Adani Total Gas got a mind-blowing funding of $375 million

The company confesses in an official press release on Friday, Adani Total Gas has secured a mind blowing $375 million as funding to help widen its city gas distribution (CGD) operations.

This investment brings in a huge step for the company as it aims to procure cleaner energy options across India. Before diving deeper into the news, let us first talk about what CGD business is. City gas distribution (CGD) involves supplying natural gas to homes, businesses, and vehicles in urban areas.

Natural gas is considered a cleaner alternative to other fossil fuels, making it an important part of India’s push for better environmental practices. The initial stage of financing of $375 million involves a primary commitment of $315 million with an additional funding as required.

About the Adani Total Gas funding

Did you know about the 50:50 joint venture between Adani Total Gas Ltd and Indian Oil Corporation Ltd?

The Adani Total Gas Funding is said to fasten ATGL’s capital expenditure program and would also expand its CGD network into 34 authorized Geographical Areas across 13 states.

Out of the 34 GA’s 34 are owned by ATGL and the rest 19 are owned by Indian Oil Adani Gas Pvt Ltd. It is said to be beneficial to 14% of Indian population – over 200 million people as per what Adani Total Gas claimed in the press release.

The participants of this funding are 5 global lenders- BNP Paribas, DBS Bank, Mizuho Bank, MUFG Bank, and Sumitomo Mitsui Banking Corporation who together will come up for Adani Total Gas funding of $375 million.

Future plans of Adani Total Gas with the funds:

Adani Total Gas is set to grasp its recent $375 million funding to promptly enhance its city gas distribution (CGD) functions and operations.  Here is what Adani Total Gas plans to do for expansion and with the $375 million funding:

• Adani Total Gas funding would be used to support the construction of new pipelines, which will further ensure a wider reach of natural gas supply in urban parts. In inclusion to this, the existing infrastructure will be upgraded to improve efficiency and reliability in gas distribution.
• This expansion will enhance the penetration of Piped Natural Gas (PNG) and Compressed Natural Gas (CNG) infrastructure, fostering an ecosystem that supports a gas-based economy, the company stated.
• By increased use of PNG and CNG, ATGL aims to replace high carbon producing fuel sources and contributing positively to the environment. This operation also aligns with the Government’s aim to boost the share of natural gas in India’s energy mix from 6% to 15% by 2030.
• Adani Total Gas funding is also predicted to expand the number of CNG stations across the nation leading to increased number of compressed natural gas stations to make it more accessible for vehicles. The expansion would also promote cleaner fuel alternatives for transportation.
• The funding would also benefit the distribution networks by expanding and modernizing the networks. Adani Total Gas has also promised to provide faster and more reliable services to the customers. Next is that the Adani Total Gas expansion will be targeting underserved areas which would allow households and businesses to access natural gas.
• The company plans to take up smart technologies for monitoring and managing gas distribution, enhancing safety and efficiency.
• The Adani Total Gas sticks with future goals of India for cleaner energy solutions and would contribute to reduction in carbon emissions and a more of sustainable energy options. Sustainable alternatives would also promise to ensure the resources are being saved
• Market Expansion: Adani Total Gas is seeking to enter new cities and regions where natural gas demand is rising in India.

ATGL said it has dived into an overall financing network which would enable the company to secure future funding based on its business plan.

The borrower’s counsel included Latham & Watkins LLP and Saraf & Partners whereas, Linklaters and Cyril Amarchand Mangaldas represented as the lenders in this financial planning and arrangement, says the Adani Gas press release.