Adani group to borrow $600 million for Dhamra LNG unit

Billionaire Gautam Adani’s Dhamra LNG Terminal Pvt. is in the process of raising an offshore loan of around $600 million from banks to refinance existing debt.

The period of debt could range between three and five years, and the pricing in all probability would be linked to the Secured Overnight Financing Rate, well-placed sources said in a Bloomberg report, adding that details of the deal are yet to be officially made public.

The Adani group, with business interests ranging from ports to the power industry, is currently in talks with several lenders to ink the deal of transaction. These include BNP Paribas, Credit Agricole, DBS Bank, Mitsubishi UFJ Financial Group and Mizuho Bank, sources said. According to the Bloomberg report, the deal should be executed within the next couple of months.

Dhamra LNG Terminal Pvt is a unit of Adani Total, which is a 50-50 venture between the Adani group and the French multinational integrated energy and petroleum company, TotalEnergies.

In March this year, the Adani group saw a strong demand for its first public bond sale since the Hindenburg Research controversy of 2023. In January last year, Hindenburg Research had accused the Adani group of manipulating stocks, committing fraud in accounts and making use of shell companies to manage funds, which in turn impacted the company’s shares. The good show of the public bond sale in March 2024 underlines the fact that the company has recovered from the repercussions of the Hindenburg report.

In recent years, the Narendra Modi government has been trying to raise India’s import of LNG, so that the utilisation of natural gas grows and the use of fossil fuels such as oil and coal comes down. The current consumption of LNG is around seven per cent while the government’s effort is to raise that number to at least 15 per cent by the year 2030.