Energy News Monitor | Volume XI; Issue 1

 

 

NEWS BRIEF

OIL & GAS

June 17, 2014. Cairn India has received environmental nod for raising crude oil production from its prolific Rajasthan fields by 50 per cent to 300,000 barrels per day (15 million tons a year). Environmental clearance (EC) has been granted to Cairn India to augment hydrocarbon production from the RJ-ON-90/1 block in Barmer and Jalore districts of Rajasthan to 300,000 barrels of oil per day (bopd) from current limit of 200,000 bopd. Cairn had made 31 oil and gas discoveries in the Rajasthan block, of which four - Mangala, Bhagyam and Aishwariya (together known as MBA fields) and Raageshwari have been put on production. It contributes about 30 per cent of India's domestic crude oil production. (economictimes.indiatimes.com)

June 17, 2014. British Petroleum (BP), India's single largest foreign investor, expressed "disappointment" at the pace of approvals in the country and said the new government must reform its gas price regime for survival of the gas industry. BP, which in 2011 bought 30 per cent stake in Reliance Industries' 21 oil and gas blocks, including KG-D6 for $ 7.2 billion, has been frustrated by the delays in getting approvals for its plans to revive the sagging output from eastern offshore KG-D6 fields. Its chief executive Bob Dudley said the company's experience so far had been "disappointing." BP and RIL slapped an arbitration notice on the government for delay in revision of prices that were due from April 1. Dudley said the government must reform gas price regime. The previous UPA government had approved a new formula for pricing of all domestically produced natural gas from April 1. The formula, which would have doubled the current $ 4.2 per million British thermal unit, could however not be implemented as elections were declared. The new BJP has reviewing the formula but has not yet taken a decision. (economictimes.indiatimes.com)

June 16, 2014. Oil and Natural Gas Corp (ONGC) may raise its stake in Cairn India's prolific Rajasthan oil fields as a condition for agreeing to allow the firm operate the block after expiry of contractual period. Cairn's contractual term for exploring and producing oil from the Rajasthan Block RJ-ON-90/2 expires in 2020 and the area is to return to the block licensee, ONGC. ONGC, which currently holds 30 per cent stake in the block, has told the Oil Ministry that the Production Sharing Contract (PSC) can be extended beyond 2020 if all parties to the contract agree on mutually agreeable terms. ONGC as a licensee of the block, where crude oil production touched 200,000 barrels per day in March, pays royalty to the government on not just its 30 per cent stake but also on Cairn's 70 per cent interest. Though the royalty is later cost recovered, the company faces cash flow issues because of the payment. (economictimes.indiatimes.com)

June 16, 2014. India, the fourth largest energy consumer globally, recorded the largest volumetric decline in natural gas production and consumption last year, BP Statistical Review of World Energy 2014 said. Natural gas production in the country fell a massive 16.3 per cent to 33.7 billion cubic meters (bcm) from 40.3 bcm in the previous year. India, which is world's 11^th largest consumer of gas, saw consumption fall by 12.2 per cent to 51.4 bcm in 2013 from 58.8 bcm in the previous year. The review said India's oil production was almost unchanged at 894,000 barrels per day (42 million tons) while consumption was up 1.2 per cent at 3.72 million bpd (175.2 million tons). World natural gas consumption grew by 1.4 per cent, below the historical average of 2.6 per cent. Globally, natural gas accounted for 23.7 per cent of primary energy consumption and its production grew by 1.1 per cent, which was well below the 10-year average of 2.6 per cent. (economictimes.indiatimes.com)

June 11, 2014. India's natural gas production will stagnate at current levels if pricing reforms are not implemented and it will have to import heavily to meet the demand, a report by US-based consultancy IHS has warned. IHS said low regulated gas prices have precipitated a supply shortfall in India, but proposed that reforms to the pricing formula could yield higher domestic production and boost India's economy. If rates are allowed to increase to $8.5, as set out in the reforms initiated by the previous UPA government, an additional output of 1.95 billion cubic feet (Bcf) per day could come in 10 years. The previous government had approved a new pricing formula that would have almost doubled rates of all domestically produced natural gas from April 1. However, before a new rate could be unveiled, the general elections were announced and its implementation got deferred. The new NDA government is examining its implementation. The planned increase to the gas prices has a potential to improve India's balance of payments outlook, enhance security of supply and attract investments into the service industry and supply chain, IHS said. (economictimes.indiatimes.com)

