Energy News Monitor I Volume VIII, Issue 15

The Tussle for Energy Resources in the South China Sea

 

 

 

 

NEWS BRIEF

OIL & GAS

ONGC gives nod for Cairn-Vedanta deal

September 27, 2011. ONGC has decided to issue a no-objection certificate for London-based miner Vedanta Resources' deal to buy a majority stake in oil and gas explorer Cairn India. The approval from ONGC, which has a 30-percent holding in the Cairn-operated oil and gas fields in western India, comes after India granted conditional approval to the $6 billion deal in June, after a delay of more than 10 months. The transaction had been held up mainly over the disagreement on royalty payments between the two partners, and had undermined investor sentiment in Asia's third-largest economy.

RIL's new gas finds in KG-D6 offshore block not viable at $4.2 per mmBtu price: DGH

September 26, 2011. Oil regulator DGH has said that Reliance Industries' newer natural gas finds in the eastern offshore KG-D6 block are not economically viable at the government-stipulated price of $4.205 per mmBtu. Reliance had in December, 2009, submitted to the regulator an optimised development plan for four satellite gas fields around the currently producing Dhirubhai-1 and 3 gas fields in the KG-DWN-98/3, or KG-D6, block. It proposed to invest $1.529 billion in producing up to 10 million standard cubic metres per day from the four discoveries in five years' time. Reliance projected first gas from the Dhirubhai-2, 6, 19 and 22 (D-2, D-6, D-19 and D-22) fields in 2016. The DGH said if royalty is excluded from project cost and capital expenditure is phased over a period of two years before the date of first gas extraction, the project becomes marginally viable. But royalty in any case has to be paid to the government. Reliance had in 2007 proposed a price of $4.33 per mmBtu for gas from KG-D6. The government however tweaked the formula and fixed the sale price at $4.205 per mmBtu for the first five years of production. DGH has evaluated the new finds in KG-D6 at the government-approved price and did not consider a higher rate that may be fixed in 2014, when the price comes up for review. Reliance has so far made 18 gas discoveries in the KG-D6 block. It had in July, 2008, submitted a field development plan for nine satellite gas discoveries (D-2, D-4, D-6, D-7, D-8, D-16, D-19, D-22 and D-23) with an estimated capex of $5.6 billion and reserves of 1,708 billion cubic feet (BCF). The DGH, carried out techno-economic feasibility studies at a gas price of $4.2 per mmBtu and projected total revenue and NPV at a 10 per cent discount factor at $6.52 billion and negative $2.51 billion, respectively. The regulator then told Reliance that the development plan needs to be optimised. Reliance submitted the optimised development plan for the four satellite gas fields in end-2009. Reliance estimated 1,733 BCF of in-place gas reserves in the four finds, of which 626 BCF can be produced. However, the DGH trimmed down the estimates to 1,342 BCF and 617 BCF, respectively.

Reliance drills two dry wells in KG-D6

September 24, 2011. Reliance Industries has drilled two new wells in its KG-D6 gas block, but both have turned out to be almost dry, with very little hydrocarbon presence, vindicating the company's stand that indiscriminate drilling will not help solve the problem of falling gas output. In July, RIL completed drilling of two wells to take the number of producer or development wells in the Dhirubhai 1 and 3 (D1 and D3) gas fields of the eastern offshore KG-D6 block to 20. It, however, decided not to make a further investment to connect them to production facilities and transport the gas by pipeline to its onshore plant. Since last year, RIL has witnessed a drastic drop in reservoir pressure and water ingress in its gas producing wells, leading to a drop in output from 61 million standard cubic metres per day to less than 44 mmscmd, instead of rising as planned to over 70 mmscmd.

Reliance Industries to review oil strategy, may drill abroad with BP

September 23, 2011. Reliance Industries is undertaking a comprehensive review of its oil and gas strategy in view of its ordeals with regulators and auditors, which may compel the country's most successful private explorer to drill abroad in partnership with global major BP instead of bidding for new blocks in the energy-starved country. The company that made India's biggest hydrocarbons discovery in four decades is striving to develop more fields in the prolific KG-D6 block, where it started operations at India's first deep-sea field. But the oil ministry and the directorate general of hydrocarbons are sitting on its proposals for months and focusing their attention on its existing field, where production has fallen from 60 million metric standard cubic metres a day (mmscmd) to below 45 mmscmd. RIL remains committed to exploration and production in the blocks it has already won in India, but for new upstream initiatives, it is increasingly considering overseas options as it strives to evolve into a global oil company. RIL will look at international oil and gas opportunities and if the potential investment has implications for the Indian market, it would take a decision in consultation with BP. The British company recently completed its $7.2-billion deal to acquire stakes in more than 20 blocks of RIL, including the D-6 block. It is also forming an equal joint venture for gas marketing in the country.

Essar Energy gives up two oil blocks in Australia

September 21, 2011. Essar Energy has relinquished two offshore exploration blocks in the Northern Territory of Australia, for which it had bid in 2008 to secure crude oil supplies for its Vadinar refinery in Gujarat. However, the company is going ahead with exploration activities in several countries from Indonesia to Nigeria. The company is exploring oil and gas in several countries. It has an offshore oil and gas block in Vietnam's Song Hong basin where the exploration phase is estimated to last for five years and the investment involved is about $60 million.

Refiners see AI-like fate as govt dilly-dallies on support

September 22, 2011. Mounting losses from sale of diesel and cooking fuel and uncertainty over government support threatens to ruin the finances of top state-run refiners and impose a heavy subsidy burden on ONGC, which would derail its followon public offer. State-run refiners fear their balance sheets may bleed in the coming months, setting them on the path to become crippled like Air India. Indian Oil Corp, Hindustan Petroleum and Bharat Petroleum, which reported a combined loss of ` 9,360 crore in the first quarter, face another quarter of losses or a marginal profit. Revenue loss from selling diesel, cooking gas and kerosene at controlled rates is estimated to soar to a record ` 121,000 crore in the current financial year. The government is considering a proposal to ask oil marketing companies to bear at least 10% of this, while upstream companies like ONGC may bear nearly half of this. This would raise the combined subsidy burden of ONGC, Oil India and Gail by nearly 90% from previous years' level of ` 30,297 crore.

Rising petrol prices put CNG sales on fast track

September 21, 2011. The sharp increase in petrol prices in the past year has revved up demand for Compressed Natural Gas (CNG), which works out 70% cheaper, and triggered a rush of customers in installing kits to run their cars on the low-cost fuel. With petrol prices up 65% since January 2009, vehicle owners in Delhi, Mumbai and cities in Gujarat are increasingly opting for CNG and vehicle owners say sale of natural gas and LPG-fired vehicles is rising. In the Delhi region alone, around 5,000 vehicles are switching to CNG every month, according to a survey by Indraprastha Gas Ltd (IGL), accelerating the growth in natural gas demand to 12% to 15% a year in the region. In Gujarat, which consumes a third of the natural gas sold in India, CNG stations in cities and along the highway connecting Maharashtra with Rajasthan have galloped since April. Daily sales of Adani gas have risen to 3.12 lakh cubic metres from 2.68 lakh in April, while Gujarat Gas, a subsidiary of Britain's BG group, has twice as many cars at its pumps than a year ago. GSPC Gas Co, the biggest CNG player in Gujarat, has seen sales rise 25% in the past two months. In Delhi, where a CNG kit costs ` 50,000 for a Euro-IV petrol car and ` 30,000 for the older technology cars, sales are booming. CNG Kit manufacturer, Ecogas, which owns more than 8 CNG fitment centres in the National Capital Region, says sales have risen 30-40% in the past 3-4 months. The number of private vehicles running on CNG in the last fiscal year soared to 4.3 lakh, three and a half times the number in 2006-07. In the past three years, IGL's daily supply has increased from 21 lakh kg to 52 lakh kg. GM India said sale of cars running on CNG or diesel was rising. As the customer base swells, motorists are often stranded in long queues at filling stations as infrastructure has not kept pace with demand. IGL is trying hard. It has increased the number of CNG stations in Delhi 163 to 278 in the past three years and has plans to add 30 stations every year.

