Energy News Monitor I Volume VI, Issue 20

Climate Change: Technology Development and Transfer

 

 

NEWS BRIEF

OIL & GAS

CAG team to vet RIL books this month

November 3, 2009. The nation’s premier audit body CAG has constituted a high-level team for auditing Reliance Industries’ (RIL) expenses on eastern offshore KG D-6 fields and the exercise will begin this month. The Comptroller and Auditor General (CAG), which has been asked to do special audit of not only RIL but also Cairn India’s Rajasthan block and British energy firm BG Group operated Panna/Mukta and Tapti fields, has constituted various teams for undertaking the audit, sources in the know said. It is also understood that scope of this audit will far exceed the normal course of audit by CAG and the prime objective may be to detect fraud, if any, by the operator (RIL) allegedly in collusion with oil regulator DGH and ministry of petroleum and natural gas. It is expected that the audit may take several months to complete.  CAG was asked by the oil ministry to audit the accounts of RIL, which is facing allegations of gold-plating gas field costs that has increased four-fold to $8.8 billion. RIL had on August 17 agreed to an audit by the country’s premier audit body. 

Former oil regulator Sibal goes on long leave from OIL

November 3, 2009. Former oil regulator V K Sibal, who was denied an extension of service, has gone on long leave after his parent organisation Oil India Ltd kept pending his application for early retirement. Sibal rejoined OIL on October 31 and immediately applied for early retirement, government sources said. In 2004, he had gone as Directorate General of Hydrocarbons on lien from where he was reverted to his parent company OIL.  OIL has not taken a decision on his application as the vigilance clearance is still pending.  

Reliance spuds KGV-D3-R1 exploratory well offshore India

November 3, 2009. Hardy Oil and Gas reported that Reliance Industries has commenced drilling of the exploration well KGV-D3-R1 on the Company's KG-DWN-2003/1 (D3) exploration license.  he exploratory well KGV-D3-R1 commenced drilling on November 2, 2009, with the Transocean Deepwater Expedition, in water depth of approximately 1,964 m. The target depth of the KGV-D3-R1 well is 4,710 m MDRT to explore the hydrocarbon potential of various Miocene age sands. This well is part of the Company's ongoing exploration program in the Krishna Godavari Basin on the East Coast of India and the Company expects to drill three additional exploration wells on the block before the end of 2010. The D3 license is located in the Krishna Godavari Basin on the East Coast of India, covers an area of approximately 3,288 km2 and provides for the drilling of a minimum of six exploration wells within the first exploration phase. The Company holds a 10 percent participating interest in the Reliance-operated exploration block. The first two exploratory wells (KGV-D3-A1 and KGV-D3-B1) resulted in gas discoveries (Dhirubhai 39 and 41) and are presently under appraisal.

Crude oil imports fall by 41 pc to $31.6 bn in Apr-Sept

November 3, 2009. India's crude oil import bill fell by 41 per cent to $31.6 billion in April-September this year as international rates declined from a record peak.  Asia's third-largest oil consumer imported 69.6 million tonnes of crude oil for $31.6 billion in the first six months of current fiscal against 64.84 million tonnes of crude imported for $53.78 billion in the year ago period.  India also imported 7.16 million tonnes of petroleum products, mainly diesel and naphtha, for $3.61 billion. In April-September 2008, fuel imports of 9.98 million tonnes cost $9.44 billion.  Fuel exports at 14.3 million tonnes ($7.29 billion) in April-September 2009 were lower than 19.17 million tonnes ($18.77 billion) in the same period last year.  The nation's domestic consumption was almost flat at 10.69 million tonnes in September and rose 3.6 per cent to 67.26 million tonnes in April-September, the data showed.  Demand for diesel, the most consumed fuel, was up 4.7 per cent at 4.12 million tonnes in September and 8.5 per cent to 27.17 million tonnes in April-September. Petrol consumption soared 14.7 per cent to 6.3 million tonnes in the six months. Jet fuel consumption was down 0.3 per cent at 2.22 million tonnes, reflecting the impact of economic slowdown on airlines. 

Cairn may supply oil to RIL, Essar by Dec

November 2, 2009. Cairn India hopes to complete price negotiations and start supplying crude from its Rajasthan fields to Reliance Industries (RIL) and Essar Oil by December.  It was earlier reported that RIL wants to buy about 30,000 to 60,000 barrels per day (1.5-3 million tonne) of crude from Cairn’s Rajasthan fields for its two refineries at Jamnagar in Gujarat. Essar Oil has also expressed interest in buying 30,000 bpd this year and 120,000 bpd (six mt) by 2011 when it expands its Vadinar refinery. It is for the first time that crude oil from a domestic field will be sold to a private refiner. So far, all the crude oil that is produced in India is consumed by PSU refiners. Till now, the company, which began production from its Rajasthan fields in August-end, could sell the crude oil only to state-run companies — Indian Oil Corp (IOC), Hindustan Petroleum (HPCL) and Mangalore Refinery and Petrochemicals (MRPL). The designated public sector refiners will lift only about 50% of the total estimated production of Cairn India’s estimated crude production. They include HPCL, which has decided to lift about 0.3 mt of crude in 2009-10 and another 0.5 mt in 2010-11. IOC, on the other hand, said it will consume 0.2 mt and 1.5 mt in 2009-10 and 2010-11, respectively. The company, which ramped up its production to about 10,000 bpd oil from Rajasthan, is planning to reach its optimum level of 30,000 bpd (1.5 mt) by the end of the year. Rajasthan is the largest onland oilfield discovered in more than two decades and will have a peak output of 8.75 mt, contributing more than one-fifth of the nation’s current oil production. 

Essar Oil to sell natural gas from Raniganj coal bed from Jan

November 2, 2009. Essar Oil said it will begin sale of natural gas it is extracting from below coal seams in West Bengal in January-March quarter. Reputed international agency, NSAI has certified the in-place reserves at the company's Raniganj coal bed methane (CBM) block in West Bengal at a level of 3.1 Trillion cubic feet.  Of this, one-third reserves are recoverable, with upside potential, the company said. Having won the 3.2 Tcf Rajmahal CBM block in Jharkhand in the just concluded fourth round of bidding for CBM blocks, Essar has emerged as a leading CBM player.

OIL director Srivastava leads race for DGH top job

October 28, 2009. Oil India director (operations) and former deputy director general in the Directorate General of Hydrocarbon (DGH), SK Srivastava, is likely to replace the controversial chief custodian of country’s oil and gas assets, VK Sibal.  The change has been necessitated following the oil ministry’s refusal to extend Mr Sibal’s tenure.

Jaipur fire: Indian Oil faces negligence charge

November 3, 2009. An executive of a private company has filed a complaint against Indian Oil Corporation (IOC) after a fire broke out at its oil depot  killing 11 people and injuring over 150. With four of the 11 tanks in the depot still ablaze the IOC has been charged with criminal negligence.  The blaze broke out in the depot in Sitapura industrial area about 20 km from the Jaipur city centre at 7.15 pm Oct 29.  Meanwhile the district administration has decided to shut educational institutes in Sitapura for the next eight days. The decision was taken as some of the buildings at the institutes were damaged.

Alfa Laval India bags Rs 700 mn project from PetroVietnam Group

November 2, 2009. Alfa Laval India, the Indian arm of Swedish Alfa Laval Group, has secured a Rs 700 mn project from Vietnam-based PetroVietnam Group for supplying equipment and engineering solutions for the latter's ethanol process plant. The delivery is scheduled for 2010 and the plant, which will produce fuel ethanol, is expected to go on stream during 2011, Alfa Laval India.  Alfa Laval's heat exchangers, decanters and tank cleaning equipment will be used in the plant, which is being set up in Northern Vietnam, the engineering solutions provider. Once ready, the plant will produce about 3.30 lakh litres per day of fuel ethanol.

Essar in pact to buy 3 Shell refineries

October 31, 2009. The Ruias-owned Essar Group has clinched an exclusive agreement to buy three refineries from Royal Dutch Shell, beating larger rivals, including US-based Valero Energy, in a move that could potentially catapult the Mumbai-based conglomerate to become India’s largest overseas refiners. Although Essar’s agreement implies that Royal Dutch will negotiate for a sale with the Indian conglomerate alone, it doesn’t lead to a conclusion of the transaction. The talks to buy the three refineries from Royal, Europe’s largest refiner, saw many suitors, including Libya’s National Oil Corporation and an investment vehicle controlled by the Saudi royal family, lining up. The three refineries include one in the UK and two in Germany, and have a combined capacity of 500,000 barrels per day, or about 26 million tonnes per annum. Essar is reportedly learnt to have offered £1.2 billion for the three refineries, while Shell is learnt to have sought up to £1.5 billion, for the three refineries. The Essar group is also talking with UBS, Citigroup and JPMorgan for arranging a loan of $750 million to part finance the deal, if it gets the three European refineries. Essar Oil currently has a capacity of 10.5 million tonnes and plans to expand this to 34 million tonnes. Essar’s Kenya refinery has a capacity of 2 million tonnes, which will raise Essar Group’s total refining capacity at 36 million tonnes. Tight margins and falling fuel demand have prompted many big oil companies to offload European and US refineries.

