MonitorsPublished on Jun 19, 2013
Energy News Monitor I Volume X, Issue 2
Un-Conventional Hydrocarbons: Irrational Exuberance? Lydia Powell, Observer Research Foundation


he new report from the Energy Information Administration (EIA) offers a first assessment of shale oil resources around the world and a revised assessment of shale gas resources first estimated in 2011 covering 137 shale formations in 42 countries including the United States. Shale oil reserve estimates have been increased by over 10 times from 32 billion barrels to 345 billion barrels and shale gas resources by about 10% from about 185 trillion cubic meters (tcm) to about 205 tcm. Overall the report suggests an 11% increase in oil resources and a 47% increase in gas resources due to inclusion of shale resources. Before we come to conclusions, it is important to keep in mind that these figures represent technically extractable resources and not economically extractible resources and are subject to further revision. In the words of the EIA the resources are ‘highly uncertain and will remain so until tested with extensive production wells’. On the other hand, potential resources in important areas such as Middle East and Central Asia are not included in the report. 

On the whole there is a substantial increase in hydrocarbon resources. In this context, the first question that comes to mind is what impact this addition of resources will have on peak oil or peak gas (conventional)? On the basis of the current estimate, shale oil is expected to contribute 10 years of consumption and gas a little longer. This cannot be seen as a significant extension of the life of hydrocarbons but nevertheless it is a substantial improvement.  However euphoric talk of 100-200 years of natural gas seems to be exaggerations.   

The second question that one may ask is whether this changes the geopolitics of oil and gas? Once again the additional resources of shale oil and gas are unlikely to change existing geo-political hierarchies. As the Financial Times reported earlier this week, additional shale resources do not significantly alter the ‘balance of power’ between developing and developed countries as far as resource endowment is concerned. Out of the 41 countries covered by the study, 72% of conventional oil resources and 81% of conventional gas resources were in developing countries and the remaining in developed countries. On the basis of the new resource estimates 73% of shale oil resources and 75% of shale gas resources are in developing countries. 60% of shale oil is concentrated in just five countries (Russia, USA, China, Argentina and Libya). Likewise 50% of shale gas resources are in just five countries (China, Argentina, Algeria, USA and Canada). India does not figure in the ‘top-ten’ list of countries with shale oil or gas resources while China is among the top 3 in both. 

For India, the study assessed four priority basins: Cambay, Krishna-Godavari, Cauvery and Damodar Valley. The study also screened other basins in India, such as the Upper Assam, Vindhyan, Pranhita-Godavari, Rajasthan and South Rewa. However, in these basins the shales were found to be thermally too immature or the data for conducting a rigorous resource assessment were not available. India may also be irked by the finding that Pakistan’s Indus basin has more shale oil resources than India. Now what does all this mean for India especially with regard to future gas prices? In order to answer this question we need to seek further information on the credibility of these new figures. 

The Guardian news paper has reported concern of experts who feel that the EIA report relies too much on external agencies for the conduct of the research and that the said agency had close ties to the oil industry. The news paper gives an overview of other studies that contest claims by the EIA report. For example a European group along with the International Energy Agency is said to be in agreement that world conventional oil production had peaked in 2006. As per their report, shale oil production in the USA is also likely to peak between 2015 and 2017 and shale gas production is likely to peak in 2015. This means that global gas prices will increase rather than decrease in the medium to long term. The news paper quotes another study by the Post Carbon Institute that concludes that though shale oil and gas had reversed the long term decline of oil and gas production shale gas production had been on a plateau since the end of 2011 and that 80% of gas production came from just 5 plays which are already in decline. The report is said to have highlighted the fact that high rates of decline in shale gas wells required substantial input of capital to drill numerous additional wells and the cost of drilling wells exceeded the value of shale gas produced in 2012. The Guardian also quotes another report by the Energy Policy Forum which warns of the inconsistency between geological complexities of shale gas and financial exuberance that was creating an unsustainable bubble. As per the report, shale gas and oil estimates have been overstated by 100 to 500% and that underperforming shale assets were being bundled into assets in a way that was dangerously similar to the manner in which sub-prime financial assets were packaged and sold in the run up to the financial crisis. The final conclusion of the report that US producers were ramping up exports to take advantage of the arbitrage between domestic and international prices so as to shore up the frail balance sheets of the shale companies must be highlighted in the context of the ‘irrational exuberance’ over shale gas in India. Irrational exuberance over gas, both domestic and international is unlikely to lead to any sustainable plan!

Views are those of the author                     

Author can be contacted at [email protected]



Denationalization of the coal sector – A step towards another Scam!

Ashish Gupta, Observer Research Foundation


ndia has a long history of coal mining and it also has a mature coal industry.  Despite this the problems of the sector is becoming more and more complex. In other words, the 66 years of the experience seems to count for nothing.  As it is well known, the demand for coal for industry and power generation has far outstripped coal production. Coal India ltd. (CIL) the largest miner is unable to meet the demand, forcing utilities to resort to very expensive imports. The falling rupee value has added to the cost of imported coal and contributed to growing trade imbalances and the current account deficit. All this necessitates a major revamp of the coal sector to ensure adequate supply of this low-cost primary energy source. But the problem is there is no clarity on what should be done?

In the light of coal shortages and CIL’s monopoly over the sector, the voices for denationalizing the coal sector are at their peak. Even Industry bodies who claim to be neutral are advocating the same. But what is the basis? It is clear that the coal industry is seriously suffering with “short term memory loss”.  Or else they would have learnt some lessons from the distorted project of coal block allocation. In 1993 Coal Mines Nationalisation Act was amended to allow private sector participation in captive coal mining for generation of power, washing of coal and other end uses as notified by the Government. Even at that time the problems were the same: the industry was in dire need of coal and the same recommendations and complaints that Coal India was not able to augment coal production were flooding the ministry.  It was felt that the private sector will change the outlook of the coal sector. But that policy failed miserably.  The recent statistics on coal production by private players stands as follows:

Coal Production from the Captive Blocks

Captive Blocks

Terminal Year X Plan

XI Plan









Actual (MT)




No. of Blocks



















The chart narrates the dismal performance of captive coal mining policy.  But no one cares to understand the main reasons.  Having said that, it must be admitted that the policy itself is not bad but the open ended structure and lacuna in the enforcing safeguards in policy pave the way for the corruption. The captive coal mining policy actually acted as a boon for the non-serious players. The advocacy for private participation therefore lacks evidence. Barring some genuine players, most of the blocks were taken by non-serious private players who took advantage of the lacuna prevailing in the process and got blocks with no intention to carry out mining but rather mint money by selling their rights to other big players. The role of the State governments and Screening Committee is also under investigation. Therefore the hypothesis for ‘denationalization’ on the assumption of strict pre-qualifying criteria with due consideration to competitiveness, proven track record of the companies is highly questionable. Can anyone give the guarantee that the same situation will not be repeated in the future? But with our “short term memory loss” mistakes can be repeated often! Even if we assume that the private sector is more competent than CIL, the idea that their presence will increase coal production has no rational basis as they will also face the same problems like CIL.

The problem of the coal shortage is beyond the allocation of coal blocks and CIL per se. Increasing coal production with that of demand is quite impossible to manage unless the regulatory framework governing the coal sector will get a makeover. Apparently there is no discourse for reviewing the regulatory structure but rather the focus is more on showing CIL’s incompetency in increasing coal production and taking the surrogate route for introducing the private sector in coal mining. Blaming CIL by its counterparts is actually a perpetual process and changes are only made depending upon the circumstances and how the concerned parties want to defend themselves. The coal blocks in North Karanpara (Central Coalfields Block), Ib Valley (Northern Coalfields Block) and Mand Raigarh (Singareni Collieries Block) where all the necessary clearances are in place and have the potential for producing 65 Million tonnes/ year; but 93 km railway line is not in place. Why has no action been taken on that yet? CIL for its part has already informed the Railways that they are willing to invest Rs 7,300 crore (INR 73 billion) for the rail track but the project is stuck due to environmental clearance. Therefore, simply assuming that CIL is incapable in meeting country’s demand does not hold any merit.

If we really wanted to bring reforms in the coal sector then we must identify and separate coal mining companies from power producing companies. Their role must be limited to coal mining and selling it to concerned users and stakeholders. We must shift our focus on strategizing a framework to make the coal sector more competitive rather than giving a free hand to the private sector which is purely profit driven. But surely these suggestions are not digestible by the players who have other ulterior motives.  There is a way, but surely there is no will!

Views are those of the author                     

Author can be contacted at [email protected]


Shale Oil & Gas Scenario: Top 10 Countries

Akhilesh Sati, Observer Research Foundation

Shale Oil

Table 1




Share in Total (World)

































Shale Gas


Table 2




Share in Total (World)























South Africa









Note: Conversions has been done using

1 barrel = 0.1364 tonnes,       1 trillion cubic feet = 0.028 trillion cubic metres

Source: Energy Information Administration








OVL-OIL to buy Videocon stake in Mozambique field for $2.5 bn

June 25, 2013. In the third acquisition in 10 months, Oil and Natural Gas Corp (ONGC) and Oil India Ltd (OIL) will buy Videocon Industries' 10 percent stake in a giant Mozambique gas field for about $2.5 billion. The acquisition of the stake in Mozambique's offshore Area 1, which may hold as much as 65 Trillion cubic feet (Tcf) of gas resources, will be done through a joint venture of ONGC Videsh Ltd (OVL) and OIL. OVL will hold 60 percent stake in the joint venture while OIL will have the remaining 40 percent. (

Cairn India to pump $3 bn over next 3 yrs in Rajasthan oilfields

June 24, 2013. Cairn India plans to invest $3 billion over the next three years in finding more oil and raising output from its showpiece Rajasthan oilfields, the company said. Cairn will raise crude oil production from Rajasthan fields by as much as 23 per cent to 215,000 barrels per day by March 2014. The Rajasthan block's current production is at around 175,000 bpd. The current production comes from five fields --- Mangala, Bhagyam, Aishwariya, Raageshwari and Saraswati. The Mangala field is producing at plateau rates of 150,000 bpd. Aishwariya commenced production in March and is expected to ramp up to approved rate of 10,000 bpd over the next few months. Bhagyam, the second biggest oilfield behind Mangala, is expected to ramp up to the approved rate of 40,000 bpd by the second half of current fiscal. Also, the Mangala Enhanced Oil Recovery (EOR) Field Development Plan (FDP) approval is in progress and Cairn expects to start full field implementation in FY2015, which will result in greater output and a further extension of the plateau in the producing field. The wells planned include 100 exploration and appraisal (E&A) wells, while balance will be development wells to sustain and enhance production volumes. The aggressive exploration and fast-track development is designed to bring new fields into production in a region where Cairn India has already discovered around 1.3 billion barrels of oil equivalent resources but has drilled only a part of its acreage. (

