The supply side does not share the optimism of the demand side. ONGC has said that producing natural gas is no longer a profitable business for the company as the government-mandated gas price is significantly below the cost of production. The oil major has sought a review of pricing formula from the government. ONGC wants a floor or minimum price of natural gas be fixed at $4.2/mmBtu for the business to be viable. With the current price, it does not make economic or commercial sense for any company to invest in new fields or in augmenting production from existing ones. Fresh investment in unlikely if the price remains below the cost of production. In October 2014, the government adopted a new pricing formula using rates prevalent in gas surplus nations like the US and Canada to determine rates in a net importing country. Prices have halved to $2.48/mmBtu since the formula was implemented. India imports half its natural gas needs and the government is keen to cut import bill by raising indigenous production and ‘Make in India’. The price paid to domestic producers is less than half of the rate paid for import of gas. ONGC produces 80 percent of the 70 mmscmd which makes it the biggest gas producer in India. ONGC lost ₹ 50.1 billion in revenue on natural gas business, and about ₹ 30 billion in profit in just last one year.Fidelity Investments and Morgan Stanley Investment Management have increased exposure to Indian city-gas retailers, as the emphasis on clean fuels burnishes the outlook for the industry. The demand from investors has been so strong that Indraprastha Gas Ltd, which supplies to homes and vehicles in New Delhi, raised the cap on foreign ownership to 30 percent from 24 percent, and may increase it again to almost half. India’s largest city gas distributor Gujarat Gas Ltd, where Aberdeen Asset Management Plc is the biggest non-state investor, and Mahanagar Gas Ltd. have also seen an increase in offshore holdings. India’s gas demand is about a fifth of China’s due to weak domestic supply and poor infrastructure, though the government is trying to change this. Measures have been stepped up to improve air quality in cities by giving priority to distributors such as Indraprastha Gas for accessing cheaper local gas. Offshore holdings in Indraprastha Gas climbed to nearly 25 percent as of March 31, from about 21 percent a year ago, according to data. Aberdeen Asset Management held about 4.6 percent of outstanding shares in Gujarat Gas as of end-April. Foreign holdings in the company have climbed about 3 percentage points to 15.4 percent in the past year. Mahanagar Gas, which sells the fuel in the financial capital Mumbai and its suburbs, has seen stock in the hands of foreign investors increase nearly six times since listing last year. India’s government wants more urban households to use natural gas and LPG for rural users.here is optimism on demand for gas that is driving imports but pessimism on production of domestic gas. H-Energy, the Mumbai-based oil and gas arm of Hiranandani Group plans to invest more than ₹ 45 billion in the natural gas sector in five years to develop LNG re-gasification units on the west and east coast of India along with pipeline infrastructure. H-Energy is at an advanced stage of setting up an LNG re-gasification unit at Jaigarh port in Maharashtra. As part of its phase-1 plan, the company in 2017 signed an agreement with France-based energy company Engie to charter a FSRU. After phase- 1 of the project stabilises, the company will be setting-up a land based re-gasification plant with an annual capacity of 8 mtpa. Also, the company has already started work on Jaigarh to Dabhol tie-in pipeline which will carry natural gas to the gas grid of GAIL (India) Ltd at Dabhol. The company has also approached PNGRB, for laying a 700 km pipeline to connect the East coast FSRU to major demand centres in West Bengal.
GAIL said it has drawn up investment plans of ₹ 300 billion for expansion. GAIL is currently executing gas pipelines worth ₹ 200 billion and another ₹ 100 billion worth of lines are under various stages of evaluation. The pipelines under execution include Jagdishpur-Haldia line that will take the environment friendly fuel to the east. Current projects will be completed by 2019-20, taking GAILs pipeline network to 15,000 km from the current 11,000 km. The company has already spent capex of ₹ 21.8 billion in FY17 and plans to spend ₹ 42.6 billion in FY18 and ₹ 77.04 billion in FY19 towards setting up of pipelines, petrochemical and process plants. GAIL will get charge of the LNG block, while state-owned power producer NTPC Ltd would be the largest shareholder in the power block. The company reported 69 percent drop in fourth quarter net profit of ₹2.6 billion as it wrote down the value of its investment in Dabhol power plant. The company has taken up synchronised development of seven city gas distribution network projects at Varanasi, Patna, Jamshedpur, Kolkata, Ranchi, Bhubaneswar and Cuttack. The first LNG terminal at the east coast is also coming up in Dhamra in Odisha under a joint venture of public and private sector companies.
The oil ministry has formed all-powerful review committees to monitor performance of ONGC and OIL, and will have power to relinquish any oil and gas field for auctioning to private firms. Being dubbed as super-boards, the committees will be headed by the ministry’s upstream nodal authority DGH, and will review and monitor performance of areas given to ONGC and OIL on nomination basis. The two panels, one each for ONGC and OIL, will review from annual work programme and budget to declaration of a discovery as commercial as also reservoir and production performance, monitoring of development activities and collaborations with other explorers. The order follows ministry’s unhappiness with state explorers particularly on delays in projects linked to output enhancement. It has already ordered a detailed review of board of directors of ONGC for a possible revamp of the functional heads. ONGC produced 86 percent of its 26.13 MT of crude oil in 2016-17 fiscal from fields given to it on nomination basis. Natural gas production from nomination fields accounted for 93 percent of the total output of 25.34 bcm. The review committee will meet at least once every three months. Field development plans, feasibility reports of commercial discoveries in nomination fields and monitoring of development activities for early monetisation will also fall within the ambit of the committees. The visible hand of government commanding and controlling the oil sector is unlikely to produce more oil than what the invisible hand of the market can produce. Even if the invisible hand favours production, nature’s visible hand that dealt India its meagre hydrocarbon has set limits on what can be produced.
The ongoing rupee surge coupled with continuing price reductions of gas will push fuel cost down by around 5 percent, which in turn will lower the gross margins of upstream oil and gas players and deter fresh investment into the sector, Ind-Ra said. For the fifth consecutive time since implementation of the domestic gas pricing formula in November 2014, the government in March lowered domestic gas prices by 0.8 percent to $2.48/mmBtu. The price will be in force from April 1 to September 30, 2017. The price ceiling for gas produced from discoveries in deep-water, ultra-deep water and high pressure-high temperature areas for the period April-September 2017 is $ 5.56/mmBtu on gross calorific value basis, while the domestic prices has been lowered to $2.48/mmBtu on gross calorific value basis for this period. However, it will marginally benefit the midstream entities like GAIL, which will see its trading revenue fall by ₹ 2.5 billion from domestic sales during in 1H of FY18. But since GAIL sells its domestic gases on a cost-plus basis, its gross margins will be protected. GAIL will open a new energy route for India early next year by beginning regular imports of shale gas from the US, adding to New Delhi’s bargaining power with its predominantly West Asian suppliers. GAIL will begin importing gas in ships under a long-term contract from Dominion Cove Point LNG project from March 2018 and has floated tender for chartering ships for transportation. The company has also made a time-swap deal for 1 MT of US gas for FY19 in an attempt to recast its supply portfolio in line with domestic demand. GAIL had in 2013 tied up 2.3 MT LNG supplies for 20 years from Cove Point. It signed another contract for 3.5 MT of LNG with Cheniere Energy Inc’s Sabine Pass project in Louisiana, the supplies from which will begin in December 2018. The company also holds a 20 percent stake in Eagle Ford Shale of Carrizo Oil & Gas. The contracts with Cheniere and Dominion make GAIL one of the largest holders of LNG portfolio linked to Henry Hub, the US gas price benchmark, and will allow it to market 6 MT of US gas. Both Cheniere and Dominion projects have US energy department’s permission to export gas to countries such as India that do not have free trade agreement with Washington. Regular gas supply from the US at an affordable rate will underline the impact of a rebound in the US fracking industry on global energy trade and widens options for India, giving it leverage against West Asian suppliers.
Asian spot LNG prices edged lower as the early restart of Chevron’s Gorgon production facility in Australia weighed on sentiment, projects offered supply and demand from Japan stayed weak. Spot prices for July delivery LNG-AS were assessed at $5.40/mmBtu down 5 cents from earlier. The early restart of Gorgon’s first production line provided an unexpected boost to Asian supplies after operator Chevron initially estimated the outage would last until mid-June. Project stakeholder Exxon Mobil launched a tender to sell one cargo for delivery in the second half of June days before news of the facility’s restart was made public. The various supply tenders from Angola, Nigeria and Australia, which offered June-loading cargoes, came amid muted summer demand from north Asian buyers. Any downside to Asia spot prices could be capped by relatively firm European demand, including in Spain, traders said. Results from the Nigerian and Angolan sell tender are expected to emerge in the coming days, but Asian LNG market participants said it was unlikely that the cargoes would be sold to Asia given the strength in Atlantic prices.
Japan’s Mitsui & Co Ltd plans to expand its LNG trading operation as demand for the cleaner fuel spurs more spot transactions in Asia. The move comes amid a big shift in the market in Asia, which takes in about 70 percent of global shipments of LNG, with traders and end users increasing their ability to trade in anticipation of a supply influx from Australian and US projects. Mitsui traded 2.8 MT of LNG in the year ended March 31, but will receive more supplies from next year when the Cameron LNG project in Louisiana starts operations. The Japanese company has signed up to take 4 MT of LNG annually from the project, with some of it tied up in term contracts leaving it with volumes to trade. China currently imported about 26 MT of LNG in 2016, up by a third from a year earlier. The company is also looking for buyers for supplies from an LNG project in Mozambique led by Anadarko in which Mitsui has a stake.
With a tanker expected to arrive in Taiwan shortly, the US will increase the number of countries that have received LNG from the Sabine Pass terminal in Louisiana to at least 23 of the 35 that can accept the vessels. The Cadiz Knutsen tanker will go to the Taichung LNG terminal in Taiwan with a load of super-cooled gas from Cheniere Energy Inc’s Sabine, according Genscape shipping data. The increase in US deliveries coincides with the LNG market worries that Qatar, the world’s biggest LNG exporter, could experience problems delivering fuel to some countries after Saudi Arabia and a few other Arab nations severed diplomatic and transport links with the gulf sheikhdom after accusing the country of sponsoring terrorism.