No talks with Reliance for US plants: Valero

October 29, 2009. Valero Energy Corp Chairman said the company has not discussed selling three refineries to Indian energy giant Reliance Industries. Valero CEO is said to have made the comments following testimony to a US Senate committee in Washington. Valero has said it would consider selling its Aruba, Delaware City, Delaware and Paulsboro, New Jersey, refineries among other options. 

ATF fuel prices hiked by Rs 3,400 per kilolitre

October 31, 2009. State-owned oil firms hiked jet fuel prices by nine per cent to over Rs 39,000 per kilolitre following a spurt in international oil rates.  Aviation Turbine Fuel prices will be increased by an average of Rs 3,400 per kilolitre.  IOC, Bharat Petroleum and Hindustan Petroleum had for three consecutive fortnights reduced ATF rates mostly because international oil prices had eased and rupee strengthened against US dollar. In three cuts, jet fuel prices in Delhi came down to Rs 36,188.27 per kl from Rs 39,188 at the beginning of September. The hike would negate all the cuts and ATF prices would be back to their September levels.  The three oil firms revise jet fuel prices on the first and the 16th day of every month based on the average global oil price in the previous fortnight. 

Gail India to Import LNG Cargo from spot market

October 30, 2009. State-run gas utility GAIL India Ltd will next month import its first liquefied natural gas (LNG) cargo from the spot market in three years when it receives a shipment from Spain. GAIL is likely to receive the shipment at Petronet LNG Ltd's Dahej import terminal in Gujarat around November 20. The cargo has been contracted at a delivered price of US$6.5 per million British thermal units and after adding customs duty and regassification charges, the ex-terminal price of the gas will come to around USD 7.4 per mmBtu. Industry sources said GAIL is getting the cargo from Repsol, which operates a LNG receipt facility in Spain. It may have diverted one of its previously contracted cargoes to India because of a fall in demand back home.  GAIL is one of the four state-run promoters of Petronet LNG Ltd, the nation's largest liquefied natural gas importer and had in 2006 made a direct import of two spot LNG cargoes from Algeria. Since then it has not done any direct contracting and has relied on the gas Petronet imports. GAIL was looking at importing at least one cargo from spot market every month and is also scouting for short to long term LNG.  It had earlier this month contracted an 80-million-cubic meter parcel from BG Group of UK but the deal fell. Petronet is now believed to be getting the same cargo at a delivered price of USD 5.7 per mmBtu.

Govt may allow ONGC to auction off marginal fields

November 3, 2009. The government may allow state-run ONGC to auction small and marginal fields that it has not found economical to develop, so that the discoveries in the fields could be brought into production. Oil and Natural Gas Corp has a total of 165 marginal fields, out of which 144 fields have either been put on production or are in the process of monetisation. The remaining 21 fields may be auctioned for development through an international competitive bidding (ICB) route.  These 21 marginal fields comprise of five oilfields (four onland and one offshore), 14 gas fields (nine onland and five offshore) and two offshore oil and gas fields, which have been estimated to cumulatively hold crude reserves of 0.4969 million tons and gas reserves of 1.519 billion cubic meters.  Marginal fields are the oil and gas discoveries made by national oil companies in blocks awarded to them on nomination basis, but have not been exploited on the ground of commercial viability of technological constraints. The sources said the Petroleum Ministry is likely to approach the Cabinet Committee on Economic Affairs (CCEA) soon for approval of the new Marginal Field Policy (MFP) under which ONGC and Oil India Ltd can auction off a large number of marginal fields, where discoveries have been made but not monetised, for development.

Gas row: RIL, RNRL oppose shareholder's plea in SC

November 3, 2009. Mukesh Ambani Group firm RIL and Anil Ambani's RNRL joined hands to oppose the plea of a shareholder in both the companies to be made party in their ongoing dispute in the Supreme Court over the gas price to be supplied from the KG basin. Vishweshwar Madhavrao Raste, claiming himself to be the shareholder of RIL and RNRL, had also sought tabling of the family MoU of 2005. The apex court said it will not issue notice and simply post the application along with the main matters.

All oil, gas installations told to carry out safety self-audit

November 3, 2009. The Government has ordered all oil and gas installations in the country to carry out a self audit conforming to their statutory norms as well as adhere to prescribed Oil Industry Safety Directorate (OISD) standards by December 31.  The meeting was convened in the wake of the massive fire at the Indian Oil Corporation’s fuel depot in Jaipur. A technical directorate under the Ministry of Petroleum and Natural Gas, the OISD formulates and coordinates the implementation of a series of self regulatory measures aimed at enhancing the safety in the oil and gas industry in the country. The audit would not be restricted to public sector installations, but will extend to private installations as well. Meanwhile, a seven-member committee chaired by Mr M. B. Lal, former Chairman and Managing Director, HPCL, set up to inquire into IOC fire accident will submit its report in 60 days.

Sept oil product sales up 0.8 pc y/y: Govt

November 3, 2009. India's domestic oil product sales in September rose 0.8 per cent from a year earlier to 10.7 million tonnes, led by higher sales of petrol and diesel. Crude oil imports excluding purchases for Reliance Industries' new refinery were at 11.342 million tonnes or 2.77 million barrels per day (bpd). 

Stimulus to continue; may cut oil subsidies: FM

November 3, 2009. The Government said it is looking at steps to cut subsidy on fertiliser and oil sale with an aim to cutting non-Plan expenditure and contain fiscal deficit. Addressing the economic editors' conference, Finance Minister Pranab Mukherjee said that the fiscal deficit would be rolled back to 5.5 per cent in the next financial year from 6.8 per cent in 2009-10. However, he said stimulus packages given to industry last year would continue.  

Jaipur effect: A review of oil depots near cities

November 3, 2009. The fire at Indian Oil’s fuel storage facility at Jaipur has triggered alarm in the government over location of such oil marketing infrastructure in populated areas that has made people living or working around them vulnerable. There are 300-plus motor fuel and kerosene storage facilities of various sizes belonging to state-run oil marketing companies who control nearly 90% of the market. Besides, there are about 60-odd storage and refuelling facilities for aircraft. Except jet fuel, private marketers usually take motor fuel supplies for their retail outlets from state-run storages. Oil company executives say storages and other oil installations initially come up in isolated areas but gradually see settlements coming up around them. Relocating each depot could cost an average Rs 1.5 bn, depending on their size and location. This could even go upto Rs 1.7-1.8 bn. Then there are issues with land acquisition and getting right of way for storages that are fed by pipelines.

Russian hydrocarbon cos keen to partner GSPC

November 1, 2009. Russian hydrocarbon companies, including Gazprom, have evinced interest in working with Gujarat State Petroleum Corporation Ltd (GSPC) and other sectoral entities in India and abroad.  In this connection, a delegation of these companies would visit Gujarat in the “near future” and work out the modalities. Given the importance of Gujarat as the “petro-capital of India” and the activities of oil and gas sector, including the State-level gas grid, the Russia visit underlined the emerging importance of Gujarat in India and abroad. Gazprom and other companies would explore technical partnerships with GSPC in the Krishna-Godavari Basin but any possible MoUs would come forth only during the Vibrant Gujarat Global Investors’ Summit in January 2011. Gujarat was already getting products from Russia’s Sakhalin fields.

Govt going the whole hog to ensure energy security

October 30, 2009. Ensuring the nation’s energy security and assure supply of energy to poor at an affordable price are the twin-pillars of the Manmohan Singh government’s energy policy as it encourages companies to buy global energy assets and increases exploration within the nation.  These objectives are drawn from the United Progressive Alliance’s promise to citizens during the general elections in May. Congress’ manifesto highlights three action plans — intensifying oil & gas exploration, aggressive oil diplomacy and implementing a scheme to supply energy to poor at affordable rates. The petroleum ministry has already taken steps to achieve this objective.  More LPG connections, i.e., gas cylinders used for cooking, are provided in the rural areas, oil from Cairn’s Rajasthan fields has flown recently and the cabinet has already cleared investments in Satapev exploration block in Kazakhstan, a step towards acquiring oil & gas assets abroad. The government-owned Oil & Natural Gas Corp some time back acquired Imperial Energy and is interested in investing in many exploratory blocks overseas. The current subsidy regime that regulates retail prices of four ‘politically sensitive fuels’ — petrol, diesel, kerosene sold through fair-price shops and cooking gas — needs to be reworked, the planning commission believes. There is a proposal awaiting political clearance to deregulate prices of petrol and diesel and provide kerosene and cooking gas directly to the needy.

SC wants to know on what basis govt fixed gas price

October 30, 2009. The Supreme Court, while hearing the gas dispute between the Ambani brothers said the basis for fixing the government-determined natural gas price of $4.20 per unit required examination. The three-judge bench observed that the sale of gas at $2.34 per unit may not only end the dispute between the Ambani brothers but may also be in public interest. RIL counsel Harish Salve said the $4.20 per unit price benefited the government as this would make cost recovery quicker and the government would receive a higher share for longer period.  The court, however, said the basis for fixation of price for sale of KG gas at $4.20 per unit also required consideration.

