Energy News Monitor | Volume X; Issue 51

 

 

NEWS BRIEF

OIL & GAS

June 2, 2014. Oil and Natural Gas Corp (ONGC) expects a significant jump in production during the current fiscal—a trigger which, along with an expected hike in gas prices this year, will help boost the state-owned company’s revenue. ONGC expects its domestic production of oil and gas combined to rise by 3% in FY15, helped by a significant jump in production from its marginal fields, the company said. According to data available in ONGC’s annual reports, this would be the company’s first increase in production in a decade. Marginal fields are oil and gas-bearing fields whose reserves have depleted over time, making production from these fields an expensive endeavour. The company expects a jump of 1-1.5 million tonnes of oil equivalent (mmtoe) in production during the current year, coming mainly from its marginal fields. The production ramp-up has already begun, with offshore crude production in May rising by 10,000 barrels per day compared with April. For the last 10 years, ONGC has seen a steady decline in production from a high of 47.15 mmtoe in FY05. In FY14, the company’s domestic oil and gas production was 45.03 mmtoe, its lowest in a decade. In FY14, ONGC’s crude oil realization per barrel also fell to a five-year low of $40.97, as the company had to bear the burden of subsidizing losses suffered by oil marketing companies. ONGC expects a 3% rise in output in FY15, helped by a significant jump in production from its marginal fields. While ONGC’s own production has been consistently falling, the company has had the benefit of increased production from its overseas unit ONGC Videsh Ltd, and its joint venture with Cairn India Ltd, which produces crude oil and gas in the Barmer basin in Rajasthan. (www.livemint.com)

May 31, 2014. Reliance Industries Ltd (RIL) has accused Oil and Natural Gas Corporation (ONGC) of trying to camouflage its own failure to develop gas fields by alleging that RIL had drawn natural gas illegally from a reservoir that the state firm says straddles the adjoining blocks of the two firms. In its final affidavit to the Delhi High Court, RIL ruled out any connectivity of reservoirs in the company's KG-D6 block and the adjoining area of ONGC. The firm has taken RIL, oil ministry and the directorate general of hydrocarbons to court alleging Reliance may have drawn gas worth thousands of crores of rupees from a common reservoir in the KG-D6 block, while authorities turned a blind eye to the issue. ONGC has argued that Reliance had drilled wells very close to the common boundary of the blocks, but RIL says this does not mean that reservoirs are connected. (economictimes.indiatimes.com)

May 29, 2014. Vadodara headquartered Western Onshore Basin of Oil and Natural Gas Corporation (ONGC) is planning to spend ` 2,000 crore in the current fiscal year towards exploration in oilfields and other investments in Gujarat. The basin has a target to drill 38 exploratory wells and achieve 25 million metric tonnes of oil and gas in the financial year 2014-15.

According to ONGC, the corporation received good success at the oil wells in Gandhar field in 2013-14 with one oil well producing 700 barrels. The basin through its Gujarat operations contributes nearly 22 per cent to ONGC's total production in the country. The biggest contribution to the basin's operations in Gujarat comes from Mehsana field, which contributes 33 per cent and Ankleshwar field, which contributes nearly 28 per cent in Gujarat's total production. (timesofindia.indiatimes.com)

May 30, 2014. The country's biggest refiner Indian Oil Corporation (IOC) will raise $1.65 billion debt in overseas market in the current financial year. The company will raise $900 million through external commercial borrowings to replace short-term costlier loan while another $750 million will be raised over the financial year. The overseas debt interest rate was around 3 per cent - 3.5 per cent. The company raised $1.17 billion foreign debt in the last fiscal. IOC will invest ` 16,600 crore toward business expansion in 2014-15. The firm posted a steep 36 per cent fall in its net profit for the fourth quarter of last fiscal at ` 9,389.85 crore as the government did not compensate it for the under recoveries and its refining margins also shrank. (economictimes.indiatimes.com)

May 30, 2014. Reliance Industries Ltd (RIL) will shut a vacuum gas oil (VGO) hydrotreater at its 580,000 barrels per day (bpd) export focused plant for up to a month from this weekend. RIL operates the world’s biggest refining complex at Jamnagar in Gujarat, with capacity to process over 1.2 million bpd of crude. The VGO hydrotreater is one of two such units of about 110,000 bpd capacity at the refinery. A VGO hydrotreater removes sulphur from heavy feedstock to produce naphtha, jet fuel and LPG. (www.livemint.com)

May 29, 2014. The Indian Oil Corporation (IOC) aims to start crude processing at its 300,000-barrels-per-day Paradip refinery by August or September, the company said. The refinery will have only one crude distillation unit. (economictimes.indiatimes.com)

May 29, 2014. Chennai Petroleum Corp Ltd plans to shut an 80,000 barrels per day (bpd) crude unit and some secondary units for a month-long maintenance in October-December at its 210,000 bpd Manali refinery. The refiner will also shut a 2 million tonne per annum (mtpa) hydrocracker, a 400,000 tonne a year reformer, a 1 mtpa visbreaker and a 2 mtpa diesel hydrotreater for maintenance in October-December. Manali refinery in the southern state of Tamil Nadu has three crude units. Chennai Petroleum also operates the 20,000 bpd Nagapattinam refinery in the state. (economictimes.indiatimes.com)

May 28, 2014. Hindustan Petroleum Corp Ltd (HPCL) aims to invest ` 540 billion ($9.2 billion) by 2019 to raise its refining capacity by 81 percent. The capacity would rise to about 860,000 barrels per day. Expansion would help the state refiner modify its existing decades-old plants and boost refining margins by processing cheaper grades. HPCL hopes to win environmental approvals by the end of this year to expand its 130,000 bpd Mumbai refinery in Maharashtra, and the 166,000 bpd Vizag plant in Andhra Pradesh. The company is setting up a 180,000 bpd refinery at Barmer in Rajasthan, which would cost 370 billion rupees. It also has a stake in HPCL-Mittal Energy Ltd, which operates a 180,000 bpd refinery at Bathinda in northern India. HPCL would invest about ` 170 billion to expand Mumbai refinery to 200,000 bpd and Vizag to 300,000 bpd. (in.reuters.com)

May 28, 2014. Hindustan Petroleum Corp Ltd (HPCL) aims to increase its Mumbai refinery's capacity to 200,000 barrels per day from 130,000 bpd, the company said. The company also aims to increase the Vizag refinery's capacity to 300,000 bpd from 166,000 bpd. HPCL will spend ` 170 billion ($2.88 billion) for expanding the refineries. (in.reuters.com)

May 30, 2014. India's Bharat Petroleum Corp Ltd (BPCL) has signed a four-month naphtha sales deal with Chinese trading house Unipec, the first term deal between the two parties, traders said. Unipec will lift a 35,000-tonne cargo each month from Kochi port from July to October, or a total of 140,000 tonnes during the four-month period. The deal was done at around $1.00 a tonne premium to the refiner's own pricing formula on a free-on-board (FOB) basis, the traders said. BPCL which holds two other short-term naphtha contracts with Japan's Idemitsu Kosan, has separately sold a 38,000-tonne spot cargo for June 21-23 loading from Mumbai to another Chinese trader - PetroChina - at a premium of about $40 to $41 a tonne to Middle East quotes on FOB basis, traders said. (economictimes.indiatimes.com)

May 30, 2014. Reliance Industries Ltd (RIL) is boosting crude imports from Africa and cutting its dependence on the Middle East as the owner of the world's biggest refining complex seeks to benefit from shifting global oil flows caused by the US shale boom. African and Latin American crude, which together account for about 56 per cent of Reliance's imports now, have become cheaper as the United States slows purchases and increasingly turns to domestic shale oil, while Middle Eastern heavy crude grades are pricier due to demand from regional refinery expansions. (economictimes.indiatimes.com)

May 30, 2014. Reliance Industries Ltd (RIL) sold 55,000 tonnes of naphtha for June loading from Sikka, traders said, pushing its total exports for next month to 185,000 tonnes, which data shows would be the highest in a single month since December. RIL sold the cargo, scheduled for lifting from Sikka around June 24, to Vitol at a premium in the high $20s a tonne level to Middle East quotes on a free-on-board (FOB) basis. The other two cargoes for June loading were also sold to Vitol previously. (economictimes.indiatimes.com)

May 30, 2014. GAIL (India) Ltd, the nation’s biggest gas distributor, will shift its focus to businesses such as gas retailing and petrochemicals because of uncertainties in gas supply and pricing, along with delays in approvals for pipelines. GAIL will slow expansion of its core business of gas transportation and marketing, including its planned investments worth ` 20,000 crore to develop three pipeline networks across the country. (www.livemint.com)

