France\u2019s TotalEnergies has put on hold a planned investment in Adani Group\u2019s USD 50 billion hydrogen project pending results of an audit launched following allegations by a US short-seller, chief executive Patrick Pouyann\u00e9 said on Wednesday.
While the partnership where the French oil giant was to take a 25 per cent stake in the hydrogen venture of the Adani group was announced in June last year, TotalEnergies has not yet signed a contract, he said at an earnings call. \u201cObviously, the hydrogen project will be put on hold until we have clarity\u201d from Adani group on the allegation levelled by US short-seller Hindenburg Research, Pouyanne said.
TotalEnergies is one of the biggest foreign investors in billionaire Gautam Adani\u2019s business empire and had previously taken stakes in the group\u2019s renewable energy venture, Adani Green Energy Ltd and city gas unit, Adani Total Gas Ltd.
As per the June 2022 announcement, TotalEnergies was to take 25 per cent equity in Adani New Industries Ltd (ANIL) – the Adani Group firm that is investing USD 50 billion over 10 years in a green hydrogen ecosystem that includes an initial production capacity of 1 million tonnes before 2030.
The announcement by Total adds to the woes of Adani. The crisis around the group following the Hindenburg report has also been used by the opposition parties to attack the government, alleging that the tycoon\u2019s rise was primarily because of his association with Prime Minister Narendra Modi. The government has rejected the allegation.
\u201cThis project was announced but nothing has been signed\u2026 and for now it won\u2019t be signed,\u201d Pouyanne said. \u201cIt makes no sense to add more (projects) until there is clarity.\u201d
Adani has to explain the allegations, he said.
Hindenburg\u2019s allegations of accounting and financial fraud unleashed an over USD 100 billion rout across Adani\u2019s companies. Adani group has vehemently denied the allegations, calling them malicious and an \u201cattack on India\u201d. \u201cIt was announced, nothing was signed. It doesn\u2019t exist,\u201d Pouyanne said on the hydrogen venture. \u201cAdani has other things to deal with now, it\u2019s just good sense to pause things while the audit goes forward.\u201d
He said Total has USD 3.1 billion investment and the firm was \u201chappy\u201d with those investments as both Adani Green and Adani Total Gas are performing well.
\u201cThese companies have assets and revenue\u201d and are healthy, he said.
The French company conducted due diligence before and after investing in the Adani companies, he said.
Shares of Adani Green and Adani Total Gas are still up by a factor of two and eight, respectively, since Total invested in them, Pouyanne added.
Total, France\u2019s largest oil and gas company, first joined hands with Adani in 2018 for a liquefied natural gas (LNG) venture before buying a 19.75 per cent stake in Adani Green Energy Ltd and a stake in solar assets for USD 2.5 billion in 2020-21. It also took a 37.4 per cent stake in Adani Total Gas Ltd, the firm that retails CNG to automobiles and piped natural gas to household kitchens and industries.
Last week, the firm said its investments in Adani group companies were in full compliance with the law.
\u201cTotalEnergies\u2019 investments in Adani\u2019s entities were undertaken in full compliance with applicable – namely Indian – laws, and with TotalEnergies\u2019 own internal governance processes,\u201d it had said in a statement on Friday.
It added that it \u201cwelcomes the announcement by Adani to mandate one of the \u2018big four\u2019 accounting firms to carry out a general audit\u201d.
TotalEnergies\u2019 exposure resulting from these stakes is limited, as it represents 2.4 per cent (USD 3.1 billion as of December 31, 2022) of the company\u2019s capital employed and only USD 180 million of net operating income in 2022, the firm had said on Friday.
\u201cThese investments being accounted for under the equity method, TotalEnergies has not performed any re-evaluation in its accounts of its stakes in the listed entities ATGL and AGEL in relation to the increase in their stock values,\u201d the statement added.<\/p>\n","protected":false},"excerpt":{"rendered":"
France\u2019s TotalEnergies has put on hold a planned investment in Adani Group\u2019s USD 50 billion hydrogen project pending results of an audit launched following allegations by a US short-seller, chief executive Patrick Pouyann\u00e9 said on Wednesday.While the partnership where the French oil giant was to take a 25 per cent stake in the hydrogen venture […]<\/p>\n","protected":false},"author":4,"featured_media":327031,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[667],"tags":[],"class_list":["post-326992","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business"],"_links":{"self":[{"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/posts\/326992","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/comments?post=326992"}],"version-history":[{"count":0,"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/posts\/326992\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/media\/327031"}],"wp:attachment":[{"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/media?parent=326992"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/categories?post=326992"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nagalandpost.net\/index.php\/wp-json\/wp\/v2\/tags?post=326992"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}