Energy News Monitor I Volume X, Issue 9

Himalayan Blunders Lydia Powell, Observer Research Foundation

 

 

 

NEWS BRIEF

OIL & GAS

August 13, 2013. Oil and Natural Gas Corporation Limited (ONGC) reported 4 hydrocarbon discoveries in first quarter of fiscal year 2013/14 (FY13/14) ending June and an additional discovery in August. The firm discovered gas at the KGOSN041NANL-2 exploration well in the Krishna Godavari basin off India's east coast. The well flowed gas at 2.35 million standard cubic feet per day (MMscf/d) through 0.25 inch choke tested at Object-I (interval 4,039-4,098 feet). A second gas discovery made a gas discovery at the SRM-AA well in Godavari Onland Petroleum Mining License (PML) in the Krishna onshore basin. The well was drilled to a depth of 13,307 feet. ONGC also discovered gas at the GK-28-9 exploration well in the Western Offshore (Kutch) Basin when it was drilled in the eastern fault block of GK-28 structure in GK-28 PML. The GK-42-3 well - the fourth discovery made by ONGC - in the Western Offshore (Kutch) Basin was drilled north-north east of Discovery Well GK-42-1 in the eastern fault block of the basin as an assessment well to upgrade the reserves and assess the potential of the Jakhau reservoir established through GK-42-1. Object-II (interval 4,181-4,188 feet) within Nakhatrana Formation yielded gas at 1.322 MMscf/d through 0.5 inch choke. ONGC said this discovery will help reassess estimates in the fault block to the east of well B-42-1. The final discovery was made at Gandhar-686 exploration well in the Gandhar Extension-VI ML area in the Western Onland Basin. (www.rigzone.com)

August 13, 2013. ONGC is in talks with ConocoPhillips and Shell for selling a stake in its KG Basin deep-sea block, which has large oil and gas reserves, the company said. ONGC expects to produce about 9 million standard cubic meters per day gas in 2017 from the block adjoining Reliance Industries' D6 gas fields. It has been scouting for a partner for its deepwater block after Norwegian oil major Statoil and Brazil's Petrobras pulled out three years ago because of delays in regulatory approvals. Last November it formed a strategic alliance with INPEX Corp of Japan in for exploration of hydrocarbons in the basin. ONGC posted a net profit of ` 4,016 crore in Q1 after paying ` 12,622 crore compensation to state-run refiners for selling diesel, kerosene and cooking gas below market rates. The company needs better margins to be able to invest in oil and gas exploration. ONGC's gross realisation for selling one barrel of crude oil this quarter was $102.90, but after discounts it received only $40.17 per barrel. Last year, its gross realisation in the first quarter was $109.18 per barrel, but net realisation was $45.91 per barrel. The company had posted ` 6,078 crore net profit in the first quarter previous year after giving ` 12,346 crore discounts to refiners. Appraisal of ONGC's KG basin block was in progress, where oil is also found in "significant" quantities. (economictimes.indiatimes.com)

August 8, 2013. The Comptroller and Auditor General of India (CAG) has hauled up ONGC for hiring a drilling rig from Reliance Industries Ltd (RIL) without bidding and for no pressing reason. CAG said ONGC hired rig 'Actinia' from RIL for six months in 2009 for ` 146.71 crore saying it needed urgently drill three wells but its actual usage indicated the hiring was "not necessary". This is the second time that CAG has pulled up ONGC for hiring a rig from RIL. It had in a September 2012 report criticised ONGC for hiring deepsea drilling rig Dhirubhai Deepwater KG-1 (DDKG-1) in May 2009 without calling for competitive bids and on untenable grounds. ONGC had hired Actinia from RIL at a day rate or USD 190,000 to drill three wells. But CAG during the audit found that the rig was deployed at only one of the three locations that had been put as reason for hiring of the rig. The other two locations were drilled by two different rigs. (economictimes.indiatimes.com)

August 7, 2013. India's oil exploration regime has become "arrogant", losing its appeal for investors who are badly needed in the country, where weak prospects of discoveries has prompted energy giant BP and Reliance Industries to relinquish 15 of the 21 blocks for which the oil major struck a $7.2-billion deal. BP has termed the relinquishment of blocks as a routine "portfolio management" exercise, but industry experts say this is not a good sign for the country, where companies that have invested risk capital have faced enormous regulatory hardships. Industry leaders say that authorities can afford to be tough with investors if the prospects of finding oil and gas are as bright as in the Middle East, not in the country were discoveries are few and far between, with the best discoveries in recent decades were reported by private firms. The oil ministry has not auctioned exploration blocks for over two and a half years shows that either the oil ministry knows that hardly any company would be interested, or it is in no hurry to speed up oil exploration in the country that imports about 80% of the oil it processes. India initially succeeded in luring some foreign energy firms such as Petrobras, Statoil, Santos, BHP Billiton and Eni. BP paid $7.2 billion, including $2.5 billion "goodwill", to enter the promising market. But many investors have been scared away from the market that once looked irresistible. Norwegian oil major Statoil and Brazil's Petrobras pulled out from ONGC's prolific Krishna-Godavari basin block three years ago because of bureaucratic hassles and delays in getting regulatory approvals. In last couple of years, companies such as BHP Billiton, Santos and Eni also lost interest in exploring oil and gas in India for similar reasons. Indian basins are not highly prospective so the country should be more sensitive towards investors. The poor investment climate has also delayed the annual auction of oil and gas blocks, which was last held in March 2011. The government plans to launch the 10^th bidding round soon. Reliance Industries announced that it had only eight exploration blocks from 28 about two years ago. BP is upbeat about its India business that includes developing proven fields, looking for new ones, and marketing gas, including LNG. BP picked up a 30% stake in RIL's 21 blocks for $7.026 billion in August 2011. (economictimes.indiatimes.com)

August 7, 2013. Oil regulator DGH has recommended an additional penalty of $ 792 million on Reliance Industries for producing less than the projected natural gas from its eastern offshore KG-D6 fields. The Directorate General of Hydrocarbons (DGH) recommended to the Oil Ministry that $ 792 million of the cost RIL has incurred in KG-D6 fields be disallowed for producing only an average of 26.07 million cubic meters per day of gas as against the target of 86.73 mmcmd in 2012-13. This will be in addition to $ 1.005 billion in cost recovery already disallowed for output falling short of targets during 2010-11 and 2011-12. It blamed RIL for not drilling its committed quota of wells leading to fall in production, resulting in a large chunk of production facilities lying unused or under-utilised. RIL has built infrastructure to handle 80 mmscmd of output but is currently producing less than 14 mmscmd. As per the production sharing contract, RIL and its partners BP Plc and Niko Resources are allowed to deduct all of the capital and operating expenses from sale of gas before sharing profits with the government. The Oil Ministry is yet to act on the advice of DGH as the previous cost recovery disallowance notice is under arbitration. RIL and its partners have so far made $ 5.768 billion investment in developing the Dhirubhai-1 and 3 (D1&D3) gas field in KG-D6 block and another $ 1.74 billion in the MA oilfield in the same area. Another $ 1.774 billion has been spent as production expenses or operating cost. The Ministry had in May 2012 slapped a notice disallowing $ 457 million of cost till 2010-11 and $ 1.005 billion till 2011-12. The average gas production from KG-D6 block during the current year should have been 86.92 mmcmd as per the approved field development plans for D1, D3 and MA fields in this block, which are currently on production. (economictimes.indiatimes.com)

August 7, 2013. BHEL said it has bagged a ` 265-crore order from Bharat Petroleum Corporation Limited for supplying equipment for latter's refinery project in Kochi. BHEL has won a contract for supplying the Gas Turbine Generator package for an energy efficient and environment friendly co-generation captive power plant at Kochi Refinery in Kerala, the company said. The order envisages supply and supervision of three gas turbines of 34.5 MW rating each, with associated auxiliaries and control systems. The gas turbine will be operated in the cogeneration mode for meeting the power and process steam requirement of the upcoming Kochi refinery expansion project. (economictimes.indiatimes.com)

August 12, 2013. Hindustan Petroleum Corp Ltd (HPCL) will import 1 million tonne of crude oil from Iran this fiscal provided issues in getting insurance cover for processing oil from Tehran are resolved. HPCL has not bought any oil from Iran after insurance companies said they will not provide cover for refineries processing Iranian oil. The company along with Indian Oil Corp (IOC) and Bharat Petroleum Corp Ltd (BPCL) have received RBI approval for raising a cumulative USD 4 billion foreign currency loan for meeting working capital needs. (economictimes.indiatimes.com)

August 12, 2013. Indian Gas Solutions (IGS), the joint venture (JV) of BP and Reliance Industries, will source liquefied natural gas (LNG) from the Freeport terminal in US to India, which will help the company firm up plans for its import terminal and give it more business flexibility, BP said. BP signed a 20-year contract to export LNG from the Freeport terminal in Texas. Supplies will start in 2017 from the plant's first unit and the liquefaction tolling agreement with BP will commence upon completion of Freeport LNG's second production unit, said Freeport. BP India said gas from Freeport would shape Indian Gas Solutions' strategy. Indian Gas Solutions is an equal joint venture of RIL and BP, which was set up after BP bought a 30% stake in RIL's oil and gas exploration blocks for $7.2 billion in late 2011. IGS finally made a definitive move when it threw its hat in the race to pick up a 25% stake in the proposed LNG terminal at Mundra in Gujarat. Gujarat State Petroleum Corporation (GSPC) and Adani Enetrprises have a 50% and 25% stake each in this ` 5,000-crore project. (economictimes.indiatimes.com)