Gail eyes stakes in LNG units of Chevron Corporation, Algerian company Sonatrach

September 27, 2011. Gail India is in talks with at least two international energy explorers, including US-based Chevron Corporation, to acquire stakes in their liquefied natural gas plants in Australia and Algeria. Gail is aggressively pursuing Chevron for equity interest in its Gorgon plants in Australia and Algeria's state-run firm Sonatrach for a stake in some of its plants in the country.

Iran to export natural gas to India

September 25, 2011. India and Oman are considering the import of natural gas from Iran via an under-sea pipeline. The caretaker of the National Iranian Gas Export Company, said an Indian delegation will travel to Tehran for talks on building an independent undersea gas pipeline. If an under-sea gas pipeline is built by India to Oman, Iran can build a similar pipeline in deep waters to join that pipeline for exporting gas to New Delhi.

GAIL stalls pipeline projects on land acquisition hurdles

September 24, 2011. GAIL, has stalled pipeline projects worth ` 3,000 crore because of problems in acquiring land and the state-run company has sought the environment ministry's help is resolving the issue. The company said its Dadri-Bawana-Nangal project would be delayed by six months, while the Dahej-Vijaipur project will be five months behind schedule if the land acquisition issue was not resolved at the earliest. The Kochi-Bangalore-Mangalore pipeline project will also be delayed.

Dwindling domestic gas supply, high cost of imports may take toll on CNG, piped gas prices

September 24, 2011. Prices of Compressed Natural Gas (CNG) and piped gas supplied to households are expected to rise in the coming months as supply of cheap domestic gas is dwindling and the cost of imports is rapidly rising. The price of imported gas has risen 60% since March since an earthquake and Tsunami destroyed a nuclear plant in Japan, forcing the country to import large quantities of gas to generate power. The sharp decline in the rupee, which has fallen to its lowest level in 28 months, has exaggerated the impact of higher LNG prices. Customers in Delhi are supplied a mix of domestic and imported gas but with local output declining, the ratio of costly LNG would rise. The supply of gas under the administered price mechanism (APM) is declining. Natural gas from local fields operated by ONGC and Reliance costs $4.2 per unit, while LNG prices have shot up to $16 per unit, putting pressure on city gas networks. In Gujarat, where distribution companies depend heavily on LNG, prices are already higher than Delhi, and companies say their margins are under pressure.

GAIL India to open Singapore LNG trading desk in months

September 21, 2011. State-run gas utility GAIL India will open up a trading desk in Singapore in the next few months that could eventually seek outside customers. India has a double taxation avoidance agreement with the island nation. The utility owns India's biggest gas pipeline network of about 8,700 kilometres with capacity to transmit about 170 million cubic metres of gas daily.

Oil Ministry sitting on approvals for 8 Reliance gas finds: DGH

September 27, 2011. The Oil Ministry representative on the panel that oversees operations in Reliance Industries' KG-D6 block has not approved almost half the gas finds the company has made, even though over years have elapsed since they were struck, oil regulator DGH has said. The Directorate General of Hydrocarbons (DGH), forwarding a note to the ministry for approval of RIL's investment plans for four satellite finds in the Krishna-Godavari basin block, stated that a Declaration of Commerciality for eight finds has been awaiting the approval of the Oil Ministry since November, 2007. After a gas discovery is made, its potential is assessed to ascertain if it can be commercially produced. Once the Declaration of Commerciality (DoC) is approved by the Management Committee (MC), which oversees operations in the block, an investment plan is drawn up for bringing the gas to production. Unless, the Oil Ministry grants a DoC, RIL cannot begin work on the field development plan. RIL has so far made 18 gas finds in block KG-DWN-98/3, or KG-D6, which lies off the Andhra coast. Of these, two -- Dhirubhai-1 and 3, or D1 and D3 -- have been put on production and nine others (D-2, D-4, D-6, D-7, D-8, D-16, D-19, D-22 and D-23) have been declared as commercially viable by DGH. Of these nine finds, the Oil Ministry has sanctioned the DoC of only D-2, which was discovered in April, 2002, around the same time as the landmark D-1 and D3 discoveries. The DGH note said RIL submitted a field development plan for the nine satellite gas discoveries with an estimated capex of $5.6 billion and reserves of 1,708 billion cubic feet (BCF) in July, 2008. However, techno-economic feasibility studies carried by the DGH at the government-fixed gas price of $4.2 per mmBtu found them unviable, yielding a negative Net Present Value of $2.51 billion. Subsequently, DGH asked RIL to optimise the plan. The firm submitted an optimised development plan for four gas fields (D-2, D-5, D-19 and D-22) in December, 2009, proposing to invest $1.529 billion to produce up to 10 million standard cubic metres per day of gas in five years' time. While D-6 was discovered in April, 2003, D-19 was struck in December, 2009, and D-22 in April, 2005, the note said.

ONGC mulls bringing its Syrian oil to India

September 22, 2011. ONGC is considering shipping crude to India from a Syrian joint-venture if US and European sanctions prevent sales continuing to refiners in Europe. Syria exported 150,000 barrels per day of total output of 370,000 bpd in July. Most of the oil flows to Germany, Italy and France. ONGC's share of oil from the joint venture it has in Syria with the China National Petroleum Corp (CNPC) is around 13,000 to 14,000 barrels per day (bpd). At present, India imports no crude from Syria. The ONGC and CNPC joint venture holds a stake in Syria's main oil producing consortium. The venture holds a 33.3-37.5 per cent participating interest in four production sharing contracts covering output from 36 onshore fields in Syria.

India seeks long-term LNG deals as it doubles capacity

September 21, 2011. India is seeking long-term liquefied natural gas (LNG) purchase deals with Brunei, Indonesia, Australia and Malaysia as it plans to double its LNG regassificaion capacity by 2016. India, Asia's third-largest oil importer, is scouting for long-term overseas deals to help cushion against global price fluctuations and to secure energy supply for a country that relies on imports for four-fifths of its oil needs. Gas accounts for about 10 percent of India's primary energy basket versus the world average of 24 percent. India's gas demand is expected to grow at 14 percent in the next five years.

POWER

Reliance Power on track for 5 GW capacity by 2012

September 27, 2011. Reliance Power is poised to become the country's largest private sector power generation and coal mining company in the next five years, and the company has tied up funds worth $17 billion for its businesses. The company was on track to achieve a total operating capacity of 5,000 megawatts by the end of 2012. R-Power's four billion tonnes of captive coal resources in India and Indonesia would insulate it from fuel supply risks. R-Power was set to commence coal production in India and Indonesia next year and poised to join the league of the world's top ten thermal coal producing companies with a production capability of up to 100 million tonnes per annum. The company has signed an MoU with the US Exim Bank for a $5-billion (` 25,000-crore) facility and has received approval for $1.6 billion (` 8,000 crore) -- the largest in India. Besides, it has signed an MoU with Chinese banks for $12 billion (` 60,000 crore), which represents the largest support by Chinese banks outside China. The banks include Bank of China, China Development and C-Exim. The company has received approval for $1.1 billion (` 5,500 crore) for Sasan, a first in India. The company's bank of projects with land and other critical clearances for nearly 30,000 MW capacity was a significant advantage, as these are the most commonly cited challenges in infrastructure project development. Reliance Power is set to become India's largest green power company and is building the country's largest single location wind project in Maharashtra (200 MW) at an outlay of `1,400 crore. The first phase of the 1,200MW Rosa plant in Uttar Pradesh has demonstrated a strong operating performance and the first phase of 1,400MW at Samalkot gas-based project would get fully commissioned in March 2012. The entire 2,400MW Samalkot plant will be commissioned by 2012, becoming the country's largest gas-based power plant. The company is also setting India's largest solar facility in Rajasthan at an outlay of ` 2,600 crore.

GMR Infrastructure sell 30 pc in Singapore unit to Petronas

September 26, 2011. India's GMR Infrastructure said it agreed to sell a 30 percent stake in its unit GMR Energy (Singapore) Pte Ltd to Petronas International Corp, a unit of Malaysian state-run oil firm Petronas. GMR Energy is developing an 800 megawatt, gas-based power project on Jurong Island, Singapore, which will be set up by a consortium consisting of Siemens and Samsung.

