MonitorsPublished on Nov 26, 2023
Energy News Monitor I Volume X, Issue 24
COP 19: COP OUT? Lydia Powell, Observer Research Foundation


he news source Bloomberg was clear in assigning blame for the sub-optimal outcome from the 19th meeting of the conference of parties (COP 19) at Warsaw this week (see news item in this issue). According to Bloomberg, it was ‘China and India’s success in weakening the latest global warming agreement that created friction with other ‘good’ developing countries that wanted to step up the fight against climate change’. It portrayed India and China’s insistence that they would make a contribution rather than a commitment to reduce fossil fuel based emissions in any future agreement as a wilful act against global consensus on combating climate change. Other western news sources also presented the story as one of established spoilers China and India taking a stand against their brethren, the group of small and poor developing nations. Some drew convenient causal lines from carbon dioxide belching power plants in India and China to typhoon Haiyan battered Philippines to vilify China and India. Small island nations that said that they were sinking into the sea were also portrayed as helpless victims of China and India. Such framing makes a nice news story as there are victims and villains playing their roles in an oversimplified plot.  It arouses sentiments among the uninitiated to take sides and lash out against each other. Reality is far more complicated than what news stories would have us believe.    

No one really expected anything radical from Warsaw. Climate negotiations thus far have delivered little by way of progress and there was no reason to believe that Warsaw would deliver anything better. The Warsaw meeting was held at a time when the economic crisis has more or less ruined western appetite for changes that would add to their economic wounds. There is also the realisation that the world was not exactly running out of hydrocarbons as climate activists claimed. If we are not running out of hydrocarbons and if most nations do not have the money to pay for expensive alternatives to hydrocarbons, what is the point of 190 nations with widely different goals talking about it?

The expectation from Warsaw was that some progress would be made on outcomes established in previous COP meetings. One was that some clarity on the agenda for the next meeting would emerge.  Some clarity did emerge as China and India made it clear that they wanted to make a contribution rather than a commitment to reduce fossil fuel based emissions in any future agreement. What was more subtle and hence less noticed was India’s long held insistence on common but differentiated responsibility (CBDR) for rich and poor nations was compromised. The process of undermining the principle of CBDR started many COPs ago and Warsaw took it further.  Responsibility in any future agreement is most likely to be common and undifferentiated. 

There was some expectation on institutionalising a mechanism for assessing loss and damage as agreed in the climate talks held in Doha in 2012. This was something that the developing countries wanted as they see themselves as the biggest victims of damage and loss on account floods, drought, hurricanes and typhoons which are all now seen as a consequence of climate change. Not surprisingly nothing was achieved on this.  It is indeed a pity that developing countries continue to clamour for justice and compensation in a world that is not designed to pursue either. 

Then there was the question of finance, an issue that is now hanging threadbare on account of it being dragged around from one COP to another for the last two decades. As Nikhil Desai has pointed out in his sharp remarks in NAPSNet, climate negotiations (or any global negotiations for that matter) are ultimately about the distribution of wealth and power. Climate negotiations essentially pitch one set of people against another and not humanity against climate change as we are led to believe.   

One of the most interesting questions that Warsaw raises is: what brought China and India together?  After all were we all not told that China is completely different from India and that they must not be ‘hyphenated’ into a single unit? China is far bigger, both in aggregate and per person measures in terms of wealth, consumption and pollution. If at all, China should be compared to countries in the European Union rather than India as far as carbon emissions are concerned is a remark we often hear. But the answer to the question what brought China and India together at Warsaw lies not in their relative wealth and power status but in the most obvious common element between them: size in term of population numbers! Though no one actually brings this up, size does matter in climate negotiating platforms. This arithmetic aberration allows few million people with high emissions living in a small island to become victims of climate change while it makes villains out of billions of people with low emissions living in a large nation. The small island of Maldives projects itself as a victim even though it burns hydrocarbons for almost everything including desalinating drinking water and has per person emission levels far higher than most nations. However a large nation like India which does not have enough water to drink because it cannot afford desalinated water and has per person emissions far lower than Maldives is a villain.  Sympathies will lie with Maldivians who use oil powered motor cars to cross an island of 2 kilometres and not with Indians who walk or cycle 5 kilometres or more to work. 

In climate negotiations the master narrative is the nation and not people and the nation and its sovereign right to exist trumps people’s right to exist. Under this framework, India and China can in theory break up into smaller nations of few million people each and instantly become victims of climate change. Though completely unrealistic, it is a logical proposition. If this happens there would be no large India and China to blame, only many mini ‘Indias’ and ‘Chinas’ joining the chorus for climate action much like nations in the European union!  

As this column has pointed out in earlier occasions, the global climate negotiating framework is based on many false assumptions. First it expects global environmental morals (or passions) to trump over national interests.  When the nation is the negotiating unit how could one expect it to voluntarily compromise on its own national economic and social interests?  Second it believes that common ground can be found between 190 nations with widely different compulsions, constraints and ambitions. Third it indulges in what has been described as the greatest form of injustice, the equalisation of unequal people. Everyone magically becomes equal when it comes to climate guilt.  You could be a jet setter who burns up more carbon in a day than poor nations do in a month but you are only as guilty as a poor beggar who burns a sheet of cardboard to keep warm when it comes to climate change. ‘We cannot do the same thing and expect different outcomes’ as Nikhil Desai has commented in NAPSNet. As long as the framework remains flawed, it will be ‘cop out’ irrespective of whether we have 20 or 200 COP deliberations.


Views are those of the author                    

Author can be contacted at [email protected]



Autopsy of the Indian Coal Sector: Revealing Compulsions

Ashish Gupta, Observer Research Foundation


fter independence hydro and coal became the major sources of power generation in India. As amendments in energy policies took place, hydro lost its momentum and coal became the king. Interestingly no one labelled coal as the dirtiest source at that point and everyone was happy with coal sector productivity and performance. Then came the era of the 2000s and climate change and at once coal was labelled as the killing machine of the planet. Ironically the statement was just a reflection of the bottom to top approach when it comes to responsibility (developed nations telling developing nations to do the right thing) and developing nations were asked to compromise on their development goals.

The ‘climatic approach’ which is based on carbon emissions taken by the rich countries seeks to discard coal from the energy basket of developing nations. Developing nations were thrown into a dilemma when green obligations were forced upon them. With due respect to green norms India has pursued the objective diligently and is committed to reduce carbon footprints. The point here is that the country relying only on one source will always be in a highly energy insecure strata. However India is carrying on with coal despite the realization on single source dependency because of questions over viability and financial sustainability. The approach was unacceptable to many and reports like “coal the killing machine”, “back gold has no future”, “coal reserves will exhaust soon” started coming from various agencies.  The green approach may be good but it lacks credibility, economic viability and more importantly inclusiveness! Therefore this column will focus on why coal is the need of the hour (in present terms) and how it is saving the lives of millions.

As we are aware that India is very high on aggregate consumption side but on the per capita energy front it is performing very poorly. Therefore, let us have a look on the following figures that give the cost of adding 1 additional unit per capita to 1.2 billion people, energy sources wise.


Capacity to add 1 unit to per capita (Generation Capacity (MW))


Capacity to add 100 units to per capita (Generation Capacity (MW))

Cost of Construction in ` Crores and ` billion

Thermal (Coal)

161 (4.2 times less than solar)



@5Cr per MW = 80,500 (` 805 billion – 6.7 times less than solar)


304 (2.3 times less than solar)



@5Cr per MW=1,52,000 (` 1,520 billion - 3.6 times less than solar)





@8Cr per MW=5,47,200 (` 5,472 billion)

Source: (Excerpts taken from JPL PPT at CII Energy Security Conference on 27/11/13 (KPMG Report))

The table above is self explanatory and it justifies the place of coal in the energy basket and explains why India is capitalizing on the same. Just imagine the extent of investment needed if we have to reach to the global benchmark in per capita terms using solar energy. Does India have that much of financial capability? It is better to pose the question for the intellectual minds of economics: which source would you prefer? In present terms coal based power generation is economically feasible, socially viable and sustainable.

Coming to the broader question that coal is ‘killing’ people, we have already explained in detail how coal is the saviour rather than killer through the piece “Coal ‘the Killer ‘or ‘the Saviour’? (Vol 10, Issue 1). But this column will be more focussed on the statistics!

Coal as a commodity needs transportation and Indian railways are the major carrier of the coal to the demand centres. Railways as a matter of fact are cross-subsidizing passenger traffic with freight. Coal freight traffic alone is contributing ` 35,000 crore/ annum (` 350 billion) to Indian railways kitty. No other sector contributes so much to the railways.  The relationship of coal with railways is like heart to the human body. If that stops beating the body will die. Likewise, if coal transport stops then railways will not be able to survive.  Eventually the industry will collapse.

What will happen if coal mining stops!