August 12, 2013. Mangalore Refinery and Petrochemicals Ltd (MRPL) said it expects to receive an Iranian oil cargo, the firm's first purchase from the sanctions-hit nation since April. The resumption of shipments by MRPL, Iran's top Indian client until the firm halted imports in April, will boost India's flagging Iranian oil imports, which more than halved in June from a year ago. MRPL and Hindustan Petroleum had stopped purchases due to difficulties getting insurance for refineries processing Iranian oil, forcing New Delhi to look at providing its own reinsurance after European firms backed out over sanctions. India is thinking of providing a ` 20 billion ($327 million) state guarantee to back local insurance for plants using Iranian oil. (economictimes.indiatimes.com)

August 12, 2013. Petronet LNG Ltd, the country's largest importer of liquid gas, has received the maiden cargo at its just constructed Kochi import terminal in Kerala but the ship hasn't been able to dock at the port because of dredging issues. Petronet received a ship carrying gas in its liquid form (liquefied natural gas or LNG) from Qatar but the ship could not dock at the port. The silt was not expected and was not factored in when Petronet drew plans to import the maiden cargo that would be used to commission the 5 million tons per annum Kochi Terminal. The vessel 'Wilenergy', carrying around 1 lakh cubic metres of LNG from RasGas in Qatar, is now anchored at the outer channel of Cochin Port. Once the dredging issues are resolved in 2-3 days, the ship will dock and unload the cargo. The super-cooled gas will then be used to test the systems of pipelines and unit that coverts the liquid gas into its gaseous state again before being piped to consumers. With this, the ` 4,200-crore terminal would be ready for operations. The Kochi terminal, however, will operate at just 8 per cent of its capacity in the first year of operation as pipelines taking gas to customers in Karnataka and Tamil Nadu are not ready. The company plans to import 2 cargoes or shiploads of LNG at the terminal this year. In year-2, the terminal is expected to operate at 75 per cent capacity when pipeline connecting Kochi to Mangalore and Bangalore are built. Also, state-owned GAIL is planning to connect this pipeline to Chennai. (economictimes.indiatimes.com)

August 9, 2013. RIL-BP combine, IOC, ONGC and GAIL are among the 8 firms in race to buy 25 per cent stake in a LNG import terminal being planned at Mundra in Gujarat. RIL-BP have bid for the 25 per cent stake through their equal joint venture India Gas Solutions. Gujarat State Petroleum Corp (GSPC) had invited expression of interest for the 25 per cent stake in the 5 million tonnes a year liquefied natural gas (LNG) terminal. Besides Reliance-BP, other firms expressing interest include state-owned ONGC, GAIL and IOC, Petronet LNG Ltd and Torrent Energy. Japan's Mitsui & Co and Toyota Tsusho Corporation too are in fray. GSPC would hold 50 per cent stake in the ` 5,200 crore project while Adani Group would take 25 per cent. The project is to be financed in a debt to equity ratio of 70:30. The terminal capacity would be expandable upto 10 million tonnes per annum. Most of the companies that have expressed interest, want to import their own liquid gas (LNG) and sell it to consumers in the vastly energy deficit country. GSPC has been scouting for a strategic investor for its LNG project, after Essar group -- the third partner with a 25 per cent stake in the venture -- exited from the terminal. The LNG terminal will have two LNG storage tanks. It will have LNG receiving, re-gasification and gas evacuation facilities. GSPC has awarded the front-end engineering and design (FEED) contract to Tractebel of Belgium. Mundra will be the third LNG import terminal in Gujarat, after Petronet' 10 million tonnes per annum capacity facility at Dahej and Shell's 3.6 million tonnes Hazira LNG terminal. The terminal is expected to go on stream by first quarter of 2016. Gujarat is mulling another LNG terminal at Pipavav of 2.5 to 5 million tonnes capacity. (economictimes.indiatimes.com)

August 12, 2013. The oil ministry has retracted its move to allow successful explorers such as Reliance Industries and Cairn India to explore shale oil and gas in their existing blocks without bidding after the finance ministry said new entrants should also be given an equal opportunity. The oil ministry, which had said earlier that the existing operators could be permitted to explore shale resources, along with conventional oil and gas, has now proposed that only state-run ONGC and Oil India Ltd (OIL) should be allowed to explore shale in blocks that were given to them without an auction. The ministry plans to have a separate policy later to deal with exploration of shale resources in blocks awarded to private firms for conventional oil and gas and coal bed methane. The ministry has recently finalised a draft cabinet note on the shale gas policy after inter-ministerial consultations, which will be placed before the CCEA soon. This is the second time the finance ministry questioned the oil ministry's plan. It had earlier asked the petroleum ministry to review the Cabinet decision to adopt the Rangarajan formula, which would double natural gas prices next April, going by current trends. But, oil minister Veerappa Moily ruled out any review saying the finance ministry was part of the cabinet decision. But this time, the oil ministry has accepted the finance ministry's view because it raised the issue during inter-ministerial consultations, an important bureaucratic process that precedes any cabinet decision. The proposed policy, which will be placed before the cabinet committee on economic affairs soon, will automatically allow ONGC and Oil India to exploit shale in 176 identified on-land areas where they are exploring or producing conventional crude and natural gas. (economictimes.indiatimes.com)

August 12, 2013. After its tremendous success in 20 districts, the watershed scheme of giving gas (LPG) subsidy directly to consumers in their bank accounts will be extended to 35 more districts like South Goa, Jalandhar and Ludhiana from next month. This will add about 1.4 crore LPG consumers to 2.12 crore already being covered by the scheme where consumers get an advance ` 435 in their bank accounts the moment they book a LPG refill. They are then supposed to use this to buy cooking gas cylinders at market price which is double the subsidised rate of ` 410 per 14.2-kg cylinder in Delhi. A similar amount will be transfered every time the consumer books for a subsidised refill. With this total number of districts to be covered by the Direct Benefit Transfer for LPG (DBTL) scheme comes to 55. The districts which will be covered from September 1 including 12 in Kerala, 7 in Andhra Pradesh, 7 in Himachal Pradesh, 5 in Punjab, 2 Madhya Pradesh and one each in Maharashtra and Goa. Since its launch on June 1, about 4 million direct cash transfers have been effected to consumer's bank accounts. So far, ` 150.6 crore has been transferred in the hands of LPG consumers in the 20 districts of phase-1. All Aadhaar linked domestic LPG consumers get an advance of ` 435 in their bank account as soon as they book the first subsidized cylinder before delivery. As soon as, the first subsidized cylinder is delivered to such consumers, the next subsidy will again get credited in their bank account, which can then be available for the purchase of the next subsidized cylinder at market rate. (economictimes.indiatimes.com)

August 11, 2013. DGH has cited practical difficulties in implementing finance ministry's suggestion that Reliance Industries should not be allowed to raise natural gas prices until it makes up for producing less than the projected output since 2010. Within days of the Cabinet deciding to double natural gas prices to $ 4.2 per million British thermal unit from April 2014, the Department of Expenditure in Finance Ministry on July 4 sent an office memorandum to Oil Ministry asking it to examine if RIL can be asked to deliver the shortfall it owes at the old price of $ 4.2. Asked by Oil Ministry to comment on the issue, the DGH on August 1 replied saying estimates of production outlined when investment plans are approved much before the field is put to production vastly vary with the subsequent targets approved annually by field oversight committee headed by DGH annually. While the current production of less than 14 million standard cubic meters per day from RIL's KG-D6 field is way short of 86 mmsmcd target outlined in the 2006 field development plan, it would not be in wide variance with annual output target approved by Management Committee (MC) for 2013-14. (economictimes.indiatimes.com)

August 9, 2013. Reliance Industries has approached the Supreme Court (SC), seeking an order to appoint the presiding arbitrator for its dispute with the oil ministry over reimbursement of full cost of developing its KG-D6 gas field. The company approached the court as the government's arbitrator VN Khare and the company's arbitrator Justice SP Barucha failed to select a consensus candidate, who would preside the arbitration proceedings. The two arbitrators do not agree on the third arbitrator for more than one year, two legal experts with direct knowledge of the matter said requesting anonymity. The development comes at a time when the oil ministry is considering a proposal to raise the penalty on Reliance for the sharp fall in natural gas production from the KG-D6 block. The oil ministry's technical arm, the DGH, has proposed raising the penalty amount for creating facilities in excess of actual production to $1.786 billion from $1.005 billion because of continued production shortfall in 2012-13, the oil ministry said. RIL resorted to the arbitration after the oil ministry slapped a hefty penalty of $1.005 billion on the company for a steep fall in gas output from its KG-D6 block. Recently, CPI leader Gurudas Dasgupta had alleged that oil minister Veerappa Moily was delaying the arbitration process to help RIL. Dasgupta had also approached the apex court asking it to reverse the recent government decision to double the natural gas price from $4.2 per unit from April next year and raised the issue of inordinate delay in concluding the arbitration. RIL planned to move the court under Section 11 of the Arbitration Act that allows petitioners to seek its intervention. The issue of cost recovery has gained urgency as the company readies for new investments to exploit some of the new finds in the K-G basin. The RIL board is unlikely to allow any further investment without certainty on cost recovery, a crucial part of the contract signed between RIL and the government. (economictimes.indiatimes.com)