The Netherlands is set to receive its first LNG delivery from Cheniere Energy’s Sabine Pass export plant in the US, according to shipping data. The Arctic Discoverer vessel, with a carrying capacity of 133,500 cubic metres of LNG, departed the facility on the Gulf Coast and is listed as heading for Rotterdam, data shows. Cheniere is currently the only company able to export large cargoes of LNG from the continental US but very few have so far landed on European shores despite analyst expectations of a surge in supply. According to US Department of Energy data, the biggest beneficiary of Sabine Pass volumes has so far been Mexico, followed by Chile, China, Japan, Jordan, India and Turkey. Currently Spain, Portugal, Italy and Malta are the only European countries to have received deliveries. Analysts and some LNG traders expect European imports to improve from this summer due to increased LNG production capacity as markets in Asia and elsewhere struggle to absorb the growing pool of supply. In February Britain received its first ever LNG delivery from Peru aboard the Gallina tanker. Royal Dutch Shell exports LNG from Peru, mostly to Mexico, but due to contractual issues with Mexico’s CFE the oil major had opted instead to divert some cargoes into alternate markets, traders said.
Austrian energy group OMV and Russia’s Gazprom are considering reviving a gas pipeline project through the Black Sea connecting Russia to central and southern Europe. If realized, the project would likely boost the importance of OMV’s Baumgarten gas hub, which distributes around 57 bcm a year. The project would be an extension of the TurkStream pipeline, which Gazprom plans to finish by the end of 2019. The extended line could pump Russian gas to Italy, which currently receives supplies from Baumgarten via the TAG and SOL pipelines. Alternatively, Russian gas could go from western Turkey via Greece to Italy. Russia scrapped the South Stream pipeline project, which would have supplied Russian gas to southern Europe with an undersea pipeline to Bulgaria, in late 2014 because of objections from the European Union on competition grounds.
The government of Australia’s Northern Territory gave the go-ahead to start building a $600 million gas pipeline that could help ease a shortage of the commodity in the country’s east. Jemena, owned by State Grid Corp of China and Singapore Power, was given permission to build the westernmost portion of the 622 km line designed to connect gas fields in northern Australia with the eastern state of Queensland. Australia is the world’s second-largest LNG exporter, but has faced a growing crisis over local gas supply with prices rocketing over the past two years as the commodity is shipped abroad. The company had previously said it planned to begin construction of a compressor station, for which it has already won approval, in May, and that it may eventually extend the pipeline.
ConocoPhillips said that production and exports of LNG from an investment project in Qatar have not been affected by growing Middle East diplomatic tensions. Saudi Arabia, Bahrain, Egypt and the United Arab Emirates cut ties with Qatar, accusing the country of supporting extremism. Qatar has denied the allegations. Concerns have grown that global access to Qatar’s LNG could be cut, especially after some Persian Gulf ports said they would not accept Qatari-flagged vessels. Houston-based ConocoPhillips owns a 30 percent stake in an LNG project operated by Qatargas Operating Co Ltd, part of the state-controlled energy company. Mitsui & Co Ltd owns a remaining 1.5 percent stake in the project, which processes about 3 m/day. ConocoPhillips controls the Golden Pass LNG facility in the US along with Exxon Mobil Corp and Qatar Petroleum.
Qatar has no plan to shut the Dolphin pipeline that transports natural gas to the UAE despite the severing of diplomatic ties between the two Gulf Arab nations. Saudi Arabia, the UAE, Egypt and Bahrain said they would cut all ties including transport links with Qatar, the world’s top seller of LNG, accusing it of supporting terrorism. Doha denies the accusation. Qatar supplies roughly a third of global LNG – natural gas that has been converted into liquid form for export. The pipeline was the first cross-border gas project in the Gulf Arab region. It pumps around 2 billion cubic feet of gas per day to the UAE. Tankers load Qatari crude along with UAE oil as shipping ban eases. The diplomatic dispute has stoked concern that any supply disruption could spill over into global gas markets. Even a partial shutdown would force the UAE to seek replacement LNG supplies. The UAE could cope with Qatar suspending its two to three monthly LNG deliveries by calling on international markets, but Dolphin piped flows are too large to replace fully.
The Philippines aims to build a $2 billion receiving and distribution facility for imported LNG, as it seeks to replace depleting domestic gas reserves that now produce a fifth of its power. Construction could be completed by 2020, or four years before the Malampaya natural gas field is depleted. The Philippines’ energy demand will triple by 2040, with electricity requirements anticipated to grow four times from 2015. Chinese and Japanese companies are among the foreign investors who want to help build energy infrastructure, including LNG facilities. Several firms have expressed interest in building LNG facilities in the Philippines, including Manila Electric Company, formerly in talks with Osaka Gas Co Ltd for a joint venture.
Talks over new routes for gas supplies to China from Russia have stalled while Beijing rethinks the balance of its energy needs, including how much LNG it might use. Gazprom, which is already building a gas pipeline from Eastern Siberia to Chin, the Power of Siberia, was in talks over two more routes: the so-called western gas route and a gas pipeline from the Pacific Island of Sakhalin. Gazprom said there were no developments on the two pipelines, whose combined capacity, if built, is seen adding up to another 40 bcm in possible gas supplies from Russia to China per year. The Power of Siberia pipeline, expected to be launched by the end of the decade or in the early 2020s, should bring 38 bcm to China per year. Gazprom managed to clinch the Power of Siberia deal after ten years of painstaking talks with Beijing. Neither Gazprom nor state-owned CNPC immediately responded to requests for comment. According to BP’s energy outlook to 2035, the share of pipeline gas supplies to China, including from Russia, will remain largely unchanged over the ten years from 2025, with the share of LNG and China’s own gas output significantly rising.
Oil majors BP and Eni are deepening their foray into blockchain technology, starting to run blockchain trades in parallel with their live trading systems, according to developer BTL Group. The energy traders, together with Austria’s Wien Energie, had previously tested BTL’s Interbit blockchain platform over 12 weeks, carrying out trades in European natural gas.
Sinopec said it has started building China’s largest natural gas storage and logistics center with the capacity to store up to 10 bcm of gas in Henan province in the central part of the country. The world’s second-largest economy is investing in infrastructure from pipelines to storage tanks as Beijing prepares to switch from coal-fired boilers and heating systems across 28 of its smoggiest cities to natural gas or electricity by October. The storage facility is expected to open in May 2018. The storage facility will be connected to pipelines and supply gas to central China, Beijing and Tianjin.
LNG: Liquefied Natural Gas, ONGC: Oil and Natural Gas Corp, mmBtu: million metric British thermal units, OIL: Oil India Ltd, FY: Financial Year, mtpa: million tonnes per annum, bcm: billion cubic meters, mmscmd: million metric standard cubic meter per day PNGRB: Petroleum & Natural Gas Regulatory Board, DGH: Directorate General of Hydrocarbons, MT: Million Tonnes, Ind-Ra: India Ratings and Research, FSRU: Floating Storage and Regasification Unit, US: United States, CNPC: China National Petroleum Corp, UAE: United Arab Emirates
June 20, 2017. Bharat Petroleum Corp Ltd (BPCL) is revisiting its mothballed plan to build a refinery in Allahabad to cater to the expanding demand for fuel in the country. India’s fuel demand rose 5% in 2016-17, with consumption of diesel and petrol rising about 2% and 9% respectively. The expansion in fuel demand has spurred refiners to increase capacity, which the government expects to go up by 150 million tonnes in the next 7-8 years from 235 million tonnes today. The increase is expected to include 50-60 million tonnes of brownfield expansion. BPCL, along with Indian Oil Corp (IOC) and Hindustan Petroleum Corp Ltd (BPCL), is working on setting up the world’s biggest greenfield refinery in Maharashtra. BPCL holds 25% stake in the mega project in which Saudi Aramco is said to be keen to invest.
Source: The Economic Times
June 20, 2017. Indian Oil Corp (IOC) said its proposed LPG (liquefied petroleum gas) import terminal at Puthuvypeen in Kochi, construction of which has witnessed violent protest, will help reduce backlog for cooking gas in Kerala. IOC said the backlog of supplies in Kerala is 15 days and the new import facility was aimed at easing the same. Also, the import terminal would minimise the movement of bulk LPG tankers through the highways in the state. IOC moves bulk LPG from Mangalore to various LPG bottling plants in North Kerala through about 100 bullet trucks every day, which ply on narrow highways. Besides the import terminal, the ₹ 2,200 crore project comprises a multi-user liquid terminal, the Kochi-Salem LPG pipeline and a bulk terminal at Palakkad. Out of this, about ₹ 670 crore is only towards labour cost, the company said. IOC said the National Green Tribunal (NGT) had in August 2016 permitted the company to continue with the work. However, a small group of people have been obstructing the work since February 16. The company said during the NGT hearing on April 13 this year, the agitators had committed to the Tribunal not to obstruct work. IOC said the terminal will store LPG in mounded vessels, which are considered the safest in the industry worldwide.
Source: The Times of India
June 20, 2017. Over the past three days, Thane Crime Branch has raided nine petrol pumps which showed a false reading to customers while pumping less fuel than has been paid for. The Thane crime branch has sealed seven of the nine petrol stations it raided after learning that they had been operating with rigged dispensers which show a false reading to customers while pumping less fuel than has been paid for. The police believe that the pumps have each pocketed ₹ 5.5 lakh a month by dispensing 5–7 percent less for every litre bought. The tampering doesn’t come as news to motorists in Thane and the nearby Dombivali and Khopoli, who have lodged a slew of complaints with local police stations in the past few months that they had been short-changed by the fuel stations. When police informants corroborated these allegations, the crime branch raided the nine pumps. The searches led to the discovery that the fuel dispensers at the stations had been fitted out with a chip that makes the meter run faster than the petrol being pumped out. In May, the Thane crime branch had arrested Vinay Shetye from Dombivali, for running a similar ring in Uttar Pradesh that made the technology for rigging the pumps available to many stations in the northern state. It was during his questioning that the names of some of these nine petrol pumps, which had allegedly bought the chips from Shetye, surfaced. Investigation of the other two pumps is underway, but sources have confirmed they were also manipulating the machines. The managers and owners of the nine raided pumps have been arrested. When questioned, they told the police that the petrol transporters are involved in the racket but the claim is yet to be verified, a senior investigator said.