Govt allows OVL to invest $174 mn in gas blocks

October 29, 2009. The government permitted ONGC Videsh Ltd, the overseas arm of state-run Oil and Natural Gas Corp (ONGC), to invest about USD 174 million more in two gas blocks off Myanmar. The Cabinet Committee on Economic Affairs (CCEA) approved OVL's share of investment of USD 173.85 million in prolific gas blocks A-1 and A-3 in the Bay of Bengal. OVL holds 20 per cent interest in the blocks and the investment is for developing the gas reserves found in the blocks. The company would meet the investment requirement from its own resources and/or borrowings. South Korea's Daewoo is the operator of the blocks where state-run gas utility GAIL India also holds an additional 10 per cent stake.  As per operator Daewoo, the likely expenditure till March 2010 is about USD 869.25 million in the two blocks. Of this, OVL's share of expenditure at 20 per cent shall be USD 173.85 million. 

Gas is national asset: SC

October 28, 2009. Reliance Industries told the Supreme Court that it would lose money by selling natural gas at $2.34 per million British Thermal units or mmbtu. The company’s lawyer Harish Salve told the court that RIL had not told the Bombay HC that sale at $2.34 per unit would be profitable and that the HC appeared to have misunderstood the matter. The hearing before India’s apex court was also marked by interjections by the justices. The judges observed the natural gas belongs to the government and all contracts on sharing of gas is subject to the government’s approval. The court also said that it may issue a direction to the two feuding companies, RIL and RNRL, to arrive at a suitable arrangement.  “Gas belongs to the government. Gas is national property”, said a three-judge bench headed by chief justice KG Balakrishnan. The CJI, speaking for the bench, observed: “All contracts are subject to it (government’s ownership concept over gas).”

POWER

Hydel project on TBGRI campus soon

November 3, 2009. The campus of the Tropical Botanic Garden and Research Institute (TBGRI) at Palode will soon have a mini hydroelectric project. The construction of the dam and power generation unit is expected to begin in a few months.  The project was conceived to address the twin problems of water shortage during the summer months and frequent interruption in power supply.  The run-of-the-river project will come up on the Chittar stream, a tributary of the Karamana river, that flows through the garden on the 300-acre campus. The garden is home to 3,500 species of flora, including trees, shrubs and plants.

KBS irked with land acquisition for power projects in Konkan

November 3, 2009. Sulbha Brahme, senior social activist criticised the Union and state governments for ignoring the villagers' welfare by pushing the atomic and thermal power projects in Konkan. Brahme maintained that the Konkan Bachao Samiti (KBS) is going to continue with its agitation against the state government's land acquisition. According to the documents shared by the Samiti, the government has planned to set up power plants in Shahapur (dist. Raigad), Dhopave, Bhopan, Jaigad and Ranpar (all in dist. Ratnagiri), Munge and Dhakore (dist. Sindhudurga).  As per the figures released by the government in 2008, the state has the capacity to generate 17,500 MW of power, whereas the electricity generated is only 13,575 MW, she said. The existing thermal power projects at Parali, Paras, Khaparkheda, Bhusaval and Chandrapur are yet to be utilised to their optimum capacity. Electricity leakage should be checked to meet the state's power needs better, Brahme said.

Patel Engg to set up power plant in TN

November 3, 2009. Mumbai-based Patel Engineering Ltd, a construction company specialising in hydro-power generation and irrigation, is planning to invest around Rs 50 bn to set up a thermal power plant in Nagapatnam district of Tamil Nadu.  The company would set up a 1,320 mega watt (Mw) capacity thermal power plant at Nagapatnam. The company hopes to achieve financial closure for the project by the first quarter of 2010-11 and commence work by the second quarter. It has set a three-year deadline to complete the project, which would be funded through debt and equity.  The project would require 3.6-4 million tonne coal for which it has applied to the coal ministry and is also planning to enter into an agreement with Chennai-based Marg Ltd.  The company’s power vertical is in the process of setting up a 90-Mw hydro power project at Gongri in Arunachal Pradesh and a 550Mw thermal power plant in Gujarat.

Adani Power to expand capacity at Tiroda to 3,300 Mw

November 3, 2009. Adani Power Ltd (APL) announced that it would expand capacity at the under-construction thermal power project in Tiroda, Maharashtra, to 3,300 MW. The initial plan was to produce 1,980 MW. The change envisages a total investment of nearly Rs 140 bn.

The Tiroda plant is the first large-scale investment by Adani Group outside Gujarat. The project is being implemented by subsidiary Adani Power Maharashtra Ltd. The company expects to generate power from Tiroda by the end of 2010. The company has entered into a power purchase agreement with Maharashtra Electricity Company Ltd for 1,320 MW. 

The Tiroda project, being set up by APL with Millennium Developers, will use coal from captive mines at Lohara (West) and Lohara extension coalfields.  The company is also evaluating investments for generating 1,320 MW in Rajasthan and 2,000 MW at Dahej in Gujarat. APL is expected to fully commission the 4,620-MW imported coal-based unit at Mundra next year.

ONGC plans N-plants

November 2, 2009. Public sector behemoth Oil and Natural Gas Corporation of India (ONGC) has chalked out plans to enter the nuclear power space, in a diversification from its decades-old specialisation in petroleum exploration to which it has already added gas-based power generation.

ONGC, which last year announced plans to enter uranium mining, is now seriously exploring the possibility of setting up nuclear power plants in the country. As the entry of private sector players is yet not allowed in the nuclear generation space, ONGC is planning to make use of its public utility status to diversify into the business. Cash-rich ONGC will need outside partnerships to drive its new initiative.  ONGC, in an attempt to break new ground, had entered gas-based power generation. The nuclear energy drive is part of its long-term plan to emerge as an integrated energy company.

Tata Power forms equal JV with Norway's SN

November 2, 2009. Tata Power has joined hands with Norway's SN Power for a 50:50 joint venture to develop hydroelectric power projects in India and Nepal. This is the first time that Tata Power has entered into an exclusive partnership with another hydropower company, the company said in a statement. Though the seeds were sown with hydropower, Tata Power, over a period of time, got into thermal, wind and solar energy. Today, thermal power accounts for a bulk of its generation. The hydropower stations at Khopoli, Bhivpuri and Bhira in Maharashtra that were built between 1910 and 1927 currently generate 447-mega watt of electricity. During the early years of the company, the electricity generated from the hydropower stations was used to light up Mumbai households, buildings and Indian Railways. However, to meet the growing demand of energy in the city, Tata Power set up a thermal power station at Trombay in 1956. The hydropower business had to take a backseat. Today, its coal-based thermal plants generate over 2,000 MW of power.  Tata Power and SN Power aim to produce 2,000 MW through hydropower by 2015 and a total of 4,000 MW by 2020.

Vedanta revives Rs 100 bn power project in Punjab

November 1, 2009. Global metal and mining major Vedanta Resources has decided to revive its about Rs 100 bn independent power project in Punjab, which it had put on hold last year. The company put the Punjab power project on hold after global metal prices crashed by over 50 per cent, which pushed the company to reduce the capex for next four years by about USD 5 billion. The metal and mining major is undertaking its commercial and captive power projects in India under the aegis of Sterlite Energy, which last week filed a draft prospectus with SEBI for an initial public offer to raise up to Rs 51 bn from the capital market.  Sterlite Energy plans to set up power projects with total capacity of 11,000 MW in the next few years. 

Pagaria Power to set up 540 Mw plant in MP

November 1, 2009. Pagaria Power, an arm of R S Pagaria Group, would invest Rs 30 bn in constructing a 540 MW coal-based thermal power plant at Shahdol in Madhya Pradesh.  The project would comprise four units of 135 MW each, of which two units are expected to come up in 36 months from the date of start. The state government has completed the land acquisition process and has provided necessary coal linkage to the project.  This project would provide direct as well as indirect employment to about 500 people.  The Pagaria Group is primarily engaged in coal business. 

BHEL bags Rs 50.4 bn order from Jindal Power

October 30, 2009. State-run power equipment maker BHEL said it has bagged a Rs 50.4 bn contract from Jindal Power for setting up a 2,400-MW thermal power plant in Chhatisgarh.  As per the contract, BHEL will install four units of 600 MW each in this extension stage of Rs 50.4 bn OP Jindal Super Thermal Power Plant (STPP).  BHEL’s scope of work in the contract envisages design, engineering, manufacture, supply, erection, testing and commissioning of boilers, steam turbines, turbo-generators and associated auxiliaries along with controls and instrumentation system. The company, at present, manufactures equipment that can generate 10,000 MW of electricity annually. BHEL plans to augment this capacity to 15,000 MW by December 2009, and further raise it to 20,000 MW by 2012.

6 cos qualify for Rajpura power project

October 30, 2009. Six companies including Larsen & Toubro, Lanco Infratech, Adani Power have been declared as the qualified bidders for the 1,320-mw Rajpura Thermal Power Project in Punjab. The declaration was made even as the Punjab State Electricity Board hopes to issue Letter of Intent in the first week of November. Having invited bids for the second time, PSEB had received technical and price bids from seven companies including Larsen & Toubro Power Development, GMR Urja Ltd, Adani Power Ltd, Welspun Urja India Ltd, Lanco Infratech Power Project Ltd, Alliance Hydro Power and JSW Urja Ltd.

GMR to enter power sector in Turkey

October 30, 2009. The Bangalore-based GMR Group is looking at venturing into power and road projects in Turkey.  It has just completed an airport project in that country 12 months ahead of schedule.  