August 7, 2013. Minister of State for Petroleum & Natural Gas Panabaaka Lakshmi said that government would set up an additional 12.5 million tonne strategic crude oil storage capacity in the country. The project, which is being implemented by Indian Strategic Petroleum Reserves Ltd (ISPRL), will be set up in Bikaner, Rajkot, Chandikhol and Padur, she said. ISPRL has conducted a detailed feasibility study for construction of additional 12.5 million tonne of crude oil storages in phase-II at the four locations, she said. In the first phase, ISPRL is setting up storage facilities of 5.33 million tonnes of crude oil at Visakhapatnam (1.33 MT), Mangalore (1.5 MT) and Padur (storage capacity: 2.5 MT) to enhance India's energy security. Laksmhi said the Integrated Energy Policy (IEP-2008) has recommended that India should have crude oil reserves for 90 days as buffer stock for emergency supplies. India imports more than 80% crude oil it processes and any disruption in imports would have adverse impact on its economy. (economictimes.indiatimes.com)

POWER

August 9, 2013. The flowing water in irrigation canals of Gujarat could actually help generate power. A farmer-turned-entrepreneur from north Gujarat has devised a system that generates electricity using the velocity of flowing water in canals. Jayanti Patel, a native of Mehsana's Brahmanwada village, has also got a US patent for this invention that was tested successfully by the Alternate Hydro Energy Centre (AHEC) of Indian Institute of Technology (IIT), Roorkee. Patel and his engineer-friend Ashok Mistry developed a turbine and installed it at Matar branch canal of Mahi river near Nadiad. After several changes in design, the turbine could successfully generate 125 kilowatt (KW) electricity. In December 2011, the experiment got a stamp of approval from AHEC whose team along with Jadavpur University and Institute of Technology, Jalandhar, conducted vigorous testing on the site. Meanwhile, the Union ministry of new and renewable energy has asked AHEC to identify potential sites to test the viability of this invention. (articles.timesofindia.indiatimes.com)

August 13, 2013. NTPC has issued seven tenders to buy a total 5 million tonnes (MT) of imported thermal coal. The imports will bridge a shortfall in local supplies that it expects in the year to March 2014. Coal fuels more than half of India's power generation, but domestic production has not kept up with demand from the power sector, leading to power cuts that crimp growth and result in costlier imports. NTPC, top power producer with an installed capacity of 41,184 MW, requires 178 million tonnes of coal in this fiscal year to fuel its generators. It expects to source 145 million tonnes of coal locally, signing agreements with miner Coal India Ltd, which produces around 80 percent of the country's coal. India produces mostly low-grade thermal coal with high ash content and about 70 percent of the fuel that Coal India produces has an energy value of 4,300 KCal/kg or lower. The tenders are NTPC's first in this financial year that began on April 1. NTPC had a similar import requirement in 2012/13, but shipments of 7 million tonnes, contracted late last fiscal year, have only been delivered since April. For the current tender, only those shipments with below 32 percent moisture, 20 percent ash and 0.90 percent sulphur, with gross calorific value in the range of 5,300-5,800 Kcal/kg would be considered. Successful bidders will need to deliver the coal from port to several NTPC power stations spanning across the country. NTPC said it expected the successful bidders to supply the coal within four months of the power producer issuing the delivery schedule. Coal imports in this fiscal year could hit 165 million tonnes to meet the local supply shortfall, another record after total imports crossed 135 million tonnes in 2012/13. (economictimes.indiatimes.com)

August 13, 2013. Armed with experience of supplying water in regions of Delhi, infrastructure development company, SPML Infra Ltd, has bagged the power distribution franchisee licence for Bihar's Bhagalpur region. This is one of the first regions in Bihar that the state government has decided to hand over to private companies for a 15-year period. Bihar is plagued with high distribution losses due to poor conditions of transformers , huge pilferages, substantial billing and collection losses. Losses are as high as 68%, meaning, that much of the power supplied does not yield any returns. The Bihar government has asked the company to distribute power to Bhagalpur town and adjoining areas including Bhagalpur Urban which includes Tilkamanjhi, Mujahidpur, Nathnagar and two rural subdivisions Aliganj and Kahalgaon for 15 years after which the area goes back to the state. The Bhagalpur area has a large silk cluster and bulk of the power supplied there is not billed because meters have not been installed.  New connections, at present, is not easily available and consumers find it difficult to pay bills as bill collection centre do not operate smoothly. This leads to rampant hooking leading to substantial losses. (economictimes.indiatimes.com)

August 12, 2013. GVK Power and Infrastructure has asked lenders to reschedule loans worth $214 million to its power business, which has been hit by gas supply shortages that have left its power plants running far below their normal capacity. The company, whose interests span highway construction to coal mining, has asked lenders for an extended moratorium of two years on its debt, Isaac George, the chief financial officer of GVK. GVK is also in talks with potential investors to sell a stake in its airport business, which runs airports in the financial capital Mumbai and in Bangalore. Two of GVK's plants have shut down as supplies dried up from the KG basin. Infra majors including GVK, Lanco Infratech, Tata Power and Adani Power have posted losses in the first quarter of the fiscal year. (economictimes.indiatimes.com)

August 12, 2013. State-run electricity distribution company, Mahavitaran is planning to pump in ` 6,000 crore over the next three years to strengthen its network. The state has already spent ` 5,000 crore during the past five years for the purpose. The state utility has two crore consumers under its network, out of which over one crore are low-end consumers with a monthly intake of under 300 units. Further, to curb instances of pilferage by tampering meters, the state utility has also embarked on a plan to replace the existing meters with infra-red (IR) and radio frequency (RF) meters. The IR meters would be used in rural areas and RF in urban localities. All meters will be replaced in the next three years. The state has signed contracts for power supply till 2019 and is working on a plan for meeting the power needs beyond 2019. Government is pursuing with the central government to make gas available for the 1,967 MW Dabhol project which is operated by Ratnagiri Gas & Power. (economictimes.indiatimes.com)

August 8, 2013. NTPC is likely to start supply of 250 MW power to neighbouring Bangladesh from September. NTPC Vidyut Vyapar Nigam (NVVN), a subsidiary of NTPC is the nodal agency for supply of power to Bangladesh. Senior official in the Bangladesh Power Ministry Mohammad Anwar Hossain handed over Sovereign Guarantee to CEO-NVVN Nand Kishore Sharma in Dhaka in presence of Chairman BPDB (Bangladesh Power Development Board) and other senior officials of BPDB and NVVN. Sovereign Guarantee is an instrument of Payment Security against supply of 250 MW Power for 25 years from various power stations of NTPC under the Power Purchase Agreement (PPA) signed between NVVN and BPDB on February 28, 2012. The public sector company is likely to export 250 MW power to Bangladesh from the unallocated quota available with the Power Ministry. BPDB is also expected to purchase an additional 250 MW from the India. The electrical grid interconnection between the two countries would be through a HVDC (high voltage direct current) link between the eastern region of India and the western grid of Bangladesh. The grid will facilitate cross-border power transfer of 500 MW. The transmission system on the Indian side will be executed by the Power Grid Corporation of India, which would also provide consultancy to Bangladesh, up to the commissioning for the project. (economictimes.indiatimes.com)

August 7, 2013. Even as the government battles to secure fuel for thermal power plants in the country, as many as six states including Gujarat, Haryana and Tamil Nadu have asked Coal India Ltd (CIL) to restrain supplies. Coal India is incentivised if it supplies fuel more than the trigger level, in this case 90 per cent, as the Fuel Supply Agreements were signed before March 2010. The lack of demand for coal can also be linked to lesser demand for electricity during monsoon in general and power from thermal in particular, as rains have improved hydro power production. The coal requirement during the current fiscal for the power sector is estimated at 548 MT. Of the domestic availability during the current fiscal, 377 MT is likely to come from Coal India, 36 MT from SCCL (Singareni Collieries Company) and 28 MT from captive coal blocks. (economictimes.indiatimes.com)

August 13, 2013. In a relief to Reliance Power, Appellate Tribunal for Electricity (APTEL) has allowed the company's appeal against Central Electricity Regulatory Commission's (CERC) order on commercial operation date of its 4,000 MW Sasan power project in Madhya Pradesh. APTEL set aside CERC's impugned order and has directed it to decide the matter afresh including the issue of maintainability raised by Sasan Power Ltd (SPL) without being influenced by its earlier findings. SPL is a wholly-owned subsidiary of Reliance Power implementing Sasan UMPP. Reliance Power through its subsidiary Sasan Power, which is executing the project at Sasan in Madhya Pradesh, had filed an appeal with APTEL on grounds that CERC's order is violative of principles of natural justice and is not tenable in law. CERC had set aside the certificate issued by Independent Engineer's for declaration of COD (commercial operation declaration) of Sasan UMPP's first 660 MW Unit based on petition filed by Western Region Load Dispatch Centre. The 3,960 MW Sasan UMPP was commissioned on March 30, 2013. The electricity generated from the project will be available to 14 distribution companies across seven states. (economictimes.indiatimes.com)