June 15, 2014. GAIL India Ltd will cut its equity stake in ONGC's mega petrochem project at Dahej to 11.6 per cent as project faces major cost overrun. GAIL had in 2008-09 picked up 19 per cent stake in ONGC Petro-additions Ltd (OPaL), which is building a mega petrochemical complex at Dahej in Gujarat. The 1.1 million tonnes plant was at that time estimated to cost ` 12,440 crore. But since then the project cost has been revised thrice upwards - first to ` 15,870 crore in end 2008, then to ` 19,535 crore in June 2010 and now to ` 21,396 crore. The project, in which Oil and Natural Gas Corp (ONGC) has 26 per cent stake, was originally to be funded in 70:30 debt-equity ratio. However, this was to change to 60:40 debt-equity ratio at the date of commissioning, which is now estimated to be around February 2015. (economictimes.indiatimes.com)

June 11, 2014. State-run refiner Indian Oil Corp (IOC) will begin commercialisation of its in-house technologies in a bid to improve shrinking refinery margins. The company will begin large scale marketing of refinery catalysts formulated and developed by its research division, in the country as well as internationally, IOC said. Catalysts are largely imported by Indian refiners, IOC said. Going forward, the company will set up refinery catalyst manufacturing unit in the country. The state-run refiner will call global bids in a month seeking a joint venture partner for manufacturing and marketing of 15,000 tonnes per annum of fluidised catalytic cracking (FCC) catalysts and additives in India. (economictimes.indiatimes.com)

June 12, 2014. GAIL Gas Ltd, a unit of state gas utility GAIL India Ltd, signed an agreement to invest ` 141 crore in building CNG highway corridors in Uttar Pradesh (UP). GAIL Gas signed a memorandum of understanding (MoU) with Uttar Pradesh State Industrial Development Corp (UPSIDC) at the UP Investors' Conclave. GAIL is planning three major CNG corridor projects along the highways - Delhi-Agra covering 200 kms with 6 CNG station at Kosi, Sikandra, Etawah, Fatehpur Sikri, Vrindavan and Govardhan; Lucknow-Kanpur highway covering 77 kms with 2 CNG station at Unnao and Karanpur-Moradabad-Kashipur-Rudrapur Highway covering 145 kms and 4 CNG station at Chandausi and Rampur.

The Delhi-Agra project will cost ` 48 crore while Lucknow-Kanpur project will cost ` 16 crore. The third project will cost ` 32 crore. GAIL plans to use mobile cascades to meet demand for natural gas in industrial clusters in Uttar Pradesh. These will cover areas like Shamli, Gajraula, Saharanpur, Kosi, Sikandra, Etawah, Fatehpur Sikri, Vrindavan and Govardhan. (economictimes.indiatimes.com)

June 11, 2014. Essar Group plans to sell the Stanlow refinery in Britain. Essar is seeking to raise $500-$600 million for the plant in the northwest of England. However other plants recently put up for sale in the UK, Murco's Milford Haven and the Bankrupt Petroplus's Coryton, have failed to find buyers. Essar Energy, the subsidiary of Essar Group that bought the refinery for $350 million from Shell in 2011. A formal sales process will be launched after all the requirements related to the delisting of Essar Energy from the London Stock Exchange. (in.reuters.com)

June 17, 2014. With foreign investment almost drying up in India's oil and gas sector, Petroleum Minister Dharmendra Pradhan promised an overhaul to make policies predictable, transparent and fair to investors. Three years of policy paralysis and regulatory policy uncertainty over issues such as natural gas pricing had led to companies deferring their investments, resulting in domestic production stagnating. In his opening remarks at the ministerial session of the World Petroleum Congress in Moscow, Pradhan said the Narendra Modi government "intends to bring in policies which would ease the way for large foreign investments in the oil and gas sector." Stating that there was an urgent need to facilitate an increase in oil and gas production, Pradhan said his ministry was in the process of ushering in a new exploration and production policy after amending the existing New Exploration Licencing Policy (NELP). The ministry proposes to replace NELP with a uniform licensing policy to facilitate production of all forms of hydrocarbons - from oil to shale gas - under a single policy regime. The next round of oil and gas block auctions will be offered with all statutory clearances that will derisk exploration activities to some extent. More than 1,48,000 square kilometres of exploration acreage has been identified for auction under the 10^th round of NELP. India consumes about 4.5 per cent of the world's primary energy and ranks fourth globally in energy consumption, making it imperative for steps to be taken to facilitate availability of energy for every single person, thereby ensuring inclusive growth, he said. (www.business-standard.com)