Transportation / Trade

GIPL, Cason join hands to offer gas monitoring system

June 24, 2013. Gujarat government-owned Gujarat Info Petro Ltd (GIPL) collaborated with Hungary-based Cason Engineering to offer mobile/tablet based gas distribution network monitoring system to oil companies in India. The agreement to this effect was signed by GIPL and Cason Engineering. The collaboration is in pursuant to the Memorandum of Understanding inked during the Vibrant Summit Gujarat-2013. The joint technical solutions would provide easy accessibility to the latest technologies for the rapidly developing city gas distributor industry. The Prime Minister of Hungary Viktor Orban is scheduled to visit India in October to launch the product. The consortium will offer a special pipeline monitoring system and leak detection to leading oil pipeline operators to check accidents and incidents of thefts and pilferages caused by third parties in the pipelines. Cason has developed several solutions for large oil pipeline operators in Europe and elsewhere. (

Reliance's oil imports down 12 pc in May y/y

June 20, 2013. Reliance Industries, owner of the world's biggest refining complex, imported nearly 12 percent less oil in May compared with a year earlier. Reliance bought about 1.17 million barrels per day (bpd) of oil in May, a decline of nearly 18 percent from April. Reliance's two advanced refineries in western Gujarat state can together process 1.2 million bpd of oil, about 28 percent of India's overall capacity. The complexity of these plants allows the refiner to diversify its crude slate continuously by testing new grades, and to improve refining margins. In the first five months of 2013, the private refiner shipped in about 1.22 million bpd of oil, a 3 percent decline from a year ago. In January to May, it bought about 48 percent of its oil needs from Latin America, with Venezuela maintaining its position as top crude supplier, which it has held since May 2012, followed by Saudi Arabia. The Neutral Zone, a border area whose production belongs to Saudi Arabia and Kuwait, was the third-biggest oil supplier to Reliance in the first five months of this year. Reliance has an annual deal with Saudi Aramco to buy about 240,000 bpd oil, including 60,000 to 65,000 bpd from its fields in the Neutral Zone. Reliance's imports from outside the Middle East included Merey and Leona from Venezuela, Jubarte and Roncador from Brazil, Maya from Mexico, Castilla from Colombia, Lokele from Cameroon, Mandji and Olende from Gabon, Dalia from Angola and Gharib Blend from Egypt. (

Policy / Performance

CNG prices in Delhi hiked by ` 2 per kg due to weak rupee

June 25, 2013. CNG price in national capital was hiked by ` 2 per kg, the second increase in rates since January, due to rupee depreciation. Also, piped cooking gas (called PNG or piped natural gas) rates were also increased by ` one with effect from midnight tonight. CNG sold to automobiles in Delhi will cost ` 41.90 per kg from midnight as compared to ` 39.90 currently. The rates of CNG in neighbouring Noida, Greater Noida and Ghaziabad have been hiked by ` 2.25 to ` 47.35 per kg. The consumer price of PNG to the households in Delhi is also being revised from ` 23.50 per standard cubic metre (scm) to ` 24.50 per scm for consumption of up to 30 scm in two months, Indraprastha Gas Ltd (IGL) said. For consumption of more than 30 scm in two months, the applicable rate in Delhi would be ` 40.50 per scm. Due to higher taxes in Uttar Pradesh, PNG in Noida, Greater Noida and Ghaziabad would cost ` 26 per scm, up from ` 25 per scm for consumption of up to 30 scm in two months. Price for consumption beyond that level will be ` 43. CNG price was last hiked on January 5 when rates went up by ` 1.55 per kg. PNG price was last hiked on February 10 by ` 1.50 per scm. (

GSPC seeks govt nod to sell KG gas at $ 13

June 23, 2013. Gujarat State Petroleum Corp (GSPC) has asked Central government to approve its plans to sell natural gas from a field in KG basin at $ 13-14, three times the current gas price. GSPC wrote to Oil Secretary Vivek Rae seeking early approval to an imported LNG-linked pricing formula for the 5.24 million standard cubic metres per day of gas it plans to produce from its Deen Dayal West (DDW) gas field in block KG-OSN-2001/3 later this year. GSPC is the second company after Reliance Industries which has sought the price, at which gas in its liquid form (LNG) imported in the country. RIL's proposal to price KG-D6 gas from April 1, 2014 and coal-bed methane or gas found below coal seams, at LNG prices had met with stiff resistance from the then Oil Minister S Jaipal Reddy. Also, power producers and Left parties had opposed it. But so far there has been no word on GSPC price. The company and its partners have already spent around $ 2.8 billion on the DDW gas field, GSPC asked Oil Secretary to accord approval to the arm-length market price that was discovered in an e-tender in February. GSPC had submitted the price formula and approval is now needed so as to help the company begin commercial production of gas from DDW field in the second half of 2013-14. (

Northeast rural areas to have LPG connections

June 22, 2013. LPG connections will be available in rural and remote areas of the north east region by next year, Indian Oil Corporation (IOC) said. With adequate LPG cylinders available for distribution in towns and cities, the Ministry of Petroleum and Natural Gas has decided to extend the facility to rural and remote villages of the region, IOC said. The Rajiv Gandhi Grammin LPG Vitrak Yojana (RGGLVY) scheme will end the cutting and felling of trees, prevent deforestation and save the environment benefitting villages, thereby increasing the people's economic activity. Initially the people's response would be limited as also investment in LPG distributorship, but would increase over time. Meetings have already been held in the identified remote areas of the region to make people aware of LPG, its benefits and safety measures while using the cylinders. Under the scheme, small distributors with capacity for 1,000 to 1,200 cylinders and small godowns will be permitted to operate in the rural areas. The scheme would have to be implemented by 2015 when a minimum 75 per cent of the rural households are expected to be covered and benefited, according to the government mandate. (

LPG use in country falls due to cap on subsidized cylinders

June 22, 2013. A tight vigil against diversion of subsidized fuel meant for domestic use seems to be paying off. The consumption of liquefied petroleum gas (LPG), commonly called cooking gas, has started to dip since government capped sale of subsidized cylinders to every household and for the first time ever, sales have fallen for two successive months in comparison to the corresponding period of the previous year. Consumption fell 0.7% in April 2013 over April 2012 while in May the fall was more pronounced at 5.2%. The government capped the number of LPG cylinders for a household to six a year effective September 2012, but later enhanced the limit to nine per year in January 2013 under pressure from political allies. Each subsidized 14.2 kg LPG cylinder is priced at ` 398 in Chennai and ` 410 in Delhi, while the price of non-subsidized refill costs ` 792 in Chennai and ` 802 in Delhi. Any consumption beyond nine cylinders is not subsidized. During April-May 2013, cooking gas consumption in India fell to 2.4 million tonnes from 2.5 million tonnes in April-May 2012, a fall of 3.3%. This includes both piped as well as bottled LPG. Oil planners had anticipated a 4-6% growth in LPG consumption for the 2013-14 fiscal. But, early figures suggest growth may be slower. LPG consumption grew around 10% in 2011-12 before it dropped sharply to 1.8% in 2012-13. (

Rupee crash: Oil subsidy arithmetic goes for a toss

June 21, 2013. Just when finance ministry officials had dropped their guard on subsidies, the near-10% fall in the rupee against the dollar has forced them to pull out their calculators. After all, finance minister P Chidambaram had gone public saying that the government will pay only ` 20,000 crore as under-recoveries, a move that would have meant that the Centre stayed within the Budgeted subsidy level. Between the time Chidambaram made the statement four weeks ago and mid-June, the cost of crude for Indian refiners has increased by $3 a barrel to $104 now. During this period, under-recoveries on diesel alone have shot up by almost 70% to ` 6.30 a litre as the under-recovery on the motor fuel goes up by 78 paise the moment the price of crude rises by $1 a barrel. (

Fertiliser department for hiking gas rates

June 20, 2013. The fertiliser department, which had earlier opposed any upward revision of natural gas rates, has accepted a pricing formula that provides marginally higher value than the gas price proposed by the oil ministry. The fertiliser department has suggested certain changes in the pricing formula proposed by the Rangarajan committee, which gives $6.78 per unit rate for gas in the current quarter of 2013-14. The oil ministry's proposed rate for the corresponding period is $6.77 per unit. Other than the power ministry, all other departments have proposed a gas price, which is $6.77 per unit or more. The power ministry has asked for a gas price below the prevailing rate of $4.20 per unit at which bulk of India's domestically produced gas is sold. (

Arbitration not yet commenced in KG-D6 output fall: Petroleum Ministry

June 20, 2013. Nearly a year after arbitrators were appointed to decide whether Reliance Industries can be penalised for producing less than target, the arbitration has not yet commenced, the Petroleum Ministry has said. The Government had disallowed $1.005 billion expense of RIL on the flagging KG-D6 gas fields for not implementing the approved field development plan. RIL had contested the move saying the Production Sharing Contract (PSC) does not provide for such a penalty in case of shortfall in production, and slapped an arbitration notice. The then Oil Minister S Jaipal Reddy had decided to join the arbitration proceedings and appointed former Chief Justice of India Justice V N Khare as the government's arbitrator. RIL had appointed former Chief Justice of India S P Bharucha but a third neutral referee has not yet been appointed and arbitration yet to commence, the Oil Ministry said in a Chronological Sequence it released to rebut CPI leader Gurudas Dasgupta's allegation of Oil Minister M Veerappa Moily trying to sabotage the arbitration to help RIL. The Oil Ministry had disallowed $1.005 billion out of the $5.756 billion investment RIL had made on developing D1&D3 gas fields in block KG-D6 as output of 27.52 million standard cubic meters per day was way short of the target of 80 mmscmd for that time of the year. The fall in output, which the ministry blamed on RIL for not drilling its committed quota of wells, had led to a large chunk of production facilities lying unused or under-utilised. And disallowed cost recovery in proportion to that. D1&D3 output has further fallen to 10.95 mmscmd this month but the ministry, now headed by Moily, has not decided to disallow any further cost. Dasgupta had alleged that Moily was trying to favour RIL by sabotaging the arbitration as well as deciding not to levy any further penalty despite the drastic fall in production leading a larger under-utilisation of facilities. (