Restoration work on Srisailam hydel unit apace

October 30, 2009. After hectic restoration works, the power generation in first of seven units of 110 MW each of the Srisailam right bank power house will commence in the first week of December.  The rest of the six units will also get into generation mode within one week each thereafter. The power house was fully submerged during the floods on October 2, causing huge loss including creating energy shortage.  This was a major development and efforts have been initiated to bring the 500 MW Vijayawada thermal power station, which is affected by teething troubles and also a blast recently.

CESC scouting for coal assets abroad

October 29, 2009. CESC is scouting for acquiring coal mines in Indonesia and South Africa. The company will source 30 per cent of its total requirement for coal for the proposed 600 MW thermal power plant at Haldia from the international market. The company hopes to get captive coal mines.  While the financial closure of Haldia is held up due to delay on the part of the State authorities in handing over the remaining 40 acres, the company is set to achieve financial closure for the proposed 2X300 MW coal based power plant of the recently acquired Dhariwal Infrastructure Private Ltd (DIPL) at Chandrapur in Maharashtra.

KG power tilting balance in favour of gas plants

October 29, 2009. Gas-based power plants in the country have seen over 35% increase in power generation during the first half of the financial year over the year-ago period, buoyed by the flow of gas from Krishna Godavari (KG) basin from April this year. The growth in production has resulted in additional revenues of Rs 40 bn for companies such as GVK Power, Lanco Infratech, GMR Industries and Torrent Power. As per the latest figures compiled by Central Electricity Authority (CEA), the total power produced by gas-based power firms stands at more than 46,000 million units (MUs). Power from gas-based plants has contributed to nearly 13% of total power produced in the country during this period, against 9.5% last year.  While gas-based units saw a sharp increase in power generation, coal-fired power units reported about 7% growth.  

Reliance Power net rises five-fold to Rs 1.9 bn

October 28, 2009. Anil Ambani promoted Reliance Power, which is setting up close to 34,000 mega watt(Mw) of power generation capacity, has posted a net profit of Rs 1.945 bn for the quarter ended September 30, 5.2 times higher than the Rs 372 mn net profit for the corresponding quarter, last year. Commissioning activities are in advanced stage for the first phase of 600 Mw Rosa project in Uttar Pradesh and synchronization of the first unit is targeted soon. The unit is likely to commence commercial operations well ahead of its March 2010 schedule. Construction work has commenced for the 600 Mw expansion at Rosa and construction activities for the 600 Mw Butibori project in Maharashtra is progressing as per schedule. Main plant construction activities are progressing in full swing for the 4000 Mw Sasan ultra mega power project (UMPP) in Madhya Pradesh and significant progress has also been made on coal mine development.

AP seeks 500 Mw from Central pool

October 28, 2009. Faced with severe power shortage due to enhanced requirement and lower power generation, the Andhra Pradesh Chief Minister, Mr K. Rosaiah, has requested the Centre to allocate additional power from Central generating stations.  While thanking the Centre for its clearance to allocate about 100 MW from the unallocated portion of the Central generating Stations, the Chief Minister mentioned that additional supplies for about three months would be of great assistance to the State.  The State is already faced with shortage due to flooding of 770 MW Srisailam right bank canal. This is likely to take at least four more months for restoration.

NTPC to float tender to secure equipment for five 800 Mw units

October 28, 2009. State-run NTPC would float the bulk tender order for securing equipment for five 800-MW units before March 2010. NTPC recently floated tenders inviting bids for 11 units of 660 MW. 

Karnataka Energy Department to recruit 3,110 linemen

November 2, 2009. Minister for Energy K.S. Eshwarappa said that the Energy Department would be recruiting 3,110 linemen on regular basis. Norms, mode of service and other procedures had been initiated in this regard, he said. The department had linemen serving on daily wages and on contract, and some of them were on the verge of retirement, he said. Keeping these factors in view, the department had decided to fill 3,110 posts of lineman, he said.

Unscheduled power cut irks domestic consumers

November 1, 2009. The Coimbatore Consumer Cause has appealed to the Tamil Nadu Electricity Board to take into account the actual power shortage and announce a power cut schedule for the domestic consumers.  In some places, power supply was disrupted during night hours too. This affected students and the common man as they were not sure when the power would go off.  Last year, when power cut was announced for domestic and industrial consumers, the public was able to adjust as the timings were scheduled. This year, with the recent drop in wind energy generation, the demand was more and the power availability was less. So, the board should draft the schedule for power cut and adhere to it strictly.  Coimbatore was a major consumer of power in the State, next only to Chennai.

Tata Power in position to add 30k more consumers by March

October 30, 2009. Tata Power Company said it will be able to supply electricity to an additional 30,000 consumers in the city by March next year. The private sector utility will begin power supplies in a month to 4,000 more consumers in Mumbai who have changed over from Reliance Infrastructure's distribution network. Tata Power has so far received and processed 3,000 to 4,000 applications for a change-over to TPC's distribution network from mainly residential consumers in Mumbai's suburbs. Tata Power's current load across Mumbai stands at 400 MW, which peaks at 477 MW in summers. India's largest private electricity producer presently supplies power to about 28,000 consumers in the metropolis. Between 40,000 -50,000 consumers of Reliance Infrastructure have been waiting to switch-over to cheaper Tata Power for electricity connections over the past few months.

CESC unhappy with Bihar SEB tendering process

October 29, 2009. The RPG Enterprises flagship CESC Ltd criticised the tendering process of Bihar State Electricity Board for appointing franchisee power distributors for Patna and a few other centres.  Having opened the financial bids (for Patna, Gaya and Muzaffarpur) earlier this month, BSEB announced Mumbai-based Glodyne Power – a Glodyne Technserve group company – as the lowest bidder for the most lucrative Patna circle followed by relatively well-known CESC and Reliance-Infra. Glodyne also won the Gaya circle. CESC became the lowest bidder for Muzaffarpur.   Reliance Infrastructure Ltd (R-Infra) has lost out on all three centres and is the sole bidder for Bhagalpur. Technical bids for all four centres were opened in June this year. BSEB has appointed IL&FS for bid evaluation.

Tariff revision: Karnataka power cos to rework numbers

October 28, 2009. The five electricity supply companies (Escom) in the State are beginning to rework their expected revenue charges in view of technical and legal compulsions. The pressure to rework the critical numbers comes even as the Karnataka Electricity Regulatory Commission (KERC) has commenced hearings for a power tariff revision.  The Escoms had been considering the 2005 tariff order, which had a higher charge for almost all consumer categories, as the base price while working out their tariff proposal. The proposal was made before the KERC in June last week, seeking a hike of 51 paise a unit for all consumer categories. However, the 2008 tariff order, which had not been implemented, has suddenly come to life.

Power sector needs to spend Rs 60 bn a yr to import equipment

November 3, 2009. The Indian power industry will need to spend Rs 60 bn annually to import equipment for meeting the government's target of adding 14,000 MW generating capacity every year, says an Assocham study.  Domestic availability of power equipment is worth only around Rs 20 bn, said the study.  According to the study, BHEL's annual equipment capacity is expected to be raised from 6,000 MW to 10,000 MW a year.  It said, however, that imports will become inevitable and will create huge prospects for investors in the power sector, especially from the overseas.  The report said the demand for power equipment would also come from a big surge in nuclear generation capacity over the next few years. The study said a big push in (thermal) power generation would come from public sector company NTPC. With an existing generation capacity of 30,644 MW, it plans to add 22,400 MW in the ongoing 11th Plan.

Centre may auction captive coal blocks

November 1, 2009. The Centre is planning to take the auction route to award the captive coal blocks to private sector. This will end the existing process of selecting captive users without any specific financial commitment by the Union Ministry of Coal.  The Bill for amendment of the Mines and Minerals (Development and Regulation) Act of 1957 will be placed in Parliament in the winter session. The amendment will allow the government to auction coal blocks for captive mining. Following the proposed amendment, 78 unexplored coal blocks currently held by Coal India Ltd will be auctioned for captive mining by private players.

Govt to take steps to meet power shortage: J&K minister

October 31, 2009. Asserting that misuse of power causes load shedding in Jammu and Kashmir, minister of state for power Shabir Ahmad Khan said the government will take steps to ensure adequate power supply to meet the requirement.  He said the government has taken various innovative initiatives to utilise the state's water treasure trove for generation of power by execution of various mega and mini hydroelectric projects in the state. On the present power scenario of Kashmir, he said that due to dry spell, water level in the rivers decreases day by day and power production of existing projects comes down to 120 MWs instead of the total power generation of 750 MWs. He said valley's daily power consumption is 1,250 MWs, but due to overloading the government is purchasing 700 MWs of power from Northern Grid.

PowerGrid to raise Rs 87.5 bn from World Bank, ADB

October 30, 2009. PowerGrid Corporation is seeking loans of Rs 87.5 bn from the World Bank and the Asian Development Bank to fund upcoming transmission projects in the country. The transmission monopoly has sent its proposal to the Ministry of Finance through the Power Ministry to negotiate with the multilateral lending agencies.   PowerGrid plans to augment its transmission capacity to 23,400 MW in the current fiscal (2009-10) from the existing 19,800 MW and enhance it to 37,000 MW within the plan period. 