May 30, 2014. Reliance Industries Ltd (RIL) imported 9.5 per cent more oil in April than in March, and made its first purchase of Mexico's extra light Olmeca grade while continuing to skip imports from Iraq for the sixth month, tanker arrival data obtained from trade sources show. It imported about 1.21 million barrels per day (bpd) of oil in April for processing at its two complex refineries at Jamnagar in western Gujarat state. The plant can together process 1.2 million bpd of oil. Reliance, which regularly tests new grades and buys cheaper tougher grades to maximise its refining margins, received a rare cargo of Equatorial Guinea's Zaffiro and Alen condensate. In the four months to end-April, Reliance bought three cargoes of Kazakhstan's CPC blend and stepped up purchase of UAE's Umm Shaif and Lower Zakum grades, the data showed. Reliance may boost intake of Brent-linked heavier, cheaper African grades in 2014 and West Texas Intermediate (WTI)-related Latin American oil while cutting intake of those from Middle East. Brent and Latin American grades have turned cheaper after being displaced from the US market because of a shale boom and enhanced Canadian supplies through pipelines and rails. (economictimes.indiatimes.com)

June 3, 2014. With the Prime Minister (PM) Narendra Modi led-government asking every ministry to come up with a 100-day agenda, the petroleum ministry is planning to line up a priority list. The list includes clarity on policies relating to the next round of bidding for exploration of oil & gas blocks, gas pricing and removal of bottlenecks in the sector. The power and coal ministries, too, have lined up an agenda that includes increasing coal production, renewable energy generation and financially healthier distribution companies. After issuing a 10-point agenda on the functioning of the government, Prime Minister Modi held a special meeting of the Council of Ministers on a 100-day plan. With Dharmendra Pradhan, minister of state for petroleum, insisting on a pro-poor approach, suggestions by the Kirit Parikh panel on pricing of petroleum products, including a rise of ` 250 in the prices of subsidised domestic cooking gas cylinders, aren’t likely to be implemented. Within 100 days, a decision on the future of direct benefits transfer for liquefied petroleum gas may also be taken. The government’s 10-point agenda included health, water, energy and roads. It sought greater transparency in governance and building confidence within the bureaucracy. To expedite decision making within the government, the Price Minister’s Office had decided to abolish the nine empowered groups of ministers and twenty-one groups of ministers. (www.business-standard.com)

June 2, 2014. Jet fuel prices have been cut by 1.8% and rates of non-subsidized cooking gas (LPG) by ` 23.50 per cylinder after the rupee’s appreciation lowered import costs. The price of jet fuel, also known as aviation turbine fuel (ATF), at Delhi was cut by ` 1,285.89 per kilolitre, or 1.81%, to ` 69,747.98 per kilolitre, according to Indian Oil Corp (IOC). This is the third reduction in jet fuel rates since April. Declining international oil prices and the strengthening of the rupee against the US dollar have made imports cheaper. In Mumbai, jet fuel costs ` 71,940.36 per kl as against ` 73,306.89 per kl previously, IOC said. The rates vary because of differences in local sales tax or VAT. Jet fuel constitutes over 40% of an airline’s operating costs and the price cut will ease the financial burden of cash-strapped carriers. Separately, the price of non-subsidised LPG, which customers buy after using up their quota of 12 subsidised cylinders, was cut by ` 23.50 per cylinder, the fifth straight reduction in rates since February. Each non-subsidized 14.2kg cooking gas cylinder will now cost ` 905, down from ` 928.50, in Delhi. The rates were cut on February 1 by ` 107—from ` 1,241 per cylinder to ` 1,134, by ` 53.5 per cylinder in March to ` 1,080.50, by ` 100 to ` 980.50 in April and by ` 52 last month. A subsidised LPG cylinder in Delhi costs ` 414. Non-domestic LPG rates were increased by a steep ` 220 per cylinder at the beginning of the year but have now been cut in line with softening international rates. IOC said losses on LPG have come down to ` 432.71 per subsidized cylinder from ` 449.14 in the previous month. The loss was ` 762.50 in January. (www.livemint.com)

June 1, 2014. Tamil Nadu Chief Minister J Jayalalitha said that the people's hope of a further progress by change of government at the Centre has been dashed with the fifty paise hike in diesel prices. She once again urged the new government to change the oil pricing formula instead of following the wrong economic policies of the erstwhile Congress led government and asked the centre to withdraw the hike, which will have inflationary effect. The oil pricing mechanism should be changed and must factor in the cost of crude (imported and domestically explored) and their refining costs, she suggested. She said if this method is followed the prices of petroleum products would come down and inflation would be contained. Jayalalitha said she will stress the Centre to withdraw the power give to Oil Marketing Companies (OMCs) to fix the fuel price. (www.business-standard.com)

May 31, 2014. Reliance Industries Ltd (RIL) said the CAG comment that the company charged a rate in excess of the government approved price for its KG-D6 gas is part of a draft report which has not yet been finalised. RIL said a report of the Comptroller and Auditor General of India (CAG) will come into existence when each audit para including one on pricing of gas "have gone through various stages of comments and clarifications from all concerned parties and the counter of the auditee under review." RIL, however, did not refute the contents of the draft report that has been sent to the Ministry of Petroleum and Natural Gas as well as to the company for comments. The CAG had in a draft report stated that RIL charged USD 4.205 per million British thermal unit as price of gas produced from its eastern offshore KG-D6 block instead of rounding off to two decimal points, i.e. $4.20 as was indicated by the company when it in 2007 undertook price discovery. On top of this sale price, RIL charged a marketing margin of USD 0.135 per mmBtu to cover for its marketing risks but did not include it for calculation of royalties and government's share of KG-D6. RIL said government had in 2007 approved a pricing formula and not a specific price. (economictimes.indiatimes.com)

May 31, 2014. The petroleum ministry wants to consult the finance and law ministries before taking a decision on revising natural gas prices. The petroleum ministry wants to consult the law ministry as Reliance Industries Ltd (RIL) has legally challenged the government by initiating arbitration over delay in the announcement of new gas prices. The previous government had approved a new formula that would have doubled gas prices from April 1 but the Election Commission blocked the move. (economictimes.indiatimes.com)

May 31, 2014. Diesel prices were hiked by 50 paise a litre, excluding state levies, the second increase in rates three weeks. The monthly hike in price came after several rounds discussions that the new oil minister Dharmendra Pradhan held with state-owned oil firms on continuing with the reform initiated by the United Progressive Alliance (UPA) government. The announcement of the hike gave clear indications that the Bharatiya Janata Party (BJP) government will continue with reforms of the previous Congress regime. The UPA had in January 2013 decided to raise diesel prices in small doses of up to 50 paise every month till such time that the subsidy on nation’s most consumed fuel is eliminated. (www.livemint.com)

May 29, 2014. India's exploration activity has crashed due to loss of focus after big discoveries, arbitrary policy changes, lack of respect for sanctity of contracts and deteriorating risk-reward ratio, but the situation can be revived with proper measures, the exploration industry has told the new government. Seismic surveys, a key activity in the hunt for hydrocarbons, plummeted 91% in the five years to 2012-13 in onshore blocks and 95% in the more challenging offshore regions, the Association of Oil and Gas Operators has estimated. Further, the number of wells drilled has dipped 22% in the country, which urgently needs to step up exploration as it imports 80% of the oil it consumes, said the industry body. The exploration industry has been mired in disputes during the UPA government. These include successful explorers such as Reliance Industries and Cairn India, which have found the biggest reserves of oil and gas since the discovery of Bombay High in the Seventies. The industry body says that the government's approach has changed drastically, and in the wrong direction. The industry feels that it is a victim of its own success. The oil and gas industry is worried that India is losing lustre as an investment decision as the government has struggled in its role as contract administrator; the oil ministry failed to resolve policy conflicts in a timely manner, violation of the sanctity of contracts and lack of recognition that the Indian upstream industry derives its strength from the enthusiasm of existing players. It has suggested that the country must realistically assess its geology, focus on providing geological information, improve the risk-reward ratio for investors and remove, or at least minimize, unnecessary controls that do not add value. The government's approach towards exploration and production as well as companies involved in this activity has largely been shaped by high-profile issues relating to the KG-D6 block, which initially hoisted India to global limelight as the world's biggest find in the year it was discovered, and being the pioneering deep-sea venture for India. However, production fell sharply leading to a bitter dispute between the oil ministry, which blamed the company, and RIL, that said it suffered because of complex geology in the challenging deep-sea region. (economictimes.indiatimes.com)

POWER

June 2, 2014. Coal India Ltd (CIL) reported provisional coal production of 36.27 million tonne (mt) for May, falling short by 6 per cent from the target of 38.56 mt. The combined production shortfall for the first two months of 2014-15 fiscal was 3 per cent at 73.79 mt (provisional) against the target of 76.17 mt. The miner though unable to meet its production target registered a growth of 5 per cent for the first two months. Eastern Coalfields, Bharat Coking Coal Ltd and Central Coalfields succeeded in surpassing production targets. (economictimes.indiatimes.com)

June 2, 2014. Power cuts could spread to many parts of the country as the electricity deficit has more than doubled in May, while spot power prices have doubled in the last few days as scorching heat has increased demand. The situation may deteriorate further as the monsoon, forecast to be deficient, is behaving erratically even before hitting Kerala The power deficit has jumped to nearly 7,000 MW from 3,000 MW in early May. As power stations try to increase generation to meet demand, coal stocks have started depleting at some thermal plants — a situation that can add to the deficit in the days ahead. (economictimes.indiatimes.com)