Source: The Economic Times
June 17, 2017. Oil Minister Dharmendra Pradhan said people won’t suffer due to daily revision of fuel prices. He said that people will daily get a little profit or loss. State-owned oil companies such as Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL), decided on a pan-India implementation of daily price revision of petrol and diesel. Before the rollout of daily price revision, Federation of All India Petroleum Traders (FAIPT) demanded an automated system to reflect price changes from the state-run oil marketing companies. The main concern of the dealers is that they will have to stop the sales every midnight for considerable time to change the daily rates. However, the IOC successfully rolled out the daily revision of petrol and diesel prices across the country through its network of 26,000-plus petrol pumps. IOC has developed various information modes for the customers to check the price being charged by the petrol pumps including the mobile app wherein the customers will be able to fetch daily updated prices of petrol and diesel at all cities through IOC’s mobile app Fuel@IOC. It will also enable customers to cross-check the prices applicable in their cities by sending SMS on various dealer codes, including various other options.
Source: Business Standard
June 16, 2017. India’s diesel imports this year may rise to the highest since at least 2011 as refiners shut down to upgrade their units to meet new fuel standards and as warmer temperatures spur demand. India’s state-owned refiners are already seeking or have bought up to 967,000 tonnes of diesel through July, according to tender data. That exceeds then-record imports of 962,000 tonnes in 2016, according to full-year government data going back to 2011. The upgrades to meet new Euro IV fuel standards implemented on April 1 and warmer temperatures are boosting diesel imports into the world’s third-largest oil consumer, Sri Paravaikkarasu, head of East of Suez Oil for oil consultants FGE, said. While monsoon rains typically reduce the need for diesel used in irrigation pumps, the curtailed supply because of the maintenance shutdowns will likely continue to boost imports into the country, Paravaikkarasu said. India is a net exporter of diesel with its refinery production usually enough to meet domestic demand, limiting imports. But the change in fuel standards has boosted imports of cleaner diesel while it has exported more lower sulphur diesel, traders said. India’s diesel demand is expected to rise to record levels again this year as a slew of infrastructure projects boosts the use of the fuel, although a government-induced cash shortage will hold growth to its slowest in three years. Diesel demand is expected to grow by 3 percent this year, lower than the 5.1 percent growth in 2016, Paravaikkarasu said.
Source: Reuters
June 15, 2017. Reflecting global crude oil prices, petrol price was cut by ₹ 1.12 per litre and diesel by ₹ 1.24 per litre. Oil companies made the announcement in the evening today and the change in price will be effective from June 16. From June 16, India will switch to a market dynamic system under which petrol and diesel prices will be revised on a daily basis. Rates will change at 6 am everyday depending on movement in cost on the previous day. Currently, prices are revised on 1st and 16th of every month based on the fortnightly average of international oil price and the foreign exchange rate. Petrol will cost ₹ 65.48 a litre in Delhi from June 16 as against ₹ 66.91 per litre currently. A litre of diesel will cost ₹ 54.49 as compared to ₹ 55.94 at present. Indian Oil Corp (IOC) said daily revision of retail selling price of petrol and diesel on pilot basis was implemented in Chandigarh, Jamshedpur, Puducherry District, Udaipur and Visakhapatnam from May 1.
Source: India Today
June 15, 2017. A day before India shifts to a market dynamic system of daily revision of petrol and diesel prices, Oil Minister Dharmendra Pradhan invited BP plc, Europe’s third-biggest oil company, and Reliance Industries Ltd (RIL) to invest in fuel retailing. While RIL already has a fuel retailing license and has some 1,400 petrol pumps on the ground, BP last year got approval to set up petrol pumps in India. RIL and BP are partners in oil and gas exploration but have no such collaboration in downstream fuel retailing business. BP is the tenth player to enter the lucrative fuel retailing business that is seeing double digit growth, not seen anywhere in the world. BP had in January last year won in-principle approval to retail aviation turbine fuel (ATF) to airlines in India. RIL too operates aviation fuelling services separately. India currently has about 59,595 petrol pumps, with public sector firms operating a majority of them. Private sector operators are limited to Essar Oil and RIL, which between them have some 4,900 petrol pumps. Royal Dutch Shell operates 85 petrol stations. Numaligarh Refineries Ltd (NRL) and Mangalore Refineries and Petrochemicals Ltd (MRPL) are late entrants and have six outlets between them. Indian Oil Corp (IOC) owns 26,212 petrol pumps, Hindustan Petroleum Corp Ltd (HPCL) 14,412 stations and Bharat Petroleum Corp Ltd (BPCL) 13,983 outlets. In aviation turbine fuel (ATF) or jet fuel retailing, there are 211 aviation fuel stations, 104 of which are owned by IOC, 42 by BPCL and 37 by HPCL. RIL has 27 aviation fuel stations at airports, while joint venture of Shell and MRPL owns one.
Source: Business Standard
June 14, 2017. Bharat Petroleum Corp Ltd (BPCL) aims to expand the capacity of its Bina refinery in central India to about 310,000 barrels per day (bpd) in the next four to five years from the current 120,000 bpd. India aims to expand its refining capacity by 35 percent to 6.2 million bpd to meet the country’s rising fuel demand. BPCL owns a majority stake in Bharat Oman Refineries Ltd (BORL), which runs the plant. Oman Oil Co owns 26 percent in the refinery. BPCL aims to shut the Bina refinery for about a month in June-September 2018 as the refinery is adding some units to raise capacity to 156,000 bpd.
Source: Reuters
June 20, 2017. India said it would sign future long-term liquefied natural gas (LNG) purchase deals with Qatar if only Doha agrees to acquire stakes in the South Asian nation’s power plants, Oil Minister Dharmendra Pradhan said. India is the latest major LNG buyer to seek concessions from Qatar, the world’s biggest LNG exporter, in order to re-sign long-term supply contracts. Amid a global glut of LNG and a slump in prices, other buyers have sought more flexible contracts, including clauses that would allow them to resell gas they do not consume. India is suffering from natural gas shortages that have required power plants with capacity of as much as 25,000 MW to shut down or run as lower rates. Qatar’s RasGas is India’s biggest LNG supplier. India wants to gradually move to a gas-based economy and has plans to raise its annual LNG import capacity to 50 million tonnes in the next few years from 21 million tonnes now. India is also open to granting stakes to Qatar in local oil and gas companies and LNG terminals, should the Gulf emirate make such a proposal, said Pradhan. India’s biggest gas importer Petronet LNG annually buys 8.5 million tonnes under a long-term contract. It also buys additional volumes from Qatar under spot deals. Prabhat Singh, chief executive officer of Petronet, said the Gulf nation needed to decide quickly on the Indian proposal. He said India could be a stable outlet for Qatar’s LNG.
Source: Reuters
June 20, 2017. Reliance Industries’ planned $6 billion investment to monetise gas finds in the KG-D6 block will increase its exposure to the extremely challenging Indian gas business that is fraught with delays and retrospective changes in regulation, Moody’s Investor Service said. Reliance Industries Ltd (RIL) and its partner BP Plc of the United Kingdom (UK) announced that they are moving ahead with development of three fields in the KG-D6 block off the east coast of India. Investment of ₹ 40,000 crore in the development of the fields is expected to produce 30-35 million metric standard cubic meter per day (mmscmd) by the year 2020-2022. It said given the regulatory environment, the timing of both the investments and cash flows from the project remains uncertain. RIL-BP estimate that the fields have 3 trillion cubic feet of discovered gas resources, which could be monetised with these investments. The investment is subject to approval by the government of the development plans which RIL and BP plan to submit before the end of 2017. Currently, RIL only gets $2.5 per million British thermal unit for its current gas production from the KG-D6 block. But the new fields are entitled to a higher rate, which is capped at $5.56. RIL-BP plan to award soon the contracts for development of the first field — R-Series, deep water gas fields located in water-depths of more than 2,000 meters, approximately 70 km offshore. The companies expect to produce up to 12 mmscmd, with first production in 2020.
Source: The Hindu Business Line
June 18, 2017. India’s largest natural gas field Bassein in the Arabian Sea has seen a remarkable turnaround with the natural decline that had set in at the 28-year old field reversed and output slated to rise by a quarter to a record high in 2018. The field, which had hit a peak of 29 million metric standard cubic meter per day (mmscmd) in 2011, had seen output decline thereafter but the same has now been reversed in last three years. Gas production has regained the 30 mmscmd mark and will climb to 34 mmscmd in few weeks before touching 37 mmscmd by December 2018. Crude oil production from the asset has risen from about 1 million tonnes to 2.5 million tonnes in last three years, making it the second highest oil producing asset of Oil and Natural Gas Corp (ONGC). Projects worth ₹ 13,181 crore to exploit C-26, Daman, Bassein and Vasai East discoveries will help ramp up the output further. Vasai East additional development project, costing ₹ 2,476 crore, will help raise crude oil production from 5,600 barrels per day (bpd) to 17,550 bpd and gas from 1.3 mmscmd to 2.5 mmscmd. The ₹ 6,086 crore Daman development project will give a peak gas output of 8.3 mmscmd and 9,600 bpd of condensate while the ₹ 4,619 crore Bassein integrated development project will help produce 19.36 billion cubic meters (bcm) of gas and 1.97 million cubic meters (mcm) of condensate. C-26 Cluster development project, costing ₹ 2,592 crore, would produce 5.94 bcm of gas and 0.644 mcm of condensate, they said. Bassein field had 393 bcm of initial gas in place, of which 248 bcm (about 7 trillion cubic feet) has been produced. It is ONGC’s fastest growing asset, spread over 7,300 square kilometres in Arabian Sea. It comprises South Bassein field that produces 18 mmscmd of gas, NBP (D-1) field, B-193 super sour field, Vasai East field and C-Series and Daman gas field.