Mahatransco plans power transmission corridor linking Nagpur, Aurangabad

October 29, 2009. Maharashtra State Electricity Transmission Company Ltd (Mahatransco) plans to construct a Rs 20 bn power transmission corridor for connecting Nagpur with Aurangabad with 765 kV lines.  Tenders for the projects would be invited by early 2010. The corridor is being set up to enhance the capacity of the State grid and to evacuate additional 1,980 MW from the Koradi power station near Nagpur.  The transmission corridor would be constructed with two single circuit lines from Nagpur to Aurangabad via Akola. The total network length would be 900 circuit km. The 765 kV lines considerably reduce losses, while transmitting power over long distances.

Power sector gets 60 pc of additional gas from KG basin

October 28, 2009. The government decided to allocate additional 20 million standard cubic metre of gas per day (mmscmd) from the D-6 block of Reliance Industries’ (RIL) Krishna-Godavari basin to power, petrochemicals, refinery and fertilizer sectors on a firm basis. It has also decided to allocate 30 mmscmd of gas on a fall-back basis depending on the level of production.  Out of the total firm allocation of KG gas cleared by the EGoM, about 13 mmscmd (over 60%) would go to the power sector and 0.44 mmscmd to steel units. Fertilizer sector, which has been on the top in the priority list under government’s gas utilization policy, has been given a firm allocation of 0.178 mmscmd gas.  The EGoM also expanded the list of KG basin gas beneficiaries, allocating 1.918 mmscmd of gas on a firm basis for the petrochemical sector and about 5 mmscmd gas for the refineries for the first time. All private and public sector refineries would get gas on a pro-rata basis.

India exploring options to lease coal mines in Australia: Shinde

October 28, 2009. India is exploring the option of leasing coal mines in Australia to tide over domestic coal shortages. The country’s coal demand for the financial year ending March 2010 is forecast to rise 10 per cent to 604 million tonnes. About 70 mt of this will be met through imports. India is looking at countries such as Australia, Indonesia, Mozambique, to secure coal supplies to fuel its growing coal-based power generation capacities as local supplies lag demand.

OIL & GAS

Abu Dhabi's Gasco signs landmark contracts for NGL project

November 3, 2009. Abu Dhabi Gas Industries Ltd. (GASCO) has signed four landmark contracts for its Integrated Gas Development (IGD) Project that links offshore and onshore gas fields owned by ADNOC within the Emirate of Abu Dhabi. This project, with a total value in excess of US$9 billion, is the Government of Abu Dhabi's strategic initiative towards meeting the growing demand for energy within the Emirate. All facilities under the 4 contracts are expected to be completed by the 3rd quarter of 2013.  This project is being implemented by GASCO on behalf of ADNOC.

Eni fires up gas production at GOM's Longhorn

November 2, 2009. Eni has started production from its Longhorn gas field located in the Gulf of Mexico, Mississippi Canyon Blocks 502/546, 60 miles off the Louisiana coast.  Eni operates the Longhorn field with a 75% working interest, while Nexen holds the remaining 25%. The field will initially produce gas at a rate of approximately 200 million standard cubic feet of gas per day from four subsea wells in water depth of 2,500 feet which are connected to the Eni-operated Corral platform, previously known as Crystal. The platform is a conventional jacket structure located in MC Block 365 about 20 miles northwest of the field in 620 feet of water depth. It has been fitted with a newly built production and compression facility with a processing capacity of 250 million standard cubic feet of gas per day and 6,000 barrels of oil per day.

Petro-Reef's drilling success to double oil production

November 2, 2009. Petro-Reef Resources noted that additional exploration drilling success with its latest exploration well in Alexander will double its oil production.  Petro-Reef has drilled a second exploration well on its acreage immediately adjacent to the Corporation's existing producing area. Petro-Reef commenced testing operations and during an extended test from a deeper exploration zone, the well flow-tested at a stabilized rate of approximately 550 mcf/d of natural gas and 125 bbls/d of crude oil (225 boe/d total production).

Romania to launch international auction to lease 30 oil fields

November 2, 2009. Romania's mineral resources agency ANRM will launch in December an international auction to lease 30 land and sea oil fields. The oil fields stretch over a surface of nearly 30,000 square meters. The bid announcement will be published in the European Union's Official Journal mid-December. According to ANRM data, 12 of the 30 fields are located near Romania's border with Hungary. The remaining 18 fields are in the Black Sea, within the 9,700 square meters area Romania won after a protracted battle with neighbor Ukraine that was settled by the International Court of Justice in the Hague. 

China's CNOOC in new discovery in Bohai Bay-Xinhua

November 1, 2009.  China's offshore oil and gas specialist CNOOC Ltd has made a new oil find in Bohai Bay offshore north China.  Qinghuangdao 35-4-3, at a depth of about 26 metres, was pumping some 1,700 barrels of crude oil and more than 100,000 cubic metres of natural gas a day.

OPEC output increased in Oct, survey shows

November 1, 2009. The Organization of Petroleum Exporting Countries raised crude-oil production last month to the highest level in 10 months as members took advantage of higher prices, a survey showed. Output averaged 28.76 million barrels a day in October, up 80,000 barrels from September, according to the survey of oil companies, producers and analysts. The entire gain came from the 11 OPEC members with quotas, all except Iraq. The 11 countries pumped 26.31 million barrels a day, 1.465 million barrels above their target. Iraqi output was unchanged.  OPEC cut output quotas by 4.2 million barrels to 24.845 million barrels a day last year as fuel demand tumbled during the worst recession since the 1930s. The group, which left the targets unchanged at a Sept. 9 meeting in Vienna, is set to meet again on Dec. 22 in Luanda, Angola.

Oil set for surge to $90, Commerzbank says

October 30, 2009. Crude oil is on track to reach $90 a barrel in New York providing that prices remain above $75, according to technical analysis by Commerzbank AG.  Oil for December delivery is trading around $79 a barrel on the New York Mercantile Exchange, having climbed to a one- year high of $82 on Oct. 21. The advance may continue to $90, Commerzbank said in a report. The number is an important level using so-called Fibonacci analysis, as it was at the start of oil’s slump toward a four-year low at the end of last year, according to the bank.

Venezuela wants OPEC to maintain output in Dec

October 30, 2009. Venezuela wants the Organization of Petroleum Exporting Countries to maintain production when the group meets in December, Oil Minister Rafael Ramirez said. OPEC member nations will meet in December in Angola to discuss output quotas. They agreed last December to cut output by a record 4.2 million barrels a day after oil prices sank 70 percent from a record $147.27 a barrel in July 2008.

Husky encouraged by shale gas exploration

October 30, 2009. JHusky Energy, announced that the Company has completed and tested two exploratory wells to evaluate the shale gas potential in the Montney and Doig formations in Northeast British Columbia, Canada. The exploration drilling results are very encouraging. The Graham b-10-D / 94-B-9 well flowed gas from the Doig formation at a rate of 2.9 million cubic feet per day. The Cypress a-31-B / 94-B-15 well flowed gas from the Montney at a rate of 5.4 million cubic feet per day and from the Doig at 2.9 million cubic feet per day.

ExxonMobil, partners strike oil at Jetta prospect off Norway

October 28, 2009. Dana Petroleum has discovered oil at the Jetta prospect offshore Norway, close to the Jotun producing oil field in which Dana is a partner.  Det norske has, together with operator ExxonMobil, and license partners Dana Petroleum, Bridge Energy and Petoro discovered oil in well 25/8-17, in the Jetta prospect, south of the Jotun field.

Petrobras, PDVSA agree on refinery terms

November 2, 2009. Petrobras announced that it has reached an agreement with Petroleos de Venezuela S.A. (PDVSA) on the conditions to incorporate a special-purpose company to build and operate the Abreu e Lima Refinery, with 60% participation of Petrobras and 40% PDVSA. The refinery, to be located in the Northeastern state of Pernambuco, will be capable of processing 230,000 barrels of heavy oil per day, to be supplied in equal parts by Petrobras and PDVSA, and its main output will be low-sulfur content diesel fuel. Petrobras and PDVSA will follow with the formal procedures required to incorporate the company in Brazil.

Gasoline price rise limits carbon costs, Point Carbon says

November 2, 2009. A 5 percent increase in gasoline prices would be enough to cover most of the higher costs for oil companies associated with global warming legislation under consideration in the U.S. Congress, according to environmental market analysts. Companies with the greatest exposure to proposed cap-and- trade programs, including Exxon Mobil Corp. and Royal Dutch Shell Plc, might see operating income decline by at least 0.4 percent, Oslo-based Point Carbon said. Under legislation that passed the House in June and is now being debated in the Senate environment committee, oil companies would have to buy carbon dioxide permits to cover both refinery emissions and the pollution created when the fuels they produce are burned.

Turkey, Iran agree to $2 bn refinery deal

November 2, 2009. Iran and Turkey agreed on several joint oil and gas projects during the recent visit of Turkish prime minister to Tehran. According to a deal recently signed between Tehran and Ankara, the two sides agreed to invest two billion U.S. dollars to build a crude oil refinery in northern Iran.  The agreements between the officials of Iran's oil and Turkish energy ministers also allow the transit of Iran's gas to European countries through Turkey.  According to the report, the two countries agreed to create a joint firm, with each side holding half the share, to transfer an annual volume of about 35 billion cubic meters of gas from Iran to Europe.