June 1, 2014. Tata Power has generated 23,928 million units of electricity at its Mundra ultra mega power project (UMPP) in the past fiscal year and 6,328 million units at Maithon Power Ltd (MPL). Generation capacities of the Mundra project, which is also known as Coastal Gujarat Power Ltd, and MPL increased by 92 per cent and 38 per cent, respectively, from the previous year, the company said. Tata Power has an installed gross generation capacity of 8,560 MW and aims to distribute 4,000 MW and secure 50 million tonnes per annum of fuel resources by 2022. (economictimes.indiatimes.com)

June 1, 2014. Power generation increased over 11 per cent in April, exceeding the target for the month, after new projects were commissioned. Electricity generation rose to 86.6 billion units from 77.87 billion in April last year, according to data from the Central Electricity Authority (CEA). Thermal power plants generated 74.02 billion units during the month. Hydel, nuclear and power imports from Bhutan contributed 9.67 billion units, 2.81 billion units and 78 million units, respectively. The electricity generated in April was higher than the target of 81.74 billion units set by the government for the month, according to the data. A thermal power project with a capacity of 135 MW was commissioned in Chhattisgarh in April. NTPC had started at least 2,000 MW of projects during the last quarter of 2013-14, including thermal stations in Uttar Pradesh and Tamil Nadu. The CEA estimates generation of 1,023 billion units in 2014-15, compared with 967 billion units in 2013-14. The peak power requirement in the country in April was 1,40,998 MW, while availability was 1,33,442 MW. (economictimes.indiatimes.com)

May 29, 2014. India Power Corp. Ltd, a group firm of Kolkata-based non-banking finance company Srei Infrastructure Finance Ltd, plans to acquire Abhijeet Group’s 1,080 MW Jharkhand power project, valued at around ` 9,000 crore, in what could be the first of several acquisitions in India’s power sector. Lenders to the Abhijeet project, including state-owned Rural Electrification Corp. Ltd (REC) and State Bank of India (SBI), have been looking to recover or restructure their loans. The Abhijeet group, promoted by Manoj Jayaswal, is one of the alleged beneficiaries of the previous government’s irregular allotment of coal mines. The Central Bureau of Investigation (CBI) is probing the allotments. Jayaswal has been in talks with Srei Infrastructure, which has approached lenders with a buyout plan. The Jharkhand project has four units of 270 MW each, divided into two phases. While REC is the lead lender for two units, SBI is the lead lender for the remaining two. According to Abhijeet Group, the expected date of commissioning of Phase I is December 2014 and Phase II August 2015. (www.livemint.com)

May 28, 2014. The power generation at the fourth unit of the Sasan Ultra Mega Power Project (UMPP) in Singrauli district of Madhya Pradesh (MP) has started. The generation at the fourth unit started with Madhya Pradesh getting 250 MW as its share, Madhya Pradesh Power Management Company Limited said. The total capacity of Sasan UMPP is 3,960 MW. A total of six units, of which four are already commissioned, are being set up in the plant. The generation from the fifth and the sixth unit too will start soon. (www.business-standard.com)

June 3, 2014. Local power producers, including Jaypee Power Ventures, Lanco Infratech, GMR Infrastructure, and iron ore miner Sesa Sterlite have offered to sell some of their power plants to India's largest power producer NTPC as lenders put pressure on them to divest assets to slash debt. NTPC has received more than 30 offers in response to its offer, known in industry parlance as expression of interest (EoI), made in April to purchase coal-fired power plants. Lanco, which has coal-fired power plants with a capacity of about 3,000 MW, had publicly stated its intention to sell some assets. NTPC was keen to purchase Jaypee's three power plants at Bina (500 MW), Nigri (1,320 MW) and Bara (1,980 MW), which are either operational or in the final stages of commissioning with adequate coal supply arrangements. Bina is already operational while Nigri will be commissioned in the next financial quarter, and Bara will be ready by 2015. (economictimes.indiatimes.com)

June 3, 2014. International Finance Corporation (IFC) said it made an equity investment of $20.4 million in Power Grid Corporation of India (Power Grid). The investment was through its participation in the FPO. Power Grid lined up a project whose cost is estimated at about $16 billion out of which $ 1 billion is funded through an equity infusion in the FPO. The project comprises of several transmission lines and sub-stations in various parts of the country. Power Grid is country's inter-state and inter-regional transmission utility, majority owned by the Government of India. The national transmission utility has a capital expenditure plan of $16 billion during the 2013-17 period (the Project) for further development of national grid. (www.business-standard.com)

June 2, 2014. Uttar Pradesh's power utility countered central government's criticism over short supply of electricity when most parts of the state are under heat wave. The centre is distorting facts of power supply situation. Newly formed NDA government and Akhilesh Yadav government in Uttar Pradesh are blaming each other for long power supply cuts in the state where ruling Samajwadi Party failed to make a mark in the general elections. Opposition parties are claiming that Yadav government is victimising voters in the constituencies that did not vote for his party. Of the state's demand for 12,700 MW, power utilities are able to cater about 10,700 MW is met, leaving a shortfall of 2,000 MW. The state's power utilities are suffering transmission and distribution losses to the tune of 32%, which translates into loss of ` 7,000 crore per annum to state exchequer. Power utilities of Uttar Pradesh are able to supply electricity for less than 13 hours in urban areas and eight hours in villages. Centre also suggested Uttar Pradesh to procure adequate power from the power exchanges to meet its shortage while the state has already started buying close to 800 MW from Indian Energy Exchange alone. It also asked NTPC to supply 325 MW of supply till June 7. Uttar Pradesh is unable to procure power from not only southern grid but lack of transmission network is also preventing Uttar Pradesh Power Corporation Ltd (UPPCL) from availing 700 MW of power it tied up early this year to meet summer demands. (economictimes.indiatimes.com)

June 1, 2014. Maharashtra State Electricity Distribution Company (MSEDCL) said that it has had to effect two to five hours of 'load shedding' across the state owing to technical issues at some private sector generating stations and a dip in supply from the central grid. Two units of 660 MW each operated by Adani Power, 600 MW from JSW Energy and 500 MW from Indiabulls Power have stopped delivering power while there is also a 500 MW dip in supply from central grid. (www.business-standard.com)

May 31, 2014. The northern electricity grid suffered a load loss of 8,000 MW, including 3,500 MW in the national capital, during a fierce storm in the region and power supplies are gradually being restored. Supplies were affected due to heavy rains, dust and thunderstorms and wind speeds exceeding 75 kmph in areas of Delhi, Uttar Pradesh, Haryana and Uttarakhand. Piyush Goyal, Minister of State for Power (independent charge) reviewed the situation arising out of the load interruption. The ministry also said restoration work has started. In Delhi, top priority was accorded to restoring power to emergency services such as hospitals, Delhi Metro, water treatment plants and the New Delhi Municipal Council area. Presently, about 3,800 MW load is being met. (economictimes.indiatimes.com)

May 31, 2014. ILFS Energy Development Co, which is developing coal- and gas-based power plants with a capacity of about 7,500 MW across the country, has begun talks with Shanghai Electric Group to sell a stake of up to 74% in eight projects, starting with its 4,000 MW power plant at Cuddalore district in Tamil Nadu. The talks are project-specific and will depend on how the ongoing discussions conclude. Apart from unlocking value, ILFS also wants a strategic investor which can execute engineering and procurement work as well as operations and maintenance once the plants are completed. (economictimes.indiatimes.com)

May 30, 2014. A separate transmission company has been created for power transmission in the Telangana region. All the functions presently being carried out by AP Transco in the area of Telangana State will be performed by the TG Transco from June 2. An order has been issued by the energy department creating the new power utility for the new state of Telangana as per the section 53 of the AP Reorganisation Act 2014. (timesofindia.indiatimes.com)