August 12, 2013. India's Essar Power plans to lift coal imports by a fifth after converting plants currently using gas, but the move is unlikely to signal a broader switch to coal by the nation's utilities in response to gas shortages and price reforms. New Delhi in late June approved higher gas prices by pledging to tie prices more closely to market rates to encourage producers to raise output and find supplies. Gas output in India has been declining since April 2010 due to ageing fields and geological issues at a Reliance Industries -operated field in the Bay of Bengal, falling 16.7 percent to 2.94 billion cubic metres in June from a year ago. Essar said it plans to convert its 515 MW Hazira plant and 500 MW Bhander Power to coal. Power stations using gas accounted for nearly 10 percent of India's 225 GW of electricity generated in June, while coal's share was nearly 60 percent. India has 64 gas-fired power stations. Essar's switch to coal will cut its gas use to 15 percent of capacity from 56 percent and more than double coal usage to 77 percent. Essar Power would need between 1.5-1.7 million tonnes of coal per annum to operate the plants, raising its coal imports by 22 percent to 9.4 million tonnes by 2016. The switch, which will cut its power output capacity to 430 MW and take about three years, would cost about $200 million, or around half the cost of a new coal-fired plant. It costs the industry ` 4-4.50 ($0.07) to generate a unit of power using local gas and ` 7-8 for imported gas. For imported coal, the cost is ` 2-2.50 per unit, and for domestic coal, the cheapest, ` 0.75-2.0. Essar's switch to coal was helped by easier access to imported coal, while other firms also face contractual obstacles. GVK has two power plants in southern Andhra Pradesh state, with a total capacity of 914 MW, but is operating at only about 12 percent of its capacity due to a lack of gas. The government has halted construction of any new gas plants until 2015-16 because of gas shortages and existing plants are operating below capacity on expensive imported liquefied natural gas (LNG), even though power cuts plague industry and growth. (www.downstreamtoday.com)

August 12, 2013. A day after BJP virtually launched its poll campaign by promising to reduce power tariff by 30 per cent, Delhi Government approved subsidy for domestic consumers whose monthly consumption does not exceed 400 units, which in effect will bring down the bill of low-end customers. The proposal to provide the subsidy was cleared by a meeting of Delhi Cabinet presided over by Chief Minister Sheila Dikshit. Dikshit had announced the subsidy when Delhi Electricity Regulatory Commission had announced a hike of five per cent for domestic consumers. Considering the subsidy, a domestic consumer will be charged ` 2.70 per unit for first 200 units of power instead of ` 3.90 as announced by Delhi Electricity Regulatory Commission. Earlier, the per unit rate for consumption upto 200 units was ` 3.70 and government used to give a subsidy of ` 1 per unit which had brought down the rate to ` 2.70. The per unit rate will be ` 5 against earlier rate ` 5.50 for consumption between 201 and 400 units as the government decided to give a subsidy of ` 80 paisa per unit for the slab. The rate will be ` 6.80 for consumption between 401 units and 800 units and for consumption beyond 800 units, the per unit rate will be ` 7 per unit. The BJP has been attacking the Delhi Government for a "series of hike" in power tariff in the last two years and promised to cut it by 30 per cent if it comes to power in the assembly polls slated for November. Rejecting BJP's criticism, Dikshit has accused BJP of "misleading" the people to gain political mileage. The power tariff in the city was hiked by 22 per cent in 2011 followed by five per cent hike in February last year. The tariff was hiked by up to two per cent in May last year and again by 26 per cent for domestic consumers in July last year. The tariff was hiked by up to three per cent in February. (economictimes.indiatimes.com)

August 9, 2013. The government is planning higher penalties and quicker punishments for entities that overdraw power. The Power Ministry is looking at ways to amend the Electricity Act so as to implement new rules as part of efforts to prevent grid failures. Overdrawal of electricity by some utilities was among the factors blamed for the massive grid failures in July 2012 that impacted more than half the country's population. According to the Ministry, Regional Load Despatch Centres (RLDCs), which ensure integrated operation of the grid system in different regions, do not have any control over the State Load Despatch Centres (SLDCs). Country's power sector is divided into five regions -- Northern, Eastern, Western, North Eastern and Southern. Each of the region has an RLDC. The National Load Despatch Centre (NLDC) monitors RLDCs. Both come under POSOCO, which is part of state-run transmission major Power Grid. To prevent overdrawal of electricity from the grids, various technologies are being worked upon by the government. Among them, Power Grid is in the process of developing a Grid Security Expert System (GSES) that involves laying of optical fibre network for reliable communication. (economictimes.indiatimes.com)

August 9, 2013. CERC has decided to engage consultants to review existing tariff norms by considering developments in the sector during the current tariff period through consultation with stakeholders, and accounting for various challenges in the power sector as well as various policy changes. The consultant will also undertake various studies for deciding financial and operational norms of CERC tariff regulations it is expected to facilitate the Commission in framing tariff regulations. The selected consultant will submit its report in four months. It will collate information received from stakeholders and review data collected from the utilities. This data will be critically examined with reference to existing operational norms, performance parameters and standards of performance achieved and reported by the industry after taking into consideration various inputs, financial norms. The consultant will also study operation & maintenance expenditure norms for generating stations (hydro and thermal) and transmission system based on annual operation and maintenance expenses for financial years 2008-09 to 2012-13. (economictimes.indiatimes.com)

August 8, 2013. Power companies will have to wait for some more time to bid for generating plants like ultra mega power projects. The meeting of an empowered group of ministers to approve bidding guidelines for location-specific power plants was inconclusive. Private firms including Tata Power, Reliance Power, GMR and Lanco Infratech said that they will not be able to quote a low tariff for power supply unless the proposed bidding norms for generation projects are shelved. Tata Power, Adani Power, GMR Energy, Jindal Power, Lanco Infratech and CLP India have written to power minister Jyotiraditya M Scindia saying the companies would not be able to place competitive bids for ultra mega power projects and such other location-specific plants based on the proposed framework. (economictimes.indiatimes.com)

August 8, 2013. The Coal Ministry has asked CIL and its subsidiaries to enter into fuel supply pacts with the power firms for a capacity of 78,000 MW by August 30. CIL had approved signing of FSAs for a capacity of 78,000 MW instead of earlier 60,678 MW. The Coal Ministry had issued a presidential directive to the maharatna firm, directing it to sign FSAs for about 78,000 MW. Earlier, CIL was directed to sign FSAs for 60,678 MW capacity which was the projected requirement for 131 power plants commissioned or to be commissioned by March, 2015. CIL has so far signed 82 FSAs of 34,793 MW capacities. These include 11 FSAs with NTPC and 5 FSAs with its joint ventures. The coal ministry had said that CIL has signed fuel supply pacts with NTPC's 16 power plants and joint ventures, while 11 more agreements with the power major and its JVs are being processed. NTPC had refused to enter into FSAs with CIL over quality issues of the dry-fuel supplied to it and had stopped payment to Coal India subsidiary, Eastern Coalfields Ltd. Retorting to the step, the world's largest coal miner had temporarily stopped supply of fuel to NTPC. The issue was resolved following government intervention. (economictimes.indiatimes.com)

August 8, 2013. Uttar Pradesh (UP) Chief Minister Akhilesh Yadav reached out to industry by promising a congenial business environment in the state. The chief minister said his government would provide all possible help to industry and businesses desirous of making investment in Uttar Pradesh. He was speaking after state power utility UP Power Corporation Limited (UPPCL) signed a long-term power purchase agreement with Lanco for the purchase of 424 MW of electricity, effective for 25 years beginning October 2016. UPPCL would purchase power at the rate of ` 4.31 to ` 4.437 per unit. Under case I bidding, UPPCL had already completed the bidding process for purchase of 6,000 MW, of which letter of intent (LoI) was issued for 1464 MW. The government also issued LoI to seven power developers for generating 130 MW of solar energy. The developers would be given 13 months to set up the plant, preferably in the arid Bundelkhand region, where the government would wheel in the energy to the state grid for transmission at its own cost. These companies include Moser Baer Projects Private Limited and Jakson Group. (www.business-standard.com)

August 8, 2013. Congestion in the power grid connection to Punjab has resulted in power prices for state touching ` 10 per unit at the exchanges. It has turned out to be the highest in the country surpassing prices for South India which has remained high historically. Punjab's import capability had, in fact, dipped to zero and the state had stopped buying power from the exchanges in the last several days. Now it resumed buying since 20<sup>th</sup> July but it had to buy ` 8 per unit which zoomed to ` 10 per unit the next day. It has been hovering between ` 8 and ` 10 per unit since then. South India on the other had witnessed a fall in price over the last one month. On 9<sup>th</sup> July prices at the exchanges were ` 5 per unit. It gradually fell to little less than ` 3 per unit on 8^th. South India prices used to be highest among all regions. But this trend has reversed with Punjab emerging as the state which is buying power at the highest cost nationally. South India faces high power cost due to grid constraint. Grid connectivity between South India and rest of the country is limited. This has been the major reason for the region buying power at very high costs. (economictimes.indiatimes.com)