No. of current Employees in (Lakhs)

Loss of jobs / Addition to existing no of unemployed workforce in (Lakhs)

No destituted on account of loss of household income (assuming an employee supports  4 people including him/herself)

Total no. of People ‘harmed’ because of lost jobs in the coal sector

Coal India

3,67,467 (0.36 million)

3,67,467 (0.36 million)

14,69,868 (1.4 million)

14,69,868 (1.4 million)


13,28,199 (1.3 million)

13,28,199 (1.3 million)

53,12,796 (5.3 million)

53,12,796 (5.3 million)


16,95,666 (1.6 million)

16,95,666 (1.66 million)

67,82,664 (6.7 million)

67,82,664 (6.7 million)

Source: ORF Study; HH = Household;

The table above does not take the power industry workforce into account.  If it does unemployment figures will be huge and eventually these figures could lead to large numbers of lost lives.  Therefore the question that we may ask is which sector has the capacity to absorb such a huge semi-skilled workforce? Do we have another alternative? Not really! Another important thing that we need to ask is what will happen to our economy: can anyone answer? Therefore those who have taken criticism of coal to the extreme by looking at it narrowly as a ‘dirty killer’ must be reminded of the fact that coal use cannot be looked at in isolation from the rest of the economy and society.  The choice of energy source is not just a moral choice but an economic and social one.  While there is no denying the fact that there are some ill effects when comes to coal use, there is another side to it which is vital to the way the economy and society are organised!


Views are those of the author                    

Author can be contacted at [email protected]


Power Generation Composition by Source in BRICS Countries

Akhilesh Sati, Observer Research Foundation


Fuel wise Electricity Generation


















































































Total Electricity Generation












                                                                                                                                                                               % Share

Source: International Energy Agency.

Oil & Gas: India’s Milestones             

Dinesh Kumar Madhrey, Observer Research Foundation

Continued from Volume X, Issue 23......


A small oil refinery was set up in Margherita in 1893 to process Digboi crude and closed by 1902. However, the Assam Oil Company (formed by AR&TC to take over the petroleum interests including the Digboi and Makum concessions) commissioned India’s first oil refinery (0.5 mt) at Digboi in December 1901. The refinery is the world’s oldest operating refinery producing in excess of its original capacity (present capacity 0.65 mt). It was taken over by IOC in 1981 & upgraded in July 1996.


In 1923 Digboi refinery was entirely rebuilt and the capacity increased.  By 1926 two product pipelines were laid from Digboi to Tinsukia in Assam.


In 1928, Asiatic Petroleum (India) joined hands with Burmah Oil Company – an active producer, refiner and distributor of petroleum products, particularly in Indian and Burmese markets. This alliance led to the formation of Burmah-Shell Oil Storage and Distributing Company of India Limited. A pioneer in more ways than one, Burmah Shell began its operations with import and marketing of Kerosene. This was imported in bulk and transported in 4 gallon and 1 gallon tins through rail, road and country craft all over India. With motor cars, came canned Petrol, followed by service stations. In the 1930s, retail sales points were built with driveways set back from the road; service stations began to appear and became accepted as a part of road development. After the war Burmah Shell established efficient and up-to-date service and filling stations to give the customers the highest possible standard of service facilities.


India virtually had no oil industry at the time of independence apart from the small refinery at Digboi.  All six oil marketing companies operating in India had their head offices outside India. Three of the marketing companies were subsidiaries of the international oil majors—the Burma-Shell, the Stanvac, later turned into ESSO and the Caltex. The three together controlled 90 percent of the sales of petroleum products to the Indian market. The Digboi refinery with less than half a million tonne capacity, also wholly owned by a subsidiary of the Burma Oil Co-a British concern which held 50 percent partnership in Burma-Shell, covered only a small part of the consumption. Digboi refinery met only 9 per cent of national requirement of Kerosene, 11 per cent of petrol and 5 per cent of fuel oil.


A second refinery was set up at Trombay by the Standard Vacuum Oil Company.


to be continued…







RIL shuts 10th well on D1&D3 gas fields

November 26, 2013. Reliance Industries Ltd (RIL) has shut another well on the main gas fields in the eastern offshore KG-D6 block due to high water ingress, leading to output plummeting to all-time low of 8.73 mmscmd. RIL shut well number B7 on the main producing fields of D1&D3 in Krishna Godavari basin block KG-DWN-98/3 or KG-D6 due to "low pressure and associated high water production," according to a status report of the Directorate General of Hydrocarbons (DGH). B7 is the 10th well to be shut since late 2010 when water and sand ingress made production of gas difficult. RIL had last shut A1 well on April 2 this year for "reservoir build-up study." (

ONGC to start drilling in Kerala-Konkan coast in Feb 2014

November 23, 2013. Oil and Natural Gas Corporation (ONGC) is likely to commence drilling in the Kerala-Konkan coast area in February next year. On the Kerala-Konkan coast, ONGC had acquired 15 wells, six of which are deep wells. Currently, ONGC is holding two blocks. Drilling will be done in the Kerala-Konkan basin in February next year. ONGC had conducted extensive exploration work on the Kerala-Konkan coast in the past few years, but there have been no commercial discoveries so far. ONGC has identified Cambay basin in Gujarat as potential area for exploration of shale gas. (


MRPL to shut a third of refinery units in January

November 26, 2013. The Mangalore Refinery and Petrochemicals Ltd (MRPL) will idle a third of its 300,000 barrels per day (bpd) crude processing capacity for 15 days in January as it plans to shut a hydrocracker for maintenance. MRPL plans to shut the 1.3 million tonnes a year hydrocracker from January 2 for 30 days for catalyst replacement. A 3 mtpa (million tonnes per annum) delayed coker unit will be commissioned during the shutdown. Once the hydrocracker is back online, a 2.2 mtpa fluid catalytic cracker will be ready for commissioning, which will help the refiner in reducing production of fuel oil and raising output of gas oil and heavy naphtha. MRPL aims to supply naphtha to a petrochemical plant being built by ONGC Mangalore Petrochemicals Ltd, a joint venture of MRPL and ONGC. (

RIL shuts secondary unit for planned maintenance

November 25, 2013. Reliance Industries Ltd (RIL) has shut a secondary unit for planned maintenance at its 580,000 barrels per day (bpd) Jamnagar refinery, part of the world's largest refining complex. It shut a desulphuriser unit around two or three days ago for planned maintenance on heat exchangers. The capacity of the unit was not immediately clear. The unit, which removes sulphur to produce fuels such as diesel, is expected to be back online in one to two weeks. The move is unlikely to affect exports of oil products as the company's other facilities can make up for any shortfall. Reliance operates another refinery in Jamnagar, in Gujarat, with a capacity of 660,000 bpd. (

Transportation / Trade

Dabhol LNG import terminal gets shipment after six-month gap

November 25, 2013. The Dabhol LNG import terminal in Maharashtra has received a shipload of liquefied natural gas (LNG) after a gap of six months. Ratnagiri Gas and Power Pvt Ltd (RGPPL) received a spot cargo from Nigeria. LNG carrier Iberica Knutsen, with a capacity of about 135,000 cubic meters, discharged the cargo at Dabhol. The vessel had loaded the gas at Nigeria LNG Ltd’s Bonny Island facility. The 5 million ton-a-year capacity LNG terminal was half ready when original builder and US energy major Enron Corp went bankrupt. The terminal and adjacent power plant were taken over in 2005 by RGPPL - a joint venture of state gas utility GAIL India and NTPC. GAIL is now seeking another cargo from the spot market for January delivery at Dabhol. Dabhol, about 340 km south of Mumbai, is India’s oldest LNG import facility and one of four such terminals in the country, Asia’s fourth-largest buyer of liquefied natural gas. The terminal has now received LNG from BG Group, RasGas of Qatar and Nigeria LNG. The shipment from Nigeria was the first imported by Dabhol after the monsoon. (

Shell to join GAIL's Kakinada LNG project with 30 pc stake

November 24, 2013. Royal Dutch Shell, Europe's largest oil company, is likely to take a 30% stake in GAIL India Ltd's proposed floating liquefied natural gas import terminal project at Kakinada in Andhra Pradesh (AP). Shell had announced plans to build a floating LNG of up to 5 million tonnes per annum capacity off Kakinada coast in a JV with Reliance Power. But Reliance Power exited the project and now Shell has decided to join the GAIL-led project which was announced in 2011. Shell, GAIL and the AP government are talking about the possible equity structure. Shell may take 30% stake. Europe's largest LNG importer GDF Suex UK with whom GAIL originally planned the Kakinada terminal will take 26%. (

IOC makes its 1st purchase of Canadian oil

November 21, 2013. Indian Oil Corp (IOC) has made its first purchase of Canadian oil, taking a cargo of light oil for January lifting via a tender. IOC, India's biggest refiner, bought 1 million barrels of Canadian White Rose from Glencore. The refiner also bought a very large crude carrier (VLCC) containing a million barrels each of Nigerian Bonga and Bonny Light crude from Vitol for January loading. A VLCC can carry about 2 million barrels of crude. (

Policy / Performance

Moily bullish as next round of NELP auction likely from Jan 15

November 26, 2013. Oil Minister M Veerappa Moily sounded bullish about the forthcoming NELP-10 auctions, likely to start January 15, at which the government will offer 86 oil and gas blocks. The latest round of oil and gas block auctions will be the largest since the New Exploration Licensing Policy (NELP) took off in 1999. It comes after a two-year hiatus as the January 2010 auctions were a washout with only 19 of the 34 blocks on offer awarded after 74 bids were received. (

RIL may win gas price hike with financial guarantees

November 26, 2013. RIL may be allowed to hike rates for its gas from April after it offered financial guarantees to the government to settle any claims against it over a shortfall in its gas output, the oil ministry said. In June, India approved a move to higher, market-related rates for locally-produced gas from April 2014, but the finance ministry later said prices for Reliance should be capped because the company's gas production from the offshore D6 block was far below its supply commitment. Reliance, which operates the D6 block off India's eastern coast, has reported a sharp decline in gas output since 2010. Reliance and partner BP have cited geological complexities for the fall in output, but the oil regulator believes they failed to drill enough wells. Falling output had already prompted the government to disallow proportionate cost recovery to Reliance, leading to arbitration proceedings over the issue. (