ONGC’s subsidy bill may rise 22 pc to ` 600 bn this year

June 20, 2013. ONGC expects its subsidy burden to rise 22% to ` 60,000 crore this fiscal, which threatens to offset the gains from the rupee's fall. The rupee's recent fall is expected to bring windfall profits to energy companies like ONGC when they sell natural gas in US dollars. However, for ONGC this is likely to get diluted by the expected rise in its subsidy bill. The company offers crude oil to oil marketing companies (OMCs) at a discount to help them sell petroleum products at government-determined rates. ONGC, the country's third-largest company by market value, has already shelled out ` 5,000 crore in subsidies since a partial decontrol of diesel prices was effected in January this year. The government deregulated petrol prices in June 2011, but continues to influence pricing. It has also allowed OMCs to raise diesel prices by 40-50 paise a litre every month for retail customers and nearly 11 for bulk consumers. (

BP asks Oil Ministry to compensate for KG basin block

June 19, 2013. UK's BP plc has asked Petroleum Ministry to compensate for a Krishna Godavari basin block that it is being forced to surrender after Defence Ministry restrictions made oil and gas exploration impossible. BP along with Reliance Industries had won the deep-sea KG-D17 block in the seventh round of auction under New Exploration Licensing Policy (NELP) in 2008. (



Uttarakhand floods could impact GVK's hydro-electric project

June 24, 2013. Recent floods in Uttarakhand could impact GVK Group's upcoming 330 MW Srinagar hydel project at Pauri district in the state and affect the ongoing works for at least two months. The project in Srinagar, the largest city in Garhwal hills of the Himalayan state, was among areas affected in the calamity that caused large-scale devastation. GVK is developing the project on the river Alaknanda in Tehri/ Pauri Garhwal district and its construction is nearing completion. GVK has signed a power purchase agreement with the state of Uttar Pradesh and 12 per cent of its total output will be given free to the state of Uttarakhand. The project is expected to commission its first unit by second quarter of this year, according to GVK. GVK said that it was in the process of developing 346 MW (146 MW +200 MW) integrated merchant power project in Pithoragarh of Uttarakhand. A merchant power plant is funded by investors and sells electricity in the competitive wholesale power market. Uttarakhand government has granted its approval for the preparation of a detailed project report for the single integrated project, combining both the projects. GVK will supply 12 outputs from this project to Uttarakhand free of cost. (

Tata Power eyes stronger overseas presence

June 23, 2013. Tata Power is looking for opportunities across geographies including the Middle East and aims to have about 5,000 MW overseas generation capacity in coming years. The country's largest private power producer is pursuing opportunities in Myanmar, Vietnam, Indonesia, the Middle East, South Africa, Bhutan, Georgia and Australia, among others. Tata Power, which already has significant interests in Indonesia, South Africa and Georgia, among others, is eyeing a diverse mix of thermal, hydro and renewables portfolio. Currently, Tata Power has an installed generation capacity of 8,521 MW, including 1,111 MW of renewable energy. Indian power sector, that is projected to add around 88,000 MW generation capacity in the current Five-Year Plan period (2012-17), is grappling with multiple woes related to fuel availability, land acquisition and poor financial health of distribution companies. On overseas plans, the company has started feasibility studies for thermal power projects in Vietnam and Myanmar. In each of these geographies, Tata Power is initially looking to have capacity of 600 MW. Tata Power is also working on hydel projects in Georgia having cumulative capacity of over 400 MW. For the first phase, the evacuation system is getting ready and power purchase agreements are under discussion. (

ONGC's Palatana project to help ease power crisis in North East

June 22, 2013. Power generation capacity in the North East has increased by almost 13% with ONGC Power Tripura Company commissioning the first unit of the region's single largest 363 MW gas fired thermal project at Palatana in Tripura near the Bangladesh border. ONGC's first project will cater to seven out of the eight states in the region suffering from a power shortage. By August, ONGC Power plans to double plant capacity by adding one more unit to make Tripura the largest power producer in the region. ONGC Power is confident that the Palatana Project, which will receive fuel from ONGC at a firm price with extension of 4% a year over the long term, will help reduce the power crisis in the region. (

Uri hydropower project ready for inauguration in Kashmir

June 21, 2013. A hydropower project with a target capacity of 240 MW is ready for inauguration in Uri, Jammu and Kashmir. The Uri-II Project, which is operated in supervision of National Hydroelectric Power Corporation (NHPC), was commissioned in September 2005, but the construction work received a setback during the October 2005 earthquake that hit the border town. This will be the second project on the River Jhelum in Uri town after the Uri I project, which was completed in 1997 and is now producing 480 MW of electricity. The cost in construction of the project is estimated to be of approximately ` 18 billion. (

Adani Power commissions third 660 MW unit of Maharashtra plant

June 20, 2013. Adani Power has started operations at its third unit of 660 MW at Tiroda in Maharashtra, raising its total generation capacity to 7,260 MW, the company said. Adani Power is setting up a 3,300 MW at Tiroda, which includes five units of 660 MW each. The first two units of the plant were commissioned in the year ended March. The company plans to register the first two units at the Tiroda Power Plant for clean development mechanism (CDM) of the United Nations Framework Convention on Climate Change (UNFCCC). (

Hydel power plants in Uttarakhand, Himachal operational

June 20, 2013. Hydel power generation from the projects affected by rains and floods in Uttarakhand and Himachal Pradesh has been restored. Due to heavy landslides many Hydro Electric Projects had stopped work on account of high silt content in water. Tehri Dam reservoir recorded the rise of 25 meters within 48 hours of rainfall on 16-17 June. On June 16, Alaknanada and Bhagirathi had a combined flow of around 13,000 cumecs at Haridwar out of which only 500 cumecs of Bhagirathi water was released from Tehri Dam Reservoir. SJVNL, which operates Nathpa Jhakri Hydroelectric Station of 1,500 MW capacity, was stalled due to higher silt level on June 18-19. NTPC's Dhauliganga project in Uttarakhand was also affected. However, the company said that normalcy has been restored at the site. (

Transmission / Distribution / Trade

UP deprived of 400 MW power after Uttarakhand deluge

June 24, 2013. The flood-ravaged Uttarakhand is now witness to one of the most peculiar power crisis with nearly a dozen plants getting plugged off because of heavy floods and siltation in rivers on which its hydro-electric power projects are located. In fact, four plants which supply around 400 MW to Uttar Pradesh (UP) have stopped working with no sign of their early revival. Besides, seven other major plants have stopped working, which may further deepen the power crisis in the northern region grid as a whole. According to Northern Region Load Dispatch Centre (NRLDC), the four power units of 100 MW each in Vishnu Prayag have been closed manually due to high siltation in the Alaknanda on which the plant is located. (

BRPL, BYPL, disconnects power in flooded areas

June 19, 2013. With Yamuna crossing the danger mark in Delhi and threat of low-lying areas being flooded looming large, Reliance-owned discoms BRPL and BYPL have suspended electricity supply to the areas falling along the river bed. Yamuna has been flowing above the danger mark of 204.83 metres and flooded low-lying areas along the river bed. BSES Rajdhani Power Limited (BRPL) nodal officers were monitoring the situation round the clock. They are in touch with the concerned agencies including the Flood Control District Administration Office. Meanwhile, BSES Yamuna Power Limited (BYPL) has mapped all its assets, within 500 metres of Yamuna River, in its distribution area. The river flows through eight divisions in BYPL operational areas. As a safety measure, low-lying areas have been evacuated and BYPL has switched off 82 power connections in Badarpur Khader area falling in the Karawal Nagar division. In Yamuna Vihar district, 172 connections have been switched off in low lying areas of Garhi Mandu, Usmanpur, Gurudwara Nanakpur and Bela farm areas. The discom has also disconnected links to two rainy well on the request from Delhi Jal Board in Lakshmi Nagar and Krishna Nagar divisions. (

Southern states to ensure power supply for key services by August during grid troubles

June 19, 2013. All the southern states are expected to implement by August the islanding schemes that would ensure power supplies to essential services in the event of grid disturbances. The idea of islanding scheme gained prominence after the massive failure of electricity grids last July that affected more than half of country's population. According to latest update from the Central Electricity Authority (CEA), the planning body for the power sector, the four Southern states - Andhra Pradesh, Tamil Nadu, Karnataka and Kerala - would have islanding scheme by August 2013. As of now, six islanding schemes have been envisaged for the South. These schemes also come at a time when the government is making efforts to connect the Southern grid with the National Grid. In the South, the biggest islanding scheme -- having a capacity of 18,545 MW -- would ensure essential power supplies to major cities in the four states. It would cover Andhra Pradesh, Karnataka, Chennai and Hosur (Tamil Nadu), and North Kerala. Another scheme of 7,380 MW would cover the rest of Tamil Nadu and Kerala. (

Policy / Performance

PM lays foundation stone of 850 MW Hydel project in J&K

June 25, 2013. Prime Minister (PM) Manmohan Singh kick-started work on a mega 850 MW hydro-electric project on the River Chenab as part of efforts to tap the hydroelectric potential in Jammu and Kashmir. The 850 MW Ratle project, which is the nation's first hydroelectric project that was bid out through tariff based international competitive bidding, will cost ` 5,500 crore, Singh said. The project was awarded to GVK Power which offered the lowest tariff for generating power. Prime Minister said the state is back on path of progress after some difficult times. As against a potential of generating 14,000 MW of power from rivers like Chenab, Jhelam and Sindh, only 2,500 MW is currently being generated in Jammu and Kashmir, he said. Despite power generation in the state rising to 1,664 MW, Jammu and Kashmir continues to be a power deficit state, he said announcing supply of 150 MW of electricity from Central pool to the state. Also, National Hydroelectric Power Corp (NHPC) has recently completed two projects in the state to make available 89 MW of electricity. (

Essar Energy planning to convert two gas-fired plants into coal-based units

June 25, 2013. The acute scarcity of natural gas and high cost of imported LNG have taken a toll on Essar Energy's power business, forcing the company to take the decision to convert two gas-fired plants at Hazira and Bhander in Gujarat into coal-based units. However, the company's oil and gas business has done well and posted an earnings before interest, taxes, depreciation and amortisation (EBITDA) of $1.33 billion in 2012-13, crossing the $1-billion mark for the first time. (