May 29, 2014. Inspectors from billionaire Anil Ambani’s electricity retailer BSES Rajdhani Power Ltd. entered a village near New Delhi hunting for tampered meters. Residents responded by beating them with iron rods. The team was also stoned in the May 21 incident, a police report shows. Inspectors who visited another village in 2012 were bound and urinated on. The attacks show the task India’s power distributors face to stem theft contributing to blackouts and $17 billion in lost revenue annually. Losses from stolen power, inefficient transmission and patchy metering pose a pivotal test for Indian Prime Minister Narendra Modi’s pledge to boost energy output as a matter of national security. The government also requires distributors to sell power below cost in India, where about two-thirds of the 1.2 billion population live on less than $2 per day. That forces retailers to increase debt to pay for supplies and curbs the funds flowing to power generation companies to scale up production. Distributors, including Reliance Infrastructure Ltd’s units BSES Rajdhani and BSES Yamuna Power Ltd in New Delhi, owed ` 141 billion ($2.4 billion) to state-run generators as of April 30, the Power Ministry estimates. The assault with rods occurred in the national capital’s Keshopur village, according to the police report. A BSES Rajdhani anti-theft squad was tied up and urinated upon in 2012 in a village near Najafgarh, about 20 kilometers (12 miles) west of central New Delhi, the company said. Assaults have worsened since 2009, when a federal police team known as the Central Industrial Security Force stopped accompanying inspectors on raids, the company said. Insufficient electricity supplies are hurting efforts to spur economic growth from close to a decade-low and leave about 300 million people, or more than the combined populations of Brazil and Argentina, without electricity. The nation’s supply network loses more than 27 percent of the power it carries because of dissipation from wires and theft, according to India’s Central Electricity Authority. That’s about 261,130 gigawatt-hour of power annually, enough to light up all of New York state for 21 months, and worth about ` 1 trillion at an average electricity price of ` 4 a unit. The loss is 5 percent in Australia, 6 percent in China and the U.S. and 16 percent in Brazil, according to the World Bank. To curb theft, BSES started raiding premises across the national capital, sometimes in the dead of the night. The company registered more than 750 cases and discovered that about 3,330 kilowatts had been stolen in the “past few days,” enough to power more than 800 middle-class households in the capital. The raids will continue for three months. (www.bloomberg.com)

June 3, 2014. Buoyed by hopes of a speedy reform process to be undertaken by the new government going ahead, Coal India (CIL) has now decided to acquire coal mines abroad, and pick up stakes, particularly, in coking coal and high grade thermal coal. Despite pursuing with handful of proposals in the past, Coal India had failed to firm up any acquisition in the past five years. With the coal ministry, under Piyush Goyal, looking at reviving efforts to boost output, Coal India now wants to go all-out on the acquisition front, especially, at a time when output of coking coal and high grade thermal coal is seen declining from the domestic mines. The state-owned miner, which has a near monopoly, is open to outright takeover of mines or even undertake equity investment on production sharing basis, Coal India has said. Coal India currently has about 17 investment proposals from overseas mining companies. (www.dnaindia.com)

June 3, 2014. The Ministry of Power has asked the State Government to ensure implementation of standard security guidelines in all vital installations, including hydel and thermal power projects. Even as there are gaping holes in security arrangement of vital installations, the State Government appears callous to the emerging threat from Left Wing Extremists (LWEs). The Naxal attack at Balimela Hydro Electricity Project and Nalco’s explosive depot atop Damanjodi hill in 2009 had exposed the lax security in several key industrial units in the Maoist-affected southern Odisha districts. A couple of years back, miscreants stole copper cables from  Indravati Hydro Electricity Project leading to total disruption of power generation for about 16 hours. Following the incident, there were proposals to increase security cover for the hydel projects in the State. (www.newindianexpress.com)

June 2, 2014. Power and Coal Minister Piyush Goyal will meet Prime Minister Narendra Modi to discuss and establish top priorities in the power sector. Coal production, renewable energy and making discoms healthy will top the priority list, he said. The government is looking at holistic solutions to issues faced by the sector. (www.business-standard.com)

June 1, 2014. Electricity consumers in Mumbai can change their supplier if they want and Brihanmumbai Electricity Supply & Transport Undertaking (BEST) cannot prevent it, the Supreme Court has held in the case, BEST vs Maharashtra Electricity Regulatory Commission. Some consumers in the BEST supply area wanted to change to Tata Power Co for power requirement. When they approached BEST, it rejected their request. They moved the Mumbai Electricity Regulatory Commission. Reliance Industries, another supplier, was also made a party to the case. The commission allowed the petitions and held that Tata Power was bound to supply electricity either through BEST wires or its own wires. (www.business-standard.com)

May 31, 2014. Power Finance Corporation (PFC) and Rural Electrification Corp (REC), have rescued Reliance Infrastructure’s power distribution companies in Delhi by helping them pay off generator NTPC’s past dues. PFC and REC disbursed a combined ` 1,000 crore as loan to the two discoms — BSES Yamuna Pvt Ltd (BYPL) and BSES Rajdhani Pvt Ltd (BRPL), the last day for clearing NTPC’s ` 700-crore dues according to the Supreme Court’s order. NTPC had been threatening to cut Delhi’s supply if its dues were not cleared. NTPC had in May sought the apex court’s permission to begin regulation of power supplied to the BSES firms, arguing nearly 75 per cent of the payments received from these companies went to Coal India, so if they did not pay, NTPC’s Badarpur thermal plant would not be able to supply electricity to Delhi. (www.business-standard.com)

May 31, 2014. Haryana raised power tariffs for a section of industrial users--2 lakh out of a total 50 lakh power consumers--but the increase has been offset by other measures. The new tariff order issued by the Haryana Electricity Regulatory Commission (HERC) will have no impact on domestic, tubewell and small, non-domestic consumers. The agriculture tariff, which was reduced to 10 paise per unit from 25 paise effective January 1, has been retained at that level for 2014-15. Supply to farms has risen to 30 minutes short of 24 hours a day from 18 hours previously. (economictimes.indiatimes.com)

May 30, 2014. The power ministry has sought to allay concerns of Uttar Pradesh (UP) residents on an alleged severe shortage of electricity in the state. Angry residents are taking to the streets protesting over near 12-hour power cuts in many areas post the general elections. UP has a peak power demand of 12,700 MW against which over 10,700 MW is being met, leaving a shortfall of around 2,000 MW. This has forced Uttar Pradesh Power Corporation Ltd (UPPCL) to take up rostering or re-allocation in many areas including rural districts. (www.business-standard.com)

May 29, 2014. Coal India Ltd (CIL) said net profit in the quarter ended March declined 18% to ` 4,434.18 crore, weighed down by lower realization from auctions and a ` 876 crore provision to resolve a dispute with its biggest customer NTPC Ltd, a power utility. Though the state-controlled miner managed to sell through electronic auctions 58 million tonnes (mt) in the March quarter compared with 49.14 mt in the same period a year ago, realization fell by around ` 300 per tonne to ` 2,140 per tonne, according to the company. (www.livemint.com)

May 28, 2014. India has agreed to build four new joint venture hydropower projects in Bhutan as the two governments agreed to closely coordinate on issues relating to their national security and interests. Prime Minister Narendra Modi met his Bhutanese counterpart Tshering Tobgay in New Delhi and agreed that India would build four new hydropower projects with a capacity to generate 2120 MW in Bhutan. Bhutanese Foreign Minister Rinzin Dorji said Modi also expressed concerns on why the implementation of Bhutan's hydropower projects was delayed. (economictimes.indiatimes.com)

May 28, 2014. The new government should take immediate steps, including levying higher customs duty on imported electrical equipment, to protect interests of the domestic industry, the Indian Electrical Equipment Manufacturing Association (IEEMA) has said. According to IEEMA, which has more than 800 members, the built-up capacity of electrical equipment industry is currently under utilised due to sluggish domestic demand. This is mainly on account of power sector slow down as well as surge in imports of electrical equipment. Suggesting various measures, the grouping has said that only domestic manufacturers should be allowed to participate in bidding for domestically-funded projects. Besides, IEEMA has suggested that basic customs duty on all electrical equipment products should be kept at a uniform rate of 10 per cent. (economictimes.indiatimes.com)

May 28, 2014. Jammu and Kashmir Chief Minister Omar Abdullah said scores of newly started power projects are set to catapult energy scenario in the state and help achieve the goal of self-reliance in electricity needs in near future. He said the enhanced power generation in the state will benefit not only the domestic and industrial consumers but transform Jammu and Kashmir from power deficit area to energy surplus state. The Chief Minister said the initiatives taken to upgrade power supply and service delivery will widen the base of customer care of the Power Development Department. (www.business-standard.com)

May 28, 2014. Fresh from his visit to New Delhi for Prime Minister Narendra Modi's swearing-in, Sri Lankan President Mahinda Rajapaksa ordered officials to quicken the progress of a coal-fired power plant being built jointly with India. Sri Lanka and India had announced the finalisation of USD 512 million joint venture coal-powered electricity plant in Sampur in the eastern port district of Trincomalee. The joint venture will see the construction of two power generators of 250 MW each. At the signing of the deal in the presence of then External Affairs Minister Salman Khurshid, it was announced that the construction was to begin within a year and the plant was to be connected to the national grid by 2018, providing cheaper electricity. Sri Lanka currently depends on expensive diesel-powered plants to meet its demand that cannot be fulfilled by hydroelectricity. (www.business-standard.com)

OIL & GAS

June 2, 2014. Russia's Gazprom Neft, the oil arm of natural gas producer Gazprom, said it has started oil production at the Badra field in Iraq. The company hopes production at the field, in the eastern Wasit province, will reach 15,000 barrels per day when the necessary infrastructure is expected to be in place. Production is expected to reach a peak of 170,000 barrels per day (around 8.5 million tonnes per year) in 2017 and then remain stable for seven years, the company said. (www.rigzone.com)