Source: The Times of India
June 18, 2017. GAIL (India) Ltd launched the ₹6,283 crore Bengaluru City Gas Distribution (CGD) project. The project is expected to cover 4,395 sq km in urban and rural Bengaluru, broadly covering eight sectors — Nelamangala, Dod Ballapur, Devanahalli, Hosakote, Bengaluru East, Bengaluru North, Bengaluru South and Anekal. As part of the project, about 60 compressed natural gas (CNG) stations are to be set up. The project will provide cheaper fuel for the transport sector and also facilitate a healthy lifestyle by creating a pollution-free environment. GAIL launched a mobile app to provide a one-stop platform for customers to view/pay piped natural gas (PNG) bills, locate CNG stations, know about the benefits of CNG/PNG and get emergency instructions. Oil Minister Dharmendra Pradhan said that so far, 66 kms of steel and 452 kms of MDPE pipeline has already been laid in the city.
Source: The Hindu Business Line
June 16, 2017. Greka Drilling Ltd, an independent oil and gas driller in Asia, has secured a three year drilling contract with Oil & Natural Gas Corp (ONGC) for the Bokaro CBM (coal-bed methane) asset in India. Under the deal, Greka will deploy one of its purpose-built rigs in the country. ONGC plans to drill 73 wells over the next three years using this rig, which has a proven track record of drilling in similar geological conditions, according to Greka. The project will entail the provision of drilling and mud services, along with the provision of associated equipment, and is estimated to generate total revenues of $15 million over the three year period.
Source: Rigzone
June 19, 2017. Singareni Collieries Company Ltd (SCCL) said the ongoing strike by a few sections of workers’ unions has not impacted coal production. The national trade unions AITUC, INTUC, CITU, HMS and BMS are among the unions to have decided to go on indefinite strike from June 15 demanding implementation of the revival of the Dependent Employment Scheme (DES) as promised by the TRS Government during elections. It further said that the coal production was over 1.71 lakh tonnes during the past four days against 1.52 tonnes a day before the beginning of the strike. Meanwhile, CITU in statement demanded that the management should immediately call agitating workers for a dialogue. The trade union held a “round table” on the issue.
Source: The Times of India
June 19, 2017. Jindal Steel and Power Ltd (JSPL) said it has secured coal linkage in the recently-concluded auctions for the captive power sub-sector. The captive power plants of the company are located at Raigarh and Dongamahuah (Raigarh district) in Chhattisgarh. The linkages ensure a steady supply of thermal coal to feed the captive power plant at calorific cost and would further enhance operational efficiency, the company said. Since 2016, JSPL has secured coal linkages of close to2.3 mtpa in various sub-sectors for a 5-year timeframe.
Source: The Economic Times
June 15, 2017. The steel ministry has asked Coal India Ltd (CIL) to set up more washeries at coal mine pitheads. According to Union Steel Minister Chaudhary Birender Singh, the move is expected to help reduce coking coal imports. According to the Minister, the Centre’s focus on ‘housing for all’ and increased movement of infrastructure projects are expected to create an additional demand of around ₹ 40,000 crore worth of steel in the country.
Source: The Hindu Business Line
June 14, 2017. State-run power giant NTPC which made its debut in coal mining this fiscal has in a major development awarded Mine Developer-cum-Operator contract for its Dulanga coal mine in Odisha, as part of its plan to produce 3 million tonnes (mt) of the dry fuel this fiscal. After the start of coal production and dispatch from Western Quarry of Pakri-Barwadih coal mine in December 2016, NTPC has now started the same from Eastern Quarry of this mine, as well. Already 56,352 tonne of coal has been extracted from this quarry. NTPC, so far, has produced more than 4.6 Lakh tonne of coal from Pakri-Barwadih mine and successfully despatched 58 coal rakes (2,02,480 tonne of coal) to its Barh power station. This mine has an estimated mining capacity of 15 million tonnes per annum and has been allotted by the central government to NTPC as a basket mine to meet the fuel shortfall of its power stations. Coal mining is integral to NTPC’s fuel security strategy, which believes that greater self—reliance on coal will go a long way in ensuring sustained growth of generation. NTPC has been allocated eight coal blocks -Pakri— Barwadih, Chatti—Bariatu & Chatti—Bariatu (South), Kerandari, Dulanga, Talaipalli, Banai, Bhalumuda and Mandakini—B by Government of India.
Source: The Hindu
June 20, 2017. The power industry in Punjab has hailed decision of Congress government led by Chief Minister (CM) Amarinder Singh to provide power at a uniform rate of ₹ 5 per unit in the state. The industry has termed the action as pro-industry and a step set to accelerate industrial growth. Confederation of Indian Industry (CII) hailed the key measures including disbanding truck unions and the CM’s appeal to the well-to-do farmers to give up power subsidy voluntarily. CM had announced to give up the free power while appealing to his Cabinet colleagues to volunteer for the same.
Source: The Economic Times
June 17, 2017. The government expects the demand for electricity to pick-up in the next couple of years, which experts believe is critical to revive the power sector saddled with stressed assets. Experts said transferring the assets from one developer to the other would not be enough to revive the stranded assets till the time demand for electricity does not pick up. The government, however, feels the problem is of over supply rather than of lean demand. The demand for power has grown by a robust 6.4% in the last three years against 6.2% in 2004-2014, the power ministry said. The government proposes to set up a special purpose vehicle to hold stressed power assets and revive them by debt-equity swaps, offering last mile equity or asking public sector companies like NTPC to operate them on a contractual basis. Power Minister Piyush Goyal said the government is close to resolution of the stressed thermal power projects where developers are not wilful defaulters or there are no significant irregularities.
Source: The Economic Times
June 16, 2017. Power Finance Corp (PFC), the state-owned power sector lender, announced it has been allowed by the government to raise bonds eligible for capital gain tax exemption under section 54EC of the Income Tax Act. Section 54EC provides that capital gain subject to a maximum of ₹ 50 lakh arising from the transfer of a long term capital asset will be exempt if the assesse invests the whole or any part of capital gains in certain specified bonds within a period of six months. An investor can save up to a maximum ₹ 10 lakh by investing maximum permissible amount of ₹ 50 lakhs in these bonds. PFC is the lead financier for the Indian power sector and is the largest infrastructure company in the country based on net worth. According to a Department of Public Enterprises survey of March 2017, PFC was ranked the seventh-highest profit making public sector undertaking (PSU) among 320 PSUs.
Source: The Economic Times
June 14, 2017. The Maharashtra State Electricity Distribution Company Ltd (MSEDCL) appears to be struggling to ensure uninterrupted power supply to the city despite claiming that adequate measures were taken before the monsoon. Almost the entire city was without power from 4 pm to 7 pm soon after it started raining. Power was restored in some areas only late at night. Consumer activist Raju Gangurde said the MSEDCL should have restored power supply within a maximum of three to four hours, but the areas did not receive power for seven hours. Gangurde said that despite the power company’s tall claims of infrastructure upgradation or pre-monsoon maintenance, the system is just not being able to stand the rain.
Source: The Times of India
June 20, 2017. NHPC has awarded an EPC (engineering, procurement and construction) contract for the development of 50 MW Solar Power PV Grid connected project located at Theni and Dindigul districts in Tamil Nadu to Larsen & Toubro, L&T Construction, Manapakkam, Chennai for an amount of ₹ 287.48 crore with its comprehensive O&M (operating and maintenance) for 10 years. The project is anticipated to be completed within 9 months.
Source: Business Standard
June 20, 2017. India’s Adani Group inked a deal with East Hope Group, one of China’s largest companies, which will invest over $300 million to set up a manufacturing unit for solar power generation equipment in Gujarat. An estimated investment of more than $300 million is expected to be made by East Hope Group in India, as part of the proposed cooperation between the two conglomerates. East Hope Group, a 70 billion yuan company, is one of the largest corporate houses in China.
Source: Business Standard
June 19, 2017. Farmers in Tamil Nadu can avail themselves of 90 percent subsidy for solar-powered irrigation pump sets if they exit the waiting list for farm connections. The State government will give 1,000 solar-powered irrigation pump sets of 5, 7.5 and 10 horsepower (hp) under a model programme to farmers across the State. These off grid units will be available with 40 percent State government subsidy, 20 percent from the Union Ministry of New and Renewable Energy; 30 percent from Tamil Nadu Generation and Distribution Corporation and the farmer’s share will be 10 percent. This scheme will be implemented at a cost of ₹ 15 crore, the Electricity Minister P Thangamani said. To avail this benefit, farmers will have to apply for irrigation pump sets under the seniority scheme. The government will also offer Tatkal scheme in which farmers can get conventional agriculture connection within six months of application. They will have to shell out ₹ 2.5 lakh for a 5 hp motor connection; ₹ 2.75 lakh for a 7.5 hp motor supply; and ₹ 3 lakh for a 10 hp supply. The connection will be provided within six months for 10,000 applicants, he said. The government also plans to establish a 500 MW solar park through a private player; and a mobile app will also be developed for power consumers to pay their utility bills, the Minister said.
Source: The Hindu Business Line
June 19, 2017. Solar power projects will be exempted from interstate transmission charges till the end of December 2019, making it feasible to compete with thermal power. The decision was taken by the ministry of power in consultation with the ministry of new and renewable energy and other stakeholders since imposition of charges would have raised cost of using solar power from another state by ₹ 1-2.50 per kilowatt hour (kWh), depending on the distance it is transmitted and voltage at which it is supplied. Solar tariffs have been falling steeply in recent years, touching an all-time low of ₹ 2.44 per kWh at Rajasthan’s Bhadla solar park auction in May, very much on a par with thermal power. But imposition of interstate transmission charges would have affected capacity to compete. The Delhi Metro Rail Corp, for example, signed an agreement in April to draw most of its daytime power needs from the 750 MW ultra mega solar power project – three plants of 250 MW each – being built at the Rewa solar park, Madhya Pradesh.