GAIL plans to set up CNG outlets on New Delhi-Mumbai highway

November 26, 2013. GAIL India Ltd plans to set up a CNG Green Corridor between New Delhi and Mumbai in 12-18 months to facilitate vehicle refuelling. GAIL, through its subsidiaries, plans to set up CNG outlets along the highway between New Delhi and Mumbai and then to Bangalore to provide refuelling for vehicles. Currently, the CNG (compressed natural gas) network is mostly spread within the municipal limits of cities such as Delhi, Agra, Indore and Mumbai. For travel between states, CNG is not viable because of lack of refuelling infrastructure. Adequate refuelling options are currently available only in patches, such as the Delhi-Agra highway. A similar corridor is being set up between Delhi and Lucknow. India currently has a gas pipeline network extending over 13,000 km, with vast stretches still not touched by the environment friendly fuel. The Green Corridor aims to establish the Natural Gas Highway in the country. Refuelling infrastructure across the Green Highway will encourage long-haul transporters to adopt natural gas vehicles (NGVs) due to increased availability of gas stations. Operational gas pipelines from Bangalore to Ludhiana provide an opportunity to transform inland transportation to operate on NGVs and expand the reach of CNG beyond cities. The availability of CNG refuelling stations will ensure the uptake of CNG by NGVs travelling on highways from Bangalore to Ludhiana, spanning Karnataka, Maharashtra, Madhya Pradesh, Uttar Pradesh, Rajasthan, Delhi, Haryana and Punjab. (

India to resume paying Iran in Euros

November 25, 2013. India is likely to resume paying Iran in Euros after a historic accord between western super powers and the Persian Gulf state made it easier to import crude oil from one of its biggest suppliers. India will however stick to its plans to cut crude oil imports from Iran by over 15% to about 11 million tons in the year ending March 31, 2014, as easing of the Western economic sanctions do not yet allow increased buying. India had since July 2011 paid in euros to clear 55% of its purchases of Iranian oil through Ankara-based Halkbank. The remaining 45% due amount was remitted in rupees in accounts Iranian oil company opened in Kolkata-based Uco Bank. Tougher sanctions blocked the payments in euro through Turkey from February 6 this year but the rupee payments for 45% of the purchases continued through Uco Bank. (

HC quashes TN Govt order on GAIL project

November 25, 2013. The Madras High Court (HC) quashed the Tamil Nadu Government’s order stopping work on the gas pipeline project of GAIL (India) that was passing through the westerns districts of the State. Upholding GAIL’s petition against the State Government’s order, the court has asked the State to facilitate the project in the public interest. In April, the Government had stopped work on the Kochi-Kuttanad-Mangalore-Bangalore pipeline project, about 310 km of which passed through Coimbatore, Tiruppur, Erode, Namakkal, Salem, Dharmapuri and Krishnagiri districts on the grounds that it would affect the livelihood of farmers in these districts. The Government even wanted GAIL to restore the lands in those areas where the pipeline had been laid to the original condition. (

Indian refiners say Iran nuclear deal eases crude import process

November 24, 2013. The lifting of a European Union ban on insuring tankers carrying Iranian crude as part of a nuclear deal reached in Geneva will ease the process of importing the Persian Gulf state’s oil, according to Indian refiners. While IOC, HPCL and MRPL said the removal of restrictions on shipping cover will enable them to purchase contracted volumes more easily, they said they don’t intend to buy more than previously planned. The insurance restrictions affected about 95 percent of the global tanker fleet because the ships are covered under rules governed by European law. Carrying Iranian oil would invalidate ships’ insurance against risks including spills and collisions. The Japanese government started providing sovereign cover for its tanker operators while India was due to consider a 20 billion rupee ($320 million) fund to help cover imports. India’s crude imports from Iran are expected to total 11 million tons in the twelve months ending March 31, a drop of about 15 percent from the previous year. Hindustan Petroleum plans to import 0.8 million tons of Iranian crude by March if it can begin shipments next month. The country’s processors are unlikely to exceed their targets in the current financial year. (

No return to administrative prices for petroleum: Moily

November 23, 2013. Oil Minister M Veerappa Moily made it clear that there would be no return to Administrative Price Mechanism for petroleum products as the country has gone far ahead in the deregulation price policy. The minister said the petroleum sector depends mostly on imports (75 per cent), which is directly linked to dollar prices. A small devaluation in the rupee would have a serious affect on petroleum products, he pointed out. Moily said India has to explore and increase oil production. But petroleum companies have no funds to undertake exploration and through price decontrol this crunch can be reduced, he said. On reintroducing the concessional rate for bulk petroleum consumers like Kerala State Road Transport Corporation, Moily said that the Centre would consider the demand raised by states like Kerala. (

Subsidy burden becoming 'backbreaking': ONGC

November 22, 2013. ONGC has said subsidy burden is now almost becoming backbreaking, hinting subsidy bill for the upstream oil and gas major may swell. ONGC's subsidy during first half of the current fiscal had been to the tune of ` 23,400 crore. Due to weak rupee and rising crude price, the overall under-recovery for oil marketing companies (OMCs) in the current financial year may touch ` 1,40,000 crore from ` 80,000 crore as pegged in the beginning of this fiscal. (



NTPC, Tata Power, Adani Power among nine companies in fray for ` 250 bn Odisha UMPP

November 25, 2013. Nine companies including NTPC, Tata Power and Adani Power are in fray for bagging the proposed ` 25,000 crore ultra mega power project (UMPP) at Bedhabahal in Odisha. Larsen & Toubro, Jindal Power, JSW Energy, Sterlite Energy have also submitted their technical bids for the project, Power Finance Corp (PFC) said. CLP India is the only foreign company while NHPC has also sought to foray in thermal power generation. PFC, bid coordinator for UMPPs, will call price bids from the qualifying companies. PFC has offered two ultra mega power projects including one at Cheyyur in Tamil Nadu, to developers under the new bid guidelines. (

NHPC's Subansiri project cost may double to ` 120 bn

November 24, 2013. The total cost of state-owned NHPC's Subansiri project in Assam is likely to be around ` 12,000 crore, nearly double than envisaged initially, following delays on account of various hindrances. The country's largest hydro power producer, NHPC is executing the 2,000 MW Subansiri hydel plant in Assam. The original cost of the project was ` 6,285 crore. The project has been stalled since December 2011, after the local people raised issues related to its safety and downstream impact. The state was earlier granted 208 MW of electricity from the hydel station which has now increased to 300 MW. Besides, the state is expected to get 25 MW or more free power from the plant which is likely to resume construction work next month. The project, earlier expected to be fully commissioned by December 2012, is now likely to be operational by December 2017. (

Tata Power scouts for local partner for Vietnam project

November 21, 2013. Private power firm Tata Power said it is looking for a local partner in Vietnam for the proposed 1,320 MW project in the Southeast Asian country. The company has signed an agreement with the Vietnamese government for setting up the thermal power plant in that country. The project, consisting of two units of 660 MW each, is likely to come up at an investment of over ` 10,000 crore. The company bagged the Long Phu 2 power project. (

Transmission / Distribution / Trade

Kalpataru Power gains on bagging ` 10 bn new orders

November 26, 2013. Kalpataru Power Transmission has surged 6% to ` 82.90 in early morning deals on BSE after the company said it has received orders worth of over ` 1,000 crore. The orders involve projects in Egypt, Rwanda and D.R.Congo. The company also received order for supply and installation of 220 KV transmission systems amounting of ` 246 crore in, Rwanda and D.R.Congo and installation of cross-country pipeline worth ` 131 crore from HPCL. (

NTPC seeks 12 million tonnes coal imports per year

November 25, 2013. India's top power producer NTPC Ltd is looking to import 12 million tonnes of thermal coal a year on a long-term basis starting 2018, compared with 16 million tonnes currently, as it looks to reduce dependence on costly shipments. NTPC's top supplier Coal India Ltd accounts for 80 percent of the country's coal output. But the state miner's inability to raise output in line with demand has meant India has become the No. 3 importer of the fuel despite sitting on what BP has estimated as the world's fifth-largest reserves. NTPC is seeking an expression of interest from third parties for the import of coal for up to 15 years. Indonesia, Australia, South Africa and the United States are the top coal exporters to India. (

Techno Electric bags concession to build transmission network

November 25, 2013. Techno Electric & Engineering Company Ltd (TEECL) said it has bagged the concession for ` 200 crore project from PFC Consulting to build transmission network in Punjab. The concession -- right to use land or other property for a specified purpose, granted by a government or a controlling body -- awarded for a period of 35 years is on Build, Own, Operate and Maintain model, TEECL said. TEECL emerged as the successful bidder selected through tariff based competitive bidding guidelines for transmission services issued by the Power Ministry. (