Mitsui Chem, Sinopec plan petrochem plants

November 1, 2009. Japan's Mitsui Chemicals and China Petroleum & Chemical Corp (Sinopec) plan to spend 60 billion yen ($670 million) to build two factories in Shanghai to produce resins and synthetic rubber, the Nikkei business daily reported.  The two firms will invest 40 billion yen to build a plant to produce 250,000 tonnes of phenol annually and spend another 20 billion yen for a factory with annual output capacity of 75,000 tonnes of synthetic rubber materials.

BP fined record $87 mn on Texas refinery safety

October 30, 2009.  BP Plc will be fined a record $87.4 million by the U.S. for failing to correct safety shortfalls at a Texas refinery after a 2005 explosion that killed 15 workers, the U.S. Occupational Safety and Health Administration said. OSHA this month rejected BP’s request for more time to comply with a settlement over the blast, which left 170 people injured. London-based BP, Europe’s second-largest oil producer, said in a statement that it’s “disappointed” with the penalty. The Texas City refinery is the fourth-largest in the U.S., counting a plant in the U.S. Virgin Islands, and has a capacity of 470,000 barrels a day.

Graham wins Mideast refinery projects

October 30, 2009. Graham Corp., a manufacturer of critical equipment for the oil refinery, petrochemical and power industries, announced that it has been awarded orders for two refinery projects in the Middle East and a fertilizer project in Asia with a combined value exceeding $16 million. The orders were booked in Graham's second quarter of fiscal 2010, which ended September 30, 2009, and are included in the $29.6 million in total orders booked during the quarter. The Company anticipates the majority of the related products shipping during the second half of fiscal 2011, which begins on April 1, 2010, and the early part of fiscal 2012.

Brazil, Venezuela to put finishing touches on refinery deal

October 29, 2009. Brazil and Venezuela will sign "definitive" accords for a joint refinery in the northeastern Brazilian state of Pernambuco.  Those agreements will be inked in the eastern Venezuelan city of El Tigre as part of Brazilian President Luiz Inacio Lula da Silva's visit to the Andean nation.  The project, the most ambitious step the oil-rich countries have taken toward bilateral energy cooperation, has been discussed since 2005 but run into numerous snags, prompting both presidents in May to express their frustration over delays in the negotiations.  In 2008, Petrobras began work on the $12 billion refinery - expected to come on line in 2011 with a 230,000 barrel-per-day capacity - despite the lack of a final agreement with PDVSA.

Constructions begins on wharf for China-Myanmar crude oil pipeline

November 3, 2009. The oil wharf for the China-Myanmar crude oil pipeline has started construction. According to a report, the inauguration ceremony was held at Maday Island in Myanmar's western coastal area, where is the start point of the proposed China-Myanmar crude oil pipeline. The commencement of the wharf construction also declared formal start of the 771-kilometer-long China-Myanmar crude oil pipeline, which will serve as a shortcut to carry crude oil from Africa and the Middle East into China instead of the sea route via Malacca Strait.

Denbury resources to acquire Encore for $4.5 bn

November 1, 2009. Denbury Resources Inc., a U.S. oil and natural-gas producer, said it will buy Encore Acquisition Co. for about $4.5 billion to add fields in the Rocky Mountains and Gulf of Mexico. The acquisition will double oil reserves for Plano, Texas- based Denbury, a specialist in extracting crude from mature fields. Denbury said it would postpone its third-quarter earnings release and conference call because of the transaction, which will allow Denbury to undertake larger projects using carbon dioxide to get oil in a process known as enhanced oil recovery.

Iberdrola to supply LNG to US after Chevron accord

November 1, 2009. Spain's Iberdrola will supply up to 1 billion cubic metres of liquefied natural gas a year to the U.S. market after an accord with Chevron Corp comes into effect, the utility said.  Iberdrola said the agreement, which began in October, gives it part of Chevron's import capacity at the Sabine Pass LNG terminal in Louisiana.

BP Indonesia: 2^nd Tangguh LNG cargo heading to China

October 29, 2009. The Indonesian unit of BP has shipped a second liquefied natural gas cargo to China's Fujian terminal from its Tangguh project in Papua, an official at BP Indonesia said.

Egypt postpones plan for second LNG train

October 29, 2009. Egypt's state-owned Egyptian Natural Gas Holding Company (EGAS) said plans for a second liquefied natural gas train at Damietta had been postponed until enough gas reserves were found. BP and ENI had proposed a second LNG train at Damietta with a capacity of around 2 billion cubic metres per year.

Bahrain, Saudi Aramco hold talks to build pipeline

October 28, 2009. Bahrain is now in talks with oil giant Saudi Aramco over plans to move ahead with constructing a new pipeline between the two countries. The more than 100km project, expected to cost $350 million, is expected to take off by the end of the year.

GE O&G provides services for Qatargas' LNG pipeline network

October 28, 2009. GE Oil & Gas' PII Pipeline Solutions business has been awarded a multi-million U.S. dollar, six-year contract to supply Qatargas Operating Company Limited (Qatargas) with advanced pipeline integrity management services to enhance the monitoring and maintenance of the company’s liquid natural gas (LNG) network.  Based in Ras Laffan City in the State of Qatar, Qatargas has nine prominent shareholders -- Qatar Petroleum, ExxonMobil, Total, Mitsui, Marubeni, ConocoPhillips, Shell, Idemitsu and Cosmo Oil.  Under the agreement GE Oil & Gas will build and deploy a custom pipeline integrity management system (PIMS) to drive Qatargas' overall integrity management processes.

Putin: EU should help finance gas supplies to Ukraine

November 3, 2009. Russian Prime Minister Vladimir Putin has called on the European Union to help finance the supply of Russian natural gas to Ukraine, which has repeatedly had problems paying its bills.  After a meeting with Danish Prime Minister Lars Rasmussen, Putin said that the EU should come up with at least a billion dollars.  

The Russian prime minister also warned about new potential bottlenecks in gas supplies for European consumers. He gave the reason as the payment problems afflicting Ukraine, the most important transit country for supplies to the EU. In the last few months the Ukrainian company Naftogas has often transferred the money to the state-controlled Russian gas giant Gazprom at the last moment.

Cnooc Group may set up electric-car battery network in China

November 3, 2009. China National Offshore Oil Corp. may build a network of battery-changing stations for electric cars in China, the world’s second-biggest automobile market.  Cnooc Group is considering the plan after the company invested 5 billion yuan ($732 million) in July for a stake in closely held Tianjin Lishen Battery Joint-Stock Co., a mainland battery maker for electric vehicles. The company expects to sell about 30,000 S18s within three or four years.

Japan's JBIC threatens to drop finance for Sulawesi LNG

November 2, 2009. Japan Bank for International Cooperation (JBIC) will withdraw its commitment to finance the construction of a liquefied natural gas (LNG) plant in Central Sulawesi if the Indonesian government maintains its decision that the LNG to be produced is only for domestic consumption.  A consortium of state oil and gas company PT Pertamina, Medco Energi Internasional and Mitsubishi Corp has established PT Donggi Senoro LNG to build the US$1.6 billion LNG plant.  The plant will use gas from the Donggi and Senoro fields owned by Pertamina and Medco.  Mitsubishi joined the consortium with a majority share of 51 percent, and JBIC agreed to finance the project hoping that the gas could be exported to Japan.

Japan studies introducing fossil-fuels tax in 2010

October 31, 2009. Japan will study the introduction of a tax on fossil fuels in 2010 to curb emissions of carbon dioxide and help make up revenue from the abolition of a provisional tax on gasoline.

Senate panel backs Iran petroleum investment sanction

October 29, 2009.  The Senate Banking Committee voted unanimously to further restrict trade with Iran and impose sanctions on companies that help the country acquire refined petroleum products. The 23-0 vote follows the approval by the House Foreign Affairs Committee of a similar measure to sanction companies involved in supplying, shipping, financing and consulting for Iran’s petroleum sector. Iran has limited refining capacity.  Efforts to tighten sanctions on Iran are gathering steam on Capitol Hill as the Obama administration uses diplomacy to try to limit Iran’s ability to obtain nuclear weapons.

POWER

Entergy NY Indian Pt 2 reactor shut

November 3, 2009. Entergy Corp’s, 020-megawatt Unit 2 at the Indian Point nuclear power station in New York shut from full power the U.S. Nuclear Regulatory Commission said in a report. The 2,045-MW Indian Point station is located in Buchanan in Westchester County about 45 miles north of New York City. The station has two units, the 1,020-MW Unit 2 and the 1,025-MW Unit 3, which entered service in 1973 and 1976.  One MW powers about 800 homes in New York. In April 2007, Entergy filed with the NRC for a 20-year extension of the unit's original 40-year operating licenses.  Community and environmental organizations have been trying to shut Indian Point since before the Three Mile Island accident in 1979. They fear radioactive contamination from an accident could harm the public in the heavily populated suburbs north of New York City.