GVK Power & Infrastructure eyes 7.5 GW thermal power capacity by 2016-17

September 25, 2011. GVK Power and Infrastructure, the flagship company of Hyderabad-based GVK group, is planning to have 7,500 MW thermal power generation capacity by 2016-17. To run the plants the company would import 20 million tonnes of coal a year from GVK Group's intended acquisition of assets of Australia's Hancock Coal. The company, which has gas-based 901 MW power generation capacity, is expecting to commission its first thermal plant of 540 MW in Punjab in 2012-13. Moreover, the move is part of a long-term growth plan of the company, which is aiming to have about 12,000 MW power generation capacity by 2016-17. Currently, new units of 3,530 MW power generation capacity are at various stages of construction and development, including 1,390 MW hydro power units.

NHPC to raise ` 20 bn debt

September 24, 2011. The country's largest hydropower generator, NHPC, will raise ` 2,000 crore debt in the next five months by issuing bonds and term loans in the domestic market. NHPC would raise the debt at a rate of 10-10.5%. The debt was required to fund the company's plans to add 678 MW in the current financial year. NHPC is executing 10 projects with a total capacity of 4,502 MW. The projects would be financed through internal resources, subordinate debt and market borrowings.

Teesta project not affected by Sikkim quake: Teesta Urja Ltd

September 22, 2011. Power company Teesta Urja Ltd said its under-construction, 1,200-MW Teesta State-III hydroelectric project in North Sikkim has not been majorly impacted by the devastating earthquake in the state. This area, along with other parts of North Sikkim, were affected by the earthquake in Sikkim and other areas of the North-East India. The company said none of its personnel are trapped inside the tunnels. Army personnel involved in rescue operations in Saffu could not reach the project site by road, owing to landslides in the area. They commuted from Theng village to Saffu through the project tunnels, which are clear and safe. The company said its officials have also driven through this tunnel from Theng village to Saffu and also to Chungthang several times for transporting men and materials and are carrying out relief operations.

Tata Power to run Mundra UMPP at low capacity

September 21, 2011. With no immediate relief in sight on the tariff hike sought by Tata Power Company for its Mundra Ultra Mega Power Project, the company is preparing contingency plans to minimise loss from running the plant as the cost of imported coal from Indonesia has risen sharply. The Tata Group utility plans to run the 4,000-megawatt Mundra unit at low capacity, at around 72-78%, and is considering blending the fuel with cheaper coal of low calorific value to reduce cost of generation. This would lead to lower power supplies to Gujarat, Maharashtra, Punjab, Haryana and Rajasthan which have signed pacts to buy power from the unit at 2.26 a unit.

NTPC to get coal blocks for 4 projects

September 21, 2011. The coal ministry will award mining blocks to state-run NTPC for four of its upcoming projects and could also return licences that were revoked in June, putting the power plans of the company back on track. The four NTPC power projects, entailing an investment of ` 8,500 crore, are: 2,400-mw Kudgi project in Karnataka, 1,600-mw Gajmara project in Orissa, and 1,320-mw Barethi and 500-mw Unchahar projects in UP. Equipment for three of these projects was being sourced through international tariff-based competitive bidding. NTPC is expected to use 280 mt of coal a year by 2017, the terminal year of the next five-year plan. Around 70% of this is to be met from domestic sources, 20% from own mines and the rest 10% through imports. In June, the ministry had revoked licences of 15 coal and lignite blocks, 12 of which belonged to state-run companies. The five blocks of NTPC- Chattibariatu, Chattibariatu (South), Kerandari, Brahmani and Chichiro Patsimal- were de-allocated on grounds of slow progress. The other three blocks being considered for re-allotment are Damodar Valley Corp's Saharpur Jamarpani, Tenughat Vidyut Nigam's Gondulpara and Jharkhand State Electricity Board's Banhardih.

Areva T&D bags Reliance Power contract

September 27, 2011. Areva T&D India Ltd said it has bagged ` 40 crore contract from Reliance Power for construction of a substation. Areva T&D, part of Alstom Grid, will set up a 220kV substation for Reliance's 350 MW Doorsar solar power plant in Rajasthan. The turnkey contract involves design and construction of the substation including transformers, control, protection, monitoring systems and civil works of the plant.

Supply crunch may trip 8 GW of new gas-based power capacity

September 27, 2011. At a time when the country is struggling to fill the power demand-supply gap, almost 8,000 megawatt of new gas-based power capacity may be stranded due to lack of fuel as the domestic gas output continues to fall with no signs of recovery in sight. The power units that could have helped the country reduce its peak time power deficit of 14% would at best be able to secure enough fuel to run at low capacity, power sector experts said.

Erratic power supply hits AP industries

September 26, 2011. The power supply situation has turned grim in Andhra Pradesh with industrial consumers forced to bear with a day's power holiday, domestic consumers faced with shortage of up to six hours and farm sector consumers with erratic supply. The demand supply mismatch has gone up to 33 million units forcing load shedding for all sections of consumers. While the daily demand is around 260 MUs, the State is able to meet the requirement of about 227 MUs, resulting in shortage of about 33 MUs or about 1,400 MW. This is in spite of the purchase of nearly 1,500 MW from various Central generating stations and also utilising idle capacity from other independent power producers. The State is faced with a tough situation as the coal supply from the State-owned Singareni Collieries Company Ltd has drastically fallen due to the ongoing strike by miners in support of separate Telangana.

Work on Jaitapur, Koodankulam nuclear power projects might be delayed: DAE

September 27, 2011. Amid public resistance to nuclear power projects at Jaitapur and Koodankulam, the Department of Atomic Energy (DAE) has said the work on both plants will be completed but their could be delay. There have been mass protests by locals and activists against the 9900-MW Jaitapur plant and 2000-MW Koodankulam project in Maharashtra and Tamil Nadu respectively due to land acquisition issues and safety concerns in the backdrop of the Fukushima disaster. However, the DAE has disfavoured the scrapping of these projects in view of the mounting energy needs.

2011/12 coal demand seen at 696 million tonnes: Government

September 27, 2011. India's coal demand is seen at 696 million tonnes in 2011/12 against an expected local production of 554 million tonnes. Earlier estimates have suggested Asia's third-largest economy is likely to import about 135 million tonnes in the year ending March 31, 2012.

Orissa to get 50 pc power from NTPC's super thermal projects

September 26, 2011. Orissa will get 50 per cent power from two super thermal power projects proposed by National Thermal Power Corporation Ltd (NTPC) in the state. NTPC has proposed to set up a 4,800 MW plant at Darlipalli in Sundergarh district and 3,200 MW plant at Gajmara in Dhenkanal district. The 4,800 MW power plant coming up on around 3,000 acres of land at Darlipalli will be commissioned in three phases. Each phase has a capacity of 1,600 MW (2x800) and all the three phases are scheduled to be commissioned by the end of the 12th Plan period (2016-17). NTPC has obtained water clearance from the Orissa government for this project and deposited establishment charges for land acquisition before the issue of notification under Section 4 (1) of the Land Acquisition Act. It has also conducted various studies like Environmental Impact Study (EIA), socio-economic study, topographical study, hydrographic study and seismic study. The Gajamara project needed 2,900 acres of land and NTPC claims to have conducted the gram sabha for this project in March this year. The navratna power utility, which has an installed capacity of 3,460 MW in Orissa will pump over ` 50,000 crore in generating additional capacity of 9,320 MW in the state by the end of 2017. Besides these two mega power projects, NTPC is also scaling up the capacity of its existing thermal power station at Talcher by adding two supercritical units of 1,320 MW capacity (2x660 MW).