Source: The Economic Times
June 19, 2017. Over 12,000 solar pumps have been distributed so far to the farmers at subsidised rates under ‘Saur Sujala Yojna’ in Chhattisgarh. Chief Minister (CM) Raman Singh was informed about the development under the scheme while he was chairing a review meeting of the energy department. Prime Minister Narendra Modi had launched the ‘Saur Sujala’ scheme on state’s foundation day on November 1, 2016 in Raipur. During the meeting, the CM instructed the officials to focus more in 85 tribal-dominated development blocks for the distribution of the solar energy-based irrigation pumps. Singh expressed satisfaction that the department had distributed more solar pumps than the set target and congratulated the officials. The CM further stressed on the need to cover 20,000 farmers under this scheme by the end of this year pointing that farmers belonging to remote areas and inaccessible regions, should be given priority while distribution. Notably, farmers are being provided solar-irrigation pumps of 5 horsepower (hp) and 3 hp at heavily subsidized rates in the state. Solar irrigation pump worth ₹ 3.5 lakh (3 hp) is being given to Scheduled Caste and Scheduled Tribe classes at the cost of ₹ 7,000, to Other Backward Class (OBC) at ₹ 12,000 and general category farmers at ₹ 18,000. The remaining amount is borne by the state government, he said. Besides, the chief minister also directed the officials to complete electrification of all villages and hamlets by March next year. Similarly, he also asked to complete the installation of 32 power substations being established in different parts of the state, by March next year.
Source: The Financial Express
June 19, 2017. The government is working on a scheme to promote energy efficient homes by offering cheaper loans and lower registration fee for green residential units as it ramps up efforts to mitigate climate change by moving towards a net zero-energy building regime. Government said the proposal is part of ongoing discussions on framing the ‘Energy Conservation Building Code for Residential Sector (ECBC-R)’ on the lines of such a code for government and commercial buildings framed in 2007. Power, Coal, New and Renewable Energy and Mines Minister Piyush Goyal is scheduled to release the refreshed version of the code, ECBC-2017, outlining a quantum leap towards a greener outlook for Indian realty. The Bureau of Energy Efficiency is working on a scheme to incentivise new homes that are more energy efficient and make lower demand on utilities for lighting and cooling energy. ECBC-R will be a booster for the government’s ‘Make in India’ campaign as it is expected to raise the demand for energy efficient household equipment as well as other services. Seen in the backdrop of climate change and expanding cities, ECBC-R will strengthen the government’s efforts at reducing the carbon footprint of a growing segment of energy consumers. It will also add green jobs in the real estate sector.
Source: The Economic Times
June 18, 2017. The Delhi government’s power department said it has opened registration process for installation of rooftop solar power plants in the city, as it aims to tap 1 GW of green energy by the year 2020. Under the scheme, 30 percent central finance assistance will be given by the ministry of new and renewable energy on the cost of solar photovoltaic plant. The generation based incentive of ₹ 2 per unit is also there for residential category. The Indraprastha Power Generation Company Ltd has empanelled vendors for solar photovoltaic installations. Lt Governor Anil Baijal had directed the power department to prepare a standard operating procedure and a roadmap for promoting installation of solar power panels in the city. The Delhi Solar Policy, which aims at mass adoption of solar power in the city, was notified on September 27, 2016. The highlights of the policy includes a generation-based incentive for three years.
Source: The Financial Express
June 16, 2017. Tamil Nadu Government has shown interest to purchase low floor, air conditioned electric vehicle CIRCUIT provided by Hinduja Group flagship Ashok Leyland. Ashok Leyland, Head-Global Bus, T Venkataraman said the company introduced the electric vehicle in October last year and has been talking to various governments for providing the service. Asked on the company’s overseas operations in Electric Vehicle business, he said Ashok Leyland already operates such buses in London under “Optare” brand. The buses can be produced on multiple platforms depending upon the customer’s requirement, he said. Ashok Leyland showcased the electric vehicle CIRCUIT in October 2016. The buses equipped with fire detection and suppression system can travel upto 120 kilometrs on a single charge under standard test conditions.
Source: The Economic Times
June 16, 2017. Tesla Motors is planning to set up a factory in India to cater to the local demand for electric cars, at a time when the Modi government has launched an ambitious plan of moving to 100 percent electric mobility by 2030. The United States (US) carmaker is looking to enter India as a retailer and is in talks with the government for waiver of restrictions on imports of its high-end electric cars until its factory is built. The import penalties or restrictions that Elon Musk, chief executive officer, Tesla, referred to are most likely the norms for multinationals to set up single-brand retail in India, which mandate them to source at least 30 percent locally. Unlike traditional automakers, Tesla sells and services its vehicles on its own rather than through local dealers. Over the past couple of years, this policy has largely worked, with brands such as Mercedes-Benz, Audi, BMW, JLR and Volvo having units in India. Experts believe that the government should do the same even for electric vehicles as it will help boost the local industry.
Source: The Economic Times
June 16, 2017. Mozambique, the southern African country rated as one of the poorest, has topped a survey of nations with the lowest global environmental impact while India has ranked a dismal 75th in the report. Mozambique topped the list because almost all its energy use comes from green sources. India, on the other hand, was placed 75th, with renewable energy making up only 15.2 percent of all energy used; only 2.2 percent of waste water being recycled, and municipal waste of 0.34 kg per person being generated daily.
Source: The Economic Times
June 16, 2017. Azure Power, an independent solar power producer in India, announced it has been granted ₹ 67.83 crore ($10.5 million) of low-cost debt financing through the State Bank of India (SBI)-World Bank Grid Connected Rooftop Solar PV Program. The loan is granted for 15 years with an interest rate of 8.35 percent per annum, among the lowest interest rates availed by solar power developers in India, according to the company. The World Bank and the International Bank for Reconstruction and Development (IBRD) approved a line of credit of $625 million to support the government’s goal to expand rooftop solar capacity to 40,000 MW. The company said its Azure Roof Power platform has over 1,000 MW capacity projects across 18 states. Its customers include commercial real estate companies, a chain of premium hotels, distribution companies in smart cities, warehouses, Delhi Metro Rail Corp (DMRC) and Indian Railways.
Source: The Economic Times
June 16, 2017. Gujarat Urja Vikas Nigam Ltd (GUVNL) has decided to buy 1,000 MW of renewable power through competitive bidding, which will be followed by an e-auction for the lowest price. The company floated two separate tenders for procuring 500 MW each from solar and wind power projects. According to the request for selection (RFS) document, GUVNL has invited bids to procure solar and wind power to fulfil renewable purchase obligations (RPOs) and to meet the future needs of its distribution companies. The RPO mandates that distribution company buy electricity from renewable sources for a defined minimum percentage of the total consumption of its consumers. The last date for submission of bids is July 10, 2017 and a pre-bid meeting for the tenders will be held on June 30. After opening the technical bids on July 11, the reverse auction will take place on July 17 and 18 for wind and solar tenders respectively. The bidders selected by GUVNL based on this RFS, shall set up wind and solar power projects in accordance with provisions of the RFS document and standard power purchase agreement.
Source: The Economic Times
June 16, 2017. Bihar is eyeing an investment of ₹ 20,000 crore in the renewable energy sector in the next five years to generate over 3,000 MW of clean energy. The plan is part of the new renewable energy policy that aims to tap the potential of new and renewable sources of energy in the state. Bihar Renewable Energy Development Agency director R. Lakshmanan said that with Bihar’s increasing population and rapidly growing economy, the state needs access to clean, cheap and reliable sources of energy. Lakshmanan said the new renewable policy target is for installed capacity of 2,969 MW solar, 244 MW biomass and 220 MW small hydropower in the next five years so as to meet the growing demand of power in an environmentally sustainable manner. The Centre for Environment and Energy Development (CEED) chief executive officer Ramapati Kumar said with a well defined target, fixed timeline, emphasis on solar rooftops and decentralised renewable energy systems, the agriculture sector will be transformed. Most of the expected ₹ 20,000 crore investment is likely to flow into setting up new manufacturing capacity in the state, for solar panels and other renewable energy equipments, skill developments, and research and development for sustainable clean energy, Ramapati said. State’s Energy Minister Bijendra Prasad Yadav said it is time for organisations to invest in Bihar to accelerate the state’s development.
Source: The Economic Times
June 15, 2017. Catchment areas of the hydroelectric power projects in Kerala are yet to receive copious southwest monsoon rains, keeping the storage levels well below normal. With the storage as, 514 million units of power can be generated. Normally, at the end of June, the storage used to be enough to generate 795 million units, the Kerala State Electricity Board (KSEB) said. The current daily demand is at 62 million units and it is met by hydel generation and imports from various sources. Currently, 8 million units are generated daily from the hydel sources, 27.8 million units come from the Central grid and 21.3 million units from purchases. With purchases from power exchange and deviations, the total comes to 59.43 million units. The gap of 3.5 million units is filled by wind mills and small hydro-electric projects in the private sector, the KSEB said. The KSEB is in a comfortable position and would avoid costly thermal power from NTPC Kayamkulam and BSES Ernakulalm this year.
Source: The Hindu Business Line
June 15, 2017. Rajasthan Chief Minister Vasundhara Raje invited Japanese companies to invest in solar energy sector in the state. In her meeting with a delegation of Japan External Trade Organization, she said solar energy is the power of the future and Rajasthan is the ideal destination for investment in Solar Energy.