June 2, 2014. Bankrupt Brazilian oil company Oleo e Gas Participacoes SA expects to produce its first oil from the Atlanta offshore field in the BS-4 block in the Santos Basin in late 2015 or early 2016, the company said. Oleo e Gas owns 40 percent of an estimated 147 million barrels of proven, or "1P," oil reserves, and 56 million cubic meters of natural gas in the Atlanta field. The neighbouring Oliva field holds 65 million barrels of recoverable oil and equivalent natural gas, with first oil expected in 2021. (www.rigzone.com)

June 1, 2014. Argentina state oil producer YPF said it had made a discovery of 'tight gas' in the western Argentine province of Mendoza. The find by the Paso de las Bardas Norte xp-37 exploration well has a potential 25 million barrels equivalent of recoverable resources, the company said. There was also "important potential" for oil, it said. Tight gas is a type of hydrocarbon found in reservoirs formed by rocks of low permeability. Gas production infrastructure is already in place in the area, allowing for immediate production, said YPF. (www.rigzone.com)

May 30, 2014. After focusing on natural gas for 13 years as a private company, Houston-based Laredo Energy is interested in getting into oil production in east Texas this year, ahead of the decision to go public in 2015, the company said. This is the first time that the company will be focusing on oil production; up until now, it has confined its efforts to natural gas exploration. However, with $130 million in new equity commitments from Avisa Capital Partners and Liberty Energy Holdings, the company will be expanding its drilling program to include the Eaglebine play in East Central Texas as it continues to drill for gas in South Texas. Laredo Energy’s natural gas drilling will focus on plays in Webb County, while the oil production will be in Brazos, Burleson and Robertson counties, where the company will use the knowledge and experience it gained from drilling for gas in South Texas. (www.rigzone.com)

May 28, 2014. Sundance Energy Australia Ltd., an explorer that’s expanding in the Eagle Ford shale formation of Texas, will look at acquisitions of as much as $200 million as some competitors focus on drilling over deals. Sundance plans to add more acreage in the Eagle Ford through leases, small purchases and potentially larger acquisitions. The company may purchase as much as 25 percent of the more than 50,000 acres it’s evaluating. (www.bloomberg.com)

May 28, 2014. Maersk Oil, a unit in Danish shipping and oil group A.P. Moller-Maersk, said it has received approval from British and Norwegian authorities to develop the Flyndre and Cawdor fields. The fields lie approximately 293 kilometres southeast of Aberdeen in the UK North Sea. The Flyndre well is expected to peak at around 10,000 barrels of oil per day with first oil expected in 2016, with Cawdor expected to peak at around 5,000 barrels per day with production beginning in 2017, Maersk Oil said. (www.rigzone.com)

June 2, 2014. Venezuela will appeal an arbitration ruling allowing refiner Phillips 66 to acquire state oil company PDVSA's 50 percent stake in a delayed coking unit at the Sweeny refinery, the Oil Minister Rafael Ramirez said. The 70,000 barrel-per-day coking unit was originally owned by Merey Sweeny LP, a joint venture between PDVSA and Phillips. (www.downstreamtoday.com)

June 2, 2014. Idemitsu Kosan Co, Japan's third-largest oil refiner by capacity, shut the 160,000 barrels per day (bpd) crude distillation unit (CDU) at its Hokkaido refinery in northern Japan for scheduled maintenance, the company said. The CDU will be closed until early July. (www.downstreamtoday.com)

May 30, 2014. Russia's Mariysky refinery, which has been closed for around a year due to financial problems, could restart production in June after a change in ownership. The plant had bought more than 100,000 tonnes of crude oil, possibly from Shell's Russian Salym venture with Gazprom Neft. (www.downstreamtoday.com)

May 30, 2014. Azeri state oil company SOCAR has signed a $3.29 billion financing deal with 23 banks and export credit agencies for the construction of a refinery on Turkey's Aegean coast, SOCAR's Turkish subsidiary Petkim said. SOCAR is building the $5.5 billion Star refinery to supply feedstock to petrochemicals maker Petkim, which will help cut Turkey's dependence on imported refined oil products. The Star plant in Aliaga on the Aegean coast is expected to have an annual capacity of 10 million tonnes, 1.6 million tonnes of which would be naphtha which could feed the Petkim plant. It will also produce diesel, jet fuel and LPG. (www.downstreamtoday.com)

May 29, 2014. Spanish oil engineering company Tecnicas Reunidas said it had won a $2.7 billion contract to expand Peru's Talara refinery. Tecnicas Reunidas will be in charge of designing, engineering and building the new facilities, it said in a notice to Spain's stock market regulator. The Peruvian government had announced a deal with Tecnicas Reunidas over a $3.5 billion expansion project at the refinery but did not at the time disclose the exact amount of the contract. The project aims to increase output by 50 percent at the Talara refinery to around 96,000 barrels per day. (www.downstreamtoday.com)

June 3, 2014. An oil tanker shipping crude from Iraq’s semi-autonomous Kurdish region turned back after getting almost 200 miles across the Atlantic Ocean, amid a challenge over the shipment’s legality. The United Leadership, able to haul 1 million barrels, signalled that it was about 5 miles off Mohammedia in Morocco, according to information entered by the ship’s crew and captured by Coulsdon, England-based IHS Maritime. It turned back after getting about 190 miles west of Gibraltar, at which point it was sailing to the U.S. Gulf. The shipment is illegal, SOMO, Iraq’s oil marketing company, said. The tanker is close to the port of Mohammedia in Morocco, tracking data show. Representatives from the facility are meeting their counterparts at the local refinery. At least seven calls to Mohammedia refinery officials weren’t returned. The Kurdistan Regional Government (KRG) estimates its region has about 45 billion barrels of crude reserves. Iraq itself has about 150 billion barrels. A dispute between the two sides escalated when the Kurds began pumping oil through their own pipeline to Ceyhan, the Turkish port in the Mediterranean sea from where ship tracking data show United Leadership loaded its cargo. (www.bloomberg.com)

May 30, 2014. Turkey’s state oil and gas company will sign a deal to increase its stake in Azerbaijan’s Shah Deniz natural gas project, according to the Azeri oil company SOCAR. Turkey will also increase its stake in the Trans-Anatolian Pipeline project, led by BP Plc, to transport Caspian Sea gas to Europe through Turkey, according to the SOCAR. Turkey is seeking to diversify supplies away from Russia and Iran, which supplied more than half of its gas imports. The Azerbaijan pipeline and other Caspian projects also offer European Union countries a chance to reduce their reliance on Russia, amid concerns that disputes over Ukraine may affect energy supplies. (www.bloomberg.com)

May 29, 2014. Exxon Mobil Corp., which extended its partnership with Russia’s OAO Rosneft, hasn’t had to change its business in the country amid Ukraine-related sanctions and said such steps are typically ineffective. Exxon is among American oil producers that ignored U.S. State Department recommendations to skip an energy forum in St. Petersburg as it extended a pact with Rosneft involving drilling for crude in the Arctic and Siberia. Exxon, through a 2011 deal with the state-run crude producer, owns drilling rights across 11.4 million acres of Russian land, including vast swaths of the Kara Sea. (www.bloomberg.com)

May 29, 2014. A Singapore-based subsidiary of oil major Shell has signed a 20-year liquefied natural gas (LNG) deal with Japan's Chubu Electric, Shell said. Under the agreement, Shell Eastern Trading will supply up to 12 cargoes of LNG per year to Chubu Electric. The deal, which will start in October, is the first long-term LNG supply agreement between Shell and Chubu Electric. (www.downstreamtoday.com)

May 29, 2014. Global miner BHP Billiton has signed a liquefied natural gas (LNG) contract for its Escondida project in Chile, helping to secure the future energy supply of the world's largest copper mine. Gas Natural Fenosa will supply LNG to the Mejillones terminal in northern Chile from 2016, when BHP's nearby Kelar power plant, currently under construction, is due to be ready. (www.downstreamtoday.com)

May 28, 2014. German utility E.ON and Qatar's RasGas said they signed a deal for the supply of liquefied natural gas (LNG) over three years from Qatar to the British Isle of Grain. The medium-term flexible contract is potentially for up to 2 billion cubic metres over the term, the two firms said. (www.downstreamtoday.com)

May 28, 2014. The Angola liquefied natural gas (LNG) export project is expected to resume production in mid-2015 following a rupture on a flare line that forced it to shut down, the Chevron-led project said. It is expected that this work will continue into next year, with the plant anticipated to restart in mid 2015. (www.downstreamtoday.com)