Uncertain future for hydropower projects in Uttarakhand

June 24, 2013. Following the declaration of a 130-km stretch of the Bhagirarthi River Valley between Gomukh and Uttarkashi as an eco-sensitive zone by the ministry of environment and forests (MoEF) in December 2012, and the submission of the B K Chaturvedi Committee report in March this year, small hydro power companies in Uttarakhand are facing an uncertain future. Some of them are now looking at diversifying into thermal, solar and wind power. The B K Chaturvedi Committee was appointed to review existing and ongoing hydroelectric projects on the Ganga and its tributaries. It was also asked to recommend the flow that should be maintained in these rivers, and to suggest how existing power projects should be altered to achieve the required flow. It has suggested certain alterations in existing projects. The committee's recommendations have acquired added significance in light of the flash floods and landslides that occurred in parts of Uttarakhand. According to a rough estimate, small hydro power projects totalling 6,000 MW in the Ganga river basin in Uttarakhand have been affected by the recommendations of the Chaturvedi Committee. The eco-sensitive zone declared by the MoEF has impacted power stations with a total generating capacity of 1,743 MW. Companies affected included Uttarakhand Jal Vidyut Nigam Ltd (UJVN) and THDC India Ltd. Newly floated subsidiaries of NTPC, GVK and Larsen & Toubro are also affected by the adverse report on the hydropower sector. A total of 69 hydropower projects with a capacity of more than 9000 MW were under review by the inter-ministerial group which was set up following an agitation by environmentalists and religious leaders against the development of scores of hydro power projects on the river Bhagirathi. (

Coal Ministry avoids CBI queries on blocks allocated through JV

June 24, 2013. CBI probe into coal blocks allocated through joint venture (JV) route has not been able to progress as the Coal Ministry has not responded to the agency's queries related to alleged majority stake given to some private partners and policy adapted in the allocation. The issue was raised by CBI Director Ranjit Sinha in a recent letter to Coal Ministry where he had said that despite repeated explanations sought by the agency on coal blocks allocated through JV route, the Ministry has not provided satisfactory responses. Under the joint venture mechanism, coal blocks were allocated to PSUs (central or state) which enter in a joint venture with a private player. The benefit to the corporation is that while it makes virtually no investment, it holds majority stake as sweat equity in the venture. The agency probe has so far revealed that in some cases block allocation allegedly violated provisions of company law as private partners were given majority stake. Sinha said the agency has not been able to get clear responses from the ministry even through it has repeatedly raised the issue at different levels to clarify points related to policy of giving coal blocks through JV routes. The agency which had registered a preliminary enquiry into the coal blocks allocated through joint venture route has not been able to register any FIR in this connection as clarifications have not been provided by the coal ministry on the policy. (

Govt urges OERC to reconsider order on reconnection fees

June 24, 2013. The state government urged Odisha Electricity Regulatory Commission (OERC) to reconsider its order on payment of reconnection charge of ` 150 for Low Tension (LT) single phase domestic consumers in the event the consumer fails to pay the electric charges for two consecutive months. The state government has requested the OERC to keep the order in abeyance for at least one year. Under the prevailing situation it may not be proper to impose reconnection charges in Central Electricity Supply Utility of Odisha (CESU) franchise area for non-payment of electric charges for two consecutive months. (

Govt aims to build world's largest transmission grid by 2017

June 23, 2013. Power Ministry has set an ambitious target of building the world's largest transmission network spanning across 1,40,000 circuit kilometres by 2017. The Power Minister Jyotiraditya Scindia also said the country will have a single transmission grid by January next year. At present, the southern grid is not connected to the national grid. Its connectivity with the rest of the grids would help in overcoming the acute electricity shortage in southern states. The government, in September last year, approved restructuring of ` 1.9 lakh crore debt of State Electricity Boards in a move to turnaround the near-bankrupt power discoms. The power generation capacity of the country at present is 2,30,000 MW. The minister also said that as much as 40 per cent of the investment in infrastructure comes from the power sector. (

Govt agrees hike in coal-based power costs

June 21, 2013. Govt has decided to allow power companies to pass on the costs of foreign coal to customers, a minister said, a move likely to boost imports and investment in power generation, but bringing higher energy prices to consumers. A proposal to raise gas prices has been deferred, information and broadcasting minister Manish Tiwari said after a cabinet meeting. India is the world's third-largest producer of coal and more than half the country's power comes from burning the fuel, but domestic output falls short of demand, triggering frequent and lengthy power cuts in Asia's third-largest economy. It also means power producers have to turn to expensive coal imports and until now, they have not been able to pass these costs fully on to customers. The move comes as the coalition government is trying to tackle a raft of economic reforms, some of them leading to unpopular price rises and some giving benefits to powerful vote banks ahead of state elections this year and national elections in 2014. (

Govt okays pass through for coal import

June 21, 2013. Electricity tariff across the country will increase by a minimum 15 to 17 paise per unit after the government allowed power producers to pass on higher cost of imported coal to consumers. Finance Minister P Chidambaram said the Cabinet Committee on Economic Affairs has approved the pass through proposal, which would result increase in power tariff. Coal Ministry said the move would result in higher power tariff to consumers. Chidambaram said significant power capacities stand stranded in India due to lack of coal and gas. (

Govt okays continuation of restructured power development

June 21, 2013. The government decided to continue with the restructured power development and reforms programme in the 12th Five-Year Plan period ending March 2017, as it looks to improve overall efficiency in the country's electricity system. The Cabinet Committee on Economic Affairs (CCEA) has approved the Restructured Accelerated Power Development and Reforms Programme (R-APDRP) for the 12th Plan (2012-17) with minor changes to complete the ongoing/in pipeline projects. (

APTEL stays MERC order on cross subsidy surcharge

June 21, 2013. The Appellate Tribunal for Electricity (APTEL) stayed a Maharashtra Electricity Regulatory Commission (MERC) order increasing cross subsidy surcharge (CSS) payable by Tata Power customers migrating from Reliance Infra's network. The Tribunal further observed that unless the tariff and the cost of supply are determined, the applicable CSS cannot be determined. MERC in its order had said it would decide about CSS in the multi-year tariff (MYT) proceedings. Tata Power had filed a petition before the APTEL seeking stay on MERC's order on the cross subsidy surcharge. (

Gujarat blames Centre for power crisis in several states

June 21, 2013. Gujarat blamed the Centre for power shortage in several states by not taking a decision on allowing the power-starved states to purchase electricity from Gujarat, which has surplus capacity. State Energy Minister Saurabh Patel said this while speaking at a conference hosted by the Institute of Chartered Accountants of India (ICAI). He said that Gujarat government had not demanded any special package from the Centre as the state strictly follows provisions of the Fiscal Responsibility Act. (

New bidding norms for power projects in a month's time

June 21, 2013. New bidding norms for power plants would be out in a month's time, Power Minister Jyotiraditya Scindia said. The new Standard Bidding Documents are in their last lap of finalisation. The Power Ministry provisionally finalised the new standard bidding documents in July last year. (

Sonia Gandhi lays foundation stone of Suratgarh Power Station

June 20, 2013. Congress President Sonia Gandhi laid the foundation stone of two units of 660 MW each at Suratgarh Power Station in Sriganganagar district. The seventh and eighth units of super critical thermal power station at Suratgarh will be ready by 2016-17. They have been built at a cost of ` 7920 crore. Gandhi was accompanied by Chief Minister Ashok Gehlot and Energy Minister Jitendra Singh. She will later inaugurate a ` 2,938 crore water supply project at Jayal in Nagaur district. (




Frack music attracts Halliburton to submarine spy tool

June 25, 2013. A gossamer-thin glass line threaded two miles underground is allowing oilfield engineers to listen to a new kind of music: the sounds of fracking. Halliburton Co. and competing providers of drilling gear are adapting acoustic spy technology used by U.S. submarines to record sounds made deep in the earth that can guide engineers in finishing a well and predicting how much oil will flow. The ability to hear inside a well enables producers to fine-tune hydraulic fracturing, or fracking, the process that blasts underground rock with water, sand and chemicals to free trapped oil and natural gas. The technology is targeted at an estimated $31 billion that will be spent this year on fracking stages that yield less-than-optimal results, a majority of the work at 26,100 U.S. wells set to be pressure-pumped in 2013. Fracking has helped U.S. oil production reach a 21-year high. Environmental groups have criticized the practice because of concerns it may affect drinking water supplies. (

Rosneft, Eni sign pact to jointly explore Russia's offshore blocks

June 24, 2013. Rosneft and Eni signed a Completion Deed relating to the agreements for their joint exploration in Russia's Barents Sea and Black Sea. Russian President Vladimir Putin witnessed the signing of the joint exploration agreement at the Saint Petersburg International Economic Forum. Rosneft and Eni will conduct jointly exploration of the Fedynsky block and Central Barents block in the Barents Sea and the Western Chernomorsky block in the Black Sea. The projects come under the Strategic Cooperation Agreement entered into by both companies, which provides for joint development of the Russian offshore blocks, technological and staff exchange and Rosneft’s participation in Eni’s international projects. Three Joint Venture companies were formed to operate the Russian offshore projects, with Rosneft holding a two-third stake and the remaining one-third going to Eni. (

Shell to invest $3.9 bn in new Nigeria oil, gas projects

June 21, 2013. A joint venture led by Royal Dutch Shell PLC said it will invest $3.9 billion on new oil and gas projects in Nigeria that will maintain the country's domestic energy supplies and export capability, while reducing the problem of oil theft from pipelines that has caused serious environmental pollution. Shell said the investment demonstrates its long-term commitment to its presence in Nigeria, although it also plans a strategic review of its operations in the country that could result in the sale of some onshore oil fields. (

PTTEP resumes oil production at Montara field

June 21, 2013. PTT Exploration and Production Public Company Limited (PTTEP) announced that PTTEP Australasia Pty Ltd, a wholly owned subsidiary of PTTEP, has started to introduce hydrocarbon to the Montara Venture floating production storage and offloading (FPSO) facility at the beginning of June in the Montara field offshore Western Australia. Oil production at the Montara field is projected to ramp up to 21,000 barrels per day (bopd) initially. Production is expected to rise to 30,000 bopd following completion of one additional development well scheduled for the second half of 2013. The first crude oil sales offtake is expected in August this year, PTTEP said. (