Source: Business Standard
June 14, 2017. Indian Oil Corp (IOC) is planning to foray into energy storage business. The firm is weighing the option of launch of an improved version of lead-acid battery for low cost mobility and industrial applications. IOC’s foray into the energy storage market comes at a time the government is working on an ambitious target to ramp up renewable energy generation capacity to 175 GW by 2022 and also completely shift to e-vehicles by 2030. India added 5,526 MW of solar capacity during 2016-2017, a growth of 85 percent, and 5,400 MW of wind capacity, 63 percent more than the capacity added previous year. Analysts said IOC’s entry in the energy storage market may invoke interest from the booming renewable energy sector which is in need of indigenous battery solutions but demand from the auto industry may still take time to catch up. Currently, Mahindra Electric is the only company manufacturing electric cars in India in the passenger vehicle segment. The company manufactures only 100 units per month due to low demand but plans to ramp up production to over 1,000 units in the soon. In the two-wheeler space, Hero Electric, Ather Energy and Lohia Auto are the few mainstream players manufacturing electric vehicles. IOC is not the only company diversifying its portfolio to enter into the energy storage business. IOC has so far commissioned 167 MW of wind-power projects in Gujarat, Andhra Pradesh and Rajasthan. The company’s total installed solar photovoltaic (PV) capacity stands at 20 MW. In addition, the fuel retailer operates 6,170 fuel stations on solar power with a cumulative capacity of 24 MW. The energy storage market for rooftop and off-grid renewable energy applications in India is likely to be worth ₹ 16,500 crore by 2022, Delhi-based Council for Energy Environment and Water (CEEW) said.
Source: The Economic Times
June 14, 2017. India is staying true to its ambitious renewable energy targets by showing a steady growth in renewable energy installations in India, which as of April 2017 account for 17.5 percent of the total energy source. The latest data, which is provided by the ministry of new and renewable energy, has been analyzed by Mercom Capital Group. India’s overall installed capacity has reached 329.4 GW, with renewables accounting for 57.472 GW. The figures show a significant rise on the data released by the ministry in February when the figure stood at around 50 GW. In April 2017, solar reached 3.8 percent of total installed capacity up from 2.23 percent in April 2016. Country’s coal-fired fleet remains strong with a 59 percent share in the total energy mix, although NTPC has showed itself to be the principle supporter of the government’s green energy agenda. India has set a target of reaching 170 GW of renewable energy capacity by 2022, out of which 100 GW is to come from solar.
Source: The Economic Times
June 20, 2017. The BP-operated Prudhoe Bay oil field in Alaska has reached 40 years of production, generating more than 12.5 billion barrels of oil in the process. The field continues to support more than 16,000 Alaska jobs and supplies 55 percent of all Alaska oil output, BP revealed. The original estimated recovery for Prudhoe Bay was 9.6 billion barrels. However, an additional 3 billion barrels so far have been unlocked through innovations in oilfield technology. While production has fallen from historic peaks due to natural decline, Prudhoe Bay remains the third-largest oil field in the US by proved reserves, behind the Eagle Ford Shale and Spraberry fields in Texas.
Source: Rigzone
June 20, 2017. Italian oil major Eni signed an agreement with Iran for feasibility studies to develop an oil field and a gas field, signaling a possible return to Iran’s upstream sector. Eni had signed a Memorandum of Understanding with the National Iranian Oil Company for studies on the Kish gas field and the third phase of the Darkhovin oil field in southern Iran. Eni has six months to present the results of its studies.
Source: Reuters
June 19, 2017. China issued a second batch of crude oil import quotas under the so-called “non-state trade” that is higher than for all of the allowances in 2016, but allotments to independent refineries were lower than a year earlier. The lower grants to the independents dealt the new group of crude oil buyers another blow because they were already barred from exporting refined fuel, squeezing margins in an oversupplied domestic fuel market. The commerce ministry approved 22.92 million tonnes to 32 companies, against 29 recipients in the first issue for 2017. The 32 companies included mostly independent oil refineries, also known as teapots, and some state-run companies. That latest quotas take the total issued this year to 91.73 million tonnes, compared with 87.6 million tonnes in 2016. The second batch will be valid until year-end. Volumes for the 19 independent oil plants that make up two thirds of the total issues for 2017 dropped by 12.36 million tonnes, or nearly 17 percent, from last 2016.
Source: Reuters
June 19, 2017. Mexico auctioned two-thirds of the shallow water oil and gas blocks up for grabs in the latest round of its energy market opening, surpassing the cautious estimates officials made. Italy’s Eni, Colombia’s Ecopetrol and Capricorn Energy, a unit of Edinburgh-based Cairn Energy, were among the companies at the forefront of the bidding for 15 blocks in the southern Gulf of Mexico. Ten of the 15 blocks were taken up in the auction. The potential output from the blocks auctioned could total 170,000 barrels per day of crude equivalent, and investments could eventually reach $8.2 billion, Energy Minister Pedro Joaquin Coldwell said. Mexico hopes opening the energy sector will help reverse years of declining crude output. Total crude production in Mexico has fallen to 2.01 million barrels per day from a peak of 3.38 million in 2004.
Source: Reuters
June 19, 2017. Saudi Energy Minister Khalid al-Falih said the oil market is heading in the right direction but still needs time to rebalance. Oil prices dipped, weighed down by a continuing expansion in US (United States) drilling that has helped to maintain high global supplies despite an OPEC (Organization of the Petroleum Exporting Countries) -led initiative to tighten the market by cutting production. The price of oil is down around 14 percent since late May, when producers led by the OPEC extended their pledge to cut output by 1.8 million barrels per day (bpd) by an extra nine months. Falih said there was a relatively big draw of around 50 million barrels from floating storage and a drop in industrialised nations’ onshore storage of 65 million barrels compared to July last year. Compliance in April and May with the OPEC-led output deal was above 100 percent, he said. Falih also said he expects Libya’s production to return to normal levels. OPEC members Libya and Nigeria were exempted from the supply cuts because unrest had curbed their output.
Source: Reuters
June 18, 2017. Qatar will not cut off gas to the United Arab Emirates (UAE) despite a diplomatic dispute and a “force majeure” clause in its contract, the Qatar Petroleum chief executive officer (CEO) Saad al-Kaabi said. CEO said that although there was a “force majeure” clause in the agreement on the Dolphin gas pipeline, which links Qatar’s giant North Field with the UAE, Qatar would not stop supplies for other reasons. The Dolphin gas pipeline links Qatar with the UAE and Oman and pumps around 2 billion cubic feet of gas per day to the UAE.
Source: Reuters
June 18, 2017. Russia’s largest oil producer Rosneft said it had found its first oilfield in the Laptev Sea in the eastern Arctic, making a breakthrough in the search for hydrocarbons in the harsh and far-flung region despite Western sanctions. Rosneft and its partners plan to invest 480 billion roubles (6.57 billion pounds) in developing Russia’s offshore energy industry in the next five years, part of a drive to boost output from new areas. The company has sought tie-ups with several global oil players to develop Russia’s offshore regions. But a deal to work in the Kara Sea in the western Arctic with U.S. company Exxon Mobil was suspended in 2014 after the imposition of Western sanctions against Moscow. The Arctic offshore area is expected to account for between 20 and 30 percent of Russian production, one of the world’s largest, by 2050. Rosneft owns 28 blocks in the Arctic offshore area with combined estimated resources of 34 billion tonnes of oil equivalent. There is only one offshore platform in the Russian Arctic, Prirazlomnoye, operated by Gazprom Neft, which plans to produce 2.6 million tonnes (52,000 barrels per day) this year. Analysts said oil production in the region – apart from Prirazlomnoye – is years away and may start only in the mid-2020s Rosneft has been working in the Laptev Sea since 2014. It values the hydrocarbon resources of the sea at around 9.5 billion tonnes of oil equivalent.
Source: Reuters
June 17, 2017. The United Arab Emirates (UAE) Energy Minister Suhail bin Mohammed al-Mazrouei said he saw no need for an extraordinary meeting of the Organization of the Petroleum Exporting Countries (OPEC) ahead of regular talks in November. OPEC holds its next regular meeting in Vienna on November 30. OPEC and non-members led by Russia decided on May 25 to extend cuts in oil output by nine months to March 2018 as they battle a global glut of crude. Mazrouei also said he expected demand for oil to pick up in the third quarter of the year.
Source: Reuters
June 16, 2017. Exxon Mobil Corp said it and partners would spend $4.4 billion to develop part of the Liza oilfield off the coast of Guyana, approving a megaproject at a time when the oil industry has grown obsessed with lower-cost shale. Exxon’s decision shows that oil companies remain interested in large projects, especially offshore, even in an era of belt-tightening after two years of low crude prices. The Guyana announcement from Exxon and partners Hess Corp and CNOOC was the fifth deepwater project to gain approvals this year. BP Plc and Reliance Industries Ltd (RIL) said they would spend $6 billion to develop natural gas reserves off the Indian coast. Exxon, which spent nearly $7 billion to more than double its holdings in the Permian shale formation in the United States, said the Guyana project was approved due in part to its low cost of production. Phase One of the Liza development project should tap about 450 million barrels of oil and pump about 120,000 barrels per day when it comes online in 2020, Exxon said.
Source: Reuters
June 14, 2017. Uganda is set to sign two oil production sharing agreements (PSAs) with a Nigerian firm, enabling the company to begin exploration work, the government said. The firm, Oranto Petroleum International, was among a number of companies that bid in the country’s first competitive oil exploration licensing round last year, with two other Nigerian firms and Australia’s Armour Energy also getting through to final negotiations for the award of the PSAs. The ministry of energy and mineral development said the deal with Oranto covers the Ngassa Shallow Play and Ngassa Deep Play exploration blocks located near the southern part of Lake Albert. Uganda discovered oil in 2006 in the Albertine rift basin along its border with the Democratic Republic of Congo. Gross crude reserves are estimated by government geologists at 6.5 billion barrels of which between 1.4 to 1.7 billion barrels are considered recoverable. Production is expected to start in 2020. The first batch of licences that Uganda awarded in the early 2000s were given on a first-come, first-served basis. But after the discovery of commercially recoverable reserves the country enacted new laws to manage the sector and under those laws exploration licences must be granted on a competitive basis.
Source: Reuters
June 14, 2017. China’s crude oil production fell to its lowest on record in May, even as refineries in the world’s top buyer of crude churned out product at their fastest pace in nearly two years, data showed. Crude output fell 3.7 percent in May from a year earlier to 16.26 million tonnes, or 3.83 million barrels per day, data from the National Bureau of Statistics showed. The figure is the lowest since the bureau began publishing records in 2011. The drop in China’s crude oil output has slowed as major oil producers raised spending to boost production as oil prices have stabilized in a range between $48 to $55 per barrel. Analysts are forecasting flat or positive production growth for calendar 2017. PetroChina, the owner of China’s largest oilfield Daqing, said in December that it would slash capital spending on the field this year by 20 percent from a year earlier.