June 3, 2014. Meeting the world’s energy supply needs by 2035 will require $40 trillion of investment, as demand grows and production and processing facilities have to be replaced, the International Energy Agency (IEA) said. More than half of that amount will be needed to compensate for declining output at mature oil and gas fields, and the remainder on finding new supplies to meet rising demand, the Paris-based agency said. The world will increasingly rely on countries that restrict foreign companies’ access to their oil reserves, as North American shale output tails off from the middle of next decade, it predicted. While a boom in shale oil is pushing U.S. production to its highest level in almost 30 years, diminishing the biggest crude consumer’s reliance on imports, this output surge is forecast to fade, restoring the importance of supplies from the Middle East and the Organization of Petroleum Exporting Countries. Spending on extracting oil and gas worldwide will climb by 25 percent to $850 billion a year by 2035, with most of this concentrated in natural gas, according to the report. Global markets will tighten if investments in the resource-rich Middle East are too slow, pushing oil prices $15 a barrel higher on average in 2025, it warned. Brent futures averaged $108.70 a barrel last year. About half of the $40 trillion spent on energy through to 2035 will be on extraction, refining and transporting fossil fuels, the report indicated. Two-thirds of the total will be spent in emerging economies, according to the agency. Investment needed in renewable energy will total $6 trillion, with another $1 trillion in nuclear power. Annual spending on satisfying global energy requirements will increase to $2 trillion by 2035, up from $1.6 trillion last year, the agency projected. Spending on energy efficiency through 2035 pushes the total required investment to $48 trillion, according to the IEA. (www.bloomberg.com)

June 3, 2014. Investors in Norway, western Europe’s largest oil and gas producer, face more political wrangling as the level of brinkmanship in lawmaking picks up. The minority coalition, in office since October, is Norway’s first in almost a decade to rely on opposition parties to push through laws. Those include how to manage the nation’s $880 billion sovereign wealth fund and how to develop key offshore oil projects. The composition of the legislature means stakeholders in Norway’s affairs must gird for “some disturbances,” Finance Minister Siv Jensen said. Investors in Scandinavia’s richest nation have been wrong-footed a few times in the past three years, most notably when the government in 2011 withdrew Eksportfinans ASA’s state backing, turning top-rated bonds into junk notes. Then in 2013, investors balked at a decision to cut gas distribution tariffs, a move they said sliced as much as $6.5 billion off their income. The Labor government that pushed through those measures is now the largest party in the opposition bloc. In May, oil and gas producers warned of delays after a parliamentary majority worked against the government to try to force Statoil ASA and other producers to power North Sea developments from land. Labor backed down and struck a deal with the government to avoid potentially costly delays. (www.bloomberg.com)

June 2, 2014. Kuwait's oil minister said his country was looking to sign an agreement with Iran to secure much-needed natural gas supplies. The oil-rich OPEC producer lined up $15 billion worth of gas supply from BP and Royal Dutch Shell BP and Royal Dutch Shell last month to help meet soaring demand. Kuwait also signed a contract to import liquefied natural gas (LNG) from fellow Gulf state Qatar to help meet its energy needs to the end of 2014 in April. (www.downstreamtoday.com)

May 30, 2014. Oil-price volatility fell to a record amid speculation that crude-supply growth in the U.S. and spare Saudi Arabian production capacity will avoid any shortages resulting from strengthening economies. The 20-day historical volatility of Brent crude declined to 8.1 percent in London, set to be the lowest since the contract began trading in 1988, according to data. Spare capacity in Saudi Arabia and booming U.S. output of oil from shale-rock formations are preventing price surges, while stable global economic recovery and steady stimulus measures by the Federal Reserve avert a slump, BNP Paribas SA said. (www.bloomberg.com)

May 30, 2014. Repsol SA won government approval to start a $10 billion oil drilling project off Spain’s Canary Islands, signaling success in its 12-year campaign to start exploration near the Atlantic archipelago. Spain’s environment ministry cleared the plan with conditions. The decision follows a reconfirmation in 2012 of an exploration license first awarded in 2001 and later tied up in court battles. The decision advances plans by Spain’s largest oil company to hunt for fields in an area geologists estimate may be able to supply about 10 percent of national demand. (www.bloomberg.com)

May 29, 2014. China’s effort to catch up with the U.S. in developing shale gas and become more energy independent is coming at a big cost: It’s spending four times as much developing some fields, according to a new report. Holding the world’s biggest potential reserves of natural gas in shale rock, China will spend billions of dollars in trying to close a gap with the shale leader, which is about a decade ahead in developing the energy resource, according to a study. The emergence of shale projects in Asia and Europe affects global gas and oil prices and is changing the energy agendas of governments from London to Beijing. In China, leaders mandated national targets for their producers such as China Petroleum & Chemical Corp., known as Sinopec. (www.bloomberg.com)

May 29, 2014. Petroleos Mexicanos, the state-owned oil producer, is negotiating with Chinese companies to create a fund valued at as much as $4 billion to invest and finance projects. The proposed arrangement is in a “final stage of negotiations,” Pemex, as the Mexico City-based oil producer is known, said. The Sino-Mex Energy Fund would be the largest Chinese investment fund in Latin America. The prospective agreement between Pemex’s international unit PMI Comercio Internacional and Xinxing Ductile Iron Pipes, SPF Capital Hong Kong Ltd. and other Chinese companies would be used to finance large-scale projects and create jobs. Pemex is seeking to increase sales to Asia and Europe to offset falling oil exports to the U.S., Mexico’s largest crude buyer. U.S. oil imports from Mexico have fallen 47 percent in the past decade, dropping to a 20-year low, according to the U.S. Energy Information Administration. Pemex has announced plans to export light crude to Japan, Hawaii, India and Switzerland, and will continue to pursue new partners in Asia and the Pacific region, Gustavo Hernandez, Pemex said. Mexico signed a landmark energy bill to end Pemex’s production monopoly and allow for private investment in the oil industry. Pemex’s production has fallen to 2.5 million barrels a day from 3.3 million in 2004. The government is also considering creating a fund allowing it to partner with third-party investors to develop fields, similar to Norway’s Petoro AS, that may require as much as 30 percent participation in contracts it seeks. (www.bloomberg.com)

May 29, 2014. The U.S. will benefit from increased oil production and lower gasoline prices if the government lifts restrictions on crude exports, according to IHS Inc. The world’s largest oil consumer may save an average of $67 billion a year from its import bill as domestic output may rise as much as 949,000 barrels a day in 2016 with the removal of the export ban, the Colorado-based consultant said in a report. Such a scenario would support 964,000 additional jobs in 2018, it predicted. (www.bloomberg.com)

May 28, 2014. The European Union (EU) should reduce energy consumption, seek new supply sources and examine ways to increase transparency of the gas market to cut its rising dependence on imports from Russia, an EU report showed. Increasing domestic energy production and accelerating the integration of the EU energy market are also ways to increase the 28-nation bloc’s energy security, the European Commission said. EU leaders in March asked the bloc’s regulatory arm to prepare a plan for reducing Europe’s reliance on Russia for energy amid the escalating crisis in Ukraine. (www.bloomberg.com)

May 28, 2014. Japanese lawmakers are reviving efforts for a 600 billion yen ($5.9 billion) natural gas pipeline from Russia, which signed a supply deal with China, to cut energy costs after the Fukushima nuclear disaster. A group of 33 lawmakers is backing the 1,350-kilometer (839 miles) pipeline between Russia’s Sakhalin Island and Japan’s Ibaraki prefecture, northeast of Tokyo, Naokazu Takemoto, the secretary general of the group, said. He plans to propose the project to Prime Minister Shinzo Abe as early as June so it’s on the agenda when Russian President Vladimir Putin visits in autumn, he said. (www.bloomberg.com)

May 28, 2014. The European Union still faces the threat of natural gas disruptions this winter after helping forge a draft deal to settle a debt dispute between Russia and Ukraine, which carries about 15 percent of the bloc’s gas needs. The premium of U.K. winter gas over the day-ahead contract widened 3.1 percent, its biggest increase in more than 10 days in a sign that supply concerns remain, broker data show.

The risk of transit interruption, as in previous disputes between the eastern European nations in 2006 and 2009, persists as long as no definite agreement is signed between the parties, according to Societe Generale SA. Ukraine’s state energy company NAK Naftogaz Ukrainy would pay Russia’s OAO Gazprom $2 billion by May 30 and a further $500 million by June 7, the European Commission said. Ukraine will give its answer on the commission’s proposal, Energy Minister Yuri Prodan said. (www.bloomberg.com)

POWER

June 3, 2014. PacificLight Power launched its 800 MW combined cycle gas turbine power plant, the first in Singapore to be fully fuelled by liquefied natural gas (LNG). Construction of the US$1.2 billion power plant on Jurong Island started in 2011, by a consortium of Siemens AG, Siemens and Samsung C&T. The plant contributes 6.2 per cent of Singapore's total installed generating capacity, the company said. (www.straitstimes.com)

June 2, 2014. Mitsubishi Hitachi Power Systems (MHPS) has secured a contract to construct a 480 MW natural gas-fired, gas turbine combined cycle (GTCC) power generation plant in Japan. The power plant will be built at Kyushu Electric Power's existing Shin Oita thermal power station in Oita City, Japan. MHPS said the new plant will help ensure a more stable electricity supply by significantly expanding the power station's generating capacity. (fossilfuel.energy-business-review.com)