Energy bourses expect 5 pc market share of power trade by FY 16

November 21, 2013. Power exchanges aim to grab at least 5 per cent market share of all India power trading volume, estimated at 800 billion units, on new regulations and market-friendly products. The market share will rise from current 2.5 to 3 per cent of the pie, they said. In India, two exchanges--IEX and Power Exchange India Ltd (PXIL) are offering power as a commodity, which is traded on one-day ahead basis. They also sell renewable energy certificates and solar energy on their respective platforms. IEX is the leading power exchange of the country. The trend of buying short term power, currently preferred by mostly industrial units, will expand to power distribution companies (discoms) in future, once Central Electricity Regulatory Commission (CERC) comes up with tighter grid frequency band order. ( 

Tata Power commissions additional transmission line in Maharashtra

November 20, 2013. Tata Power said it has commissioned additional transmission lines in Maharashtra. Tata Power announced the commissioning of additional transmission lines in Maharashtra between Kalwa and Salsette, the company said. The transmission line will relieve critical loading of the Kalwa-Salsette lines and will enhance transmission for bringing power from outside to Mumbai city, it said. The unavailability of natural gas to power plants has forced Tata Power's Trombay thermal plant to be underutilised or remain out since July 19, 2013. This acute shortage of up to 500 MW capacity generation from Trombay for Mumbai city, has made it necessary for power to be imported from outside the city. To reduce the critical loading of these lines, Tata Power had put up a proposal to Maharashtra State Load Despatch Centre and State Transmission Utility for augmenting transmission lines between Kalwa and Salsette. ( 

CIL invites applications from entities for coal import

November 20, 2013. Coal India Ltd (CIL) has invited applications from interested state entities for importing coal that would be supplied to power plants. The company further said that the agency will supply coal to various power plant across the country till March 2015. CIL had recently said that the company may import five to six million tonnes in the current financial year. CIL had said that it is likely to import 15 million tonnes of coal for power utilities as part of meeting the fuel supply agreement (FSA) commitment. According to the new FSA, Coal India will supply 65% of the contracted amount from domestic sources and another 15% through imports with pass-on pricing model. Pass-on in other words would mean CIL will charge buyers imported coal at landed cost plus a service charge. ( 

Policy / Performance

TN blames central generating stations for power cuts in state

November 26, 2013. Tamil Nadu Chief Minister J Jayalalithaa blamed the Central Generating Stations for the power cuts, which returned to the state after 4-6 months. In a letter to the Prime Minister, the Chief Minister said a close analysis reveals that power cuts were primarily due to the shortfall in generation by Central Generating Stations. She said this includes the joint venture with NTPC and the new thermal power projects under trial production which are yet to be handed over by BHEL to Tamil Nadu Generation and Distribution Corporation Limited. ( 

Narendra Modi gets it wrong on Delhi power

November 23, 2013. Bharatiya Janata Party (BJP) prime ministerial candidate Narendra Modi may have succeeded in garnering the audience’s applause in claiming that Delhi-ites asked for electricity but did not get any. But his claim falls flat when verified against facts. Delhi-ites asked for 13,112 million units (MUs) of electricity between April and August this year and got 13,067 MUs, a gap of 0.3 per cent, the lowest-ever in the national capital, according to the latest data from the Central Electricity Authority. During the same period, the national deficit was five per cent. Gujarat, however, has a deficit of six MUs. Modi seems to have got it partly correct. While 18,000 MW is stranded nationally, it is based on gas, not coal. However, 25,000 MW of coal-based capacity is running on low plant load factor of less than 60 per cent. During hours of peak demand in Delhi, observed during mornings and evenings, the city received a power quantum of 5,653 MW against a demand of 6,035 MW, recording a power deficit of 6.3 per cent. This was the same as the national average deficit during the same period. (

Inter-ministerial panel cancels 11 coal block allocations

November 23, 2013. An inter-ministerial panel headed by the additional secretary in the coal ministry has decided to cancel the allocation of 11 blocks to various companies, including Jindal Steel and Power (JSPL), Monnet Ispat & Energy and Rungta Mines. The move is part of the government’s drive to tighten the noose around companies that haven’t developed their blocks through the years. With the latest cancellations, 51 of the 218 coal block allocations since 1993 have been axed. The ministry also forfeited bank guarantees in six other cases. It has asked companies to furnish guarantees in five other block allocations. (

Odisha settles outstanding power dues of govt departments

November 22, 2013. The Odisha government has come out with a notification for settling the arrear electricity dues of Odisha Lift irrigation corporation (OLIC) and government offices in a cashless manner. The unpaid electricity dues of OLIC from April, 1999 to December 2002, including the delayed surcharge and the arrears from the government offices, is totalled at ` 156.72 crore and ` 496.25 crore respectively. The outstanding OLIC dues includes ` 119.91 crore to Gridco, ` 11.72 crore to Cesu, ` 13.60 crore to Nesco, ` 4.8 crore to Wesco and ` 6.69 crore to Southco. To help OLIC clear the dues payable to Gridco and discoms, the state government will provide notional subsidy to OLIC under non-plan budget of water resources department in the supplementary statement of expenditure, 2013-14. (

Power ministry seeks basic minimum gas supply for Dabhol from oil ministry

November 21, 2013. The power ministry has written to its oil counterpart, seeking the minimum gas supply required to operate the beleaguered 1,967-MW Dabhol power project in Maharashtra, which has been languishing for want of fuel. The move follows ICICI Bank approaching the government over the project’s inability to repay loans. The ` 8,500-crore loan to the project could turn sour for lenders, as the plant was running at just three per cent capacity and was unable to pay loan instalments. The Dabhol project came into existence in 2001, after the government took over US Energy major Enron’s mothballed plants and an adjacent gas shipping terminal that went bust. Now, the plant is owned and operated by Ratnagiri Gas and Power Projects Ltd, a joint venture of GAIL and NTPC. (

Maharashtra govt gives nod to Mundra UMPP rate revision with riders

November 20, 2013. Maharashtra government approved an application from Tata Power's 4,000 MW ultra mega power project (UMPP) at Mundra seeking tariff revision, as recommended by the Deepak Parekh panel, but with some riders. Maharashtra's power distribution arm MahaVitaran has tied up for getting 800 MW from the coal-fired UMPP in Gujarat. But the state is currently getting 80 per cent of this and wants the company to ensure it gets the entire quota. One of the riders says once the price of imported coal (used in UMPP) falls, the tariff should be revised downwards accordingly. Another caveat calls for an undertaking from the private firm to reduce its return on equity or RoE (a measure of company profitability) as far as possible, they said. If the revision materialises, the power tariff may increase by 59 paise per unit for MahaVitaran. But according to a state discom, they expect the effective increase to be 35-45 paise a unit. The state government has accepted recommendations of the panel, headed by HDFC Chairman Deepak Parekh, which had called for a hike in tariff for power supplied by Coastal Gujarat Power, an arm of Tata Power that runs Mundra UMPP. (

AAP promises power to people, cheaper electricity

November 20, 2013. Cheaper electricity, decentralisation of power and a Delhi Lokpal bill are among the promises the Aam Aadmi Party (AAP) has made in its manifesto for the Dec 4 assembly elections released. Announcing the manifesto, AAP leader Yogendra Yadav said the party will undertake a "radical experiment" of decentralising power by organising "mohalla sabhas" (colony assemblies). Rates of electricity will be slashed to half, we will change the entire system of electricity distribution which is at present being manipulated by power discoms, he said. (




Jones Energy to acquire O&G assets in Anadarko basin, Oklahoma

November 26, 2013. Jones Energy has signed an agreement with a privately-held company to acquire oil and gas assets in the Anadarko basin for $195 mn. As part of the deal, the company will acquire around 26,000 net acres in the Cleveland, Tonkawa and Marmaton plays in the Texas Panhandle and western Oklahoma. The acquired assets are expected to include 92 producing wells with net production of around 3,400 barrels of oil equivalent per day, of which 54% is liquids. The acquired assets include proved reserves of 14.3 million barrels of oil equivalent and 225 identified drilling locations with a working interest of 70%. (

Baker Hughes begins to resume Iraq oilfield operations

November 25, 2013. Baker Hughes Inc is preparing to resume operations in Iraq after protests in Basra prompted the U.S. oilfield services company to stop work at the Rumaila field. Baker Hughes has been working with local authorities to ensure the safety of its workers and has received assurances that there will be additional security forces. (

Statoil exploration to focus on Africa, Norway in 2014

November 25, 2013. Norwegian oil major Statoil expects to keep exploration spending close to this year's record level in 2014, even as some peers rein in investment to save cash for dividends and to combat rising costs. Statoil will focus exploration on Norway, the Gulf of Mexico, Angola and Tanzania, and will also move deeper into the Arctic with wells in the Faroe Islands. Statoil plans to spend about $3.75 billion on exploration this year, a record amount for the firm, and above the $3.5 billion it targeted at the start of the year. (

Tullow finds more oil onshore Kenya

November 22, 2013. Africa-focused Tullow Oil reported that its Agete-1 exploration well on Block 13T, onshore northern Kenya, has discovered and sampled movable oil with an estimated 330 feet of net oil pay in good-quality sandstone reservoirs. Agete-1 wildcat well is part of a major exploration campaign that has now seen the fifth consecutive oil discovery in the first of a chain of multiple rift basins across Tullow's acreage in the region. The discovery de-risks several follow-on prospects that are located to the north and is on trend with the Twiga South, Ekales and Ngamia oil discoveries. Tullow operates the Agete-1 well with a 50-percent interest, while Africa Oil has a non-operated interest of 50-percent. (