Sellafield to host 3.5-gigawatt nuclear station

November 3, 2009. A new nuclear power station is planned to be built at Sellafield after a consortium of energy companies bought a land earmarked for the development. The construction of the 3.5-gigawatt nuclear power plant will start by 2015. The new nuclear plant could provide power to an equivalent of 26 million homes in the country.  Scottish and Southern Energy (SSE), along with the Spanish energy company Iberdrola and French power firm GDF Suez, will pay about £70 million for the new construction site, according to the UK’s Nuclear Decommissioning Authority (NDA). The contract will involve an initial payment of £19.5 million for the 470-acre land, followed by an additional £50.5 million in the next six years.

Plan for coal-fired plant in South Dakota shelved after 4 utilities drop out

November 2, 2009. A power plant ran out of steam as developers announced that they have decided not to build the $1.6 billion Big Stone II project near South Dakota's border with Minnesota. The joint announcement by four utilities brings to an end one of the larger environmental debates in the state in recent years because of mounting public concerns about global warming and energy policy.  Seven utilities were partners when the 500- to 600-megawatt coal-fired plant was announced in 2004, but three dropped out. Environmental groups opposed the project before South Dakota and Minnesota regulators.

Syria launches its first electricity privatization tender

November 3, 2009. An Arab-Finnish consortium is well placed to win Syria’s first private power concession and help solve big electricity shortages, a senior executive in the group said on Monday. The Syrian state, which has been controlled by the ruling Baath Party since 1963, is seeking private sector investment after decades of Soviet style policies to overhaul the rundown infrastructure and boost electricity output that falls one third short of demand.

SWEPCO asks for $17.8 mn rate increase

November 3, 2009. Southwestern Electric Power Co. is asking the Arkansas Public Service Commission for a $17.8 million rate increase. SWEPCO officials say the cost-of-service increase would cost the average customer an additional $3.84 per month.  The increase comes after Shreveport, La.-based SWEPCO reached an agreement with the PSC staff, state attorney general's office and opponents in the case.  The agreement calls for SWEPCO not to include any recovery costs for construction of a $2.1 billion coal plant in Hempstead County.  The company asked the PSC to rule on the request by Nov. 25 so it can include the increase in its December bills.

Vandalism, theft threaten Bujagali transmission line

November 2, 2009. Vandalism and theft of electrical equipment are threatening the on-going construction of the Bujagali transmission line in Uganda.  The Bujagali power transmission line project is sponsored by the Uganda Electricity Transmission Company (UETCL). It is needed to connect electricity from the 250MW Bujagali hydro-power project to the national grid.  Bujagali Energy Limited, which is funding the hydro-power project, is working with UETCL to construct the transmission line. The interconnection project includes 97km of new power transmission lines and a sub-station at Kawanda.

Nigeria: Electricity transformers for 6k Mw yet to arrive

November 2, 2009. Less than sixty (60) days to the expiration of the 6,000 mega watts target deadline by the administration of the President Umar Musa Yar adua, some power equipment including the heavy duty transformers for the transmission of the electricity are yet to arrive into the country from the manufacturers. The federal government last year has ordered for nine 60MVA, 132/33kV, two of 150 MVA, 33kV/132kV and six 60MVA, 132/33kV power transformers to expand and upgrade the transmission lines in the country.

Landslide risk rises near Three Gorges Dam

November 2, 2009. China's vast Three Gorges reservoir will see a increasing number of landslides and other geological hazards as the water reaches its maximum level this autumn, a magazine report warned. The Three Gorges Dam, the world's largest, aims to tame the mighty River Yangtze and provide cheap, clean energy. Reservoir engineers began withholding outflows last September to push the dam's water level up to 175 meters (574 ft) above sea level.

AEP tests coal’s future at its West Virginia plant

October 30, 2009. An American Electric Power Co. plant in New Haven, West Virginia, may help determine whether the nation’s 1,500 coal-burning power generators become relics of a dirtier age or can flourish in a low-carbon world. American Electric’s 29-year-old Mountaineer facility this month became the first coal-fired power plant in the U.S. to capture a portion of its carbon dioxide emissions and inject them underground. The company hosted lawmakers, local officials and news media at a ceremony for the pilot project, which will bury about 1.5 percent of the plant’s emissions.

Utilities say Boxer’s climate bill trims free pollution permits

October 30, 2009. The chiefs of Exelon Corp. and American Electric Power Co. said climate-change legislation in the Senate would shortchange companies of free pollution permits they would get under a version passed in the House. Both measures would use a cap-and-trade system of permits to limit emissions scientists say contribute to global warming. Most permits would be given away free initially to utilities and other polluters to ease the transition. The Senate version by Senator Barbara Boxer would carve out 15 percent of those allowances for other purposes, such as selling them to reduce the federal deficit.

Entergy unit to buy Louisiana natgas-fired plant

October 30, 2009. Entergy Corp's largest Louisiana utility said it has agreed to acquire the 580-megawatt Acadia 2 natural gas-fired unit near Eunice, Louisiana, from independent Acadia Power Partners LLP.

The combined-cycle unit, completed in 2002, becomes one of the most efficient gas-fired units in Entergy Louisiana's fleet and will help lower the utility's fuel costs, Entergy said in a release.

Coal producer Massey: mine permitting hurts growth

October 28, 2009. The demand for coal to generate power and make steel is growing, but environmental bureaucracy is making it more difficult to mine the fuel, the head of Massey Energy said. Last month, the EPA ruled that all 79 pending mine permits in Appalachia must undergo additional evaluation, because they pose a potential hazard to water in parts of Kentucky, West Virginia and Ohio. Blankenship's broadside at tighter permitting procedures came a day after Massey reported a drop in third-quarter profit and trimmed its shipment outlook as demand, particularly for steam, or thermal coal for power generation, remained weak.

Public hearing on climate change in Jaipur

November 3, 2009. A public hearing on 'Climate Change: Voices from rain fed region' aimed at informing global players about the impact that poors are the worst affected of the climate change will be organised in Jaipur. Over 300 people representatives and NGOs from 11 rainfed and drought affected states of the country will participate in the hearing organised by organisation 'Oxfam India' at HCM-RIPA camps in the city.

Besu eyes green tech

November 2, 2009. Bengal Engineering and Science University (Besu) could become the country’s first green university if plans for a Rs 200 mn green technology centre gets the Centre’s nod.  

The green technology centre will be a part of the proposed Centre of Excellence for Green Energy and Sensor Systems. It “will introduce, practise and expand a sensible comprehensive strategy of green technology (including green energy and sensor systems), education and research in phases to improve lifestyle in environmentally-friendly and non-polluting ways.” The establishment of the centre is significant with the Union government slated to launch Jawaharlal Nehru National Solar Mission, which aims to generate 20,000MW of solar power by 2020, on November 14.

IOC limbers up for nuclear power foray

November 1, 2009. State-owned Indian Oil Corporation will sign a joint venture agreement with Nuclear Power Corporation of India Ltd (NPCIL) this month.  The foray into nuclear power will turn the PSU into an integrated energy firm. According to the Atomic Energy Act 1962, nuclear power can be generated only by a government entity in which the Centre holds at least 51 per cent.

IOC will be a minority partner in the NPCIL venture. IOC and NPCIL will enter into a confidentiality agreement after the MoU, and NPCIL will share project details with the refiner. IOC is looking to participate in either of the three proposed projects of NPCIL — the 2X700 mega watt (MW) project at Kakrapar in Gujarat or Rawatbhata in Rajasthan, the 2X1000 MW project at Kudankulam in Tamil Nadu and the 2X1650 MW unit at Jaitapur in Maharashtra.

Clean coal tech gets leg-up from oil cos

November 1, 2009. India’s move to adopt clean coal technologies is making steady progress through a collaborative effort, with Coal India Ltd (CIL) getting much-needed support from its counterparts in the oil sector — GAIL (India) Ltd and ONGC.

CIL and GAIL are collaborating to develop a surface coal gasification project at Talcher coalfield in Orissa for production of ammonium nitrate and urea.  Last year, GAIL and CIL entered into an agreement to set up the surface coal gasification project for the production of synthesis gas to be used as feedstock for fertiliser production.  

GAIL had organised a study by Udhe India for examining the potential of the project. It was estimated that the project will consume 5,000 tonnes of coal a day to produce 7.76 mscmd of synthesis gas (equivalent to 3,000 tonnes a day of ammonia) to produce 3,500 tonnes of urea a day.

Project to tap power from trees

October 31, 2009. Bio-Fuels Technologies India Private Limited has joined hands with the U.S.-based Clenergen Corporation for generating power from trees. Power generated from coal and hydel projects, atomic power plants and wind mills are not adequate to meet the ever increasing demand for power in India. Trees which are able to generate a minimum of 4,500 kw of power a cubic meter have been identified by Coimbatore based Bio-Fuels and Technologies India Private Limited.

GACL gets Centre's nod for its CDM projects

October 29, 2009. The city-based Gujarat Alkalies and Chemicals Limited (GACL) has got Centre's approval for its Clean Development Mechanism (CDM) projects, a top company official has said.  The company had in 1989 took the lead in the country to convert the Mercury Cell Technology to environment friendly and energy efficient Membrane Cell Technology and promote CDM projects to reduce Green House gas emission responsible for global warming, he said.  In addition to the windmill project, the company has identified and got registered three projects under the CDM projects and could go for modernisation of first lot of CERS.