Dismantling of the 'go, no-go' policy may do little to improve supplies of coal

September 25, 2011. In March this year, the Central Bureau of Investigation (CBI) raided the houses and businesses of a few top industrialists in Dhanbad, Jharkhand, home to one of the subsidiaries of India's biggest coal miner, Coal India (CIL). Dhanbad is more widely known in popular imagination as home of the infamous 'coal mafia', which spread a reign of terror across the coal mining districts of the then undivided Bihar in the 1970s and 1980s. The raids came after the CBI suspected that the industrialists were misusing their 'coal linkage' certificates. These certificates are in effect, a form of licence, which entitles the holder to quotas of subsidised coal for their business, whether its running a power plant, or a steel plant. The condition is that the coal cannot be resold to others but must be used by the certificate holders themselves. The industrialists were accused of violating this condition, and of benefiting from the huge and growing price differential between subsidised coal and the price of coal in the black market. Meanwhile, Odisha politics was hit by a ` 125-crore scam involving diversion of subsidised 'linkage' coal to the open market by firms linked to politicians. Both these incidents are a symptom of the growing hunger for, and shortage of, domestic coal in the country. Whether it is the linkage scams in the heart of coal country, or the growing imports of coal by steel plants, or the recent acquisitions of overseas coal mines, such as the $1.26-billion deal by GVK Power to buy mines in Australia, or the fact that 14 power plants in the country have less than four days of coal stocks available, these symptoms are growing by the day. That coal shortage is projected to hit 137 million tons this year up from just 43 million tons barely five years ago, and has forced the government to resort to its favourite tactic when faced with a crisis - set up a Group of Ministers (GoM). It met this week and scrapped the contentious 'go, no-go' policy, which has had the coal and environment ministries at loggerheads for months now. Critics have claimed that the policy, which essentially blocks coal from being mined in heavily forested areas, stands in the way of greater coal production. The potential production capacity of around 168 CIL coal blocks pending with the Ministry of Environment and Forests (MoEF) for forest clearances, was about 200 million tons a year. Total domestic production of coal was around 533 million tons in 2010-11. So if all these projects take off, they could have a big impact on coal output. But that's a big if. The 'resolution' of the 'go, no-go' issue has been touted as solving the problem of coal shortage, or at least go ing a long way towards fixing that shortage. In reality, it is likely to do little. If there does indeed exist a conflict between development on the one hand, and environmental concerns on the other, it is in the mining sector where this is the most apparent. A car plant can be shifted to another location if there are serious environmental or other social concerns. Coal or iron ore mines cannot. According to the latest coal ministry statistics, 286 captive coal blocks, with total geological reserves of 43.5 billion tons have been allocated to both private and government players. Till June last year, only 26 of these had actually started production - delays in forest clearances are only part of the reason. Land acquisition is another major reason. By March this year, the rhetoric on 'go, no-go' had shifted subtly, and there was no more talk by the coal minister of working 'jointly' with the MoEF. With the scrapping of the 'go, no-go' plan, the uncertainty has returned. There is again the possibility that miners may apply for a forest clearance only to face rejection later. And irrespective of whether 'go, no-go' exists or not, all coal blocks need an MoEF clearance if they happen to be on land owned by the forest department. The whole 'go, no-go' controversy has obscured the fact that it is these forest clearances which can take years to come through and which need to be speeded up.

20 bidders qualify for next round for Orissa's UMPP

September 23, 2011. All the 20 power companies, including Tatas, NTPC and Lanco, which had submitted bids for the 4,000 MW ultra mega power project (UMPP) in Orissa are believed to have qualified for the second round, which starts in October. They have qualified for submitting the technical and financial bid for the estimated ` 20,000 crore UMPP at Bedabahal in Orissa. So far, four UMPPs have been awarded, with Reliance Power bagging three - Sasan (Madhya Pradesh), Krishnapatnam (Andhra Pradesh) and Tilaiya (Jharkhand) - and Tata Power executing the fourth one at Mundra in Gujarat. Ministry of Power plans to set up 16 UMPPs over a period of time to overcome electricity shortage in the country.

India said to lift curbs on coal mining in dense forest areas

September 21, 2011. A group of Indian ministers agreed to allow companies to seek approval to mine coal in some dense forest areas, overturning an environment ministry ban. The ministers decided that applications could be considered on a case-by-case basis. The decision will benefit companies including Coal India Ltd. (COAL), the world’s largest producer of the commodity, Essar Power Ltd. and Hindalco Industries Ltd. (HNDL). The environment ministry halted mining in dense forests in 2009 to preserve tree cover and wildlife. The coal ministry wants more areas opened for mining coal, which is used to fire more than half of the power generation capacity in Asia’s second-fastest growing major economy. India’s cabinet referred the issue of coal mining in forests to the government panel in January. The company is awaiting approval to mine its Mahan block in Madhya Pradesh state for coal to produce electricity for a planned 359,000 metric ton aluminum smelter. India’s biggest aluminum maker formed a venture with Essar Power to develop the Mahan coal mine. India’s coal production has trailed demand from utilities, steel mills and cement makers. Domestic coal output in the year ending March 31 is estimated at 559 million tons, falling short of demand by 137 million tons. Coal India cut its output target for the year ending March 2017 by 16 percent to 556.4 million metric tons because of delays in environmental approvals and land acquisition.

OIL & GAS

Total raises O&G output growth outlook to 2.5 pc for 2010-2015

September 26, 2011. Total raised its outlook for annual production growth to 2.5% from 2% and said project start-ups during this stretch should produce around 600,000 barrels of oil equivalent a day by 2015. Total said in its annual investor presentation that it would increase oil and gas output 2% annually between 2009 and 2014. The company said production in the next four years would be boosted by new projects coming onstream, such as the Usan deepwater field offshore Nigeria and the Pazflor heavy oil field in Angola. The company has followed an aggressive acquisition strategy in the past 18 months, spending $10 billion as it seeks to expand its acreage portfolio beyond its traditional remit of Africa and the Middle East. Major new upstream projects are underway following recent transactions in Russia, Uganda and Canada. And while Total said it predicts strong natural gas demand, expecting it to become the world's second-largest energy source by 2030, 60% of its new projects will be in liquids like oil, heavy oil and LNG and 40% in gas alone.

Statoil, partners tag $1.7 bn for Skuld field development

September 26, 2011. Statoil and its partners have submitted a plan for development and operation (PDO) of the Skuld field on the Halten Bank to the authorities. Recoverable reserves in Skuld are estimated at 90 million barrels of oil equivalents, mostly oil. Total investments are estimated at nearly NOK 10 billion ($1.7B). Skuld will be implemented as a fast-track development and the field will be tied to the Norne production ship. This development brings the number of Statoil fast-track PDOs to five, with Skuld the largest fast-track development so far. The plan is to have all five in operation in late 2012/early 2013. In total, the fast-track developments are expected to produce nearly 90,000 barrels per day in 2014. Skuld will contribute more than half of this volume.

Doubts raised about giant shale gas find in England

September 23, 2011. Experts have cast doubt on claims of a giant shale gas find in northwest England, leaving opponents to accuse the company behind it of painting an excessively rosy picture to win political support for the controversial project. Cuadrilla Resources is owned by Australian drilling company AJ Lucas and private equity firm Riverstone, and has former BP Chief Executive John Browne on its board, said it had found 200 trillion cubic feet of gas in place at its licenses in Lancashire.

Venezuela’s PDVSA in talks on $6 bn settlement with Exxon Mobil

September 22, 2011. Petroleos de Venezuela SA, the state oil company, and Exxon Mobil Corp. are negotiating an arbitration settlement of about $6 billion for assets seized by President Hugo Chavez in 2007. Chavez, since coming to power in 1999, has nationalized parts of the oil, metals, cement and utilities industries. In 2007, he forced foreign oil producers into joint ventures as minority partners. Irving, Texas-based Exxon Mobil and ConocoPhillips rejected the revised terms and instead entered into international arbitration.

Petrobras makes new discovery in Barra prospect

September 21, 2011. Petrobras announced that the presence of oil and gas accumulations in ultra deep waters in the Sergipe-Alagoas basin is confirmed, after the conclusion of the lined well formation test in the BM-SEAL-11 concession, located in Block SEAL-M-426. The discovery was confirmed through wireline logging and fluid sampling from a lined well formation test.