Chemicals maker’s $2 bn US bet driven by fracked gas

November 22, 2013. Formosa Plastics Group, Asia’s largest chemical producer, is seeking U.S. permits for a $2 billion expansion of its Texas operations as cheaper natural gas prices make U.S. production more competitive. The Taiwanese company asked federal and state environmental regulators to approve plans for an ethane cracker unit and downstream derivatives. Formosa Plastics’s proposed U.S. investment comes as Taiwan seeks to diversify business and trade ties beyond China, which has become its largest trade partner while also disputing the island’s sovereignty. Taiwan this year resumed trade talks with the U.S. after a five-year halt and the U.S. House Committee on Foreign Affairs this week agreed to introduce a bill to allow the sale of four frigates to Taiwan’s navy. (

Norway to join Chinese firm in Iceland oil exploration

November 22, 2013. Norway said it would team up with a Chinese firm to explore for oil offshore Iceland, in a rare cooperation for the two countries since a diplomatic row over the award of the 2010 Nobel Peace Prize to Chinese dissident Liu Xiaobo. Norway has the right to join an exploration licence with Chinese oil firm CNOOC in the waters between Iceland and Norway's Jan Mayen island, and Norway's government decided it should participate. Diplomatic ties between Beijing and Oslo have been virtually frozen since the 2010 Peace Prize, and collaboration in Iceland may be a sign that relations could be improving. Under a 1981 treaty, Norway has a right to take a 25 percent stake in Iceland's oil licences. Iceland awarded its first two licences in January, in which Norway decided to participate. In June it gave another licence to CNOOC and Icelandic firm Eykon Energy, the first for a Chinese firm to look for oil in the Arctic. (

Vietnam offers 6 O&G blocks to OVL

November 21, 2013. Vietnam has offered to give ONGC Videsh Ltd (OVL) five offshore oil and gas exploration areas in South China Sea and its Kossor block in Uzbekistan without bidding. The five blocks offered on nomination basis lie outside the territory claimed by China in the South China Sea. Vietnam's national oil company PetroVietnam offered Block 17, 41 and 43 while PetroVietnam Exploration Corporation offered blocks 10&11-1 and 102&106/10 and the Kossor block it has in Uzbekistan as Hanoi looks to counter China's influence in the region. (

Canada's NEB forecasts 75 pc rise in crude oil output by 2035

November 21, 2013. Canadian oil production will rise by nearly 75 percent to 5.8 million barrels per day by 2035, the country's National Energy Board (NEB) said in a report, assuming the infrastructure is built to transport crude to export markets. The NEB, Canada's energy regulator, said the discount on Canadian crude versus the West Texas Intermediate benchmark will likely remain volatile if extra takeaway capacity is not built, potentially affecting production growth. (

First gas production from UK Jasmine field

November 20, 2013. BG Group announced first gas production from the Jasmine field in the UK North Sea, in which the company has a 30.5 percent interest. The successful start-up of the field marks the delivery of another of the Group's key milestones for 2013. Jasmine is expected to contribute around 30,000 barrels of oil equivalent per day net to BG Group. (


Petrofac says it has won $2.1 bn Oman refinery deal

November 25, 2013. Petrofac said a joint venture with South Korea's Daelim Industrial Co had won a $2.1 billion contract for a refinery project from Oman Oil Refineries and Petroleum Industries Company. The three-year contract includes engineering, procurement, construction, start-up and commissioning services at a refinery in the Sohar Industrial Area, Petrofac said. The deal includes improvements at the existing facility and the addition of new refining units, it said. (

Asia refiners weigh impact of Iran oil insurance deal on imports

November 25, 2013. Refiners in South Korea and Japan said they have no immediate plans to boost crude purchases from Iran while Indian processors intend to maintain contracted volumes after the EU lifted a ban on insuring tankers. It’s still too early to say whether SK Innovation Co., South Korea’s largest refiner, will increase purchases. Japan’s Showa Shell Sekiyu K.K. doesn’t plan to change its supply deals for the time being, according to the company. Indian Oil Corp., Hindustan Petroleum Corp. and Mangalore Refinery & Petrochemicals Ltd said that while the removal of restrictions will enable them to import contracted volumes more easily, they don’t intend to buy more than previously planned. (

Valerus secures contract for condensate stabilization facility in Venezuela

November 22, 2013. US-based Valerus has received a contract from Cardón IV, a joint venture of Eni and Repsol, to provide engineering, procurement and construction for a natural gas conditioning and condensate stabilization facility in Venezuela. Under the contract, Valerus will perform the process design and fabricate the process equipment, while Consorcio La Perla, a consortium of Valerus Venezuela and Lindsay Venezuela, will be involved in the construction of the facility. The 300 million cubic ft per day facility will process natural gas for Cardon to develop as well as produce dry gas resources at the La Perla field offshore Venezuela. (

Transportation / Trade

Sinopec’s pipeline blast may hurt reform, safety efforts

November 24, 2013. An explosion at a China Petroleum & Chemical Corp. oil pipeline and the nation’s deadliest spillage since at least 2005 may threaten the government’s efforts to lure investment to state-controlled industries as President Xi Jinping called for improved industrial safety. The Nov. 22 accident at the Huangdao district in the eastern city of Qingdao killed at least 52 people. Sinopec, as China Petroleum is known, said it was still investigating the cause of the blast, which happened after crude oil leaked from a 27-year-old pipeline into Qingdao’s municipal rainwater pipe network. China pledged to allow more private investment in state-controlled industries as part of the biggest package of reforms since the 1990s. Oil and energy companies will benefit from the changes as a Communist Party document made clear statements about moving back to market-driven policies. China uses its big three oil companies, of which PetroChina Co. is the largest, to control domestic fuel prices and secure energy supplies from overseas to meet the burgeoning needs of an economy that expanded 7.7 percent last year. (

China considers pipeline reform to boost gas supply

November 24, 2013. As China struggles to rid cities of choking smog, one of the early priorities for Beijing's economic reforms will likely be to force PetroChina to allow private producers fair access to natural gas pipelines. Without fair access to the distribution network, independent producers have no incentive to develop the country's vast gas reserves to their full potential. Already the world's fourth-largest gas user, China's leaders want to boost domestic output to accelerate the substitution of cleaner-burning gas for coal to fuel power and heating. China's largest oil-and-gas producer, PetroChina, built and runs nearly three quarters of the 54,000-km natural gas pipeline system across China. It controls most of the large, long-distance trunk lines that pipe gas from far-flung fields to fast-growing cities. Other state energy firms - Sinopec and CNOOC - run the remaining trunk pipelines but are much smaller operators compared to PetroChina. (

China’s diesel net exports rise to 6-month high on record quota

November 21, 2013. China’s net exports of diesel rose to the highest level in six months in October after refiners were granted record sales quotas. Overseas shipments of the fuel exceeded purchases by 200,211 metric tons, according to the Customs data. That’s about 48,600 barrels a day, the most since April, and more than triple net exports in September, the data show. China, the world’s second-largest oil consumer, is shipping more diesel cargoes after the government increased export allowances for China National Petroleum Corp. and China Petroleum & Chemical Corp., its two biggest refiners. That’s meant to preempt a surplus in fuel supply as plants restart after seasonal repairs and upgrades, according to ICIS-C1 Energy, a Shanghai-based energy consultant. China’s net exports of gasoline fell to 323,666 tons last month, the least since July, the data show. Net jet-kerosene exports climbed to a record 696,200 tons. Imports of fuel oil, used by ships and smaller refineries known as teapot plants, increased to 1.69 million tons in October, the highest level in three months, the data show. Shipments in the first 10 months of 2013 were 20.8 million. Venezuela remained the biggest fuel oil supplier to China after it shipped 381,441 tons last month. Russia shipped 224,956 tons, Singapore delivered 307,381 tons and Iran sold 177,246 tons. (

Lundin favors Norwegian contractors for Johan Sverdrup

November 21, 2013. Lundin Petroleum AB favors Norwegian suppliers to develop the Johan Sverdrup oilfield, the country’s biggest find in decades, after saving money employing a local contractor at its Edvard Grieg project. The company will discuss the matter with partners Statoil ASA, Det Norske Oljeselskap ASA and Petoro AS. Lundin awarded topside-installation and steel-jacket work at the North Sea Grieg platform to Norway’s Kvaerner ASA at a time when several local offshore contracts were given to Asian companies, raising concern that the Nordic country’s oil-industry suppliers weren’t competitive. Lundin may save more than 1 billion kroner ($163 million) at Grieg by contracting a Norwegian supplier. Timely delivery and higher quality can make up for lower prices at Asian competitors. The partners at Johan Sverdrup will announce their “concept” for the field. That can include decisions on platforms, fuel transportation and timeframes, as well as an updated resource estimate. Statoil has already indicated the platforms will have steel jackets and the oil will be processed at sea before being piped to shore. (

Pirates looting cargoes with AK-47s threaten African oil

November 21, 2013. Ankur Varma, third officer on the oil tanker M/V Cotton, opened his cabin door at five minutes to midnight on July 14 to find two men pointing AK-47s at him. They also took the ship’s cargo. The Maltese-flagged vessel was carrying about 10,000 tons of fuel oil belonging to France’s largest oil company when it was attacked by 15 pirates off the coast of Gabon in West Africa. The hijackers kept control of the tanker for seven days as they siphoned off the fuel. While Total SA eventually got its fuel oil back with the help of Ghana’s navy, Varma’s story is becoming increasingly typical as Africa’s west coast replaces Somalia as the world’s most piracy-prone area. The attacks, which are getting more frequent and more violent, threaten shipping in sub-Saharan Africa’s largest oil-producing region. (