Nepal Cabinet to hold meeting on climate change at Everest Base Camp

November 3, 2009. The Nepal government was preparing to hold a Cabinet meeting at the base camp of Mount Everest next month in order to draw attention of the world towards the impact of climate change, local media reports said. The objective of the meeting at Everest Base Camp would be to draw world’s attention towards the impact of climate change on the Himalayas. The meeting at the base camp of the world's highest mountain peak, The Everest, will be organised before the Conference on Climate Change in at Copenhagen, to be organised on the occasion of International Mountain Day on December 11.

Climate talks in Barcelona important: Boer

November 3, 2009. Noting that climate talks in Barcelona were not meant to resolve tough political issues on finance and emission reduction targets, United Nations climate chief, Yvo de Boer, said the negotiations before the Copenhagen summit should be used to consolidate areas of consensus. The five-day meet in Barcelona till December 7 is the last in the series of talks on the climate issue among governments meeting this December in Danish capital. 192 countries will meet at the Climate Change Conference in December and are expected to hammer out a climate treaty to succeed the Kyoto Protocol since the first commitment period under this treaty ends in 2012.

Sahara solar project will power Europe by 2015

November 3, 2009. A group of 12 companies – including Siemens, E.ON and Deutsche Bank – have pledged their support to creating a carbon-free power generation in the deserts of North Africa.  The long-term goal of Desertec – the foundation behind the idea – is to develop a reliable, sustainable and climate-friendly energy supply from the North African deserts, in order to achieve a target of supplying 15% of Europe’s electricity demand by 2050.

Obama, Merkel meet to discuss Afghanistan, climate change

November 3, 2009. US President Barack Obama and German Chancellor Angela Merkel met to discuss the war in Afghanistan and ongoing negotiations to produce an international climate change pact.  Merkel has been one of the leading advocates for an agreement to rein in global warming. Obama has endorsed reaching an agreement as well, but has not gone as far as Merkel would like for greater reductions in the greenhouse gases blamed for warming.

EU plays hide & seek on climate

November 2, 2009. With the semifinal round of climate negotiations beginning in Barcelona, the European Union cocked another snook at developing countries, refusing to put on the table any fixed amount that it was willing to offer as compensation for adaptation and greenhouse gas mitigation.  While the five days of negotiations in Barcelona are not expected to lead to a comprehensive agreement, the clamour for a ‘political statement’ has increased in the past fortnight. The call for a statement to be signed by political heads of states took root with the EU as well as the US now adamant that they would not be able to conjure up figures for their short-term GHG mitigation targets or financial support for the developing world.

European satellite to measure climate change

November 2, 2009. The European Space Agency says a satellite designed to help measure climate change has been launched into orbit.  The agency says the satellite is the first designed ‘to map sea surface salinity and to monitor soil moisture on a global scale.’ French researchers involved in the project say the satellite will help study ocean currents, which play an important role in climate change. They say better knowledge of soil moisture will lead to more accurate weather forecasting.  The European Space Agency and researchers in France and Spain developed the satellite. It was sent into orbit from the Plesetsk Cosmodrome in northern Russia.

Climate Envoys may want Chinese actions, not results, binding

November 2, 2009. United Nations climate negotiators meeting in Barcelona will debate how far they can push developing nations such as China and India to restrict greenhouse-gas emissions blamed for global warming.  While the UN will ask industrialized countries to accept binding targets on their gas discharges, poorer nations may be urged only to adopt measures to limit emissions growth, such as building wind-energy farms. Developing countries may be urged only to ensure those “actions” are undertaken, and may not have to prove they are successful, under a new climate-protection agreement, the UN’s top climate official said in an interview.

PV Crystalox sees benefits in solar price war

November 2, 2009. Price pressure in the solar industry has helped to increase the market and boosted module orders in the second half of the year, according to the chief executive of Britain's PV Crystalox Solar. Average selling prices for solar systems have fallen by more than fifth in the major German and U.S. markets, as a result of oversupply and price pressure from Chinese producers, hurting earnings for many established solar players, such as Solarworld and Q-Cells. PV Crystalox makes silicon wafers for major solar cell manufacturers such as SunTech Power and Sharp, and its wafers are mostly sold into the German and Japanese markets, which enjoy generous subsidies.

Palm oil CO₂ targets delayed as planters, NGOs clash

November 2, 2009. Planned palm oil carbon emission targets will be delayed by at least a year as planters clash with NGOs on calculating the vegetable oil's environmental impact, officials said. The measure was aimed at combating the negative image of palm oil output, which green groups say has been partly fueled by producers in Southeast Asia cutting down swathes of rainforests and draining carbon-rich peatlands. But Malaysian and Indonesian producers say imposing limits on land expansion based on greenhouse gas emissions was an unfair barrier to trade as oil palm estates could act as net carbon sink. The CO2 targets were delayed by a year pending further study and watered down to a voluntary undertaking during the Roundtable of Sustainable Palm Oil (RSPO) that brings together producers, buyers and NGOS this week in the Malaysian capital.

U.S. urged to clarify greenhouse-gas reduction target by UN, EU

November 2, 2009. The United Nations and European Union said the U.S. needs to clarify by how much it intends to reduce its greenhouse-gas emissions in order for an international global-warming agreement to be reached next month in Copenhagen. Any Copenhagen deal must include the U.S., the biggest historical emitter, which never signed the existing climate- change treaty, the Kyoto Protocol, said UN Framework Convention on Climate Change Executive Secretary Yvo de Boer. He made his comments as delegates from about 180 nations began the last week of preparatory talks in Barcelona before the Copenhagen summit.

Fearing climate change, Maldives turns to wind

November 2, 2009. The Maldives announced plans to build a wind farm that can supply 40 percent of its electricity as part of the low-lying archipelago's pledge to become the world's first carbon neutral nation.

The plan is intended to spur other countries to make similar commitments to renewable energy and to cutting emissions of greenhouse gases, President Mohamed Nasheed said. The nation of 1,192 coral islands is heavily dependent on oil imports to fuel generators and is increasingly reliant on energy-intensive desalination plants.

The $200 million wind project, to be built by General Electric by mid-2011, will create a farm of 30 large wind turbines 65 kilometers (40 miles) north of the capital, Male, government officials said. It was not clear if the turbines would be on land or on the sea bed.

Mass-market U.N. carbon scheme finds favor in India

October 30, 2009. A new type of U.N. scheme is spreading clean energy technology to millions of people in India, promising to cut carbon emissions and help investors earn valuable carbon credits. Two leading carbon offset project developers in India say the scheme offers the promise of improving livelihoods and greatly expanding the reach and potential investment returns of the U.N.'s existing Clean Development Mechanism. The CDM allows investors to build clean-energy projects, such as wind farms and solar power stations, in developing countries and earn carbon offsets in return. These can be sold on to help buyers in rich nations meet mandatory emissions targets. But the CDM is hampered because it is based on the approval of single projects, which can take up to two years and is costly. The expanded scheme, called program of activities (PoA), aims to allow the launch of identical emissions-reduction projects across a much wider user base in a single program, so cutting overall costs and simplifying the roll-out.

EU agrees final stance for Copenhagen climate talks

October 30, 2009. European Union leaders agreed an offer to put on the table at global climate talks in Copenhagen in December after healing a rift over how to split the bill. Developing countries will need 100 billion euros ($148 billion) a year by 2020 to battle climate change, and 22-50 billion of this will have to come from the public purse in rich countries worldwide, rather than industry, leaders said. The two-day EU summit secured a complex negotiating mandate for the Copenhagen talks to find a successor to the Kyoto Protocol, the United Nations anti-climate change scheme expiring in 2012

Carbon tariff proposals unworkable: China WTO rep

October 29, 2009. Proposals to impose "carbon tariffs" on countries that do not make efforts to reduce their CO2 emissions are unworkable and counterproductive, a Chinese trade representative said.  Zhang Xiangchen, one of China's permanent representatives at the World Trade Organization in Geneva, said "all countries should firmly oppose" the proposals, which have been raised by both the European Union and the United States. Negotiations to expand or replace the Kyoto Protocol, whose first phase ends in 2012, will take place in Copenhagen in December. Observers fear that Doha-style wrangling could prolong the talks.

China's renewable curbs a boon to big players

October 29, 2009. China's efforts to curtail expansion in its renewable energy sector should brighten prospects for the country's more established wind equipment and solar companies, as curbs on excess capacity squeeze out smaller competitors.

Solar firm Yingli Energy Holdings, wind gear maker China High Speed Transmission and solar components company GCL-Poly Energy Holdings are likely to survive the reforms largely unscathed thanks to their strong balance sheets and massive production capacity. 

For smaller companies, the government's plan to withhold approval of new investments and shut off funding for projects is likely to deliver a crushing blow for this part of the sector that makes up nearly 50 percent of the market.

Big polluters to reap benefit of climate deal

October 28, 2009. Big energy and engineering companies will reap most profit from a climate deal due in December, as they use their financial and intellectual clout to grab low carbon subsidies.

Utilities and oil companies, among the biggest polluters, are using their market awareness to stay ahead of a climate race, maneuvering to own the most viable low-carbon technologies. In addition, they are a natural magnet for government incentives as big emitters which have to drive cuts.

The council works with scientists and sympathetic industry to develop a green business voice and says governments must penalize carbon emissions more, to drive more investment in cash-starved, clean energy entrepreneurs.

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