Jubail JV refinery to open December 2013

September 26, 2011. Saudi Aramco Total Refinery and Petrochemicals Company (Satorp) expects its new refinery at Jubail in Saudi Arabia to be fully operational in December 2013. State-run Saudi Aramco and France's Total are building the $14-billion Jubail facility as part of a push by the world's top oil exporter to almost double its refining capacity. Although the joint venture (JV) refinery was designed to process 400,000 barrels per day (bpd), Saudi Aramco had committed to supply it with up to 440,000 bpd for 30 years. Jubail will refine Saudi heavy crude into a range of fuels - from gasoline to petroleum coke - for domestic consumption and export.

Libya PetroCanada venture to start pumping oil

September 25, 2011. Harouge Oil Operations, a joint venture between Libya’s state-owned National Oil Corp. and PetroCanada, will begin pumping crude from the Amal field. The venture expects to reach its full output level of 100,000 barrels a day.

US DOT approves restart of Exxon's Montana pipeline

September 23, 2011. The U.S. Department of Transportation DOT approved Exxon Mobil Corp.'s plan to restart its Silvertip oil pipeline, which had ruptured and leaked about 1,000 barrels of oil into Montana's Yellowstone River in July. The leak caused Exxon to organize a multimillion-dollar cleanup effort and find alternative supply sources for its 60,000 barrel-a-day refinery in Billings, Mont.

Shipowner mothballing first new supertanker since 1980s

September 23, 2011. A shipowner will mothball a newly built supertanker for the first time since the 1980s as a glut of the ships erodes earnings to an unprofitable $1,000 a day. The tanker, capable of carrying 2 million barrels of crude, will be sent to a natural harbor in Malaysia. Earnings from this class of vessel, which carry about a fifth of the world’s oil, averaged $1,000 a day. Some tankers were contracted speculatively and not secured against long-term charters. The largest supertanker fleet in 29 years has cut earnings from the vessels by 96 percent since 2007 when they rose to a record $229,000 a day.

China considers policy shift to boost shale gas

September 25, 2011. China may treat shale gas as separate from conventional hydrocarbons to encourage companies outside of state-owned industry to invest. It may also offer pricing and other incentives across the industry to further to tap the potentially huge resource. A handful of state-run energy majors now dominate the sector in China as private and foreign firms face hurdles such as securing mining rights for onshore drilling activities or the ability to bid in tenders. China is at an early stage of shale gas exploration with no commercial production yet. But the world's second-largest oil consumer may hold the world's largest shale gas supplies at 26 trillion cubic meters, according to Chinese industry estimates, larger than the 24.4 trillion cubic meters in the United States. China issued its first-ever shale gas tender in July and a second tender could come in the second half of the year.

BP files first Gulf drill plan since Macondo

September 24, 2011. BP confirmed it has filed a plan with U.S. regulators to pursue its first new deepwater oil exploration work in the Gulf of Mexico since the disastrous Macondo spill in 2010. The plan, filed with the Bureau of Ocean Energy Management, Regulation and Enforcement, is BP's first move to return to deepwater Gulf exploration since its Macondo well ruptured on April 20, 2010, and caused nearly 5 million barrels of oil to spew into the sea in what was the worst U.S. marine oil spill. The supplemental exploration plan will be a key litmus test for how U.S. regulators treat BP, the biggest Gulf oil producer, in the post-Macondo world.

China agrees plan to alter resource tax that may cut profit

September 22, 2011. China will levy a tax on resource producers based on the value and volume of their output. The country will adjust tax ratios on crude oil and natural gas exploration. It currently imposes a tax on producers of oil, gas and coal based on output volume. A higher tax will likely cut profits of oil explorers including PetroChina Co. and coal miners including China Shenhua Energy Co. The government has proposed increasing resource taxes nationwide to fund development of the nation’s western regions, which contain oil, gas and coal reserves. It introduced a trial tax of 5 percent of oil and gas production by value in the Xinjiang region in June 2010 before extending the levy to other western provinces.

Platts: China's oil demand dips to lowest in 10 months

September 21, 2011. China's apparent oil demand was 38.02 million metric tons (mt) in August, or an average of 8.98 million barrels per day (bpd), the lowest level since October 2010, according to a Platts analysis based on statistics recently released by the Chinese government. But on a year-over-year basis, the August rate was up seven percent. This marks the first time in 10 months that apparent oil demand has dipped below nine million bpd and reflects a softening in refined product consumption, compounded by a shrinking of crude oil use due to refinery repairs and incidents. The last time China's apparent oil demand was less than nine million bpd was in October 2010, when it reached 8.95 million bpd.

Japan LNG, Thermal coal imports rise to record in August; oil imports gain

September 21, 2011. Japan’s imports of liquefied natural gas and thermal coal rose to a record in August because of low utilization rates at nuclear power plants. The nation’s LNG imports climbed 18.2 percent from a year earlier to 7.55 million metric tons, while thermal-coal imports increased 7.1 percent to 10 million tons. The operating rate for nuclear power plants fell to 26.4 percent in August, the Federation of Electric Power Companies announced. It was the lowest since the federation started compiling data in April 1977. Power generation at thermal plants rose 8.2 percent, while total electricity output by utilities dropped 12.1 percent on lower temperatures and efforts to conserve energy. The country’s crude-oil imports rose 1.2 percent to 18.38 million kiloliters.

POWER

SaskPower to boost gas-fired power plant capacity 200 MW

September 26, 2011. SaskPower, announced it will invest more than C$550 million (US$533 million) to add 200 megawatts (MW) of natural gas generation at its 430 MW Queen Elizabeth Power Station in Saskatoon. The expansion will ensure SaskPower is able to meet Saskatchewan’s growing need for power. The project involves the construction of three 35-MW natural gas turbines, six steam generators and a steam turbine designed to produce 95 MW of power. The new turbines and steam generators are expected to begin operations in 2015, and will produce enough electricity to power 200,000 homes. The private sector will play a major role in the design, construction and commissioning of the project, with many of the good and services to be purchased from local vendors. In 2010, SaskPower commissioned three new natural gas generating units at the Queen Elizabeth Power Station, boosting the power station’s generating capacity to 430 MW. The generating capacity of Queen Elizabeth Power Station will increase to 630 MW when the new units are commissioned, giving it the second-highest capacity among Saskatchewan power stations.

Romania's nuclear power plant experiencing technical issues

September 26, 2011. Romanian government said that the country’s Cernavoda nuclear power plant second reactor unit was closed due to “technical” issues for 36 hours. The Cernavoda nuclear power plant is Romania’s sole civilian nuclear power station generating electricity.

Oriental plans $300 mn ferronickel, power plants

September 26, 2011. Oriental Peninsula Resources Group Inc. is investing $300 million to put up ferronickel and coal-fired power plants. The planned ferronickel plant would have a monthly capacity of as much as 300,000 tons, or about 1.8 million tons annually. The plant would enable the company to process the nickel ore into higher end product instead of just exporting raw material. Oriental Peninsula is also considering the possibility of building a coal-fired power plant with capacity of between 50 megawatts and 60 MW. The company planned to build the two plants within the next four to five years.

Saudi signs deal to build 4 GW gas power plant

September 21, 2011. State-controlled Saudi Electricity Co signed a deal to build a 4,000-megawatt (MW) gas fired power plant aimed at keeping up with rapidly rising Saudi power demand. The giant gas plant near Khobar will burn 600 million cubic feet a day (mcfd) of natural gas. The 10.7 billion riyals ($2.85 billion) power plant deal --signed with a consortium led by Saudi Acwa Power Projects and including South Korea's Samsung C&T -- combines two plant project phases. Al-Qurayyah, south of the eastern city of Khobar, which had been planned in two parts -- IPP1 and IPP2 -- is the third of five now planned (IPP) that will add a total of around 11,000 MW of capacity.

More power for Uganda consumers but no tariff relief

September 25, 2011. Uganda could soon see the last of the crippling electric power shortages as the 250MW Bujagali hydropower station comes on line in late November. The first unit at Bujagali will begin adding 50MW to the grid from the end of November through April 2012 when the station will become fully operational.