Angola LNG production underway

June 20, 2013. Chevron subsidiary Cabinda Gulf Oil Company Limited confirmed that initial production of liquefied natural gas (LNG) has commenced at the Angola LNG project. Angola LNG is one of the largest energy projects on the African continent. The $10 billion project will collect and transport natural gas from offshore Angola to an onshore liquefaction plant on the coast near the Congo River. The project has the capacity to produce 5.2 million metric tons per year of LNG, 63,000 barrels per day of natural gas liquids for export and 125 million cubic feet per day of natural gas for domestic consumption. (

Vietnam, China expand joint exploration in Gulf of Tonkin

June 20, 2013. Vietnam and China have extended an agreement to jointly explore for oil and gas in the Gulf of Tonkin until 2016, while significantly expanding the area involved. The two sides started joint explorations in the gulf - led by Vietnam Oil & Gas Group, or PetroVietnam, and China National Offshore Oil Corp., or Cnooc - in November 2006. However, no reserves of commercial value have been identified yet. Under the new terms, Vietnam and China have expanded the area covered by the joint-exploration agreement to 4,076 square kilometers from the 1,541 square kilometers under the initial arrangement, the Vietnamese government said. (

Statoil 'on track' for 1.4 mbpd from the NCS by 2020

June 20, 2013. Statoil reported that it is on track to fulfil its ambition of producing more than 1.4 million barrels per day (mbpd) on the Norwegian Continental Shelf (NCS) by 2020. Statoil is operator for more than 70 percent of all oil and gas production on the NCS, which includes more than 40 assets in the North Sea, Norwegian Sea and Barents Sea.

But Statoil stressed that a predictable and stable fiscal framework is important to secure the attractiveness of continued investments on the NCS, noting that this is particularly important for marginal fields and fields that require significant investments in infrastructure. (

US needs oil sands as surge from shale bonanza seen overdone

June 19, 2013. The U.S. will continue to need crude from Canada’s oil sands because rising production from its shale formations is too expensive to maintain. Therefore many see increased crude output from U.S. shale isn’t “sustainable production”. It is felt that producers need to invest too much to sustain production from wells in the Bakken and Permian basins, which falls as much as 70 percent in the first year. Oil-sands capital spending fell 10 percent last year to C$20.4 billion ($20 billion), as some Canadian producers cut budgets amid competition from lower-cost oil supplies in U.S. shale basins. Production from the Bakken Shale in North Dakota has more than doubled from 2011 through April to 727,150 barrels a day. The U.S. will probably never be able to meet its own supply needs, Devon Energy Corp.’s Canadian division said. Devon produced 8.5 million barrels of crude from Canada in the first quarter, including from its Jackfish oil-sands project. Canadian oil producers are being paid less for their crude than global prices, as proposed pipelines to the continent’s coasts are delayed amid rising North American supplies. Canada’s crude output will more than double to 6.7 million barrels a day by 2030, provided new export conduits are built. (


Costa Rica halts $1.3 bn China-funded refinery plan

June 21, 2013. Costa Rica’s government halted a $1.3 billion refinery modernization largely funded by the Chinese government due to a contractual violation, paralyzing the Central American country’s biggest investment project. A feasibility study on the refinery modernization was conducted by Chinese company HQCEC, which has ties to China National Petroleum Corp., or CNPC. The terms of the contract specified that the study couldn’t be carried out by a company associated with CNPC, which is partnering with the Costa Rican state oil company, or Recope, on the project. The project, in the city of Limon on the Caribbean coast, was the subject of talks between Chinese President Xi Jinping and President Laura Chinchilla during a visit by Xi to the country. The modernization was to be primarily funded by a $900 million loan from China Development Bank Corp. A revised plan for the refinery’s modernization, which targeted an increase in fuel production to 65,000 barrels per day from the current rate of 18,000, will be prepared within six months, Recope said. (

Transportation / Trade

Novatek expects new LNG sales deals with Asia in 2013

June 24, 2013. OAO Novatek, Russia's largest independent producer of natural gas, expects to sign new long-term supply agreements with Asian companies this year, the company said. Under the deal, China National Petroleum Corp. (CNPC) will receive long-term supplies from the Yamal LNG project, a pioneering venture that would transport LNG by tanker along Russia's arctic coast. The project is currently jointly owned by Novatek, which has an 80% stake, and Total, with 20%. (

Peru's army removes explosives placed near key gas pipeline

June 24, 2013. Peru's army has removed explosives that were placed near a key gas pipeline running through a remote jungle area rife with heavily-armed rebels. The Joint Command of the Armed Forces said that six explosives were placed near the pipeline that transports gas from the Camisea fields in southeastern Peru to the Pacific coast. The explosives were discovered by an army patrol in the valley of the Apurimac, Ene and Mantaro rivers, an isolated area known as the VRAEM that is home to remnants of the Shining Path rebels. The Shining Path was largely defeated in the 1990s, but a splinter group continues to operate in the VRAEM where it regularly attacks state security personnel and has also targeted the private-sector. The army said the Shining Path setup the explosives in order to kill soldiers or civilians working on the pipeline. It added five of the explosives were removed, while one was destroyed. (

Bakken boom cutting west coast imports of crude

June 22, 2013. The West Coast is bringing in record amounts of crude from the interior of the U.S., cutting the price of foreign supplies and heralding the end of some overseas imports by next year. California shipped via rail more oil than ever in February from North Dakota’s Bakken formation, while Russian imports to the region slid to 713,000 barrels from a June 2012 record of 6.53 million. The premium for Russia’s East Siberia-Pacific Ocean oil has retreated 60 percent against U.S. benchmark West Texas Intermediate. (

China fuel oil imports climb to five-year high on Iran supplies

June 21, 2013. China’s fuel oil imports surged to the highest level in five years last month as the country boosted purchases from Iran. Imports of the residual fuel, used by power plants and so-called teapot oil refineries, rose 19 percent to 2.83 million tons from a month earlier. That’s the most since May 2008. Shipments from Iran climbed to 526,203 tons in May, the highest since February 2004. Iran ranked as China’s second-largest fuel oil supplier in May after Russia, which shipped 632,078 tons. Singapore was the third-biggest with 460,872 tons. Supplies from Iran cost $609.98 a ton, compared with $629.49 from Singapore and $685.75 from Russia. China bought a total of 804,034 tons of Iranian fuel oil in the first five months of this year, compared with about 1,322 tons in 2012 and 428 tons in 2011. The nation imported 2.4 million tons of crude from the Persian Gulf country in May, 6.4 percent more than a year earlier. That’s the biggest volume since December. (

Gas to emerge as significant transport fuel over next 5 yrs

June 20, 2013. Natural gas is set to emerge as a significant new transportation fuel over the next five years, raising the prospect of a challenge to oil's dominance in the sector, the International Energy Agency (IEA) said. Already, gas demand in road transport grew tenfold between 2000 and 2010, but cheap gas in the U.S. as a result of the boom in production of shale gas, and concerns over air pollution and oil dependency in China, could help it develop into a more mainstream fuel, the IEA said. (

Saudi April crude exports little changed while Iraq increased

June 19, 2013. Saudi Arabia, the biggest crude oil exporter, shipped 7.44 million barrels a day oil in April, 0.3 percent more than in March, while exports from fellow Organization of Petroleum Exporting Countries (OPEC) members Iraq and Venezuela made steeper gains. Total Saudi crude production increased to 9.3 million barrels a day in April from 9.14 million barrels the previous month. The kingdom exported 20,000 barrels a day more than in March. Iraq, the second-largest producer in the OPEC, shipped 2.62 million barrels a day in April, up 200,000 barrels a day from the prior month, while Venezuela exported 1.63 million barrels, a gain for the month of 80,000 a day. (

Keystone XL pipe shuns infrared sensors to detect leaks

June 19, 2013. TransCanada Corp., which says Keystone XL will be the safest pipeline ever built, isn’t planning to use infrared sensors or fiber-optic cables to detect spills along the system’s 2,000-mile (3,200-kilometer) path to Texas refineries from fields in Alberta. Pipeline companies have been slow to adopt new leak detection technology, including infrared equipment on helicopters flying 80 miles an hour or acoustic sensors that can identify the sound of oil seeping from a pinhole-sized opening. Instead of tools that can find even the smallest leaks, TransCanada will search for spills using software-based methods and traditional flyovers and surveys. As pipelines multiply across North America to carry booming supplies of oil and natural gas, a series of recent spills and explosions are raising concerns about the safety of the conduits, including Keystone XL, which is awaiting U.S. government approval. (

Europe-US gasoline cargoes seen falling in shipbroker survey

June 19, 2013. The number of gasoline cargoes booked for shipment to the U.S. from Europe will decline over the next two weeks. Traders will charter a total of 17 Medium Range tankers for loading to July 2, the median in a survey of six shipbrokers and traders showed. That compares with 21 vessels, each normally carrying 37,000 metric tons of the auto fuel, in a corresponding survey earlier. There are 29 ships available for the trade, one more than before. Tankers plying the trans-Atlantic route were earning $7,354 daily, the lowest since Nov. 26. Eleven of the 17 charters have been completed and the rest are anticipated, the latest survey showed. Ship bookings often contain clauses allowing vessels to sail to different ports. The survey is based on the industry’s benchmark Rotterdam-to-New York voyage, which takes about 11 days at 12.5 knots. Below is a table of ships chartered, probably hired and available to be booked for the journey loading over the two-week periods from the dates shown. (

Policy / Performance

US FTC said to open probe of oil price-fixing after EU

June 25, 2013. The U.S. Federal Trade Commission (FTC) opened a formal investigation into how prices of crude oil and petroleum-derived products are set, mirroring a European Union inquiry. The investigation, now in a preliminary stage, will probably broaden into a multi-jurisdictional affair like the inquiry into manipulation of the London interbank offered rate, or Libor. FTC investigators are reviewing the progress made by their European counterparts. The FTC, which routinely monitors wholesale and retail gasoline prices in the U.S. to look for anticompetitive behavior, agreed with the Justice Department’s antitrust division to handle the probe. The assignment of the matter to the FTC instead of the Justice Department is an indication that U.S. regulators don’t suspect the conduct they’re scrutinizing is criminal. The opening of the oil-price investigation in the U.S. is the latest in a growing number of simultaneous EU-U.S. inquiries into areas including Libor, standard essential patents and Internet search manipulation, as well as merger reviews in the music and airline industries. The extent to which regulators in each jurisdiction can collaborate with one another depends on whether the companies under review sign waivers allowing data about them to be shared. (