June 17, 2014. With sale of branded or premium petrol and diesel falling to almost nil due to high duties, a government appointed expert panel has recommended slashing excise duty to make them at par with regular fuel. At present, the finance ministry levies ` 15.50 per litre excise duty on branded or premium petrol as compared to ` 9.20 a litre on regular or unbranded fuel. Similarly, on branded diesel attracts ` 5.75 a litre excise duty as opposed to ` 3.46 a litre for fuel without a brand name. As a result, branded petrol costs ` 80.99 a litre in Delhi while regular petrol is priced at ` 71.46. Similarly, premium diesel costs ` 63.71 per litre while unbranded diesel is priced at ` 57.28. The Saumitra Chaudhuri Committee on Auto Fuel Vision & Policy 2025 said the differential duty rate would not fulfil the narrow revenue objectives as branded fuel sales have fallen sharply. (economictimes.indiatimes.com)

June 17, 2014. The oil ministry could be looking to cap the quantum of ethanol blending in petrol at 10%, a move that could potentially end the tiffs between the supplier sugar industry and oil companies over proportion. The ministry has been in consultation with all stakeholders of the 'Ethanol Blending Program (EBP)' over the recurring demand that the percentage of ethanol in petrol should be increased. While the sugar industry, which supplies ethanol to oil marketing companies, has been pushing for an increase in ethanol blending to 15% from the mandatory 5%, Union Transport Minister Nitin Gadkari has expressed the intention to examine the possibility of using a fuel mix that has 85% ethanol. However, automobile manufacturers have said that over 10% ethanol blended petrol will not be viable for the current generation of cars, according to the oil ministry. A meeting was also held between the ministries of oil, food, agriculture, transport and stakeholders from the sugar producing states of UP and Maharashtra to revive the sugar sector with avenues to produce more ethanol. (economictimes.indiatimes.com)

June 17, 2014. Losses on diesel have come down to ` 1.62 per litre from ` 2.80 in the preceding cycle. Hypothetically, India's largest selling fuel would automatically stand deregulated in three months with the monthly hike of 50 paise a litre, assuming the global product price and rupee exchange rate remain at the current levels. This is the lowest level of under-recovery in diesel in a long while, attained on the back of subdued product prices in global trading hubs and a strengthening rupee. For many in the industry, it presents a golden opportunity for the government to do away with subsidy on the fuel for good — if necessary — by raising the price by ` 1.50 at one go. When the Narendra Modi government came to power, losses on diesel stood at ` 4.41 a litre. In the backdrop of the Prime Minister's warning of hard economic decisions, the current level of under-recovery provides a low-hanging fruit for the government to grab, perhaps even as part of the Union Budget. In June 2010, the UPA government had raised diesel price by a steep ` 2, while freeing up petrol price, without much public murmur. (economictimes.indiatimes.com)

June 16, 2014. Oil-rich Kuwait and Abu Dhabi are in talks with India to store about 2 million tonne of crude oil in Indian caverns, which the country could use during emergencies such as supply constraint due to geo-political turmoil in producing countries. Kuwait Petroleum Corporation (KPC) and Abu Dhabi National Oil Company (ADNOC) have confirmed that they are willing to fill crude in two compartments of caverns at Visakhapatnam and Mangalore. Countries such as South Korea and Japan, which are hugely dependent on energy imports, have strategic oil storage facilities for secure supplies. India, which is the fourth biggest energy consumer in the world after the US, China and Russia, has been constructing three facilities with combined capacity of over 5 million tonne and planning to construct four such facilities of 12.5 million tonne in Orissa, Gujarat, Rajasthan and Karnataka. India, which imports 80% of crude oil it processes, is the regional refining hub with over 215 million tonne annual capacity, and it can't afford any crude oil supply disruption. In order to ensure energy security of the country, it is planning to significantly augment inventories, which is currently not enough for 30 days. (economictimes.indiatimes.com)