BPA announces plans for new transmission line

September 23, 2011. The Bonneville Power Administration announced plans to build a new high-voltage power line between Washington and Oregon to move energy from east of the Cascade Range to Pacific Northwest population centers, marking another step in the agency's efforts to absorb the region's increasing renewable energy production.

Panel sees nuke disaster compensation at $39-$52 bn

September 27, 2011. Compensation for the Fukushima Daiichi nuclear disaster will cost at least 3-4 trillion yen ($39-$52 billion), reckons a government-appointed panel looking into Tokyo Electric Power Co's finances. Tepco, as the utility is known, will run out of cash unless it restarts idle reactors at its workhorse Kashiwazaki-Kariwa nuclear power plant in Niigata Prefecture or charges more for electricity.

New York can replace Indian Point reactors: Governor Cuomo

September 26, 2011. New York Governor Andrew Cuomo is confident the state can replace the power generated by the giant Indian Point nuclear plant, but offered no details. Cuomo wants the 2,065-megawatt nuclear plant, located on the Hudson River about 45 miles north of New York City in Westchester County, to shut when its two reactors' original 40-year operating licenses expire in 2013 and 2015. Entergy, the second biggest nuclear power plant operator in the United States and Indian Point's owner, however, wants the reactors to continue running for another 20 years and has asked federal nuclear regulators for new operating licenses. Indian Point generates about 25 percent of the power used in New York City and Westchester. Each of the plant's two reactors is capable of powering about a million homes.

South Sudan’s government to build hydropower dam

September 26, 2011. South Sudan plans to build a hydropower dam in the northwest of the newly independent country. The dam, which will also be used to store water for irrigation, will be constructed at Wau, 509 kilometers (316 miles) northwest of the capital. South Sudan will also pursue membership of the Nile Basin Authority, a regional body that works to develop water resources in riparian nations on the world’s longest river.

Iran invites US firms to build nuclear power plants

September 25, 2011. Iranian President Mahmoud Ahmadinejad laid emphasis on nuclear cooperation among the world countries and once again invited US companies to build nuclear power plants in Iran. Iran has already built its first nuclear power plant in Southern port city of Bushehr with Russia's help. Earlier, Ahmadinejad said that his government is in discussion with Russia about constructing another nuclear power plant in Iran. Ahmadinejad said Iran needs an additional 19,000 megawatts, or twenty times the power that the Bushehr nuclear plant currently provides.

Sri Lanka's coal power plant to undergo a performance test

September 25, 2011. Sri Lanka's power authority, Ceylon Electricity Board has planned to conduct a performance test soon in the Lakvijaya coal power plant in Norochcholai. For the performance test and the other needs, the plant is to be shut down for ten days from September 28. The US$ 450 million coal power plant that adds 300 megawatts to the national energy grid, commenced operations at the beginning of this year. During the period of closure, the desulphurization unit which was disrupted by a recent fire erupted in the plant is also to be reinstalled.

Delhi Metro gets certification from UN

September 26, 2011. The United Nations has certified Delhi Metro as the first metro rail based system in the world to get carbon credits for contributing to the fight against climate change by helping in reducing pollution levels in the city by 6.3 lakh tons every year. The organisation has also earned carbon credits worth ` 47 crore annually for the next seven years. With nearly 20 lakh people taking the new age transport system every day, the Metro has helped reduce pollution and emission of green house gases as it is a completely non-polluting and environment-friendly system. The organisation earned carbon credits worth about ` 47 crore annually for the next seven years and with the increase in number of passengers, this figure shall increase. No other Metro in the world could get the carbon credit for the above because of the very stringent requirement of the United Nations body to provide conclusive documentary proof of reduction in emissions. Delhi Metro has helped remove more than 91,000 vehicles from the roads of Delhi daily. Metro complements other modes of transport and replaces partially trips made by conventional or traditional means of transit. The CDM project replaces trips made by conventional transport modes with Metro, being a more efficient, faster, safer and more reliable transport means. Emission reductions are achieved through reducing GHG emissions per passenger-kilometre, comparing conventional modes of transport with Metro.

Goldman Sachs to invest $201 mn in Indian start-up ReNew Wind Power

September 26, 2011. U.S. investment bank Goldman Sachs will invest 10 billion rupees ($201.6 million) in equity of Indian renewable energy start-up ReNew Wind Power. ReNew expects to reach capacity of 1 gigawatt by 2015 and plans to expand its wind portfolio by 200-300 megawatts annually.

India to host meet against putting green fretters on developing countries

September 25, 2011. It's no more just climate change. Another front has opened in the global UN negotiations where green concerns are being propped up as impediments to growth of emerging economies such as India – the Rio+20 talks. India will host a ministerial round on the talks from October 3-4 hoping to block the attempt. The Rio+20 talks are meant to review the work done two decades after the famed Rio summit or the UN meet on environment and development at Rio de Janeiro in 1992. But the Rio+20 conference is turning into another global ground to put green fretters on developing economies. A proposal floated in the run-up to the meeting has suggested 'sustainable development goals' along the lines of millennium development goals. But the goals could turn into green chains on growth in emerging economies with goals like carbon emissions and fixed renewable energy content in energy mix being forced down in the name of sustainable development.

Farooq Abdullah seeks international investment in Indian renewable power market

September 23, 2011. Renewable Energy Minister Dr. Farooq Abdullah has called on investors to invest in the burgeoning Indian renewable power market with a special emphasis on solar sector. Dr. Abdullah urged investors, companies, universities and institutions at the CII roundtable conference in Chicago to explore technology-based partnerships and research collaborations with Indian counterparts. Given just over 15 MW of current installed capacity and an ambitious target to produce 30,000 MW of solar power by 2022, India would open up tremendous business opportunities in the field.

Suzlon plans to buy out REpower's minority shareholders in 4 months

September 23, 2011. Suzlon Energy is likely to complete the buyout of the remaining 4.8% stake in Germany's REpower Systems for 63 million euros to make it a 100% owned subsidiary in the next four months. The shareholders of the company approved Suzlon's buyout offer for minority shareholders.

U.S. to do more research on electric vehicles

September 27, 2011. The Energy Department wants to devote more of its $3 billion research budget to get more electric vehicles on the road, a strategy it sees as making the biggest difference in reducing oil imports and cutting pollution. Energy Secretary Steven Chu is due to unveil the results of a major review of research spending, one that could shift research dollars away from clean electricity and biofuels toward electric vehicles and modernizing the power grid. The first-ever "Quadrennial Technology Review" prioritizes research that can be commercialized within 10 years, and research that could make a substantial dent in oil use and greenhouse gas production in the next two decades. Chu, who ran one of the Energy Department's national laboratories before his appointment, has come under scrutiny for his "clean energy" advocacy after a failed government investment in a solar company that filed for bankruptcy.

Growing UK wind power to rival gas plants

September 27, 2011. A rapid rise in British wind power capacity will gradually cut returns for operators of gas and coal plants over the next three years as their power stations serve more and more as gap fillers for intermittent renewables. UK wind capacity is forecast to rise by 50 percent to 8,500 megawatts by late 2012, around 13 percent of total installed capacity.

Airlines should brace for tough times, IATA says

September 27, 2011. The International Air Transport Association (IATA) warned of tough times ahead for the airline industry and the head of Thai Airways said financial market turmoil as the European and U.S. economies slow down was "frightening." IATA said the European Union's carbon emission trading system would add to the financial pressures on airlines despite an offer of free permits, which he criticized as "linguistic gymnastics." IATA has already warned that a weak global economy would prompt a 29-percent fall in airline profits in 2012 and cut the industry's profit margins to a wafer thin 0.8 percent from 1.2 percent this year. IATA, whose 230 members carry more than 93 percent of scheduled international air traffic, forecast global economic growth of 2.4 percent in 2012, lower than the International Monetary Fund's projection of 4.0 percent. Still, global growth is closely tied to the financial performance of airlines. Whenever growth slipped below 2 percent, the airline industry has lost money, IATA says. IATA forecasts industry profits in 2012 will fall 29 percent to $4.9 billion from $6.9 billion this year. Stagnating cargo flows in recent months also pointed to weaker markets going forward into next year, IATA said. Some airlines have warned that profits will be affected by carbon permit costs as the aviation sector is scheduled to join the European Union's emissions trading scheme (ETS) from January next year. The European Union will require all airlines flying into or out of the 27-nation bloc to be include in the scheme that forces polluters to buy permits for each tonne of carbon dioxide they emit above a certain cap.