Vitol, Shell ask judge to halt release of oil documents

November 21, 2013. Some of the world’s largest oil traders including Vitol Group, Morgan Stanley and Royal Dutch Shell Plc are asking a judge to stop the disclosure of millions of records gathered by the top U.S. commodity regulator during its nationwide investigation of the crude markets. The haul includes e-mails, depositions, trading records and audio files obtained by the U.S. Commodity Futures Trading Commission since its probe of the oil market began in December 2007. The companies appealed an Oct. 25 order by U.S. District Judge William H. Pauley that would allow the handover of the trove to lawyers leading a civil case alleging market manipulation by firms controlled by Norwegian billionaire John Fredriksen. The U.S. Court of Appeals in New York ordered a temporary stay halting the release of the records while it considers speeding up review of the challenge. (

Japan trade deficit widens as fossil fuel imports surge

November 20, 2013. Japan posted its biggest October trade deficit on record, as a revival in exports to the U.S. and China was overwhelmed by the nation’s soaring costs for imported fuel in the wake of the nuclear industry’s shutdown. The shortfall of 1.09 trillion yen ($10.9 billion) extended a record run of deficits to 16 months, and was larger than all 28 forecasts in a survey, a finance ministry report showed in Tokyo. Imports climbed 26.1 percent from a year earlier, while exports gained 18.6 percent. (

Policy / Performance

Somaliland to sign accord with fourth company on oil exploration

November 25, 2013. Somaliland expects to sign an agreement with a fourth international energy company to begin exploring for oil in the semi-autonomous region, Energy Minister Hussein Abdi Dualeh said. An accord with the Middle East-based company, which Dualeh declined to identify, has been completed. The other three companies already operating in the country are London-based Genel Energy Plc, RAK Gas LLC, owned by the government of Ras al-Khaimah in the United Arab Emirates, and Oslo-based DNO International ASA. (

Putin bets on Gazprom purge as slowdown threatens legacy

November 25, 2013. Russian president Vladimir Putin had spent the August morning in a helicopter over Khabarovsk, near the Chinese border, surveying flood damage that had left tens of thousands of people homeless. Then he met with senior advisers who were on the trip, for a briefing on economic issues. They drew parallels to another brewing storm: The energy-export model Putin had relied on to restore Russia’s economic strength had run its course. The state-dominated economy needed a shock, and, to prevent stagnation as growth slowed, a reset. Something had to be done. The solution Putin chose will ripple through the entire Russian economy starting next year: He elected to freeze prices at such powerful state companies as OAO Gazprom and OAO Russian Railways. The plan is to set off a chain reaction that will lead to increased efficiency, more stable costs for companies and tamer inflation. Brent crude, the benchmark for more than half the world’s oil, has fallen 3 percent this year after gaining 43 percent in the previous three years. That also compares with an 87 percent increase in the commodity during Putin’s first stint as president, from 2000 to 2008. The Economy Ministry expects the freeze to boost profit at the biggest industrial enterprises by 2.5 percent to 3 percent next year alone as budgeted cost increases disappear. Oil producers should benefit the most, led by state-run OAO Rosneft, as well as miners and steelmakers, which should spend 47 billion rubles less in total than planned in 2014 on power and cargo bills, the ministry said. (

US says Iran oil exports can’t increase under nuclear accord

November 24, 2013. Iran’s crude oil sales will still be limited to about 1 million barrels a day under international sanctions that remain in force as part of the nuclear accord reached in Geneva, according to the White House. Iran’s crude exports have fallen 60 percent since the beginning of 2012, depriving the country of more than $80 billion in revenue, the Obama administration said after the deal was announced. The agreement means buyers that have significantly reduced purchases won’t be required to make further cuts and includes the removal of a European Union ban on insuring tankers transporting Iranian oil. An EU embargo on crude imports from the country remains in place. (

China winter gas shortages to last through 2020

November 22, 2013. China is likely to see natural gas shortages every winter until the end of the decade as domestic production fails to keep up with demand, a factor likely to drive global liquefied natural gas prices higher, energy consultancy Wood Mackenzie said in a report. Increased gas demand from China for heating has already helped lift spot liquefied natural gas (LNG) prices by over 20 percent since mid-September and will aggravate an already tight market for spot LNG cargoes. Winter gas shortages will be exacerbated through to 2020 as seasonal demand growth in northern China increases at an annualised rate of approximately 16 percent per annum, the report said. China's need for more imported gas comes just as the needs of top LNG buyers Japan and South Korea are also rising due to reduced nuclear capacity. Spot LNG prices LNG-AS are currently close to $19 per million British thermal units (mmBtu), up from around $15 mmBtu in September. Domestic gas production in China during the first nine months of 2013 rose 9 percent year-on-year to 58 billion cubic meters, but the increase was insufficient to keep up with surging demand. China's top natural gas producers have already cut supplies to industrial consumers to ensure homes and users of transport have enough fuel. The report said China will need to rely on imported LNG for up to 46 percent of its additional gas demand. The rest will be met by supplies piped in from Central Asia and Myanmar. (



Holland BPW continues plans for new power plant

November 26, 2013. The Holland BPW is looking to tie up loose ends involving land acquisition for its proposed new natural gas-fueled power plant. The plant is projected to be online by the end of 2016, and would replace the current coal-fired DeYoung facility as the BPW’s main source for generating electricity. (

Oracle, Sepco sign MoU for Thar coal-fired power plant development in Pakistan

November 25, 2013. Oracle Coalfields has signed a memorandum of understanding (MoU) with Sepco Electric Power Construction to develop the 600 MW coal-fired power plant at the Block VI, Thar Coalfield in Sindh province, Pakistan. As part of agreement, the companies will prepare technical feasibility study and an environmental impact study for the project, including design, construction and operation plans, and plans to finance up to 70% of the debt for the power plant and also provide equity funding for a majority stake in the new company, with Oracle taking a minority interest. (

Siemens commissions Peru's new simple cycle power plant

November 25, 2013. Siemens Energy has commissioned the Santo Domingo de los Olleros simple cycle power plant in Canete province, Lima region, Peru. The 200 MW power plant was built under a $80 mn contract awarded by Termochilca to the company in April 2011, to help address the growing power demand in Lima. The company has been providing efficient and environmentally friendly gas-fired power generation in Peru for several years. The newly commissioned natural gas fueled power generation plant is scheduled to start service in a simple cycle mode with an option for a combined cycle plant in the next phase. (

Saudi utility inks $453 mn deal for Riyadh power plants

November 24, 2013. Saudi Electricity Co (SEC) signed two contracts worth around SR1.7bn ($453 million) with General Electric for maintenance of gas turbines at new power plants in Riyadh, SEC said. The deal, which would run for 25 years split between 8 basic years and 17 optional years, would cover maintenance work on the 12 gas units for the combined-cycle power plants, SEC said. This follows a previous deal signed in which GE will supply SEC with 12 gas units and four steam turbines for the planned Riyadh Power Plant 13 (PP13) and PP14. Each plant would have a capacity of between 1,600 and 1,950 MW. (

Tecnatom supports start-up of Lungmen nuclear power plant in Taiwan

November 21, 2013. Spanish utility Tecnatom has participated along with other international companies in the design and start-up of the Lungmen nuclear power plant, which is located in Gongliao Township, Taiwan. Specifically, the company played a significant role in plant instrumentation and control, besides collaborating in the design of the man-machine interface of the control rooms of the two groups GE-advanced boiling water reactor groups of 1,350MWe each. (

Transmission / Distribution / Trade

Appalachian Power to build transmission, substation project

November 22, 2013. Appalachian Power filed a request with the Virginia State Corporation Commission to build an electric transmission project in parts of northern Campbell County and the southern part of the city of Lynchburg. The project will add one new substation and nine miles of 138 kV transmission line to connect existing substations and ensure adequate and reliable electric service to accommodate future growth in the South Lynchburg area. The company hopes to complete the project for a desired in-service date of June 30, 2017. Its estimated overall cost is about $28 million. (

Policy / Performance

Edenville to develop 100 MW power plant at Tanzania coal play

November 26, 2013. Following recent indications by the Tanzanian government of its commitment to begin construction of the country's main power grid in 2014, coal explorer Edenville Energy has confirmed its intention to construct a 100 MW power station at its Tanzania-based Rukwa coal project, supplying energy directly into the country’s proposed new power grid. The government had indicated that construction of the Western Power Line, between Mbeya and Sumbawanga, would start in 2014 and was expected to be completed during 2016 – far earlier than previously indicated. (

Iran plans construction of 2 more nuclear power plants

November 23, 2013. Iran's atomic agency is planning to construct two more nuclear plants. Construction of the 1,000 MW plant was begun in 1975 by German company Siemens, and Russian engineers took over in the 1990s. The Russian State Nuclear Energy Corporation said that Iran's Bushehr plant is ready to be fully transferred to the Atomic Energy Organization of Iran (AEOI). Bushehr is currently operating at full capacity and the preparation for the transfer to Iranian officials is in its final stages. (