June 3, 2014. PPL Electric Utilities has selected PAR Electrical Contractors, a Quanta Services company, to install transmission infrastructure for the Northeast Pocono reliability project in the US. Under the deal, PAR will install about 68 miles of new 230kV and 138kV overhead transmission line and erect steel transmission structures. The contract also requires PAR to install concrete foundations and construct as well as maintain access roads. PAR anticipates to complete the construction work on the project in May 2017. PPL Electric proposed the Northeast Pocono reliability project to meet increasing demand for electricity and improve the reliability of electric service in northeast Pennsylvania and the Pocono Mountains. Under the project, PPL plans to construct three new electrical substations and about 57 miles of new 230-kilovolt power line from the Wilkes-Barre area to an area west of Hawley, Wayne County. The company said it needs to construct short segments of 69kV line, about 6 to 8 miles in total, for the three facilities in order to link the new substations to the existing 69kV lines they will supply. (utilitiesnetwork.energy-business-review.com)

May 30, 2014. PT Perusahaan Listrik Negara, Indonesia’s monopoly electricity distributor, is seeking to build power plants run on lower-energy coal as it anticipates falling supplies of the fuel with higher heating values. Listrik Negara will use coal with a gross heating value below 3,800 kilocalories a kilogram for future projects, Helmi Najamuddin, the company’s head of the coal division, said. About 36 percent of Indonesia’s coal is classified as low-energy, which means it has less than 5,100 kilocalories a kilogram, according to energy ministry data. China, Indonesia’s top buyer, is considering a proposal to ban imports of low-heating value grades, potentially increasing domestic supply. The Southeast Asian nation’s use of the fuel for electricity generation is forecast to rise 13 percent next year to almost 83 million metric tons as new plants start. Nationwide electricity consumption will more than double in less than a decade, with coal accounting for two-thirds of its power capacity, according to data from the company.

The state-run company plans to invite investors to build two 115 MW power plants in Aceh on Sumatra island, using coal with 3,300 kilocalories a kilogram, Najamuddin said. He didn’t provide details on how much total capacity the company will build using low-energy supplies. Indonesia’s coal use for electricity may climb to 151 million tons by 2022, according to data from Listrik Negara. About 66 percent of power generation will be fueled by coal in 2022, compared to 53 percent last year, the data show. Nationwide electricity consumption is forecast to increase by 8.4 percent a year to reach 386 terawatt hours in 2022, from 189 terawatt hours in 2013, according to Listrik Negara’s electricity outlook for 2013-2022. Listrik Negara plans to issue tenders this year for 2.5 million tons of coal annually for 5 to 20 years, to feed two new power plants and as existing deals expire, Najamuddin said. The company already has supply contracts for 85.5 million tons a year for the next two decades, he said. (www.bloomberg.com)

June 2, 2014. Federal Defence, Water and Power Minister Khawaja Muhammad Asif has said the Pakistan Muslim League Nawaz (PML-N) government is committed to coping with the energy crisis and it will allocate huge funds for it during the next fiscal year. The minister said the government would fulfil its promises on energy because Pakistan’s energy security was the priority of the PML-N government. (www.dailytimes.com.pk)

May 30, 2014. Japan’s industrial heartland in the west is facing the prospect of electricity shortages over the summer, underscoring the risks that the absence of nuclear power pose to the world’s third-largest economy. Electric Power Development Co., better known as J-Power, said it won’t be able to fully restore a 1,000 MW, coal-burning generator on Japan’s island of Kyushu until June 2015. The unit at its Matsuura plant, which serves western Japan, has been off-line since March 28, when it was damaged by an accident during an inspection. A power crunch could come while Japan is without nuclear energy over the summer peak season for the first time in more than four decades, a legacy of the Fukushima disaster of 2011. The nation is working on a thin margin of reserves and the fear is that another plant failure could leave companies and homes without enough electricity. (www.bloomberg.com)

June 2, 2014. Tata Power has commissioned its second solar power project of 25 MW capacity at Palaswadi in Maharashtra. It has developed a 25 MW solar photovoltaic power project, through its subsidiary, Tata Power Renewable Energy Ltd (TPREL), the company said. The project with an overall cost of ` 250 crore is being funded through debt and equity. TPREL had tied up the entire debt requirement through IDFC Ltd in February this year. It received the first loan disbursement on February 28, 2014. The project was ready but could not be connected to state grid due to non availability of shutdown in existing lines and substations. The solar plant, which is located in the Satara district of Maharashtra, uses Crystalline Silicon Photo-Voltaic Technology. The plant is expected to generate approximately 46 million units per year. Electricity from this plant is evacuated through the state transmission network. The company has operating solar capacities of 3 MWp (megawatt peak) at Mulshi in Maharashtra and 25 MWp at Mitahpur in Gujarat, alongwith its first solar power plant of 110 kW (kilowatt), set up way back in 1996 at Walwhan in Lonavala. With these projects, Tata Power now has a portfolio of over 56 MW of solar and 461 MW of wind. (www.business-standard.com)

June 1, 2014. Tata Power expects commissioning of its two South African wind projects, having total capacity of nearly 229 MW, by fiscal year 2017. Tata Power, which has an installed generation capacity of 8,560 MW, is developing the two projects through an equal joint venture with Exxaro Resources. They are 134.4 MW Amakhala Emoyeni and 94.8 MW Tsitsikamma plants. Similarly, the Tsitsikamma project is also expected to be operational in fiscal 2017. (www.business-standard.com)

June 1, 2014. Wind turbine maker Suzlon Energy plans to raise about ` 1,000 crore from sale of non-core assets this financial year. Besides, Suzlon is exploring new markets for business opportunities, according to the company. The wind energy major has already mopped up more than ` 700 crore by selling two non-core assets. Suzlon realised about ` 550 crore from the sale of US-based Big Sky wind farm and around ` 173 crore by offloading stake in a Chinese manufacturing facility. For the current fiscal, the company would mainly focus on ramping up volumes, boosting business efficiency and optimising capital structure. (economictimes.indiatimes.com)

May 31, 2014. Sending a message to the business community that the NDA government was serious about removing “bottlenecks” to economic growth, Prime Minister Narendra Modi has asked environment minister Prakash Javadekar to clear half of the stuck projects in the next month. Projects worth ` 1,00,000 crore are awaiting approval of the new minister as no projects were approved when the model code of conduct came into force. The new minister for environment, forest and climate change Javadekar is getting ready to clear these projects. The projects range from mining for Steel Authority of India (SAIL) and Lafarge’s mining projects in dense forest of Chhattisgarh, expansion of a mining project in fragile Western Ghats to Jindal Steel and Power’s limited’s in Maoist affected Singhbhum district of Jharkhand. The minister is also expected to consider projects on thermal power in Madhya Pradesh, Gujarat and Odisha along with some hydro power projects in the north-east. While many of these projects are in dense forest or rich ecological areas, they are not embroiled in any legal issues or caught in any controversy paving their way for clearance. (www.hindustantimes.com)

May 31, 2014. The residents of Sukhdev Vihar are on the front lines of what may be the world’s foulest war: megacities’ struggle against their mounting piles of refuse. The New Delhi neighbourhood of neat bungalows and lanes shaded with dense trees sits a few hundred yards from a two-year-old incinerator. The complex spews eye-watering noxious fumes and toxic exhaust. Global municipal solid waste will double by 2025 to 2.6 billion metric tons a year -- equal to about 6 million fully loaded Boeing 747 jumbo jets -- as rising wealth leads to more discarded packaging and used diapers, according to a July 2012 report by the Washington-based Worldwatch Institute. Indians aren’t alone in their ire. In China, a proposed waste incinerator has sparked violent protests in the eastern city of Hangzhou. Sukhdev Vihar’s woes stem from what seemed, at first, an obvious idea: New Delhi, whose population will reach almost 21 million by 2015, generates 8,000 tons of garbage a day and it suffers from chronic blackouts. Why not use the waste to generate power? An incinerator of a similar 1,800 ton-a-day waste capacity as the ` 2 billion ($34 million) New Delhi plant would cost more than 10 times that in Europe, according to the Confederation of European Waste-to-Energy Plants, or Cewep. The European plants typically generate both heat and power, raising their efficiency. For instance, Eesti Energia AS’s plant in Iru, Estonia, uses about a third of the waste of the New Delhi plant and produces as much electricity and 50 MW of heat. It cost 105 million euros ($143 million). The New Delhi incinerator is not the city’s first experience with the technology. In 1990, a waste-to-energy plant built with Danish equipment was closed within two months of commissioning because it failed to work. In the international arbitration that followed, which Denmark won, the tribunal found the unsuitable quality of waste caused the failure. (www.bloomberg.com)

May 28, 2014. The country's solar sector is expected to see good growth in coming years, helped by rising energy demand and various other factors, says a report. A right framework is required to tap the potential, the report by consulting firm Tata Strategic Management Group said. The solar sector is facing many challenges, including lack of consistency in solar policy, it said. India has more than 2,600 MW of installed solar generation capacity. (economictimes.indiatimes.com)

May 28, 2014. Tata Power Solar Systems Ltd., a unit of India’s biggest industrial group, increased production capacity, saying it expects demand to pick up as the nation prepares to slap duties on competing equipment imports. The company has expanded panel-making capacity at its Bangalore plant by 60 percent to 200 MW.

