Comments from ATGL’s CFO, Mr. Parag Parikh, highlight the importance of financing for future growth.
- Legal partners included Latham & Watkins LLP, Saraf & Partners, Linklaters, and Cyril Amarchand Mangaldas.
Media Release: Adani Total Gas Secures Largest Global Financing in City Gas Distribution Sector
The top-ranked City Gas Distribution (CGD) business in India has closed a sizable funding agreement that will enable it to develop its nationwide gas distribution network. The new finance package, the biggest of its type for the CGD sector, will be essential to the development of greener energy options and natural gas infrastructure in India.
Here is a thorough explanation of the financing’s main features, ATGL’s objectives, and the implications of this expansion for India’s energy sector.
ATGL Secures Global Financing to Expand City Gas Network
In a major milestone for India’s energy sector, Adani Total Gas Ltd (ATGL) has successfully secured an international financing package worth USD 375 million to drive the expansion of its City Gas Distribution (CGD) network. This financing marks the largest global financing deal for any city gas distribution company in the world, reflecting the confidence global lenders have in India’s shift towards a more sustainable and gas-based economy.
The financing deal was made possible with the support of international lenders, including BNP Paribas, DBS Bank, Mizuho Bank, MUFG Bank, and Sumitomo Mitsui Banking Corporation. These global financial institutions participated in the first round of funding, committing a total of USD 315 million initially, with the option to increase the funding as per future expansion requirements through an “accordion feature.”
How ATGL Will Use the Financing to Drive Expansion
With this finance, ATGL will be able to expedite its plans for capital expenditures, which will enable the firm to quickly construct and extend its natural gas network throughout India. With 34 approved Geographical Areas (GAs) spanning 13 states, the objective is to offer clean energy options to over 200 million people, or 14% of the nation’s total population.
This major development will contribute to the infrastructure for compressed natural gas (CNG) and piped natural gas (PNG) becoming more widely ingrained, particularly in urban and rural areas where these clean energy sources are still in their infancy. It will therefore contribute to a decrease in the consumption of traditional high-carbon fuels like coal and oil, offering both homes and businesses a more environmentally responsible option.
Supporting India’s Vision for a Cleaner Future
This new finance structure is in complete harmony with India’s overarching goal of raising the proportion of natural gas in the nation’s energy mix. At the moment, just 6% of India’s energy comes from natural gas. By 2030, the government wants to increase that percentage to 15%. To further this goal, ATGL has taken the lead in encouraging the use of PNG and CNG as cleaner substitutes for traditional fossil fuels like petrol and diesel.
In addition to helping India meet its environmental targets, ATGL’s more dependable, affordable, and convenient gas-based energy solutions will also benefit millions of people by lowering energy prices and promoting cleaner air.
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ATGL’s Role in India’s Energy Transition
As its customer base grows, ATGL is committed to providing clean, affordable, and sustainable energy, which has put it at the forefront of India’s energy shift. With this finance agreement, the company achieves a significant milestone that will enable it to carry on growing its network infrastructure and encouraging the use of cleaner energy.
Apart from broadening its CGD network, ATGL is also investigating alternative sources of sustainable energy. The company is engaged in many innovative initiatives that will contribute to India’s transition to a more environmentally friendly and sustainable energy system, such as biomass energy, LNG for transportation, and e-mobility (the infrastructure for electric vehicles).
Global Lenders’ Confidence in ATGL’s Vision
Leading international lenders including BNP Paribas, DBS Bank, Mizuho Bank, MUFG Bank, and Sumitomo Mitsui Banking Corporation have all participated, which is indicative of the increased trust that the natural gas sector in India and its potential as a transition fuel are receiving. With this money, ATGL will be able to pursue new initiatives and take advantage of future financing opportunities, which is a critical step in the company’s continuous growth.
Comments from ATGL Leadership
Adani Total Gas Ltd.’s Chief Financial Officer (CFO), Mr. Parag Parikh, expressed his pleasure in the finance agreement. “This financing framework is a stepping-stone for future growth,” the speaker declared. The involvement of international financiers supports city gas distribution’s potential in India as a transition fuel. As we continue to lead the way towards a cleaner, gas-based economy, we are sure that this agreement will generate long-term value for our stakeholders.
ATGL’s Broader Impact on India’s Energy Landscape
A platform for energy that supports India’s energy transformation while also catering to the nation’s expanding population has been established thanks in large part to ATGL. The company’s extensive CGD network replaces more costly and polluting fuels like coal and oil by giving homes, businesses, and automobiles access to clean, inexpensive natural gas.
ATGL is significantly contributing to lowering India’s carbon footprint and raising the standard of living for its people by encouraging the usage of natural gas. Compared to many conventional fuel sources, natural gas is not only more economical and efficient but also more environmentally benign.
Legal Partners for the Financing Deal
Prominent law firms assisted in the structuring of the financial arrangement. ATGL’s borrower’s counsel was provided by Latham & Watkins LLP and Saraf & Partners, while the lenders were represented by Linklaters and Cyril Amarchand Mangaldas. Through this partnership, the financial arrangement was made sure to be in line with everyone’s long-term objectives and legally solid.
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