August 7, 2013. Coal India Ltd workers have said they will go on a three-day strike from September 19 against the government's decision to offload 10% equity in the company. Indian National Trade Union Congress (INTUC) that represents a majority 40 per cent of the workers of the company will not participate in the strike while remaining four unions will not come to work. The four of the five trade unions have served strike notice to the government and the Coal India management for the strike between September 19-21. All India Trade Unions Congress (AITUC) said all the unions except INTUC support the strike. Talks between Coal India workers and the Centre had failed though the government has offered to reduce disinvestment in Coal India to 5 per cent from earlier proposal of 10 per cent. The government was expecting to mop up ` 20000 crore through 10 per cent disinvestment in Coal India. (economictimes.indiatimes.com)

OIL & GAS

August 8, 2013. Forum Energy Company (FEC), a United Kingdom-based gas and oil exploration and production company with a portfolio of projects in the Philippines, is reportedly interested in exploring for oil and natural gas in the waters within the disputed West Philippines Sea. The expression of interest was made and presented by the FEC to the Palawan Council for Sustainable Development (PCSD). The FEC is the holder of Service Contract Nos. 40 and 72 and is authorized to look for oil and gas 18 nautical miles off the waters of Palawan in the West Philippines Sea area. The FEC also has a 2.27 percent interest through its wholly-owned subsidiary Forum Energy Philippines Corporation (FEPC) in the second phase development of the Galoc oil field under SC-14. (www.rigzone.com)

August 12, 2013. The sale of a defunct oil refinery in the U.S. Virgin Islands has stalled. Gov. John P. de Jongh Jr. said that he sent a letter to the Hovensa refinery's owners informing them that legislators rejected a bill that would have governed a possible sale. De Jongh said officials will resume collecting a 6 percent tax on certain shipments of petroleum products being temporarily held at the refinery for storage. The refinery on St. Croix was a joint venture of U.S.-based Hess Corp. and Venezuela's state-owned oil company. It closed in January 2012 following years of weak demand and high operating costs. (www.downstreamtoday.com)

August 7, 2013. Trans-Asia Refinery Ltd (TRL) has made a major announcement expressing its ‘total commitment’ to building the most complex refinery in Pakistan, producing more than 100,000 barrels a day and 4.0 million tonnes of petroleum products every year. The refinery will be located at Port Qasim, Karachi. TRL’s determination to see the project through to completion is demonstrated by two important initiatives announced. First is the appointment of Descon to undertake a complete ‘health check’ inspection of the TRL refining equipment. The second is a newly-completed restructuring of TRL management to ensure the project proceeds with all possible haste. Descon is the leading engineering and construction company of Pakistan. The company said that, since the refinery had been delayed for some time, they will perform a health check of critical equipment before the EPC contractor is finalised. The TRL project is a direct investment of Al-Ghurair Investment LLC, a UAE-based family conglomerate and one of the most diverse industrial groups in the Middle East. As the majority shareholder, Al Ghurair will play an important role in the future supply of fuel to the nation of Pakistan. When completed, the TRL Refinery will annually produce 80,000 tonnes of LPG, 455,000 tonnes of Naphtha, 410,000 tonnes of motor gasoline, 422,000 tonnes of jet fuel, 1,000,000 tonnes of gas oil – from which 630,000 tonnes will be treated diesel – 1,050,000 tonnes of fuel oil and 200,000 tonnes of bitumen. All the products of the refinery are in high demand in Pakistan. (www.dailytimes.com.pk)

August 9, 2013. Mexico is pushing to double crude oil exports to China next year and boost India-bound shipments, the next stage of a long-term plan to diversify oil sales away from an increasingly energy-independent United States. Mexico is also open to importing light crude supplies from the United States. Crude oil shipments to China, which have risen from zero in 2010 to more than 20,000 bpd so far this year, will reach a yearly average of 30,000 barrels per day (bpd) but could more than double in 2014.

Exports to India already stand at nearly 100,000 bpd but are likely to increase in the short and medium term. In total, Asia could be taking as much as a fifth of Mexico's 1.1 million bpd of exports. The United States is still by far Mexico's largest oil export partner, but shipments have halved since 2006 to less than 850,000 bpd this year. (in.reuters.com)

August 8, 2013. Williams Cos Inc's Transcontinental Gas Pipeline Co (Transco) unit announced an open season to gauge interest in its Atlantic Sunrise project, a proposed expansion of its natural gas pipeline system in the eastern United States. Transco said that the project would provide anywhere from 450,000 dekatherms (450 million cubic feet) per day to in excess of 1,000,000 dekatherms per day of firm natural gas transportation by an in-service date of July 1, 2017. The open season will run through Sept. 27.

Atlantic Sunrise will provide transportation capacity for growing supplies of natural gas from northern Pennsylvania along Transco's existing Leidy line to markets along the Transco system. The project map stretches from the company's zone 6 territory in the Northeast to zone 4 in the Southeast. The project is part of Williams' growing presence in the Marcellus Shale. Transco's 10,200-mile pipeline system has the capacity to carry 9.9 billion cubic feet of gas per day from supply areas in the Gulf Coast, Appalachia and imported liquefied natural gas to market areas in the Southeast, mid-Atlantic and Northeast, including New York City. (www.downstreamtoday.com)

August 7, 2013. An ethics probe of the contractor assessing the environmental impact of TransCanada Corp. (TRP)’s proposed Keystone XL oil pipeline has energized critics who say it should be grounds for the project to be delayed. The State Department inspector general’s office said it is looking at conflict-of-interest complaints relating to the contractor writing the analysis of the $5.3 billion pipeline, which would connect Alberta’s oil sands to refineries in the U.S. Gulf Coast. The State Department, which is conducting the review of the project because it would cross the U.S. border, has defended its selection of the contractor in part by saying that engineering firms capable of doing broad environmental analysis often have worked for the oil industry. (www.bloomberg.com)

August 7, 2013. Developer of rail logistics and terminal facilities US Development Group (USDG) and midstream energy company Gibson Energy have joined forces to expand USDG's crude-by-rail development to Canada and increase transportation option for Gibson's Hardisty terminal customers. Gibson said it received sufficient customer term commitments to build a new rail loading facility near Hardisty, Alberta, with pipeline connectivity from Gibson's Hardisty terminal. The company will install required pumping equipment and construct a pipeline to carry crude from its Hardisty terminal to the USDG crude-by-rail facility. Term contracts have been signed with four investment grade customers for approximately 100,000 barrels per day. Initially, the Hardisty rail terminal will handle 140,000 barrels per day of multiple grades of crude oil. It will be served by the Canadian Pacific (CP) Railroad's North Main line and all the crude will be moved from Gibson's Hardisty terminal by a pipeline. The facility is scheduled to begin commercial operations in the first quarter of 2014. (transportationandstorage.energy-business-review.com)

August 13, 2013. China is considering opening up its crude import market to more refineries outside its dominant state giants, with quotas of at least 10 million tonnes being discussed for new entrants in 2014. Any new quotas would follow the entry this year by refinery operator ChemChina into the tightly controlled crude import market, and signal a further measured opening of crude purchases to smaller players as China prepares to add refining capacity. China imports about 5.7 million barrels per day (bpd) - nearly 6 percent of global supply - and this is expected to rise toward 9 million bpd by 2020. China's growth in demand over the past decade has been a key factor in a long-term rally that has taken Brent crude above $100 a barrel and kept it there for most of the past two years. Ten million tonnes is equivalent to about 200,000 bpd, and would represent an incremental step in opening up imports. China has kept tight control over crude imports to ensure stable domestic oil supply, with state giants Sinopec and PetroChina controlling nearly 90 percent of the country's total crude oil imports. The government has preferred to work through the two state firms than deal with many competing importers, but may feel that more domestic competition will push the pair to keep fuel supply abundant even when refining margins are poor. (in.reuters.com)

August 13, 2013. Iraq exported 29 percent less Kirkuk crude than scheduled in shipping plans in the first seven months of this year. The Middle Eastern nation shipped an average of 218,830 barrels a day from the Turkish port of Ceyhan from January to July. This compares with 307,311 barrels a day based on monthly loading plans. Shipments from Kirkuk to Ceyhan have repeatedly halted this year because of sabotage and technical faults. Exports of the blend are near five-year lows in July at about 190,000 barrels a day, including 14,000 barrels to Jordan, the International Energy Agency said. Loading programs are monthly schedules of crude shipments compiled by field operators to allow buyers and sellers to plan their supply and trading activities. (www.bloomberg.com)

August 12, 2013. U.K. Prime Minister David Cameron said shale gas will bring down power bills for Britons, writing to defend his push to kick-start the industry in the country. He said it’s a myth that fracking, the technique that blasts rock with water, sand and chemicals to release fuel, is unsafe and will damage the countryside. Fracking has sparked protests and caused drilling delays for Cuadrilla Resources Ltd. in Balcombe, a West Sussex town in southern England. Demonstrators have also targeted drilling sites in Lancashire in the north of the country. Cameron’s comments come after Michael Fallon, the energy minister with responsibility for fracking, said that shale reserves may be exploited in southern England. (www.bloomberg.com)

August 11, 2013. Bijan Namdar Zanganeh, a former Iranian oil minister who has been nominated by President Hassan Rohani to take over the ministry again, pledged to boost Iran’s oil output should he be approved by the parliament. Rohani has pledged to work toward easing sanctions. Parliament is set to review the qualifications of his proposed ministers. Iran, once the second-largest oil producer in the Organization of Petroleum Exporting Countries after Saudi Arabia, has slipped to sixth place, producing 2.56 million barrels a day in July. The country produced about 4 million barrels a day in 2005. Zanganeh served as oil minister from 1997-2005 and prior to that was energy minister for nine years. (www.bloomberg.com)

August 9, 2013. The Organization of Petroleum Exporting Countries (OPEC) kept estimates for global oil demand growth in 2014 unchanged amid a stable outlook for the world economy. World oil consumption will increase by 1 million barrels a day, or 1.2 percent, next year to about 90.8 million a day, the group’s Vienna-based secretariat said in its monthly market report. Increasing output from countries outside OPEC means demand for the organization’s crude will slide to 29.7 million barrels a day, or about 600,000 a day less than its 12 members pumped last month, the report showed. Brent crude futures have gained about 2.8 percent in the past three months, trading near $107 a barrel in London, amid signs the slowdown in China’s expansion has stabilized, U.S. unemployment retreating and the recession in European economies is easing. OPEC agreed to tighten compliance with its official production target of 30 million barrels a day at its last meeting in May. The group will next meet on Dec. 4. OPEC said group production fell 97,000 barrels a day to 30.3 million amid declines in Libya and Iraq. Output in the North African nation slumped 124,400 barrels a day to about 1.1 million while Iraq’s production slid by 50,900 a day to 2.97 million a day. The organization increased its 2014 forecast for oil supply from other nations by 20,000 barrels a day.