Google creates fund to help companies expand solar installations

September 27, 2011. Google Inc., which says it has invested at least $850 million in renewable energy, created a fund for Clean Power Finance Inc. to help its customers install residential solar systems. The $75 million investment is expected to finance as many as 3,000 rooftop photovoltaic systems on homes in Colorado and California. The deal is the second by the largest Internet search engine in residential solar since Google created a $280 million fund for SolarCity Corp. in June.

Solyndra allowed by court to auction solar-panel plant next month

September 27, 2011. Solyndra LLC, the bankrupt solar- panel maker, won court permission to hold an auction for a plant that was financed partly with more than $500 million in loans guaranteed by the U.S. government. The U.S. Department of Energy, which provided a $535 million loan guarantee to the company, opposed any delay, saying an effort to reorganize the company before the bankruptcy failed. The company, whose federal loan guarantee is being investigated by Republicans in Congress, filed for bankruptcy this month with a plan to either sell its eight-month-old factory or liquidate the specialized equipment used to manufacture its solar panels.

Scotland to invest 35 million pounds in wind turbine production

September 27, 2011. The Scottish government is starting a 35 million-pound ($54 million) fund to invest in the production of new wind turbines. The money will go to “support production of full-scale prototypes of the next generation of offshore wind turbines”.

U.S. pushes environmental trade agenda for APEC

September 27, 2011. The United States is pressing China and other Asia Pacific economies to agree at a leaders meeting in November to reduce tariffs and other barriers to trade in environmental goods like wind turbines and solar panels. Proposals to reduce barriers to trade in environmental goods and services such oil remediation, water treatment and sewage treatment have kicked around international forums for years, but no real talks have begun.

Arctic needs more oil-drilling protection

September 27, 2011. Environmentalists say that President Barack Obama’s administration should add to protection for Arctic wildlife as the U.S. moves to allow oil-drilling off the Alaska coast next year. The government should make special efforts to avoid harm in the most sensitive habitats and gather comprehensive data about seals, walruses and bowhead whales of the Beaufort and Chukchi seas, where Royal Dutch Shell Plc (RDSA) has bought leases, and the research should be publicly accessible.

Biofuels may push 120 million into hunger

September 26, 2011. Biofuel policies in countries from Australia to the U.S. may push 120 million people into hunger by 2050 while doing little to halt climate change. So-called first-generation biofuels produced from commodity crops compete with food for land use and fertilizers, resulting in higher grain prices and increased deforestation. World food output will have to rise by at least 70 percent by 2050 to feed a growing world population. The use of crops for biofuels is forecast to raise food prices by 30 percent to 50 percent in that period. The world food system is in crisis because natural resources are limited, land quality is worsening and water is scarce, meaning high food prices are here to stay. Government plans to boost ethanol and biodiesel production and mandates on using them in transport fuel will increase deforestation by between 20 million and 24 million hectares (49 milion to 59 million acres) by 2050 and increase fertilizer use by 10 million tons.

Oil billionaire’s Charity, backing Obama, sought Solyndra in Tulsa

September 26, 2011. George B. Kaiser, a billionaire oilman whose foundation has the biggest stake in failed solar- panel maker Solyndra LLC, might have had more than money tied up in the venture. He may also have been angling to bring jobs to his hometown of Tulsa, Oklahoma. A bankruptcy filing by the Fremont, California- based company, which had a $535 million U.S. loan guarantee, has spurred inquiries from Republicans in Congress who say President Barack Obama’s administration may have rushed the support in part because of Kaiser, a campaign donor.

Brasil Ecodiesel pursues agriculture deals in shift from fuel

September 26, 2011. Brasil Ecodiesel Industria e Comercio de Biocombustiveis e Oleos Vegetais SA, Brazil’s sixth- biggest biodiesel producer, will focus less on making fuel and more on acquisitions in the agriculture industry. The company is in talks with five “mid-size” agribusinesses and may conclude a deal in the next six months. An excess of Brazilian biodiesel is squeezing profits for producers of the renewable fuel. By pursuing deals, Brasil Ecodiesel will offer U.S. and European investors access to the nation’s agricultural industry.

Dubai aims for about 90 MW of solar power capacity by 2020

September 26, 2011. Dubai, aiming to generate 5 percent of total power supply from alternative energy sources by 2030, will “soon” announce plans for the Persian Gulf emirate’s first utility-scale solar plant. The project will be “unique” in its structure “very big”. The second-largest sheikhdom in the United Arab Emirates aims to diversify sources of electricity and improve efficiency over the next two decades to ensure long-term energy supply. The Supreme Council, the sheikhdom’s top energy policy body, this year announced targets to cut natural gas use for power generation to 70 percent from almost complete reliance now, with the rest divided between nuclear, coal and solar power. Dubai Electricity & Water Authority, the government-owned utility, has already selected a site for the solar plant. DEWA, as the company is known, is also working with consultants to plan a coal-fired power plant in the emirate. It plans to import nuclear power, rather than build its own facility. The emirate aims to gradually add solar power capacity, reaching 1 percent of total generation, by the end of this decade. That would mean Dubai may be able to generate about 90 megawatts of solar power by 2020, out of total capacity of about 9,000 megawatts. That could rise to 800 megawatts of solar capacity by 2030. The estimates were based on different scenarios the Council had developed for energy supply and demand. DEWA selected the site for the solar plant based on its access to transmission lines and on the area being big enough to host generation facilities capable of meeting the sheikhdom’s renewable energy target. The Council had decided not to raise retail power and water rates in the emirate.

EU gives airlines 85 percent free CO₂ permits in 2012

September 26, 2011. Airlines will receive 85 percent of their required carbon emission permits for free in 2012 -- the first year the sector is included in the EU's emissions trading system (ETS). The share of free allowances given to airlines will then fall to 82 percent in the third ETS trading period from 2013-2020. From January 1 2012, about 4,000 airline operators will face emission limits on all flights into or out of the 27-nation bloc -- regardless of nationality or operator -- and must submit emission permits for each metric ton of carbon dioxide released. The emissions cap of 212.9 million metric tons of CO2 in 2012 equates to 97 percent of the sector's average annual emissions from 2004 to 2006. It will tighten to 95 percent, or 208.5 million metric tons, from 2013 through 2020. Airlines' free allocation differs widely, depending on the carrier, according to a Point Carbon report, which said scheduled airlines will receive between 20 and 100 percent of their 2012 permit requirement free.

Italy solar capacity growth to slow down in 2012

September 26, 2011. Italy's total installed photovoltaic (PV) capacity is expected to rise to at least 15 gigawatts by the end of 2012, with growth slowing down under its new incentive plan. Italy's solar market, the world's second-biggest after Germany's, has boomed since 2007 when the government boosted production subsidies. In May, Rome cut incentives to help consumers, who support the scheme through power bills. The total capacity of PV installations, which turn sunlight into power, is expected to jump above 12 GW by the end of 2011, and so far this year about 6.5 GW have come on stream, bringing the current total to 10 GW.

Canada expecting record wind-capacity installations in 2011

September 26, 2011. Canada will likely install a record amount of wind-power capacity this year, led by Ontario where developers have benefited from above-market rates for low-carbon sources of electricity. About 1,338 megawatts of new wind energy is expected to come on line this year, almost double last year’s 690 megawatts. That represents an investment of C$3.5 billion ($3.4 billion) on turbines and other equipment. Canada will have at least 5,300 gigawatts of installed wind capacity by the end of the year, the Ottawa-based trade group said in the statement. The nation of 34 million, which has no national incentive program for renewable energy, was the world’s ninth-largest generator of wind power at the end of last year.

China to invest 2 trillion yuan in low-carbon economy

September 25, 2011. China will invest 2 trillion yuan (about $313 billion) to promote a green, low-carbon economy in the next five years. The government will promote low-carbon development with a variety of projects during China's current five-year plan which began this year.