Pakistan plans nuclear power plant with China amid energy woes

November 22, 2013. Pakistan plans to construct a civil nuclear power plant with China’s help in the country’s biggest city to meet growing demand for energy, Prime Minister Nawaz Sharif said. He plans to travel to Karachi to lay the foundation stone of Pakistan’s sixth nuclear power plant, which he said will produce 2,117 MW of electricity. China has helped Pakistan build two atomic reactors at Chashma in Punjab province, and is assisting with two more under construction at the same site. The new plant would be the second in Karachi. (

Gulf Arabs face mixed blessing from an Iran accord: Arab credit

November 21, 2013. A nuclear deal between Iran and countries including the U.S. and Russia could prompt sovereign upgrades of Persian Gulf Arab nations even as it may cut their revenue by causing oil prices to fall, according to energy consultant IHS Inc. Talks between Iran and the so-called P5+1 group of world powers resumed at diplomats level in Geneva. Concern that Iran seeks to make an atomic bomb and the civil war in Syria, where Iran supports President Bashar al-Assad, have helped boost crude prices to more than $115 a barrel twice in the past 12 months. Middle Eastern political risk weighs on GCC credit ratings. All six nations of the regional group are ranked as investment grade at Moody’s Investors Service and Standard & Poor’s. The agencies respectively rate Kuwait, Qatar and the U.A.E. as Aa2 or AA, Saudi Arabia as Aa3 and AA-, Oman as A1 and A, and Bahrain as Baa2 and BBB. Qatar seeks to raise its S&P rating by two levels to AAA, putting it on par with countries including Canada and Norway, Finance Minister Yousef Kamal said. Iran’s government says its program to enrich uranium is intended for electricity generation and other peaceful purposes. The U.S. and the European Union dispute the claim and have imposed economic sanctions on the Islamic Republic to try to halt its nuclear progress. (

IADB approves $45 mn loan to boost electricity sector in Nicaragua

November 20, 2013. The Inter-American Development Bank (IADB) has agreed to provide a $45 mn loan to Nicaragua to strengthen electricity sector in the country. The country will use the loan to improve energy sector management and support steps to create a sustainable energy grid by promoting renewable energy sources, private investment and energy efficiency. The project will seek to identify obstacles and solutions for entering the national electricity market, encourage improvements in new-generation contracting processes so as to stimulate competition and private investment through a legal framework with clearly defined rules. (



Tata Power eyes more purchases in wind and solar push

November 26, 2013. Tata Power is looking for more acquisitions as part of a $260-million-a-year investment push into renewable energy, following last month's purchase of a wind farm in western Gujarat from AES Corp. Primarily a thermal power utility, it is targeting rapid expansion in renewables at home and overseas, aiming to add about 150 to 200 MW of wind capacity and 30 to 50 MW of solar power every year. Its newly acquired plant has a capacity of 39.2 MW. As coal and gas shortages and populist tariff regimes hobble the performance of thermal power stations, renewable energy players such as Tata and Welspun Energy want to tap the sector's potential in a growing but energy-starved economy. But problems with acquiring land for projects, poorly enforced government policies, and a race to the bottom in bidding for solar projects are a drag on renewables growth, said Rahul Shah, the chief of business development for India business and renewables. The margins on renewable energy are lower, at around 12 percent to 18 percent versus about 20 percent to 30 percent in the thermal sector, Shah said. Although the firm will look to sell a stake in its renewable business at some point, it has no timeline for this, Shah said. Tata operates about 400 MW of wind projects and 30 MW of solar. Shah said he hoped to buy more projects as soon as this fiscal year, which ends in March, and is evaluating projects worth a total of 370 MW for possible purchase. India has targeted doubling its renewable energy capacity to 55,000 MW by 2017, from nearly 27,000 at the start of this year. Renewables contribute about 12.5 percent of India's energy, the 2012/13 report by the New and Renewable Energy Ministry shows. (

Kerala coir pith to fuel 10 MW power plant

November 25, 2013. A path-breaking initiative by the Kochi-headquartered Coir Board has proved that electricity can be generated from the spongy coir pith. The successful experiment by the Coir Board's research and development wing has prompted the organisation to set up a 10 MW power generation project in Thiruvananthapuram district - a first in the country. The proposed unit will be set up with an estimated investment of ` 50 crore. Power will be generated after removing moisture from the coir pith. For continuous availability of raw material for the power unit, the Coir Board is launching a Kerala-level programme to guarantee scientific procurement of coconut husk. Currently, only 30 per cent of the husk is being converted into coir. (

Maharashtra farmers get climate smart with hi-tech weather alerts

November 25, 2013. Farmers in Maharashtra are getting climate smart! Thanks to advanced technology they are now empowered to adapt to extreme climatic changes and accordingly plan their agricultural activities. Twice a week these farmers receive text messages or can read on wall displays, weather variance information that is specific to their crop and geographical location - courtesy 51 automated weather stations scattered across villages of the state's Akole and Sangamner blocks in Ahmednagar district. This advisory system is part of the agro-met component of Watershed Organisation Trust's Climate Change Adaptation project implemented with the help of India Meteorological Department that started the first agro-advisories via radio in 1945. (

NTPC, IOCL set up pilot plant to mitigate CO2 at NTPC Faridabad gas facility

November 23, 2013. National Thermal Power Corporation (NTPC) and Indian Oil Corporation Ltd have set up a pilot plant for Bio-fixation of CO2 from the flue gas through micro algae, at its NTPC Faridabad facility. Two conjoining algae ponds of area have been constructed to draw CO2 from stacks at the project. The inoculation in the smaller of the two ponds was done earlier in the month and in the bigger pond on November 20 to generate micro algae, much ahead of the targeted date of Jan 2014. This project is part of NTPC's plan to meet environment challenges of the 21st century and beyond, where the company plans to adopt latest environment practices and protection systems, in order to minimize the impact of power generation on environment. CO2 is a major green house gas contributing to more than 50% to the total predicted global warming of the earth's atmosphere. (

Mahindra plans to double solar contracts in South India

November 22, 2013. A unit of Mahindra & Mahindra Ltd., India’s biggest sports utility-vehicle maker, plans to almost triple solar capacity by adding plants in the state of Tamil Nadu where a power deficit is spurring clean-energy investment. The company’s Mahindra EPC Services unit expects to add 150 MW of solar capacity in the state over the next 18 months. Mahindra EPC has already designed and installed 80 MW of photovoltaic plants in India as the contractor for solar investors. (

India rejects US plan to use ozone treaty to cut HFCs

November 21, 2013. India opposed using the Montreal Protocol ozone-protection treaty to restrict powerful greenhouse gases called hydrofluorocarbons (HFCs), pouring cold water on efforts by the U.S. and the European Union. U.S. and EU envoys have suggested using the ozone treaty to pare back the gases. That would bypass slow-moving UN climate talks, which often deadlock on unrelated issues. The gases are made by companies including Honeywell International Inc. and DuPont Co. in a $4 billion global refrigerant industry. (

Indowind Energy honours $6.5 mn FCCBs

November 21, 2013. Indowind Energy Limited, a Chennai-based company that sells ready-to-buy wind farm projects to corporates and green power to corporates and electricity boards, has honoured foreign currency convertible bonds (FCCBs) amounting $6.5 million (` 40.4 crore) and cancelled the same. With this, the total cancelled FCCBs amount to $15 million, which is 50% of the original issue size $30 million, the company said. The board had discussed and reviewed the FCCB issue and the ongoing 28 MW windfarms project in Karnataka and Tamil Nadu. It also decided to explore the possibilities for raising an additional $30 million through euro convertible bonds (ECBs) to meet the gap in funding the project, which would be about $10 million and the balance $20 million for clearing the existing long-term loans and FCCB obligations as per the restructured terms. (

Auto parts makers plan 50 MW solar capacity in Tamil Nadu

November 21, 2013. A consortium of automotive component manufacturers in Chennai is planning to set up around 50 MW solar power capacity in Tamil Nadu with an investment of ` 300 crore over the next 2-3 years. The power produced from here will be used for captive purpose. At today's rate, setting up a one mega watt of solar farm would cost ` 6-6.5 crore. (

India likely to see 1.75 GW solar capacity addition 

November 20. 2013. India is projected to see a solar power generation capacity addition of 1,750 MW next year, says a report. Noting that new solar installations so far this year have been around 900 MW, Mercom Capital Group said that India is not likely to register any significant year-over-year growth for 2013. However, during this period, global solar market is estimated to see 20 per cent growth. (


RWE scraps British wind farm amid political energy row

November 26, 2013. Germany's RWE has scrapped plans to build the world's largest offshore wind farm in British waters only a month after warning that political wrangling over green energy was endangering billions of pounds of investment. RWE's nPower said that the Atlantic Array project off southwest England, which would have featured up to 240 wind turbines and powered as many as 900,000 British homes, no longer made economic sense in current market conditions. The cost of the project has been estimated at as much as 4 billion pounds ($6.5 billion). (

Methane emissions in US probably top estimates

November 26, 2013. U.S. emissions of methane -- a greenhouse gas -- are probably 50 percent higher than current estimates show, according to a study published in the Proceedings of the National Academy of Science. The study estimated emissions in 2007 and 2008, using measurements on the ground, in telecommunications towers and from aircraft for a comprehensive inventory of the second most abundant greenhouse gas after carbon dioxide. It found that the U.S. now underestimates methane releases from the raising of livestock and the extraction of oil and natural gas. (