June 14, 2014. The government may defer its radical fuel pricing reforms due to the sharp rise in international oil prices and the continued depreciation of the rupee amid escalating turmoil in Iraq, India's second-biggest energy supplier. Benchmark Brent crude oil rose to about $113 per barrel and the rupee weakened to 59.48 per US dollar after the United States warned of military action against al-Qaeda-linked militants moving towards Baghdad after capturing Mosul. The government has been planning to substantially reduce its ` 1.4 lakh crore oil subsidy burden by deregulating diesel after aligning its pump prices with the market and increasing rates of kerosene and cooking gas or liquefied petroleum gas (LPG). According to agencies, oil minister Dharmendra Pradhan ruled out any immediate hike in LPG rates, but did not comment on the proposal of diesel price deregulation. The oil ministry had proposed to raise the price of kerosene by ` 4 a litre and LPG by ` 250 per cylinder. State-run oil marketing companies have been losing ` 1.66 per litre on diesel, ` 32.87 per litre on kerosene and ` 433 per cylinder on cooking gas. According to government officials and industry executives, the development in Iraq is critical for India's energy security as the country imports about 14-15 per cent of its annual crude oil requirement from the Gulf country. Falling rupee is also a major concern because India imports 80 per cent crude oil it processes and pays in dollars. Iraq, which was the third-biggest supplier of crude oil to India until 2009-10 after Saudi Arabia and Iran, jumped to the second position in 2011-12 after economic sanctions against Tehran. (economictimes.indiatimes.com)

June 13, 2014. The price of domestic LPG cylinders will not be increased and the number of subsidised refills given to consumers would continue, Oil Minister Dharmendra Pradhan said. About petrol and diesel prices, he said these are big issues and the central government is paying attention to them. Pradhan, who is scheduled to take stock of the oil and gas situation in Bihar at a meeting with Indian Oil Corp (IOC), expressed concerns over the low LPG penetration in the state, which is 26 per cent as compared to 45-50 per cent in others. At the meeting, the condition of Barauni refinery in Bihar would be reviewed, besides the status of the proposed gas pipeline between Haldia to Jagdishpur. Low LPG penetration will also be reviewed, he said. (economictimes.indiatimes.com)

June 13, 2014. Gujarat energy minister Saurabh Patel met oil minister Dharmendra Pradhan to discuss the state's ongoing legal battle with public sector ONGC over demand for ` 10,000 crore on past royalty. The Supreme Court had stayed a Gujarat High Court (HC) order asking ONGC to pay ` 10,000 crore in past royalty dues to Gujarat. The flagship oil producer contended that it could not pay royalty on revenue it did not earn. This was Patel's second meeting with Pradhan and triggered a buzz in the industry on ONGC's increasing isolation within the government. The ministry confirmed discussion on the royalty case but remained silent on whether Patel sought the ministry's intervention or any relief on the matter. (economictimes.indiatimes.com)

June 13, 2014. The BJP-led government may appoint an expert panel to recommend a less complex formula for pricing of natural gas to resolve the imbroglio that has been holding up investments. The previous UPA government had approved pricing of all forms of domestically produced gas according to a formula suggested by a panel headed by C Rangarajan. This formula was to come into effect from April 1 but the announcement of the new rate was deferred because of general elections. A new panel may be asked to look into the issue, he said, adding if that happens a new price may be delayed beyond July 1, the date the oil ministry has given to Reliance Industries for implementation of new rate. The Rangarajan pricing formula is based on the average of the prices of imported LNG into India and the weighted average of gas prices in North America, Europe and Japan in 12 months. The price of gas, according to this formula, comes to around $8.3 per million British thermal unit for April-June quarter, almost double the current price of $4.2. However, if only LNG bought on long-term contract is kept and the purchases from volatile spot market are eliminated, the new rate would come to $7.8. (www.financialexpress.com)

June 13, 2014. Petrol and diesel prices will be hiked by 75 paise a litre each if the government accepts an expert panel report that recommends nationwide fuel standards be upgraded to eliminate cancer-causing particle emissions by 2020. The Saumitra Chaudhuri Committee on Auto Fuel Vision & Policy 2025 estimated that upgrading refineries to produce Euro-V equivalent petrol and diesel will need an investment of ` 80,000 crore. This cost can be met by the 75 paise levy on petrol and diesel, it said. The panel, headed by former Planning Commission member Chaudhuri, suggested that fuels should meet Euro-IV emission norms all over the country by 2017 and Euro-V standards by 2020. BS VI emission norms are expected to come into effect from April 2024. Presently, 26 cities including Delhi, Mumbai, Chennai, Ahmedabad and Lucknow use Euro-IV equivalent fuels, also known as BS-IV fuels, while motorists in the rest of the country use BS-III fuels. (economictimes.indiatimes.com)