The green economy plan includes setting up 100 bases for demonstrating resource utilisation and launching low-carbon pilot programmes in five provinces and eight cities. Chinese leaders have often stated their commitment to cutting China's energy consumption and developing green technology.

Eskom agrees on $365 million renewable-energy loans with S. Africa

September 25, 2011. Eskom Holdings SOC Ltd., South Africa’s power utility, and the African Development Bank have signed two loan agreements worth a total of $365 million for renewable wind and solar generation. The loans are guaranteed by the South African government.

Blame-China chorus grows as Solyndra falls

September 23, 2011. The collapse of Solyndra LLC has renewed demands from U.S. lawmakers and union leaders that the Obama administration pursue unfair-trade complaints against China for out-sized subsidies to its clean-energy companies. The U.S. solar industry, eager to shake off the shadow cast by Solyndra's high-profile collapse, has launched a full-scale public relations campaign as scrutiny of government support programs for renewable energy intensifies. Solar industry officials are aiming to portray Solyndra's failure as an isolated incident in an industry that is otherwise thriving, thanks in part to support from Washington.

American Superconductor surges after announcing new contracts

September 23, 2011. American Superconductor Corp. (AMSC), the wind turbine component maker that’s suing its largest customer, surged the most in almost two years after announcing $100 million in new sales. American Superconductor has sold almost $100 million of wind power and electric grid equipment to customers in China, India, Korea, the U.S. and Europe since April 1. It also said it has $166.2 million in cash and marketable securities.

UN carbon market will survive should Kyoto goals end, EU says

September 23, 2011. The United Nation’s carbon market will survive if the Kyoto Protocol greenhouse gas-reduction goals for developed nations expire in 2012 without being immediately renewed, the European Union climate chief said.

The EU, which gives companies in its emissions trading system the right to import credits from the UN’s Clean Development Mechanism, will probably remain that market’s driving force in coming years, said the bloc’s Climate Commissioner Connie Hedegaard.

The European cap-and-trade system, the world’s largest, was valued at $119.8 billion, according to World Bank estimates. The 27-nation EU has a target for a 20 percent reduction in greenhouse-gas discharges by 2020 compared with 1990 levels, and it wants to limit them by as much as 95 percent by 2050. The bloc’s emissions trading program, known as ETS, is a cornerstone of its climate initiative, putting limits on more than 11,000 utilities and manufacturing companies and leading to a cap in 2020 that would be 21 percent below 2005 discharges.

Cypark, LG Electronics to develop solar farm project in Malaysia

September 23, 2011. Cypark Resources Bhd. and LG Electronics Inc. signed a preliminary agreement to develop a 8 megawatt solar farm project in Malaysia. Cypark also signed a 75 million-ringgit loan financing agreement with HSBC Amanah Malaysia.

Carbon market loses ‘mojo,’ tracks EU economic health

September 23, 2011. The European carbon market is increasingly becoming an indicator of European Union economic output, rather than being fixed by supply and demand for the permits.

EU permits for December were correlated with the Euro STOXX 50 index at 76 percent, the highest since Aug. 10, 2009. It’s been correlated with the 10-year German bond at 66 percent since July. The EU will probably have economic growth of 1 percent next year, compared with 1.6 percent this year. There’s a probability of as much as 20 percent that European authorities fail to contain the sovereign debt crisis and a second major financial crisis and recession ensue.

China calls on Iceland for energy help in bid to tap hot springs

September 22, 2011. China, the largest consumer of coal for power generation, is sending engineers 5,000 miles across the world to learn how the Earth’s bubbling hotspots can help utilities clean up their act.

China, aiming to get 15 percent of its energy from non- fossil fuels by 2020, is seeking Iceland’s expertise as it pursues a five-year, $10 billion district heating program. China Petrochemical Corp. has pledged to make geothermal one of its main business units over the period, and Xianyang-based Shaanxi Green Energy Geothermal Development Co. plans to become the world’s largest supplier of Earth-generated heat.

Chinese government drafts plan to develop carbon capture industry

September 22, 2011. China is drafting a development plan for the carbon capture, utilization and storage industry as the country takes steps to cut emissions. The government plans to double its spending on projects capturing and storing carbon in the five years ending 2015 to 400 million yuan from the preceding five-year period. The spending may attract 2.3 billion yuan of investments in the industry during that period, compared with the 1 billion yuan invested between 2006 and 2010, according to Wan. Alstom SA, the third-largest maker of power equipment, and China Datang Corp. agreed to develop two trial projects to capture carbon dioxide from power plants and store it in China’s two biggest oilfields. China is willing to share its experience and expertise on carbon capture and storage with other developing nations.

S. Korea to help World Bank support energy in developing nations

September 22, 2011. South Korea and the World Bank signed a cooperation pact to help developing countries invest in renewable energy, water resources and transportation. South Korea will provide $40 million of assistance over four years from 2012.

Green investors call U.S. loan process rigorous

September 22, 2011. U.S. renewable energy investors defended the government energy loan program at the center of the political firestorm ignited by the high-profile collapse of solar panel maker Solyndra, one of the program's beneficiaries.

Partners at top private equity firms that have participated in the government's loan guarantee program for alternative energy described the program's review process for applicants as "robust" and even more in-depth than in the private sector.

Japan utilities surrender 57 million Kyoto units in 2010

September 21, 2011. Japanese utilities surrendered 57 million metric tons of emission permits and offsets governed by the 1997 Kyoto Protocol in the year to March. The purchased and then surrendered units enabled power generators to effectively reduce their emissions in the year by 15 percent to 317 million tons of carbon dioxide.

Gamesa talking with at least three utilities for offshore wind turbines

September 21, 2011. Gamesa Corp. Technologica SA, a Spanish wind-turbine company that began developing models for offshore energy projects last year, is talking to at least three potential customers.

Gamesa is aiming to capture 10 percent to 15 percent of the global offshore wind market by 2020, and is closing 52 percent of its production capacity for onshore turbines in Spain.

Clinton trumpets green investments to create jobs

September 21, 2011. Investments in energy-saving building retrofits and clean-energy projects can create hundreds of thousands of jobs and bolster the U.S. economy, former U.S. President Bill Clinton said. More than 1,200 people, including more than 50 heads of state such as U.S. President Barack Obama, business leaders, humanitarians and celebrities were due to attend the seventh annual Clinton Global Initiative that began.

New Yorkers back fracking 45 to 41 percent, poll shows

September 21, 2011. Forty-five percent of New York state voters support natural gas drilling in the Marcellus Shale for the economic benefits versus 41 percent who oppose it because of its environmental impact, a poll said. Support for a new tax on drilling companies fell to 51 percent from 59 percent in August, the Quinnipiac University poll said. Quinnipiac began measuring public sentiment on gas drilling a month ago as New York state considers whether to open its share of the Marcellus Shale to hydraulic fracturing, or "fracking," a method that environmentalists oppose. The 45-41 margin in favor of drilling showed a minor decline in support of 47-42 from a month earlier, a difference within the margin of error of plus or minus 3.1 percentage points. This month's poll surveyed 1,016 registered voters from September 13-18. Republicans supported drilling by a 69-20 margin while Democrats opposed it 52-35. Fifty-one percent of those polled support a new tax on drilling companies versus 36 who oppose a new tax. A month ago, 59 percent of those responding supported the tax versus 29 percent in opposition.

SolarWorld says China competition unfair

September 21, 2011. Germany's No.2 solar company SolarWorld, has criticized Chinese rivals for eating into the market share of European peers, potentially driving them out of business. Criticism of China's efforts to boost its solar sector are not new.

The U.S.-based United Steelworkers union (USW) in 2010 blamed China's aid to its solar industry for creating a supply glut that drove down panel prices 40 percent in 2009 and pushed American competitors out of the market.

GE sees 2012 energy profit up 10 percent, gas a focus

September 21, 2011. General Electric Co said it is targeting 10 percent earnings growth and expects revenue to rise at least 8 percent in 2012 at its energy unit, which makes products ranging from gas-fired electric turbines to thin-film solar panels.

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