Source: Reuters
June 14, 2017. Brazil’s state-controlled oil company Petroleo Brasileiro SA (Petrobras) reduced its average prices at refineries by 2.3 percent for gasoline and 5.8 percent for diesel, the company said. The gasoline prices for consumers may drop up to 0.9 percent and diesel prices, up to 3.5 percent, the company said.
Source: Reuters
June 20, 2017. Shell is considering whether to invest in a gas project in Nigeria’s southern Niger Delta energy hub. Shell Petroleum Development Company of Nigeria (SPDC) said the project under consideration would have a capacity of 300 million cubic feet and would be located in the city of Asa.
Source: Reuters
June 20, 2017. Italian gas group Snam is in exclusive talks with EDF’s Italian unit Edison to buy a stake in a liquefied natural gas (LNG) terminal in northern Italy as part of plans to develop its LNG business. Snam is looking to buy Edison’s 7.3 percent stake in Terminale LNG Adriatico and the gas pipeline that connects it to Italy’s gas transmission backbone. Adriatic LNG, which has a capacity of 8 billion cubic metres per year, is 70.7 percent owned by ExxonMobil and 22 percent by Qatar Petroleum. Exxon and Qatar have a pre-emption right on Edison’s stake. Snam, which makes most of its money from gas transmission, is looking to play a leading role in integrating Europe’s grids and making Italy a European gas hub.
Source: Reuters
June 20, 2017. LNG Gorskaya, a privately-owned Russian liquefied natural gas (LNG) producer, has launched a €340 million ($379 million) project to become the first LNG exporter from Russia’s European coast. Russia expects to send LNG to Europe by the end of 2017 from its distant Arctic peninsula of Yamal but a plant on its Baltic coast could establish the country as a more immediate supplier of LNG in a region already dependent on piped Russian gas. The company will build a floating LNG plant off the port of Gorskaya, not far from Saint Petersburg, which will be fed by a 12 km pipeline from Gazprom. The company had agreed to build floating bunkering stations and storage facilities at the Baltic ports that will be able to supply LNG-fueled vessels with mostly Russian LNG by 2020. The company said it had the acquired the necessary gas export permits from Gazprom. The project means LNG Gorskaya could deliver the Baltic’s first large-scale, locally produced Russian LNG three years ahead of Gazprom’s Baltic LNG project, a much delayed plan the state-owned gas giant now expects to be running by 2023.
Source: Reuters
June 20, 2017. Qatargas has agreed to supply up to 1.1 million tonnes of liquefied natural gas (LNG) per annum to Royal Dutch Shell for five years. A new sale and purchase agreement (SPA) signed by the parties will come into effect from January 2019. LNG will be supplied from Qatar Liquefied Gas Company 4 (Qatargas 4) which is a joint venture (JV) of Qatar Petroleum and Shell. In the JV, Qatar Petroleum holds 70% stake while Shell holds 30%, which was incorporated in 2007. The LNG is likely to be delivered to the Dragon LNG Terminal located in the UK or the Netherlands-based Gate LNG Terminal. In March, Qatargas entered into an agreement to boost the volume of its currently supplied LNG to PGNiG to two million tonnes per annum. The agreement is slated to come into effect on 1 January 2018 and will expire in June 2034.
Source: Energy Business Review
June 16, 2017. Protesters blockading oil and gas fields in southern Tunisia have reached an agreement with the government to end a sit-in and allow production to restart immediately, the government and protesters said. Protests over jobs in southern Tataouine and Kebili provinces hit oil and gas production in a region where French company Perenco and Austrian producer OMV operate. The deal calls for jobs in oil companies and development projects. Protesters were pressing demands for jobs and a share of the country’s energy wealth and forced the closure of two oil and gas pumping stations in Kamour in Tatatouine and in Kebili.
Source: Reuters
June 15, 2017. JX Nippon Oil & Gas Exploration (Malaysia) Ltd revealed that it has commenced commercial gas production from the Layang field, offshore Sarawak in Malaysia. The initial production of natural gas and condensate from Layang, which is situated in the JX Nippon operated Block SK10, is estimated at around 12,000 barrels of oil equivalent per day. Natural gas produced from Layang field, together with natural gas from the Helang gas field, will be supplied through subsea pipelines to the MLNG Tiga Sdn. Bhd. liquefaction plant in Bintulu, Sarawak, which is partly owned by JXTG Nippon Oil & Energy Corporation. The natural gas will be sold as LNG after liquefaction to its customers, including buyers in Japan.
Source: Rigzone
June 20, 2017. Rio Tinto selected Yancoal to buy its Coal & Allied division in Australia for $2.45 billion, surprising commodities trading giant Glencore, which had put in a higher bid. Glencore offered $2.55 billion cash this month for Rio’s coal mines in the Hunter Valley region of New South Wales, beating a previous offer from Yancoal, which is based in Australia and owned by China’s Yanzhou Coal Mining Company. Glencore has long sought Rio’s high-quality thermal coal assets in the Hunter Valley. Despite environmental concerns about the carbon-intensive fossil fuel, Glencore expects continued demand, especially in Asia, as coal can still be the cheapest form of baseload power. Rio Tinto said Yancoal had agreed to accelerate payments it had said it would defer when it made its original offer in January. Yancoal will also pay a royalty linked to coal prices. Glencore said it had received clearance from Japan, which would be the destination for much of the coal involved.
Source: Reuters
June 16, 2017. China’s thermal coal futures rallied to a record high, lifting September futures to a premium over October, as a prolonged hot spell spurred power demand and low water levels dented hopes of higher hydro output. The buying lifted futures for delivery in September to a premium of 6 yuan ($0.88) per tonne over October, in a structure known as a backwardation, when prompt prices are higher than those for later months, that reflects tightening supplies. At the start of the month, the spread had been in a 4 yuan contango. The new curve suggests a brighter outlook for prices of the fuel most used to generate power in China even as Beijing has tried to boost supplies to avoid another crunch in supply that triggered a historic rally in prices last year. Data showed miners in May produced coal at their fastest pace in years ahead of peak summer demand. Prompt coal prices for cargoes from Australia’s Newcastle export terminal, Asia’s benchmark, have shot up 18 percent since mid-May to $84 per tonne. Total daily consumption from six of the largest coal power plants rose to 622,400 tonnes per day by June 16, up from 592,000 tonnes a month ago, according to China Sublime Information Group.
Source: Reuters
June 16, 2017. Nippon Steel & Sumitomo Metal, Japan’s top steelmaker, has given up its decades-old role in setting global coking coal prices because the rise of Chinese and Indian rivals has weakened its influence over the market. Nippon Steel stepped down as top negotiator on the coking coal benchmark, also because wild swings in the spot market played havoc with its profits, with gaps between the benchmark and spot prices making it less responsive to the market than rivals using index-linked pricing. Japan bought 61.5 million tonnes of coking coal in 2008, more than double India’s 26.5 million and nearly 20 times China’s 3.2 million. Last year, though, Japan imported 53.4 million tonnes against India’s 46.7 million tonnes and China’s 35.7 million, according to Clarksons Research. Nippon Steel and other Japanese steelmakers have long resisted the idea of more flexible pricing for coking coal, preferring the stable supply and steady prices of quarterly term contracts. Using the new pricing formula – which sets prices based the spot price indexes provided by S&P Global Platts, Argus Media and The Steel Index – coking coal for the April-June quarter will likely be set at around $190-195 a tonne, Nippon Steel said.
Source: Reuters
June 16, 2017. China will allow some coal mines to increase capacity, the National Development and Reform Commission (NDRC) said, as Beijing ramps up efforts to boost supply for summer. Both open pit and underground mines will be able to apply to increase production capacity as long as they haven’t reported major accidents, are efficient mines and follow strict safety measures, the NDRC said. Producers in regions that have complex geological conditions, are vulnerable to firedamp accidents or have been required by the government to cut capacity will not be eligible to apply. NDRC’s latest move came as China’s coal futures prices rose to a record high as warm weather leading into the summer season raised investors’ expectations for increased demand. China’s coal production rose 12 percent in May from a year ago, notching the fastest growth pace in years, data showed. The NDRC said producers granted quota increases would need to shut down some old inefficient coal mines in exchange.
Source: Reuters
June 15, 2017. Natural gas constraints in Southern California could pose a risk to the region’s power supply this summer, while New England and Texas could face tight electricity supplies, the United States (US) Federal Energy Regulatory Commission (FERC) said. The anticipated reserve margin in ISO New England, the regional power grid operator, is forecast at 14.9 percent, slightly below the target of 15.1 percent. The operator could be forced to import additional power from neighbouring regions in case peak summer conditions materialize, as forecast, since the commissioning of about 700 MW of new resources could be delayed, FERC said. In Texas, FERC forecast that reserve margins in the Electric Reliability Council of Texas, which operates the power grid for about 75 percent of the state, would continue to be tight when compared to other regions, even though the operator expects to have adequate generating capacity to meet peak demand.
Source: Reuters
June 14, 2017. Eastern Australia’s power grid will be stretched again if fierce heatwaves hit over the next two summers, despite recent government steps to beef up supply, the Australian Energy Market Operator (AEMO) said. The latest outlook from the AEMO comes three months after it warned that Australia’s most populous states face a gas shortfall from the end of 2018 that could spark power or gas cuts to homes and businesses. The AEMO said power supply should be adequate in normal summer weather, assuming 140 MW of energy storage backed by the South Australian and Victorian state governments is in place, there are no planned generator outages and three gas-fired generators return to service as promised. The market will need more coal-fired power in the state of New South Wales, more renewable power and higher output from gas-fired generators to replace a 1,600 MW plant shut by France’s Engie SA in neighbouring Victoria in March. The grid would be most vulnerable in extreme heat on weekday afternoons and evenings when people switch on air conditioners, with the risk rising if the wind drops and the sun is down or other generation is disrupted at the same time, the AEMO said.
