French oil major TotalEnergies is moving forward with a new joint venture with India's Adani Green Energy, following the approval of the deal by Adani Green's board on Monday. TotalEnergies will invest $444 million in the partnership, marking a significant step in their ongoing collaboration in renewable energy.

The joint venture was initially announced in September 2023, with a deal then valued at $300 million. This agreement aims to provide TotalEnergies "direct access to ownership of assets" contributed by Adani Green, specifically wind and solar farms in India. The country, where the majority of energy needs are still met by coal, is a crucial market for renewable energy expansion.

A TotalEnergies spokesperson confirmed the development, stating that a formal announcement would be made on Tuesday. However, neither company provided immediate details on why the investment value had increased from the initial $300 million to $444 million.

According to Adani Green, the 50/50 joint venture will control a portfolio of 1.15 gigawatts of solar electricity installations, including projects that are both operational and under construction. The statement did not disclose any specific financial commitments from Adani Green for the deal, which involves TotalEnergies Renewables Singapore.

This partnership marks the first significant collaboration between TotalEnergies and Adani since Total paused its involvement with the Adani Group last year. The pause followed allegations of improper dealings and the use of tax havens, published by U.S. short-seller Hindenburg Research in early 2023, which resulted in a $150 billion loss in market value for the Adani Group.

Despite the controversy, TotalEnergies CEO Patrick Pouyanne has defended the company's investments in Adani. TotalEnergies holds a 37.4% stake in Adani Total Gas and a 19.75% share of Adani Green Energy. Pouyanne emphasised that these investments remain valuable, stating they are still worth more now than when Total first acquired them.

As part of its broader strategy, TotalEnergies aims to achieve 45 gigawatts of renewable energy capacity by 2030. The progress of this joint venture with Adani Green Energy aligns with that goal, highlighting the importance of renewable energy in TotalEnergies' future plans.

Following the announcement, shares of Adani Green Energy closed 5.9% higher on Monday.

Image source: Reuters