US sees cuts in India's Iran oil imports as 'important step' - Kerry

June 24, 2013. The United States sees India's reductions in imports of oil from Iran as an "important step" in bringing pressure on Tehran over its nuclear programme, Secretary of State John Kerry said. Washington renewed six-month waivers on its Iran sanctions for India, China and seven other economies in exchange for their agreeing to reduce purchases of oil from Tehran. Indian refiners had cut dependency on Iranian crude to about 5.5 percent of total imports in January to May from over 10 percent in the same period a year ago. (

Jakarta Calm after subsidized fuel prices are increased

June 22, 2013. The streets of Indonesia’s capital Jakarta were quiet after the government raised fuel prices for the first time since 2008, compared with earlier this week when protests erupted across the country. The price of subsidized gasoline was increased by 44 percent to 6,500 rupiah ($0.65) a liter, while diesel is 22 percent higher at 5,500 rupiah a liter, Energy and Mineral Resources Minister Jero Wacik said. President Susilo Bambang Yudhoyono’s administration raised prices to cut subsidy costs and boost confidence in the rupiah, in a country where riots spurred by soaring living costs helped oust Dictator Suharto in 1998. Curbing energy subsidies could reduce demand for oil imports, which have led to trade and current-account deficits and contributed to the rupiah being one of the worst performing currencies in Asia in the past year. Some Jakarta residents were thinking about how to save money in other areas to compensate for higher fuel prices. (

Eni, Gazprom reach agreement on gas supply prices

June 21, 2013. Eni and Gazprom reached an agreement for the reduction of Russian gas supply prices for 2013. The two companies have also committed to complete renegotiations on prices and volumes of gas supplies for 2014 and beyond by the end of 2013. The parties also discussed the progress of the South Stream project, confirming the aim of starting-up the pipeline’s construction by the second quarter of 2014 and first gas by 2015. (

Iraq’s Kurds to export oil by new pipeline ‘very soon’

June 19, 2013. Iraq’s Kurds will start exporting crude by pipeline “very soon” after the completion of a new link to the Turkish border by the end of September, the Kurdistan Regional Government Natural Resources Minister, Ashti Hawrami said. The pipeline to Fishkabour near the frontier with Turkey, will eventually have a capacity of 1 million barrels a day by 2015, Ashti Hawrami said. The semi-autonomous region in northern Iraq is “well on its way” to have enough oil to fill the line’s capacity, he said. The landlocked, self-governed Kurdish enclave halted crude exports through the Iraqi central government-run pipeline since December. The Kurds are sparring with the Oil Ministry in Baghdad over the sharing of revenue from crude sales and payments owed to international companies with investments in Kurdish oil fields such as DNO International ASA and Genel Energy Plc. The Kurdish region is currently exporting 30,000 barrels a day by truck to Turkey. Its oil-production capacity is due to increase to 400,000 barrels a day by the end of the year from a current 300,000 barrels a day, Hawrami said. The Kurds will start crude production from six more oil fields by the year-end, Hawrami said. The region has awarded five oil exploration blocks to a Turkish entity, he said. (

Israeli govt approves 40 pc of country's natural gas for export

June 19, 2013. Market worries over the future development of Israel's energy sector eased after government officials approved the export of 40% of the natural gas from the country's offshore Leviathan reserve, opening the way for an inflow of billions of dollars into the economy. The exports will bring in $60 billion for the economy over 20 years. The decision, made by a group of ministers, is expected to get government cabinet approval. Environmental Protection Minister Amir Peretz said he is concerned that it jeopardizes Israel's long-term energy security. In the last decade, there have been several large gas discoveries in Israel, including the Leviathan field, which contains an estimated 19 trillion cubic feet of gas. The export quota doesn't apply to the smaller Tamar field, which contains about 9 billion cubic feet of gas, much of it already committed to domestic companies. (

Women may get into Augusta easier than energy CEO role

June 19, 2013. Women may have better odds of getting a membership at Augusta National Golf Club than becoming the chief executive officer (CEO) of an energy company in the Standard & Poor’s 500 Index. With its decision to name Lynn J. Good as its first female CEO, Duke Energy Corp. will be the largest U.S. energy business by market value led by a woman. Good will be only the second female energy leader on the index, raising the amount to 0.4 percent. While energy companies have long been led by engineers or lawyers, professions that were dominated by men, “over the last five to 10 years you’ve seen more women move into leadership,” Good said. Becoming chief financial officer, as Good was at Duke, may be one path to leadership for females in the energy industry. Women currently serve as CFOs at some of North America’s largest energy producers, including Chevron Corp., Occidental Petroleum Corp., Marathon Oil Corp. and Encana Corp. (



ADFD commits investment of $30 mn for 140 MW hydro project in Nepal

June 24, 2013. The Abu Dhabi Fund for Development (ADFD) has committed an investment of $30 mn to Nepal to finance the development of 140 MW Tanahun hydropower project located near Damauli. The Finance ministry has received a letter from ADFD notifying the government that it approved the loan. Nepal government has secured a total $370 mn from three investor partners including $150 mn loan from Asian Development Bank (ADB), $150 mn from (Japan International Cooperation Agency) JICA and $70 mn from (European Investment Bank) EIB. Tanahun hydro project is expected to be concluded by 2020. (

Perry nuclear power plant in US restarts after outage

June 24, 2013. Perry nuclear power plant in US has started operations following a four day outage of the facility, after a contained radioactive steam leak was detected. The 1,268 MW power plant is owned and operated by FirstEnergy. Perry power plant is a boiling water reactor, which serves northern Ohio and various regions of FirstEnergy's service territory. GE Energy's nuclear business has provided operational support services for the plant, which is reported to supply about a third of the electricity generated by FirstEnergy. (

ACWA expects to keep Saudi power plant project after fuel change

June 23, 2013. Saudi-based developer ACWA Power expects to retain a commission to build a 1,800 MW power plant for Saudi Electricity Co despite the utility changing the fuel for the project. Electricity generation is a key issue in the kingdom, where 27 million people face sporadic power cuts when air conditioning usage surges in the hot summer. The country's minister for water and electricity, Abdullah al-Hussayen, said that 500 billion riyals ($133 bn) of investment was required in the next 10 years to meet rapidly rising power demand. The change of design to a gas-powered plant will make the plant cheaper, meaning the $2 billion funding package agreed with a consortium of seven local and international banks earlier this year will also be revised down. (

GE signs deal with Tanzania to help build 400 MW power plant

June 21, 2013. General Electric Co (GE) and Symbion Power Tanzania have signed a co-operation agreement to develop a 400 MW gas-fired power plant in Tanzania, a project that could alleviate power shortages in east Africa's second largest economy. Tanzania estimates it has 41.7 trillion cubic feet (tcf) of recoverable natural gas reserves but little of it pumped out, while economic growth remains constrained by chronic energy shortages that result in frequent power blackouts. The proposed power plant, to be built in southern Tanzania's Mtwara region, will also include a transmission line to Songea, a city several hundred kilometres away near Lake Malawi. (

Gazprom to Acquire Belgian Power Plant

June 20, 2013. OAO Gazprom is set to acquire its first power plant in Western Europe, fulfilling a long-held ambition to deepen its presence in its largest market, even as the Russian gas giant turns its attention to supplying energy-hungry Asian consumers. Gazprom has struck a provisional agreement with Italy's Enel SpA to buy the 405 MW Marcinelle power plant in Belgium, valued by Enel at around $265 million, Enel said. A memorandum would be signed with Enel. (

Transmission / Distribution / Trade

Italgen signs 120 MW Egyptian transmission deal

June 24, 2013. Italgen, a subsidiary of cement producer Italcementi, has signed contracts with the Egyptian Electricity Transmission Company, making it the first private investor allowed to connect to the national grid. The 120 MW wind farm on the Gulf El Zayet, represents an investment of around EUR 120-130 million. The project's capacity could eventually rise to 400 MW. (

PPL Electric Utilities to invest in electric infrastructure improvement in US

June 21, 2013. US-based electricity services provider PPL Electric Utilities has announced its plans to invest in electric infrastructure projects and improve the reliability of its power distribution system in Pennsylvania. The company will invest about $27 mn for around 30 local projects to improve electric infrastructure and benefit customers by addressing increase in energy demand, reduce outages, enhance reliability and utility operations. (

JCP&L proposes 230kV power line in Monmouth County, US

June 20, 2013. US-based Jersey Central Power & Light (JCP&L) has proposed to build a 230kV transmission line in Monmouth County, New Jersey, to add redundancy to the system and meet the growing demand for electricity. The proposed 16 mile long Ocean view Reinforcement Project is expected to be built for a cost of $44.5 mn in Monmouth County and pass through Colts Neck, Howell, Neptune, Tinton Falls, and Wall. (

Policy / Performance

Indonesia-Malaysia to jointly develop coal power plant in Sumatra

June 25, 2013. Indonesia and Malaysia would cooperate to develop a coal-fired power plant in Sumatra to meet the needs of electricity in the two countries. The cooperation agreement was signed by the two countries’ electricity companies last year, energy minister Jero Wacik said. The plant would have a capacity of 2,000 MW and 1,000 of which would be used to meet electricity needs in Sumatra and the rest in Malaysia. He said under the cooperation agreement Indonesia would provide the land and coal supply while Malaysia would build the plant. (

US NRC to seek public input on spent fuel pool study

June 25, 2013. The US Nuclear Regulatory Commission (NRC) will request public to give their input on a study regarding the faster removal of spent nuclear fuel from pools to dry cask storage and reduce the health and safety risk. NRC's draft study, which is based on previous research, examined how severe earthquakes can become potential risk for spent fuel pools to overheat and release radioactive material into the environment. The research concluded that the possibility of such an activity can occur only in one-in-10-million-years. The commission initiated the draft study after the March 2011 Fukushima nuclear plant accident, where the spent fuel pools survived a strong earthquake. NRC's study considered a spent fuel pool similar to those at Fukushima and 23 other US nuclear reactors and an earthquake several times stronger than what the pool's design considered. Under the study, NRC examined one full spent fuel pool and one with less fuel and more spacing between individual fuel assemblies, as well as emergency procedures for adding water to the pool in the unlikely event that the earthquake causes the pool to lose water. (