Source: Reuters
June 20, 2017. With the Trump administration expected to publish an analysis that could undermine the United States (US) wind and solar industries, two renewable energy lobbying groups released their own study saying new energy sources pose no threat to the country’s power grid. Wind and solar advocates have said the government study’s outcome appeared to be pre-determined to favor fossil fuel industries. The new report, commissioned by the American Wind Energy Association and Advanced Energy Economy, said cheap natural gas is behind most of the decline in the numbers of US coal-fired power plants in recent years, not government subsidies that have bolstered the growth of wind and solar power. It also said there is no evidence to show that wind and solar energy are threatening the reliability of the electric grid. The groups commissioned the report shortly after Energy Secretary Rick Perry in April ordered a 60-day study of the reliability of the grid and said Obama-era policies offering incentives for the deployment of renewable energy had come at the expense of energy sources like coal and nuclear.
Source: Reuters
June 20, 2017. Tesla Inc is close to an agreement to produce vehicles in China for the first time, giving the electric-car maker better access to the world’s largest auto market. The agreement with the city of Shanghai would allow Tesla to build facilities in its Lingang development zone and could come as soon. Details are being finalized and the timing of the announcement could change. Tesla would need to set up a joint venture with at least one local partner under existing rules and it is not immediately clear who that would be. Setting up local production is key for Chief Executive Officer Elon Musk to continue growing in China, where Tesla’s revenue tripled to more than $1 billion last year. Assembling vehicles locally would allow the company to avoid a 25 percent tax that renders Model S sedans and Model X sport utility vehicles more expensive than in the United States (US). China has identified new-energy vehicles as a strategic emerging industry and aims to boost annual sales of plug-in hybrids and fully electric cars 10-fold in the next decade. Government support helped China surpass the US in 2015 to become the world’s biggest market for the non-emission autos. Tesla, which made roughly 80,000 cars in 2016 and aims to boost it by about 7-fold to 500,000 annually by 2018. The automaker also plans to finalize locations of up to three battery Gigafactories this year.
Source: Bloomberg
June 19, 2017. Carbon capture and storage is gradually gaining government attention after being overtaken by investment in wind and solar energy, with the International Energy Agency (IEA) saying the technology will be crucial to limiting global warming. The IEA estimates carbon capture and storage (CCS) will be needed to cut 14 percent of the emissions that have to be abated by 2060 to limit the global rise in temperature to less than 2 degrees Celsius (3.6 degrees Fahrenheit). By one estimate, $80 billion has been invested in renewable energy compared with $20 billion in CCS, Australia’s ambassador for the environment, Patrick Suckling, said. Efforts to expand carbon capture and storage include a Japanese project to bury carbon dioxide below the seabed off Hokkaido island and construction of China’s first large-scale carbon capture, utilisation and storage (CCUS) project at a coal-to-chemicals plant run by Yanchang Petroleum in Xian.
Source: Reuters
June 19, 2017. The United States (US) Supreme Court handed a victory to Chevron Corp by preventing Ecuadorean villagers and their American lawyer from trying to collect on an $8.65 billion pollution judgment issued against the oil company by a court in Ecuador. The justices turned away an appeal by New York-based lawyer Steven Donziger, who has spent more than two decades trying to hold Chevron responsible for pollution in the Ecuadorean rain forest, of lower court rulings blocking enforcement in the US of the 2011 judgment. While not disputing that pollution occurred, San Ramon, California-based Chevron has said it is not liable and that Donziger and his associates orchestrated the writing of a key environmental report and bribed the presiding judge in Ecuador.
Source: Reuters
June 19, 2017. Sterling and Wilson said it has bagged turnkey engineering procurement and construction along with operation and maintenance contract for the world’s largest single location solar photovoltaic (PV) plant in Sweihan, Emirates of Abu Dhabi. According to the company, with construction already underway, the prodigious plant, which is spread over a desert area of 7.8 sq km, is scheduled to be fully integrated with the grid in a record timeline of just 23 months. The project was awarded at the lowest ever recorded bid in the history of PV solar. The plant is jointly developed by Marubeni, a Japanese integrated trading and investment giant, along with Jinko, a global leader in the solar industry, and Abu Dhabi Water and Electricity Authority. The consortium has successfully bid a tariff of $2.42 cents per kilowatt hour, marking the lowest cost ever for solar power. The plant, once commissioned, would save around 7 million tonnes of carbon emissions every year, a number that would be a national landmark.
Source: The Times of India
June 18, 2017. Scientists at Stanford University in the United States (US) have developed a device that can wirelessly charge a moving object at close range. The technology could one day be used to charge electric cars on the highway, or medical implants and cellphones as you walk nearby. According to the study, published in the journal Nature, wireless charging would address a major drawback of plug-in electric cars — their limited driving range. A charge-as-you-drive system would overcome these limitations. Professor Shanhui Fan said that a coil in the bottom of the vehicle could receive electricity from a series of coils connected to an electric current embedded in the road. Mid-range wireless power transfer is based on magnetic resonance coupling. The team transmitted electricity wirelessly to a moving light emitting diode (LED) light bulb but the demonstration only involved a one milliwatt charge, far less than what electric cars require. The scientists are now working on greatly increasing the amount of electricity that can be transferred, and tweaking the system to extend the transfer distance and improve efficiency.
Source: Business Standard
June 16, 2017. South Korea’s oldest nuclear reactor, the 40-year-old Kori No. 1, will halt operations, becoming the country’s first nuclear plant to close permanently amid plans for a shift towards natural gas and renewables. South Korea is the world’s fifth-biggest consumer of nuclear energy, and one of few countries to export its technology, having won an order to build reactors in the United Arab Emirates. But a scandal over forged certificates for spare parts in 2012 and the 2011 Fukushima meltdown in neighbouring Japan have undermined public support for nuclear power, while the new left-leaning government aims to speed up plans to move away from both coal and nuclear. Another 11 of South Korea’s 25 reactors are set to shut down by 2030 as they reach the end of their operating lives, although some may push to have their operating licenses renewed. With the country still setting its long-term energy plans, it is unclear how many will be replaced by new reactors. Since Kori No.1 began operations on June 19, 1977, the 587 MW reactor has generated enough electricity to meet the entire country’s current demand for around 100 days, according to data from the Nuclear Safety and Security Commission. The energy ministry estimated it will take at least 15 years to fully dismantle Kori No. 1, at a cost of about 644 billion won ($571 million). Some experts hope that shutting the reactor may help South Korea catch up to the United States, Japan and Germany in decommissioning plants. The global decommissioning market is expected to grow to about $980 billion by 2050, according to a report by the Korea Atomic Energy Research Institute.
Source: Reuters
June 15, 2017. Bulgaria has given €1.3 billion ($1.5 billion) in illegal aid to coal-fired and other power plants, according to a complaint filed with the European Commission by London-based ClientEarth lawyer Sam Bright. European Union (EU) state aid rules are designed to support a shift towards a lower carbon economy, though they allow some support for fossil fuel if it is needed to prevent blackouts or if it cuts emissions by improving efficiency. Bright said the activist lawyers had spent more than a year investigating Bulgaria’s practice of requiring public power provider NEK and distribution companies to buy all the electricity produced by plants classified as “high-efficiency co-generation” that produce heat as well as power. These operators are paid a surcharge, which comes from a levy on consumer bills. ClientEarth, whose campaigning successes include exposing Britain’s breach of EU air quality legislation, said its research found the aid flouted EU rules and the plants did not qualify for such help. In that complaint, ClientEarth alleges four power plants, which will receive permits to pollute worth €197 million between January 2013 and December 2020, had not met all the criteria to qualify.
Source: Reuters
June 15, 2017. Global emissions of greenhouse gases from the power sector are expected to peak in 2026, but will still be some way above levels needed to limit temperature rises in line with the Paris climate agreement, research showed. Overall, $10.2 trillion will be invested in new global power generation between 2017 and 2040, with renewable power sources such as wind and solar accounting for almost three quarters of that, a report by Bloomberg New Energy Finance (BNEF) said. By 2040, global emissions are expected to be 4 percent below 2016’s levels, but an additional $5.3 trillion investment in renewable power would be needed by 2040 to keep rising global temperatures below 2 degrees Celsius (3.6 degrees Fahrenheit). Under the 2015 Paris deal, more than 190 countries pledged to curb greenhouse gas emissions to keep planet-warming well below 2 degrees to stave off the worst effects of climate change. The report said the costs of renewable power were expected to continue to fall, with the cost of solar tipped to fall by 66 percent by 2040.
Source: Reuters
June 15, 2017. Nevada Governor Brian Sandoval signed a bill to reinstate a key rooftop solar policy and bring national residential installers Tesla Inc’s solar division and Sunrun Inc back to the state after an 18-month absence. State legislators passed the bill, which requires utilities to purchase excess power generated from rooftop solar panels at near the full retail rate.
Source: Reuters
June 14, 2017. The Trump administration will suspend compliance dates on a rule limiting methane emissions from oil and gas companies working on public lands as soon as, according to an Interior Department document. The move is part of an effort by President Donald Trump, a Republican, to roll back the environmental regulations of former President Barack Obama, a Democrat. The Environmental Protection Agency said it would propose a two-year stay on another Obama methane rule requiring companies to detect and capture leaking emissions. Compliance dates on the rule on methane on public lands, which the Obama administration issued in November 2016, will be suspended until a federal court in Wyoming considers litigation on the regulation, the document said.
Source: Reuters
| Year | Solar Power Capacity Addition | Solar Power Cumulative Capacity |
| (MW) | ||
| Upto 2010 | — | 11 |
| 2010-11 | 25 | 36 |
| 2011-12 | 994 | 1030 |
| 2012-13 | 656 | 1686 |
| 2013-14 | 946 | 2632 |
| 2014-15 | 1112 | 3744 |
| 2015-16 | 3019 | 6763 |
| 2016-17 (As on October 2016) | 1965 | 8728 |
Trends in Solar and Total Renewable Generating Capacity
Publisher: Baljit Kapoor
Editorial advisor: Lydia Powell
Editor: Akhilesh Sati
Content development: Vinod Kumar Tomar
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