Indian solar equipment makers had idled about 70 percent of production capacity in the last three years after losing orders to foreign competitors. The government has taken steps to support domestic manufacturing, including a decision last week by the Ministry of Commerce & Industry to recommended dumping duties on solar imports from China, the U.S., Malaysia and Taiwan. India also reserved half of the capacity it awarded in its latest national auction of solar licenses for developers that pledged to use domestic equipment. That rule prompted a complaint by the U.S. government to the World Trade Organization accusing India of unfairly protecting local makers. (www.bloomberg.com)

June 3, 2014. Japan said the U.S.’s proposed cuts in greenhouse-gas emissions from its power plants is a bold step to tackle climate change. The stance by Japan, which in November watered down its own targets to reduce greenhouse-gas emissions, is in contrast to the European Union’s view that the U.S. must do more. The decision announced by the Environmental Protection Agency (EPA) in Washington is the most comprehensive climate-protection plan yet from President Barack Obama’s administration. The EPA’s program starts to set in place policies the U.S. will bring to discussions this year of 190 nations on how to limit pollution after 2020. While it gives Obama ammunition to show that other nations also need to act, the limits set out by the EPA cover only about a third of emissions by 2030. (www.bloomberg.com)

June 3, 2014. Obama administration officials gave new life to cap-and-trade. Just don’t expect them to say so. Republicans championed the approach decades ago then rejected it when President Barack Obama pushed it in 2009. States may now view the politically toxic concept as a way to comply with limits on carbon emissions from power plants Obama proposed. Bordoff, who was a senior director for Energy and Climate Change on the staff of the National Security Council under Obama, said before the plan was announced that cap-and-trade has become “a little bit tarnished” since it failed in Congress, though the approach can be an effective way to drive emissions cuts. Obama has included an incentive for states to develop regional carbon-trading systems. They can get an additional year to comply over states that chose to act alone, pushing their deadline to come up with an emission-reduction plan to 2018. Ultimately, the decision may fall along familiar fault lines of politics: states now participating in carbon-trading systems, such as California and those in the Northeast, tend to vote Democratic. Opposition to the idea is already becoming a theme in criticism by Republicans, who are reviving complaints that Obama’s plan is a “cap and tax” approach that would send electricity bills higher and hurt the economy. States can meet the goals through energy efficiency gains, using more renewable energy and by switching from coal to cleaner-burning natural gas without joining trading networks. (www.bloomberg.com)

June 3, 2014. Coal-dependent power companies from American Electric Power Co. to Duke Energy Corp. face billions of dollars in added costs from the Obama administration’s proposed climate rules. Renewable-energy backers and nuclear generators like Exelon Corp. stand to gain from the effort to shift the foundations of the U.S. energy industry. The regulations will be felt from the coal mines of West Virginia to natural gas wells in the Marcellus Shale as the U.S. moves toward cleaner fuel sources. A clampdown on emissions from coal-fired plants, the largest source of electricity, will force state regulators to determine whether consumers will foot the bill for reducing gases that contribute to climate change. The redrawing of the U.S. energy map stems from the Environmental Protection Agency’s proposal to cut power-plant emissions -- the nation’s single largest source of carbon dioxide -- by 30 percent from 2005 levels. The reductions give the Obama administration ammunition as it seeks to convince developing nations from India to China to join a global agreement needed to avert dangerous climate change that’s affecting cities worldwide. (www.bloomberg.com)

June 3, 2014. President Barack Obama’s decision to propose tougher limits on power-plant emissions poses a threat to Democrats amid the coal-rich mountainsides of Kentucky and to his party’s efforts to keep control of the U.S. Senate. Republicans need a net gain of six seats in November’s elections to secure a Senate majority, and a half-dozen key contests are in states with histories of hostility toward federal environmental regulations or close ties to the coal industry. They include West Virginia, Colorado, Louisiana, Montana, Arkansas and Kentucky. (www.bloomberg.com)

June 2, 2014. President Barack Obama will propose cutting greenhouse-gas emissions from the nation’s power plants by an average of 30 percent from 2005 levels, a key part of his plan to fight climate change that also carries political risks. The proposal is scheduled to be unveiled by the U.S. Environmental Protection Agency (EPA) in Washington. It represents one of the boldest steps the U.S. has taken to fight global warming, and drew immediate pledges from Republicans to seek to block the rule. The proposal will list a range of options being considered, and note that the administration prefers an average 30 percent cut over 2005 levels by 2030. Because emissions from power plants fell about 15 percent from 2005 to last year, the preferred reduction equates to less than a 20 percent from current levels. (www.bloomberg.com)

May 30, 2014. An industry group in Japan boosted its target for wind power capacity by half to 75 GW by fiscal 2050 as the country expands the use of clean energy. The Japan Wind Power Association revised the target from a previous goal of 50 GW, announced in 2012, due to more onshore and offshore wind works. Under the new target, Japan’s onshore wind capacity should increase to 38 GW by fiscal 2050. Offshore wind will make up the rest from bottom-fixed turbines as well as from floating turbines. Japan is gearing up to increase renewables, starting an incentive program in July 2012 that pays above-market rates for clean-energy producers. So far, solar makes up most of the added capacity since the program began. (www.bloomberg.com)

May 30, 2014. Royal Dutch Shell Plc may boost the internal carbon emissions price it uses for planning new projects if governments tighten climate rules. Europe’s biggest oil company budgets for future capital investment on the assumption it will pay $40 a metric ton for carbon emissions, according to Angus Gillespie, vice president of CO₂. That’s almost six times the current price for pollution rights in the European Union’s carbon market, the world’s biggest. (www.bloomberg.com)

May 30, 2014. Actress Daryl Hannah hasn’t chained herself to the White House fence in support of tougher power plant emissions. Limits on smokestack emissions that the Obama administration will propose in three days could have 10 times the impact on carbon emissions as the issue Hannah and other celebrities have protested: the proposed Canada-to-U.S. Keystone XL oil pipeline. The U.S. Environmental Protection Agency estimates Keystone could add 18.7 million metric tons annually of heat-trapping carbon dioxide to the atmosphere. The power-plant rules President Barack Obama will announce June 2 could slash emissions by 169 million metric tons a year. (www.bloomberg.com)

May 29, 2014. The US has said that it is willing to take steps to reduce its emissions but also wants countries like India and China to take responsibility to address the challenge of climate change. Steps like development of Climate Action Plan by the US will enable it to meet the types of commitments it made in Copenhagen about fuel efficiency standards or coal-fired power plants. (www.business-standard.com)

May 29, 2014. ExxonMobil, one of the oil companies whose stance on climate change disclosure has been under scrutiny from investors, has revealed that it expects the implied cost of CO₂ emissions to reach $80 per metric ton [tonne] in 2040 in developed economies. It comes as major institutional investors backed a shareholder proposal calling on Exxon to set quantitative goals for reducing its emissions at its annual meeting in Dallas. (www.bloomberg.com)

May 29, 2014. Homeowners and developers installed 1.33 GW of solar panels in the first quarter, the second-largest total on record, according to the Solar Energy Industries Association. Installation increased 79 percent from the same quarter a year earlier with utility-scale projects making up almost two-thirds of the total and homeowner demand surging, the Washington-based trade group said. (www.bloomberg.com)

May 29, 2014. U.S. President Barack Obama says natural gas can be a bridge from coal to a cleaner energy future. Investors are showing it’s more likely a bridge to nowhere. The country’s embrace of natural gas means less love for wind and solar. New investments in renewable energy sources declined 5 percent in North America last year to $56 billion, the lowest since 2010. By comparison, North American oil and gas companies spent $168.2 billion on exploration and production last year, more than double 2009. (www.bloomberg.com)

May 29, 2014. Alberta, which relies on coal to generate about half its power, would see electricity rates rise more slowly in coming decades if use of renewable energy increased, according to a study published. Prices for electricity would be 4 percent lower by 2033 with a transition to more wind, solar and hydroelectric power than a persistent reliance on coal and natural gas, according to a report by Calgary-based environmental research firm Pembina Institute and Clean Energy Canada, a Vancouver-based organization that promotes renewable energy. The price per kilowatt-hour in Calgary has averaged less than 10 Canadian cents (9 U.S. cents) in the past decade. (www.bloomberg.com)

May 28, 2014. China announced a plan to conserve energy and cut greenhouse gas emissions through the end of next year by targeting heavy industry, automobile emissions and coal consumption in major metropolitan areas around Beijing, Shanghai and the Pearl River Delta in southern China. National Development and Reform Commission declared a “sense of urgency” to meet the goals, which include cutting energy intensity per unit of gross domestic product by 3.9 percent in each of the next two years and reducing carbon dioxide intensity per unit of GDP by over 4 percent this year and 3.5 percent in 2015.

The announcement of relatively short-term goals to run through the end of 2015 may feed into China's attempt to reach national goals under the 12^th Five-Year Plan (2011-2015). Announced in 2011, those goals were to reduce energy intensity by 16 percent and carbon intensity by 17 percent—both compared to 2010 levels—by the end of 2015. (www.bloomberg.com)

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