Non-OPEC producers, led by the U.S. and Canada, will bolster production by 1.15 million barrels a day in 2014 to 55.1 million a day, according to the report. OPEC’s projection for global oil demand growth is similar to that of the International Energy Agency, the Paris-based adviser to oil-consuming nations, which earlier forecast that consumption will increase 1.1 million barrels a day in 2014 to 92 million a day. The group’s members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. (www.bloomberg.com)

August 7, 2013. Yemen’s government said it uncovered an al-Qaeda plot to seize port facilities in the volatile southeastern province of Hadramut after the U.S. and Britain urged their nationals to leave the country. Islamic militants were prevented from attacking the al-Dhabah oil export terminal, where foreign nationals were working, Rajeh Badi, adviser to Yemen’s Prime Minister Mohamed Salem Basindwah, said. They had also planned to seize the port city of Mukalla in Hadramut and attack a liquefied natural gas installation in Shabwah province, he said.

Yemen, where popular unrest in 2011 led to the toppling of President Ali Abdullah Salehas ruler of the poorest country in the Middle East, has struggled to contain the threat from Islamic militants even with U.S. military assistance. The U.S., Britain, France and other countries have closed their embassies in Yemen following an unspecified threat to personnel. The mountainous country, described by the Central Intelligence Agency factbook as mostly desert, has become a battleground against al-Qaeda militants planning attacks on Western targets and on Saudi Arabia, the world’s largest oil supplier. (www.bloomberg.com)

POWER

August 12, 2013. Tokyo Electric Power Co. (Tepco), Japan’s biggest power company by generation capacity, nearly doubled its coal consumption in July from a year earlier after starting new units that use the cheaper fuel.

Tepco, used 745,000 metric tons of coal last month, the most since at least April 2003. Crude and fuel oil consumption fell by about 18 percent and 30 percent, respectively. Tepco has been increasing its use of coal since it began test operations of two coal-fired units, with a combined capacity of 1,600 MW, in April.

All of the company’s 13 nuclear reactors have been shut after the 2011 Fukushima atomic disaster, forcing it to rely on coal, oil and natural gas to meet demand.

Coal-fired power generation cost 9.5 yen (10 cents) per kilowatt hour, while liquefied natural gas and oil cost 10.7 yen and 36 yen, respectively, a government panel said. (www.bloomberg.com)

August 8, 2013. Boralex, a power producer company headquartered in Canada, has secured funds of about C$55.3 mn ($53.14 mn) for the 22 MW Jamie Creek hydroelectric power station located near Gold Bridge, British Columbia.

The credit facility, representing nearly 85% of estimated project costs, was provided by Canada Life Assurance Company and Great West Life Assurance Company. The loan has a nine-year grace period for repayment of principal and will be amortized thereafter over a 31-year period at a rate of 5.42% for the full term of the loan, the company said.

Boralex, meanwhile, has secured additional facility of C$19mn ($18.26 mn) from German bank SAAR LB to finance the construction of 8 MW Vron wind farm. Having commenced construction of the Jamie Creek project, the company has scheduled commissioning for the first quarter of 2014. (hydro.energy-business-review.com)

August 13, 2013. Record temperatures across North Asia have killed dozens and pushed electricity grids to near breaking point, forcing governments to introduce emergency measures as more of the same heat is forecast. Air-conditioning in South Korea’s public buildings has been shut off as the government warned of power shortages. China has opened air-raid shelters as makeshift cooling stations, while thousands in Japan have been hospitalized for heatstroke. Shanghai hit a record 40.8 degrees Celsius (105 degrees Fahrenheit) on Aug. 7, according to the meteorological bureau, as the city endured its hottest summer in 140 years. In southern Japan, temperatures in Shimanto city peaked at 41 degrees Celsius, the highest ever recorded in the country, according to the meteorological agency. Eight people have died of heatstroke across South Korea as of Aug. 11, while 867 people have been hospitalized, according to the Central Disaster and Safety Countermeasures Headquarters. Seventeen people in Japan were killed by heatstroke between Aug. 7 and Aug. 11, according to the Fire and Disaster Management Agency, with more than 9,800 in the hospital for treatment. In China, at least 11 people have died from heatstroke since July, the Shanghai Daily reported Aug. 1. The record temperatures are a result of multilayered high pressure systems extending over much of the region, including Japan, South Korea and China, Kenji Okada, a forecaster at the Japan Meteorological Agency, said. (www.bloomberg.com)

August 9, 2013. The Ontario Energy Board in Canada has selected Upper Canada Transmission as the transmitter for completing development work for the East-West Tie Line in Ontario. To be developed in Northwestern Ontario, the East-West Tie Line will be about 400km long and run between Thunder Bay and Wawa. The line is planned to enhance the reliability of electricity supply in Northwestern Ontario by increasing the amount of electricity that can be transfered between the transmission system in the Northwest and the rest of Ontario. Ontario Energy Board said the Ministry of Energy identified the East-West Tie Line as a priority project in its Long Term Energy Plan. The board also said Upper Canada Transmission has the authority to spend about $22.2 mn on the development work and to recover the costs. (utilitiesnetwork.energy-business-review.com)

August 8, 2013. UK-based energy firm National Grid has started the second phase of a £30m project to upgrade a 116km electricity transmission line across Cumbria and Lancashire. Under the phase, the company is installing new wires, repairing steelwork on the 345 pylons which make up the power line. The transmission line runs south from a substation at Harker, near Carlisle to a substation at Old Hutton near Kendal and then on to a point on the national grid system at Quernmore in Lancashire. After completion of the project, more than 300 tons of steelwork will be replaced and over 1,000km of new wires will be suspended on the pylons. National Grid said work to replace the wires on one side of the pylons is complete and work on the other side wires has been started. The work on the line is anticipated to be completed by November 2013 and temporary offices and working areas around pylons will be removed by April 2014. (utilitiesnetwork.energy-business-review.com)

August 12, 2013. The federal government of US has cleared the 'Bureau of Reclamation Small Conduit Hydropower Development and Rural Jobs Act' into law to further boost the hydro power industry. The new law signed by President Barack Obama was first proposed by US Senators of Wyoming and Idaho John Barrasso and Jim Risch, respectively, in the wake of unnecessary regulations blocking the development of small hydro projects. Senator Barrasso said the bill is aimed at removing barriers to hydropower development, creating rural jobs and lowering electricity prices for American families. With this law, the Congressional Budget Office (CBO) estimates to generate federal revenues of nearly $5 mn over the 2012-2021 period. (hydro.energy-business-review.com)

August 10, 2013. The future of the world's most famous mountain range could be endangered by a vast dam-building project, as a risky regional race for water resources takes place in Asia. New academic research shows that India, Nepal, Bhutan and Pakistan are engaged in a huge "water grab" in the Himalayas, as they seek new sources of electricity to power their economies. Taken together, the countries have plans for more than 400 hydro dams which, if built, could together provide more than 160,000 MW of electricity – three times more than the UK uses. China has plans for around 100 dams to generate a similar amount of power from major rivers rising in Tibet. A further 60 or more dams are being planned for the Mekong river which also rises in Tibet and flows south through south-east Asia. Most of the Himalayan rivers have been relatively untouched by dams near their sources. Now the two great Asian powers, India and China, are rushing to harness them as they cut through some of the world's deepest valleys. Many of the proposed dams would be among the tallest in the world, able to generate more than 4,000 MW, as much as the Hoover dam on the Colorado river in the US. (www.theguardian.com)

August 9, 2013. A nuclear power plant in Taiwan may have been leaking radioactive water for three years, the government has said, adding to a growing crisis of confidence in North Asia about nuclear safety. Japan is struggling to contain radioactive water pouring out of the Fukushima nuclear plant that was wrecked by a 2011 tsunami. In South Korea, prosecutors are conducting a massive investigation into forged safety certificates and substandard parts at many of its reactors. Nuclear power has long been used as a reliable alternative to fossil fuels in natural resource-starved parts of Asia like Japan, Taiwan and South Korea, but the safety worries are forcing a rethink. A plan to build Taiwan's fourth nuclear plant has been held up for years by street protests and a brawl in the legislature over safety issues. Most nuclear plants in Japan remain closed and nine of South Korea's reactors have been shut down, six for maintenance and three to replace cables that were supplied using forged certificates. (www.reuters.com)

