In return for the stake, ADB will provide partial credit guarantee aggregating to the tune of US$75 million, which should help Petronet ease its US$154 million debt program.
The ADB guarantee is seen as being very useful to Petronet as a way to raise funds from the domestic debt market without having the need for a counter guarantee from the Indian central government. Furthermore, the country's first LNG supplier is looking to raise around US$220 million via an IPO expected in February where it will sell 35% of its equity on the open market.
In related news, Petronet has succeeded in setting up India's first five million tonne per annum LNG terminal at Dahej in the state of Gujarat. The terminal, which cost an estimated US$547 million, is expected to begin operations in April.
The project is expected to service gas users along the 2,500km Hazira-Bijaipur-Jagdishpur pipeline, which covers the states of Gujarat, Western Madhya Pradesh, Rajasthan, Delhi, Haryana and Western Uttar Pradesh. Also looking to benefit are users near Uran in Maharashtra State.