Brazil SC favors Cemig's ownership of 424 MW hydro project

June 25, 2013. Brazil Supreme Court (SC) of Justice has passed a ruling that will allow utility company Cemig to retain its holding in the 424 MW Jaguara hydroelectric plant. The ruling follows concession license termination of Cemig by the federal government for the facility on the Grande River located north of Rifaina. Cemig refused to comply with revised contract in line with government's MP579 bill sanctioned by President Dilma Rousseff earlier in January 2013. The terms of the contract reduced the revenues from the plant. Cemig is yet to renew its concession license for 1.7 GW São Simão and 408 MW Miranda hydroelectric plants in the country. (



Welspun gets funding for Karnataka solar project

June 25, 2013. Welspun Energy, India's biggest developer of solar projects, said it has got ` 48.75 crore funding from financial institutions for its Karnataka solar project. The 7 MW project located in Chitradurga district will cost ` 65 crore and is being funded in 75:25 debt-equity ratio. The project is being developed by the firm's subsidiary Welspun Solar Kannada Pvt Ltd under the Karnataka State Policy. (

India plans to revive wind-farm tax break, raise subsidy

June 24, 2013. India plans to revive tax breaks for wind farms after the expiry of earlier incentive programs led to a 47 percent slump in installations. The Ministry of New and Renewable Energy proposed to resume a break for depreciation on wind farms and boost a subsidy for alternative generation. Investment in the wind industry sputtered after the two incentives expired on March 31, 2012, stalling turbine orders for manufacturers such as Suzlon Energy Ltd. and Gamesa Corp. Tecnologica SA. The slump in installations last financial year toppled India from its place as the world’s third-biggest market for the industry. Investors may claim the tax break and subsidy retroactively from April 1, 2012, should they be revived. Under the program, wind-farm owners could claim accelerated depreciation on 80 percent of the cost of equipment, allowing them to write off investments quickly. Alternatively, they would be allowed ` 500 ($8.37) per megawatt-hour of electricity fed into the grid under the generation-based incentive program. (

India, US set up working group on climate change

June 24, 2013. India and the US agreed to set up a working group on climate change. Announcing this after the fourth round of India-US Strategic Dialogue, US Secretary of State John Kerry said the working group would "intensify efforts to find ways that we can bilaterally join together to address the urgency of climate change". Kerry said the working group will be coordinated by him and External Affairs Minister Salman Khurshid within their respective governments. He said India and the US were collaborating on development efforts and "believe we can so more on climate change". (

Nereus raises $100 mn for India clean energy fund

June 24, 2013. Nereus Capital Management LLC said it raised as much as $100 million from Northern Lights Capital Group LLC and the U.S. Agency for International Development for its India clean energy fund. Northern Lights will contribute $100 million to Nereus Capital’s India Alternative Energy Fund, which includes a $40 million credit guarantee from USAID, Nereus said. The money will be used in the construction of as much as 400 MW of clean-energy capacity in India, according to Northern Lights and the U.S. agency. Potential investments include wind, hydropower and solar utilities, as well as large-scale energy efficiency projects. India targets doubling renewable-energy capacity to about 60,000 MW by 2017 to help reduce blackouts and diversify generation away from fossil fuel-based power plants struggling with fuel shortages. Private equity-funded Indian wind and solar developers include Morgan Stanley’s Continuum Wind Energy Pte Ltd. and Kiran Energy Solar Power Pvt. backed by Bessemer Venture Partners, an early funder of Skype Technologies SA. Nereus received $20 million last year from the International Finance Corp., the World Bank’s private financing arm, as part of a plan to raise $250 million. (

India slips in renewable energy attractiveness index: Ernst & Young survey

June 23, 2013. High entry-barriers for foreign investors and the rising cost of financing have led to the country slipping to a low eighth position on the renewable energy country attractive index in the first quarter of 2013, says an Ernst & Young survey. According to the report 'Renewable Energy Country Attractiveness Index', India's ranking slipped from fourth position to eighth this period, due to several challenges, including high cost of finance, entry-barriers for external investors, among others. However, the index sees the country gaining the 'hot spot' as the market with increased focus on the role of renewable energy driving new levels of power sector investment and aiming to nearly double the amount it generates from renewable sources. (

Tata Power, Geodynamics commission 1 MW geothermal plant in Australia

June 20, 2013. Tata Power along with Geodynamics have commissioned a 1 MW geothermal plant in Australia. Tata Power has a minority stake in Australia-based Geodynamics, a leading player in Enhanced Geothermal System (EGS) technology. Tata Power said it has successfully commissioned 1 MW geothermal pilot plant in Australia. The company aims to have 20-25 per cent of generation portfolio from clean energy. Geodynamics has geothermal exploration interests in three Australian states including the license for exploring 2,000 square kilometre of area in the Cooper Basin. Geodynamics' tenements in the Cooper Basin contain the hottest granites on earth and are estimated to provide a thermal resource equivalent of 50 billion barrels of oil. Besides Australia, Tata Power is implementing a 250 MW geothermal project in Indonesia in partnership with Origin energy and PT Supraco. (

Jakson Power to double revenue by March 2016

June 20, 2013. Jakson Power Solutions announced plans to double its revenue by March 2016 to ` 2500 crore. As part of its strategy to double revenues, the company will increase its market share in diesel-based power generation in India. It plans to manufacture 12,500 generating sets by the year 2016 compared with 8,000 units now. Jakson Power has started manufacturing generating sets at its Kalsar plant in Gujarat apart from Daman and Jammu units. This plant will be India's largest integrated DG Set manufacturing facility and it will also focus on manufacturing of special application generating sets like defense. The Greater Noida plant focuses on manufacture of Solar & Power Distribution Products. The range of diesel generators spans from 7.5 KVA to 3000 KVA. The plants at Kalsar and Daman would be manufacturing generating sets upto 250 KVA capacity and higher capacity would be produced at Jammu plants. The company is completely geared up for the roll out of CPCB2 emission compliant products. The CPCB 2 norms are expected to be implemented early next year. The company has also recently invested in Solar Power Plant and has commissioned its own 20 MW IPP in Bap, near Jodhpur in Rajasthan with the investment of around ` 200 crore. The company has signed 25 years power purchase agreement (PPA) with NVVN (NTPC Vidyut Vyapar Nigam Limited) for this project. The company is planning to increase the overall generation capacity from 80 MW to 100 MW within next three to four years with an investment of ` 750 crore. (

World Bank says India in for big climate change

June 20, 2013. Global warming could lead to more droughts, water scarcity, extremely hot summer, severe flooding, and poor food production in South-Asia, including India, a World Bank report said. Mumbai and Kolkata will see a “rise in the sea level, tropical cyclones and riverine flooding”. Water scarcity will plague the Western Ghats. There will be “increased droughts over north-western India, Pakistan and Afghanistan”. If there would be “unprecedented” hot summers, there would also be “extremely wet monsoons”. “An extremely wet monsoon that at present has a chance of occurring only once in 100 years is projected to occur every 10 years by the end of this century,” the report said. It also projected a rise in severe floods and “severe tropical cyclone impact” within the next 25 years. The report estimates that by 2050s, with a temperature increase of 2-2.5°C, water for agriculture in the river basins of the Indus, the Ganga and the Brahmaputra will reduce. A rise of 2°C in global temperature would mean India’s crop yield would go down significantly by the 2040s. (

Tata wins over IBM, DELL with solar cheaper than grid

June 20, 2013. Tata Group’s solar unit is expanding its business building plants for customers, forecasting that offices and factories will be paying more for grid power than solar by 2016 in most Indian states. Solar installations for commercial and industrial energy consumers, such as cement factories, information technology parks and car manufacturers, seeking to generate their own power represent a market of about ` 80 billion ($1.3 billion), said Tata Power Solar Systems Ltd. The company, formerly known as Tata BP Solar Ltd., is seeking to diversify from making panels after an oversupply from Chinese competitors crushed prices globally and idled Indian factories. Customers for whom it has already completed solar plants for self-generation include Maruti Suzuki India Ltd., the country’s biggest carmaker, and the local units of Dell Inc. (DELL) and International Business Machines Corp (IBM). The investment can pay for itself in a year if the customer is able to claim tax depreciation benefits or about four years if they can’t. The economics improve further when businesses calculate the cost of diesel burned during daily blackouts. Diesel generators cost about ` 17 per kilowatt-hour to run, more than double the cost of solar, according to HSBC Holdings Plc. Commercial consumers such as hotels and shopping malls, which pay the highest rates for electricity from the grid, can already generate solar power cheaper in 10 percent of India’s 35 states and territories. By 2016, that’ll be true in 60 percent of India’s states and territories, and if government subsidies are considered, the number will increase to 80 percent. In India, the rate paid for electricity delivered by the national transmission network differs depending on the type of consumer and the location. On average, the tariff has risen 15 percent since 2010 to ` 4.55 a kilowatt-hour. In the same period, the average cost of solar energy fell 39 percent to ` 6.89 per kilowatt-hour. (


Shanghai Aerospace to invest $211 mn in solar projects

June 25, 2013. Shanghai Aerospace Automobile Electromechanical Co., a maker of car air conditioners and solar-power parts, plans to invest 1.3 billion yuan ($211 million) to develop three solar power projects in China’s northwestern province of Gansu. Two projects with capacity of 49.5 MW each will be built in Jiayuguan and Lanzhou and a 30 MW solar power plant will be constructed in Zhangye, Shanghai Aerospace said. Shanghai Aerospace said it has invested and built more than 200 MW of solar farms in Gansu and Ningxia. (

Obama said to solicit states on cutting carbon emissions

June 25, 2013. The Obama administration plans to solicit ideas from states on how to cut greenhouse-gas emissions as it seeks to impose standards for carbon dioxide on new and existing electric-power plants. The administration is also considering delaying a rule for new plants as it begins to figure out how to regulate existing plants, according to people briefed on the matter who asked not to be identified so they could discuss the plans before they are unveiled.