August 7, 2013. The World Bank has agreed to $340 mn financing for the governments of Burundi, Rwanda and Tanzania to develop Regional Rusumo Falls hydroelectric project under a Great Lakes Regional Initiative. Each of the countries will receive proceeds of $113.30 mn through the International Development Association, the group's fund for the poorest. The project will cost a total of $468.6 mn and has a nameplate capacity of 80 MW. The landmark project is anticipated to have transformational impact, providing lower-cost energy to homes, businesses, and clinics in Burundi, Rwanda and Tanzania. Expected to strengthen the capacity of the Nile Equatorial Lakes Subsidiary Action Program (NELSAP), the hydro project will provide low-cost clean energy and improve economic conditions driven by new job opportunities for the Nile Equatorial Lakes (NEL) sub-region in east African countries. The bank supported in providing electricity to an additional 1.4 million people in African countries in 2011. (hydro.energy-business-review.com)

August 7, 2013. On a windy island 500 miles north of Tokyo, Japan is about to experiment with a battery designed to transform the way electricity is supplied and at the same time boost Prime Minister Shinzo Abe’s economic rescue plan. The Ministry of Economy, Trade and Industry is investing 20 billion yen ($203 million) on a Sumitomo Electric Industries Ltd. device to be used by Hokkaido island’s utility to store excess solar and wind power, stabilizing flows to consumers. Since the earthquake in 2011, Japan has redoubled work to upgrade power systems and spur exports that can revitalize the economy. The Sumitomo device is meant to give Japan the kind of market leadership it had in the 1970s with cheap calculators made by Casio Computer Co. and this century with Toyota Motor Corp.’s fuel-saving hybrid cars. The battery, which uses the metal vanadium to store electrical energy in electrolyte tanks, has been researched from Australia to China and promises to handle the sort of large power surpluses that can develop on a transmission grid. Hokkaido island was picked because it’s isolated from the mainland’s electricity network and has open land ideal for arrays of solar panels and wind turbines. Success would benefit Sharp Corp. and SoftBank Corp., which are among the investors that have sought to build solar projects with four times the capacity Hokkaido’s grid can handle. Installation is set for completion by March 2015.

August 12, 2013. India may decide whether to impose duties on imports of solar equipment, according to the country’s Solar Independent Power Producers Association lobby (SIPPA). Indosolar Ltd, Jupiter Solar Power Ltd and Websol Energy System Ltd, Indian producers of photovoltaic cells and modules, pushed for the government investigation after saying foreign competitors from the U.S., China, Taiwan and Malaysia had sold products at below cost in India. Last month, they petitioned to expand the probe to imports from the European Union and Japan. (www.bloomberg.com)

August 12, 2013. Power equipment maker Su-Kam Power Systems said it has bagged a contract for installing solar projects at 35 schools in Rwanda, Africa. The company shall also be responsible for pre-installation survey of the site and drawing out a detailed engineering plan. Su-Kam will also provide onsite training on operation and maintenance (O&M) to the personnel of Rwanda. The continent has abundant solar energy that can be tapped and utilised accordingly, the company said. Su-Kam has presence in over 70 countries overseas, it has bagged various solar power projects in African countries like Nigeria, Malawi, Gabon etc. (economictimes.indiatimes.com)

August 9, 2013. Jakson Power Solutions, announced that it has secured a new 10 MW solar Independent Power Project (IPP) from government of Uttar Pradesh under its solar power policy announced in 2013Jakson Power Solutions, announced that it has secured a new 10 MW solar IPP from government of Uttar Pradesh under its solar power policy announced in 2013. The company will set up the solar IPP in Bundelkhand region at a total cost of ` 800 million and is targeting to commission the project by March, 2014. Under its solar policy, Uttar Pradesh government aims to install 500 MW of solar power plants in the state by end of March, 2017. Jakson already owns and operate 20 MW solar power plant in Rajasthan which was installed under Phase I of Jawaharlal Nehru National Solar Mission (JNNSM). This plant was commissioned by Jakson in February, 2013. (economictimes.indiatimes.com)

August 8, 2013. The state government finalised agreements with seven private power players and a public sector undertaking to produce 230 MW of solar power. UP CM AkhileshYadav handed out Letter of Intents to Jakson Power Solutions, Moser Bayer Clean Energy Ltd, Sree Developers, DK Infracon, Refax Energy, Azure Surya Ltd and Essel Infra. These private sector firms would together be setting up solar power plants of a total 130 MW capacity. These companies would be purchasing land directly from the farmers and are expected to be commissioned within six months after the land is in possession. The Joint MD, Jakson Power Solutions, Sundeep Gupta said that they would be investing ` 80 crore within one year to establish a 10 MW solar plant. He said that they have identified some land parcels in the Bundelkhand region of the state and expect their project to be commissioned in 6 months time. Jakson power Solutions has already commssioned a 2x10 MW solar project in Rajasthan in February this year and is ambitious on growing their solar power portfolio. The state government has also signed an MoU with public undertaking the National Hydro Power Corporation Ltd (NHPC) to set up a 100 MW solar plant in Jalaun district of Bundelkhand region. (economictimes.indiatimes.com)

August 8, 2013. The Kerala State Biodiversity Board (KSBB) has initiated steps for a study on climate change in the Western Ghats area. Udayasankar S. Nair, renowned climate change expert at the Department of Atmospheric Science, University of Alabama and one who has worked in association with the National Aeronautics and Space Administration of the US led the discussion to explore viability, opportunities, technological and scientific requirements of crowd sourcing for ecological research in the Western Ghats region. Crowd sourcing is the practice of obtaining needed services, ideas or content by soliciting contributions from a large group of people, and especially from an online community, rather than from traditional employees or suppliers. Nair pointed out that traditional methods for collection of ground data-based information are through field surveys. The workshop also discussed the use of smart phones to acquire data for studying how the landscape is changing due to human activities. KSBB Chairman Oommen V. Oommen emphasised the need of the hour is to conserve and protect the Western Ghats area. Western Ghats is one of the world's newest United Nations Educational, Scientific and Cultural Organisation world heritage sites. It is home to at least 325 globally threatened flora, fauna, bird, amphibian, reptile and fish species. The Ghats run through the entire state from the hills of Wayanad in northern Kerala to the southern Sahyadri peak. (www.newkerala.com)

August 7, 2013. Wind power producers who were recently directed by the Central Electricity Regulatory Authority (CERC) to give day-ahead forecast for power generation have thrown the ball back in the government's court. A group of power producers have asked the power ministry to first resolve the issue of grid stability in the country, build required transmission infrastructure for evacuation of wind power and then expect them to comply with the regulations. The CERC recently directed all wind power producers to issue day-ahead forecast for wind power generation. There is penal action amounting to at least 15% of the revenues in case of incorrect predictions. In a recent move, ReNew Power and Tata Power have gone to the power ministry requesting better grid infrastructure. Wind Independent Power Producers' Association has already filed for an injunction in the Delhi High Court against this decision. Indian Wind Power Association has also written to the CERC to postpone this decision, as wind farms are unable to proceed with forecasting and scheduling of wind power. (economictimes.indiatimes.com)

August 13, 2013. Iowa, US-based energy company MidAmerican Energy Company is gearing up to invest around $1.9 bn to develop 1050 MW of wind energy projects in Iowa by 2015-end. The company has recently secured Iowa Utilities Board approval for the development of the proposed projects across Grundy, Madison, Marshall, O'Brien and Webster counties. MidAmerican Energy said providing clean, reliable and low-cost electricity through a diversified renewable portfolio is the best way to cater to customers' energy demands. The wind projects are estimated to reduce electricity rate of about $10m per annum by 2017, starting with reduction rate of $3.3m in 2015, besides providing additional property taxes in the excess of $360 mn the next 30 years. Construction of these projects is scheduled to begin in September 2013, with completion expected by the end of 2015. (wind.energy-business-review.com)

August 13, 2013. Elon Musk, the chief executive officer of Tesla Motors Inc. (TSLA) and Space Exploration Technologies Corp., has revealed some concrete details of what he sees as a new, superfast mode of solar-powered transportation. In typical Musk fashion, the Hyperloop stands as a challenge to the status quo -- in this case, California’s $70 billion high-speed train that has been criticized by Musk and others as too expensive, too slow and too impractical. As Musk envisions it, the Hyperloop would transport people from city to city via pods enclosed inside of tubes. He describes the design as looking like a double-barreled shotgun with the tubes running side-by-side for most of the journey and closing the loop at either end. These tubes would be mounted on columns 50 to 100 yards (45.7 to 91.4 meters) apart with the pods inside of them going as fast as 800 miles (1,300 kilometers) per hour -- fast enough to move someone from Los Angeles to San Francisco in 30 minutes. While Musk had hinted at some of these specifications before, he now provides the twist that the pods could ferry people and their cars, too. (www.bloomberg.com)