Brazil state seeks 180 MW of solar farms to lure industry

November 25, 2013. Brazil’s northeastern state of Pernambuco will auction 180 MW of solar farms on Dec. 20 as it seeks to become a manufacturing hub for the expanding industry. Developers will bid down from a maximum price of 250 reais ($109.13) a megawatt hour and the power plants must be completed within three years. Companies that agree to buy the power will qualify for a government rebate on the value-added tax ICMS, so they’ll be effectively paying 164.87 reais a megawatt hour, in line with market rates. Brazil is seeking to boost investment in solar plants and Pernambuco is well suited to supply equipment. The state is in talks with German, Korean, Chinese and Italian companies to build factories for solar equipment including inverters and support structures for panels. Brazil has three solar plants with 2.5 MW of total capacity online. About 7.6 MW of projects have been financed or are under construction. Brazil’s ICMS tax is officially known as Imposto sobre Circulacao de Mercadorias e Servicos. (

Pollution pact from China to India shows rift: Carbon & Climate

November 25, 2013. China and India’s success in weakening the latest global warming agreement created friction with other developing nations that are seeking to step up the fight against climate change. The two countries insisted on single-word changes for a deal at a United Nations conference involving 190 nations on Nov. 23. Instead of making “commitments” to roll back fossil fuel emissions, they signed up for “contributions,” a formulation that allows more flexibility in their action. (

UK says carbon commitment step too far for emerging nations

November 25, 2013. U.K. Energy Secretary Ed Davey comments on why emerging nations pushed to remove the word “commitments” from a text at United Nations climate talks in Warsaw on Nov. 23. He was speaking in an interview that day in the Polish capital, as the negotiations were finishing. Plan calls for nations to make “contributions” to cut greenhouse-gas emissions instead of commitments, according to an undated document published on the website of the UN Framework Convention on Climate Change. The text called on nations ready to do so to communicate post-2020 emission-limiting targets by March 2015. (

Markets have ‘deep roots’ in UN climate process, IETA says

November 25, 2013. Market mechanisms such as the European Union’s emissions-trading system still have “deep roots” in the United Nations climate talks after negotiators failed to adopt major decisions this year, the head of a trading lobby said. Envoys from more than 190 countries backed some measures to improve the UN’s carbon offset market, the Clean Development Mechanism, at last week’s climate summit in Warsaw. They postponed a mandated review until June and failed to agree on a framework for linking national systems. While decisions on long-term measures were put back, the commitment to have markets at the core of the future agreement is strong, according to Dirk Forrister, the chief executive officer of the International Emissions Trading Association (IETA), a market lobby. Market-based mechanisms such as emissions trading are regarded by groups including IETA and the Climate Markets and Investment Association as being the most economically efficient way to achieve a set target for reducing climate pollution. The UN’s Kyoto Protocol gave 39 industrialized countries a goal of a collective 5.2 percent cut in greenhouse-gas output from 1990 levels by 2012, and discussions are continuing over extending a target to 2020. (

Global warming fight advances with first steps on treaty

November 24, 2013. Diplomats from almost 190 nations endorsed a set of measures on global warming, laying the groundwork for a treaty to be adopted in 2015 that would limit pollution by all nations for the first time. The delegates at a United Nations conference called on those who are ready to make pledges on emissions by the first quarter of 2015. They authorized work on a “loss and damage” mechanism that would help the poorest cope with the impact of climate change, took in $100 million in aid pledges to fund adaptation programs and agreed on a forest-protection deal. The meeting sidestepped the most thorny issues in the debate, namely how to divide up responsibility for emissions cuts and how richer nations will meet their promise to channel $100 billion a year by 2020 in aid for climate projects. Those concerns may stymie work toward a broader accord in two years. This year’s meeting of the UN Framework Convention on Climate Change was never designed to produce a breakthrough. Instead, it was meant to work out the technical groundwork necessary for the 2015 deal, which will be negotiated in Paris after an interim meeting in Lima, Peru. (

UN envoys adopt conclusions on climate finance at Warsaw talks

November 23, 2013. Envoys at United Nations global warming talks adopted a decision on climate change aid, clearing up a second of three areas that’s kept them working a day over time in Warsaw. The text calls on developed countries to mobilize climate aid from government money “at increasing levels” from the $10-billion a year paid out from 2010 through 2012, with an aim to reach their pledge of $100 billion in 2020 from public and private funds. (

Forest protection plan settled at UN climate talks

November 23, 2013. Climate envoys from about 190 nations agreed on a deal that will channel funds to developing countries to cut greenhouse-gas emissions by preventing deforestation. A decision establishing rules for the mechanism, known as Reducing Emissions from Deforestation and Forest Degradation, or REDD-plus, was approved at a plenary session at United Nations-organized climate talks in Warsaw. Nations have been discussing a REDD-plus mechanism since 2005. (

Japan cuts emissions goal in setback for climate talks

November 21, 2013. Japan, the world’s fifth-largest producer of carbon dioxide, watered down its target to cut greenhouse gas emissions in a move that critics say will set back United Nations talks to tackle climate change. The new target reverses course from the goal set four years ago by allowing a 3.1 percent increase in emissions from 1990 levels rather than seeking a 25 percent cut. (

GE to supply 795 MW of wind turbines in Brazil, Colorado

November 21, 2013. General Electric Co. (GE), the largest U.S. producer of wind turbines, agreed to supply 795 MW of systems for projects in Brazil and Colorado. GE won contracts for 545 MW in Brazil, about 63 percent of the capacity awarded in a government-organized auction, the Fairfield, Connecticut-based company said. The 1.7 and 1.85 MW turbines will be used in 26 wind farms by seven developers, and the orders include 10-year service agreements. (

China, India push rich countries to move first on climate change

November 21, 2013. China and India are stepping up pressure on wealthy countries to move first on fighting global warming, saying the earliest industrialized nations are the most to blame for rising temperatures. Speaking at talks involving 190 nations that aim to forge a new treaty to limit greenhouse gas emissions, the developing nations said their richer counterparts should provide more details on a pledge to boost climate aid to $100 billion a year and on how they will cut their own emissions before the poorer countries are required to set their own targets. The comments indicate the scale of the challenge negotiators face in forging a treaty by 2015 that could replace the Kyoto Protocol, the only international pact limiting fossil fuel emissions. While richer nations led by the U.S. and European Union want all countries to make cuts together, those classed as developing want the industrial nations to move first. (

EU lawmaker Liese to seek changes to draft aviation carbon law

November 20, 2013. European Union (EU) lawmaker Peter Liese plans to propose changes to a draft law on emissions from airlines to shorten the period in which curbs on international carriers are limited to the bloc’s airspace. The draft law that he wants to be changed was proposed by the European Commission and would narrow the scope of greenhouse-gas curbs on flights to and from the region’s airports from next year through 2020. (

SunEdison gets $100 mn OPIC, IFC loan for Chile solar plant

November 20, 2013. SunEdison Inc., the solar developer and polysilicon supplier formerly known as MEMC Electronic Materials Inc., received $100.4 million in loans from Overseas Private Investment Corp. (OPIC) and the World Bank Group to build a power plant in northern Chile. OPIC, the U.S. government’s development finance institution, provided $62.9 million in debt financing and the World Bank’s IFC unit contributed $37.5 million. Rabobank International also provided a local Chilean peso VAT facility worth $25.6 million. The 50.7 MW San Andres solar farm in the Atacama region will be connected to Chile’s Central Interconnected System in the first quarter and will sell power on the spot market. (

Fossil-fuel subsidies outstripping climate aid by factor of five

November 20, 2013. Fossil-fuel subsidies paid by industrial nations are more than five times the climate aid provided to poorer nations that need funds to reduce emissions and adapt to global warming, a study showed. Industrialized countries paid $58.7 billion in 2011 in subsidies to the oil, coal and natural gas industries and to consumers of the fuels. That compares with climate-aid averaging $11.7 billion a year from 2010 to 2012, the Washington-based campaign group Oil Change International said in a report released in Warsaw. Eliminating the subsidies would help countries cut the greenhouse-gas emissions blamed for global warming and provide funds to help poor nations cope with higher temperatures. Envoys at United Nations climate talks in the Polish capital intend to craft a new agreement by 2015. At the same time, richer countries are trying to meet a pledge to provide $100 billion a year in climate aid by 2020. (

UK joins US pledge to stop funding foreign coal-power plants

November 20, 2013. The U.K. joined a U.S. commitment to minimize funding of foreign coal-fired power stations as they seek to curb use of a fuel that spews twice the levels of greenhouse emissions as burning natural gas. Funding for coal would be allowed under the “rare circumstances” when alternatives aren’t available and there’s a case for reducing poverty. Reliance on coal moved into focus at the talks after a UN report indicated that humans already burned more than half the amount of fossil fuels that could lead to dangerous changes in the climate. Coal generated 30.3 percent of the world’s primary energy in 2011, the highest level since 1969, according to the World Coal Association. It slipped to 29.9 percent last year. (

Konukiewitz says Climate Fund has no money raising expectations

November 20, 2013. Manfred Konukiewitz, co-chairman of the Green Climate Fund, said the provider of financing to developing nations has no clear expectation of how much money it will secure next year in a planned initial raising. He expected the fund would probably raise between $6 billion, the amount secured by a group of climate investment funds administered by the World Bank in New York, and $30 billion, the amount of finance provided by richer nations through 2012. Developing countries are seeking from $60 billion to $70 billion in climate finance by 2016, PwC, the accounting firm, said. (

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