French LNG major, Total, has signed a binding letter of intent with the Hague-based energy giant Shell for the sale of its 26 percent minority equity stake in Hazira LNG regasification terminal in India.
With this deal, Shell will hold a 100 percent interest in the Hazira LNG facility.
In parallel, the duo signed an agreement under which Shell will buy 0.5 million tons of liquefied natural gas per year from Total 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, the French company said in a statement on Monday.
“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 Gas, Renewables and Power at Total.
He noted that the company will continue supplying the Indian market that is regarded as a key market due to the growth in LNG demand.