August 12, 2013. Canada’s response to President Barack Obama’s challenge to reduce emissions of global-warming gases from the oil sands starts with sewage and algae. The paste-like crude extracted from oil sands is softened by heat and steam to make it flow though pipelines. Burning natural gas to process the fuel creates carbon dioxide that researchers say can be mixed with waste water and fed to algae, which can be processed into cattle feed and other products. Such efforts by Canadian Natural and rival oil producers, including Imperial Oil Ltd. and Suncor Energy Inc., are partly aimed at convincing U.S. decision makers that the industry can mitigate the climate-change impact of TransCanada Corp.’s proposed Keystone XL pipeline to the Gulf Coast from Alberta. Obama has said he won’t issue the permit TransCanada Corp. needs to build the $5.3 billion pipeline to link Alberta with refineries on the Gulf of Mexico if it would significantly worsen global warming. Obama said that Canada “could potentially be doing more to mitigate carbon release.” Following Obama’s comments, consulting company IHS CERA published a study indicating the Keystone pipeline won’t have any material impact on U.S. greenhouse-gas emissions. Canada’s Natural Resource Minister Joe Oliver is also quick to point out that the nation is ahead of the U.S. in reducing carbon. Canada has committed to cutting greenhouse gas emissions by 17 percent by 2020 from 2005 levels, in line with U.S. promises made in 2009 at United Nations climate-change talks. Prime Minister Stephen Harper’s government says the country is almost half-way to the target. (www.bloomberg.com)

August 12, 2013. California, whose green ambitions helped the solar and wind industries take root, is taking an essential next step by proposing a sharp rise in energy storage to better integrate renewable power with the rest of the grid. Power from sun and wind fluctuates dramatically, so capturing it for later use makes the supply more predictable. California's storage push comes as renewables move toward a mandated one-third of the state's electricity supply by 2020. The proposal has fired up a technology race that has already attracted venture capitalists Peter Thiel and Vinod Khosla, large-scale battery makers such as LG Chem, and establishment forces like General Electric Co and Microsoft Corp founder Bill Gates. It isn't just about California. Germany is a storage pioneer, and in the United States, stimulus funds have backed projects in states such as New York and Texas. But the Golden State's aggressive renewables target is forcing the issue here: it wants storage of up to 1.3 GW by 2020. That capacity is enough for traditional plants to power more than a million homes. Lux Research analyst Steven Minnihan said California's proposal is the first legislation that will have an immediate and lasting impact on the grid storage market, which he estimates will soar to installations worth $10.4 billion in 2017 from just $200 million last year. But storage is costly when compared to building new gas plants, and many storage projects were set up with the help of stimulus funds that have since run dry, meaning utility customers will end up with much of the tab. There are also risks that unproven storage technologies will not deliver on their promise. Beyond batteries, Gates, Thiel and Khosla all invested this year in compressed air startup LightSail Energy, which in May was awarded $1.7 million from the California Energy Commission to demonstrate its technology at a Ventura County naval base. Gates and Khosla also invested together in another storage startup - battery company Ambri. California's push "really cracks open the door" for startups that until now have had difficulty expanding small pilot projects into big purchases, Chung added. The true impact of California's initiative will be felt between 2020 and 2030, Lux's Minnihan said, and he expects the move to inspire efforts by other states. (ca.reuters.com)

August 8, 2013. The European Union (EU) decided against imposing preliminary anti-subsidy tariffs on Chinese solar panels, opting to wait another four months to assess whether the levies are warranted in the biggest EU trade fight of its kind. The European Commission waived the right to impose provisional EU duties to counter alleged trade-distorting government aid to Chinese solar-panel manufacturers. The commission will study whether “definitive” anti-subsidy levies should be applied by Dec. 8. The commission approved Aug. 2 an agreement with China to curb EU imports of solar panels as part of a parallel probe into below-cost sales, a practice known as dumping. The accord, which took effect Aug. 6, sets a minimum price and a volume limit on EU imports of Chinese solar panels until the end of 2015. Chinese manufacturers that take part are being spared provisional EU anti-dumping duties as high as 67.9 percent. The commission is engaged in a political balancing act as it seeks to limit Chinese competition against European manufacturers such as Solarworld AG. The renewable-energy dumping and subsidy cases cover EU imports of crystalline silicon photovoltaic modules or panels, and cells and wafers used in them -- shipments valued at 21 billion euros ($28 billion) in 2011. With Chinese companies such as Yingli Energy (China) Co. and Wuxi Suntech Power Co. controlling 80 percent of the EU solar-panel market and China’s government opposed to any trade protection in Europe, some European governments including those in Berlin and London have expressed opposition to anti-dumping duties to boost import prices. That led in June to commission negotiations with China on a settlement of the dumping case. EU governments, acting on a commission proposal, have until Dec. 6 to decide whether to accept the anti-dumping agreement as a definitive measure. The end-2015 timeframe of the anti-dumping accord is less than the usual five-year period for definitive EU trade protection. EU Trade Commissioner Karel De Gucht said that the pace of change in the solar-panel market justifies the shorter period of protection. (www.bloomberg.com)

August 8, 2013. Japan Prime Minister Shinzo Abe made an unlikely companion with environment protection campaigner Greenpeace as both indicated Tokyo Electric Power Co. (Tepco) isn’t up to the task of containing the Fukushima nuclear disaster. Greenpeace’s comments were blunt, Abe’s less so, though they both agreed on the seriousness of revelations that radioactive groundwater is gushing into the Pacific Ocean from the crippled coastal atomic station north of Tokyo. At least 300 tons of water laced with strontium and other radioactive particles is getting into the ocean each day, according to the Ministry of Economy, Trade and Industry. The leaks may have been happening for two years, though not at the same rate. Abe did just that, telling a ministerial meeting the government will draw up a strategy to tackle the problem. Activist groups in Japan will be pressing a similar case in a meeting with the Nuclear Regulation Authority (NRA). The groups include citizen activists from Fukushima, where as many as 160,000 people had to evacuate to escape airborne radiation when buildings exploded and reactors melted down at the atomic station in March, 2011. The activist groups argue the NRA is dedicating its already slim resources to checking that applications by utilities to restart reactors closed for inspections after Fukushima comply with new safety standards, Kyoto-based organizer Green Action said. All but two of Japan’s 50 reactors are idled for safety checks after Fukushima. The NRA, which was set up after the disaster to independently review the nuclear industry, has accepted applications from three utilities for safety inspections at four separate plants. The regulator has also indicated growing alarm about the water leaks. (www.bloomberg.com)

August 7, 2013. Showa Shell Sekiyu K.K., a Japanese refiner, will build a 49 MW biomass power plant south of Tokyo in Kanagawa prefecture as it expands it power generation business. The plant, the first biomass project for the company, will be built on the site of the company’s former refinery and will begin operating in December 2015, Tokyo-based Showa Shell said. The company will invest about 16 billion yen ($164 million). Woody biomass, mainly from North America, and palm kernel shells from Indonesia and Malaysia will be used to power the plant. (www.bloomberg.com)

August 7, 2013. The federal government relented on quotas for renewable fuels as U.S. production of next-generation sources and demand for gasoline have lagged projections. The Environmental Protection Agency (EPA) gave refiners an additional four months to reach the goal of using 16.55 billion gallons of renewable fuel for 2013. It also signaled it will cut the 18.15 billion gallon mandate for 2014, a looming requirement that had driven up the price of ethanol credits that refiners can buy to comply. Under the Renewable Fuel Standard, passed by Congress in 2007, refiners such as Exxon Mobil Corp. must use a certain amount of renewable fuels each year, with their contribution determined by their share of the fuel market. The EPA and renewable-fuel producers argue it both spurs production of domestic fuels and cuts greenhouse-gas emissions by reducing use of gasoline or diesel. Refiners complain that declining demand for gasoline means next year they would be forced to blend in more than 10 percent of ethanol, which they say isn’t safe for all engines and lacks support from consumers. Lobbyists for refiners such as Valero Corp. have pressed Congress to scrap the program altogether. The EPA pledged to lower the quota next year based on the estimated 13.2 billion gallons of ethanol that could fit within the 10 percent so-called blendwall, plus additional biodiesel or cellulosic fuels that would qualify. Because the 2013 quotas were issued late in the year, EPA also extended the deadline to comply by four months, to June 30, 2014. The agency also cut its 2013 requirement for use of cellulosic biofuel to 6 million gallons from a proposed 14 million, saying the next-generation fuel wasn’t available in adequate volumes. (www.bloomberg.com)

August 7, 2013. Offshore wind power is an “engine” of the U.K. economy, Energy and Business Minister Michael Fallon said as he opened the world’s second-biggest wind farm at sea. Fallon was inaugurating the 1.3 billion-pound ($2 billion) Greater Gabbard wind farm off eastern England, a joint venture between RWE AG’s Innogy unit and SSE Plc. The 504 MW plant will double in capacity once its Galloper extension opens in 2017, the Department of Energy and Climate Change said. The U.K. has more offshore wind capacity than the rest of the world together, and ministers published a strategy to attract more of the supply chain to Britain, where turbine makers such as Siemens AG, Gamesa Corp. Tecnologica SA and Samsung Heavy Industries Co. are considering building factories. Currently no turbines are built in the U.K, while some other components are. The government said it wants to boost jobs in the industry to 30,000 by 2020 from 4,000 now, adding an annual 7 billion pounds to the economy. Ministers want 50 percent of the capital expenditure for offshore wind farms and 85 percent of the servicing spending to be in the U.K. by 2020. (www.bloomberg.com)

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