U.S. emissions from energy last year fell to the lowest level in almost two decades, according to the U.S. Energy Information Administration, as cheap natural gas prompted utilities to shift generation from coal to gas. Those emissions are forecast to bounce back and increase by more than 3 percent this year, as the use of coal-fired power plants increases with rising natural-gas prices. Restrictions on carbon emissions may be fought by coal producers including Peabody Energy Corp. in St. Louis because the rules probably would force utilities to switch to cleaner sources of power, including natural gas and wind. Coal users including American Electric Power Co., based in Columbus, Ohio, and Southern Co. in Atlanta have argued regulations limiting coal use could raise consumer energy costs. (

BP backs Texas carbon capture as Skyonic gets $128 mn funds

June 25, 2013. BP Plc part-funded an emissions project at a Texas cement plant, betting that plans to turn the gases into chemicals for sale will succeed where traditional carbon-capture proposals have failed. BP, Cenovus Energy Inc. and other investors in developer Skyonic Corp. pledged a total of $128 million, Skyonic said. It plans to trap 83,000 metric tons of carbon dioxide a year from Capitol Aggregates Inc.’s plant in San Antonio.

Skyonic expects to profit from global efforts to curb industrial emissions by trapping and “mineralizing” CO2 into byproducts such as hydrochloric acid and baking soda. While countries including the U.S. and Britain have sought to capture carbon from power plants for burial underground, such projects are yet to operate on a commercial scale. (

China solars move factories overseas to avoid EU duties

June 24, 2013. As Europe slaps duties on $15 billion of solar panels, their Chinese producers are preparing to counterattack with devices assembled from South Africa to Istanbul that will avoid the import taxes. Trina Solar Ltd., JinkoSolar Holding Co. and Canadian Solar Inc. are among Chinese companies preparing to shift manufacturing abroad, dodging penalties imposed by the European Union in the bloc’s biggest ever anti-dumping action. China is pivoting as the EU this month set provisional tariffs on solar goods of 11.8 percent, a rate set to quintuple in August. At stake are imports from Yingli Green Energy Holding, the world’s largest panel maker, and more than 100 other Chinese makers of silicon-based panels, cells and wafers. Jinko’s yet-to-be-completed factories in South Africa and Europe could be used as “back-up solutions” depending on how high the EU raises its duties. Jinko is setting up plants in South Africa and Portugal that could export to Europe duty-free. Canadian Solar Inc., which has most of its operations in China, may open factories in Taiwan, Malaysia or Thailand. (

Japan’s high-cost renewable energy curbs subsidy impact

June 24, 2013. Japan must cut the cost of installing solar panels and wind turbines to take full advantage of clean energy incentives three times as generous as those in Germany and Sweden. High costs are one of the largest impediments to a wider uptake of clean energy in Japan following the March 2011 earthquake and nuclear meltdown. Japan’s costs threaten to detract from government policy offering financial incentives to sellers of clean energy. The program introduced a year ago next month has prompted many new entrants to Japan’s energy market, including Son’s Softbank Corp. and Orix Corp., a finance and leasing company.

Aided by the incentives, known as feed-in tariffs, Japan is projected to become the largest solar market by annual installations this year. The tariffs require utilities to buy electricity from renewable sources at fixed prices. Under Japan’s feed-in tariff program, clean energy generators sell their power to local utilities at rates guaranteed for a set period. In the case of solar, producers in Japan get 37.8 yen (38 cents) per kilowatt hour for 20 years. Japan’s tariff for solar was cut in April from 42 yen per kilowatt hour the previous year to account for the lower cost of solar panels and components. Germany began offering its industry-changing feed-in tariff for solar in 2004, building on previous smaller incentive programs. German solar tariffs are as low as 0.1063 euro per kilowatt hour for 20 years. (

USAID to catalyse $ 100 mn to promote clean energy in India

June 23, 2013. The US said it will facilitate $ 100 million investment for India's burgeoning clean energy sector and help the country's transition to low carbon economy and open-up new development opportunities. The US Agency for International Development (USAID) said that it will partner with US-based institutional investor Northern Lights Capital Group to facilitate the investment via Nereus Capital. The announcement came as Secretary of State John Kerry arrived in India to participate in the fourth annual US-India Strategic Dialogue. This investment, through the Agency's Development Credit Authority, is expected to create hundreds of additional megawatts of sustainable energy capacity and will help to advance India's clean energy industry, the agency said. The partnership is the first time in the Agency's history that it has partnered with a private investment fund to facilitate targeted investment. USAID will provide a 40 per cent credit guarantee for a $ 100 million limited partner commitment to Nereus Capital's India Alternative Energy Fund managed by Northern Lights Capital Group, an institutional investor. In order to meet latent demand and address energy shortfalls, the India government has set a target of 30,000 MW of renewable energy generation capacity in the next five years. (

Earth's temperature rise equals four Hiroshima atomic bombs: Climate scientist

June 23, 2013. Earth has been building up temperatures at a rate equal to heat generated by four Hiroshima nuclear bombs every second, a climate scientist has warned. According to John Cook, Climate Communication Fellow from the Global Change Institute at the University of Queensland, humans are emitting more carbon dioxide into the atmosphere than any other time in history of humankind. Cook said about 90 per cent of global warming was going into the oceans, which act like a natural thermometer along with changes in land, ice, and animal species. He warned that distributions of trees are shifting towards cooler areas of Earth such as the poles or mountains, and animal species are responding to global warming by mating earlier in the year. He said for last 20 years, 97 per cent of scientists have been in agreement that human activity is behind warmer temperatures. (

Fracking pollution probe in Wyoming cast in doubt by EPA

June 21, 2013. The only finding by U.S. regulators of water contamination from fracking was thrown into doubt when the federal government halted its investigation and handed the probe over to the State of Wyoming. State officials will now investigate the integrity of gas wells owned by Encana Corp. near 14 domestic water wells in Pavillion, Wyoming, while the Environmental Protection Agency stops further work on its draft report from 2011, which linked groundwater woes to hydraulic fracturing, or fracking, for natural gas. While EPA said it stands by its data, that preliminary finding is now effectively abandoned. Complaints from ranchers and homeowners in the rural Wyoming town have taken on national significance as the EPA findings were seized on by critics of fracking to illustrate the risks of the drilling technique. EPA tests found evidence of methane, ethane, diesel-range organic compounds and phenol in test wells it drilled, results that were criticized both by Encana and state regulators. Now those state officials will be replacing the EPA, and Encana will be providing $1.5 million in funding for the state’s work and for a public-education effort. (

BP defends renewable-fuel rule other oil cos oppose

June 21, 2013. As Congress considers scaling back or abolishing U.S. rules that mandate the use of renewable fuels, it has the full-throated support of the petroleum industry -- with one major exception. BP Plc, one of the world’s biggest oil companies by revenue, is part of a joint venture with DuPont Co. that is set to start producing a new alternative fuel by the end of the year. In order to preserve a market for that fuel, the venture’s officials are busy in Washington trying to convince lawmakers that the current system doesn’t need an overhaul. The Renewable Fuel Standard, or RFS, dates in its current form to 2007, when concerns about dependence on overseas oil and a desire to curb the use of fossil fuels induced Congress to set quotas for the use of alternatives to gasoline or diesel, such as corn-based ethanol and biodiesel. Under the law, refiners such as Exxon Mobil Corp. must blend a certain amount of renewable fuels into their gasoline each year, with their contribution determined by their share of the fuel market. The Environmental Protection Agency and renewable-fuel producers say the mandate spurs production of American-made fuels, helps corn farmers and cuts carbon emissions by replacing gasoline. (

Offshore wind may become key to Japan’s energy mix, Vestas says

June 21, 2013. Wind energy, especially offshore, could become a key power source as the country reviews its energy strategy, Vestas Wind Systems A/S said. Japan is reviewing its energy mix after the 2011 Fukushima nuclear disaster and the change of government in December. An incentive program started in July has boosted investments in clean energy, with most new capacity so far in solar power. Wind supplied 0.49 percent of electricity demand in 2011, according to the International Energy Agency. The application and approval process for wind projects needs to be “optimized,” Vestas said. Prime Minister Shinzo Abe’s cabinet this month approved a growth strategy that includes trying to speed up the studies, which usually take three to four years. Japan has many factors that favor the growth of wind power, Vestas said, including above-market rates for clean energy, an ambition to be more independent of energy imports, strong public support for renewables, and plenty of wind. Japan ranked 13th in the world with 2,614 MW of installed wind capacity at the end of last year, according to the Global Wind Energy Council. (

Black clouds hang over Spain's small solar farms

June 20, 2013. After retiring from a long career at IBM, Spain's Angel Miralda poured his savings into a small solar farm in the hilly northern region of Huesca, encouraged by government promises of stable returns. Now Miralda fears a new government energy policy will deepen cuts to renewable energy subsidies, wipe out his savings and push his business over the brink. Small-scale photovoltaic (PV) energy producers like Miralda started investing in solar panels when the government was offering lucrative subsidies under a decade-long drive to become a global leader in green energy. But a prolonged economic recession and a yawning budget gap forced Madrid to pull back its support for renewables, and more cuts are on the way, threatening major losses on personal investments and even defaults on bank loans. (

Chinese city proposes vehicle restrictions to reduce smog

June 20, 2013. One of China’s most polluted cities has proposed to limit vehicle ownership through a lottery, becoming the latest locality to do so in the world’s largest auto market as air quality and traffic congestion worsen. Shijiazhuang, the capital of steel-producing Hebei province surrounding Beijing, will restrict the number of new vehicles to 100,000 this year and limit households to owning two cars. That quota will be cut to 90,000 in 2015, with a lottery being used to determine who can buy cars. The proposals are at a preliminary stage and require hearings to be held before taking effect. China has vowed to step up efforts to curb emissions after air pollution and worsening congestion sparked public anger. Shijiazhuang, which ranks among the worst in air quality according to the environment ministry, joins Beijing, Shanghai, Guangzhou and Guiyang in imposing vehicle quotas, even as cities compete for new plants built by automakers from General Motors Co. to Volkswagen AG. (

Carbon rescue plan wins support of EU parliamentary panel

June 19, 2013. A panel of European Union lawmakers approved a watered-down rescue plan for the world’s biggest carbon market, after a record surplus of emission permits pushed prices to an all-time low. Carbon allowances for December fell after the European Parliament’s environment committee voted for a change to EU law that would allow delaying the sale of some carbon permits in an effort to support prices. It was the committee’s second opinion on the emergency measure, known as backloading, after the proposal was rejected by the full assembly in April. The panel recommended the whole Parliament support the restricted version of the measure after the original plan to intervene in the EU’s $72 billion cap-and-trade program divided policy makers and industry. Opponents of the fix, ranging from Poland to steelmaker ArcelorMittal, say it pushes up energy costs, while advocates such as Royal Dutch Shell Plc say it’s needed to boost investment in pollution-cutting technology. (

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