June 11, 2014. Oil producing states like Assam and Gujarat have asked that oil producing companies pay royalty to them on the wellhead price, determined by the actual price of equivalent crude oil prevailing in the international market, and not on the sale price as defined by the Ministry Petroleum & Natural Gas. Assam chief minister Tarun Gogoi said the Supreme Court has given judgment in favour of the Gujarat government in the case pertaining to under payment of oil royalty by oil companies. Assam has sought ` 10,000 crore as payment of outstanding royalty since 2008. (economictimes.indiatimes.com)

POWER

June 16, 2014. Tata Power generated 13,183 million units of electricity in the last fiscal from thermal and renewable sources, among others. In the fourth quarter ended March, the power utility produced 2,670 million units of electricity, it said. The company's gross generation has touched 8,585 MW, once again reinforcing its position as the largest integrated power company in India, Tata Power said. (economictimes.indiatimes.com)

June 14, 2014. The Uttar Pradesh government is in for some more trouble with at least three state owned thermal power plants, with a combines installed capacity of 2600 MW, running short of coal supply. If not replenished with a fresh stock the power plants would be forced to shut down. Well placed sources in UP Rajya Vidyut Utpadan Nigam said that Anpara-A, Anpara B and Paricha have been left with coal that could last for only six days. Utapadan Nigam confirmed that they are writing a letter to the centre informing it about the prevailing situation in the said power plants. (economictimes.indiatimes.com)

June 13, 2014. Bharat Heavy Electricals Limited (BHEL) commissioned 68 MW unit at the Rampur Hydro Electric Project in Himachal Pradesh. The first three units of the Rampur project, which were commissioned earlier by BHEL in March, have been put into commercial operation in May. The remaining two sets are also at an advanced stage of execution and are likely to be commissioned by BHEl shortly, the company said. Rampur hydel project is located on River Satluj in Himachal Pradesh - 120 km from Shimla. BHEL is presently executing hydro power projects of around 5,000 MW which are under various stages of implementation. It has enhanced its manufacturing capacity to 20,000 MW per annum. (economictimes.indiatimes.com)

June 12, 2014. Lanco Infratech's 1,200 MW Udupi electricity plant in Karnataka has been shut down due to non- availability of coal, while the state government put the blame on the company and said it would manage the power situation. Karnataka Energy Minister D K Shivakumar said that all bills have been paid to the firm and that the state had even given ` 300 crore in advance. For the Udupi project, long-term power purchase agreements (PPA) are in place with five ESCOMS (Electricity Supply Companies) of Karnataka for supply of 90 per cent of power generated. Besides, there is a PPA with Punjab State Power Corporation for supply of 10 per cent, according to Lanco. (economictimes.indiatimes.com)

June 11, 2014. A technical snag, which developed in the third unit of the thermal power station, has affected power generation to the tune of 210 MW. The fourth unit had been taken for maintenance and it would be ready during July first week. The plant has five units and each unit could generate 210 MW. (economictimes.indiatimes.com)

June 16, 2014. Prime Minister Narendra Modi's move to have a common minister for the power and coal ministries seems to have started showing its impact. Executives from power producers and Coal India Ltd (CIL), as well as officials from the two ministries and the Indian Railways met in New Delhi to resolve key differences over the quantity and quality of coal supplied to power plants. They have agreed to make coordinated efforts to improve the production and supply of the dry fuel that fire more than half the nation's power capacity. (economictimes.indiatimes.com)

June 16, 2014. To see the task new Indian Prime Minister Narendra Modi faces to fix the country’s electricity blackouts, look no further than the soaring share prices of companies that make back-up power generators. Kirloskar Oil Engines Ltd. is up 53 percent this year, Greaves Cotton Ltd. 45 percent and Cummins India Ltd. 35 percent, more than the benchmark S&P BSE Sensex’s 19 percent increase. Investors are betting Modi’s push to revive economic growth from close to a decade low will stoke power shortages, spurring demand for generators even as he vows reliable electricity supplies by 2022. Modi’s agenda includes speeding up about $255 billion of stalled investments after his Bharatiya Janata Party swept to India’s first single-party majority since 1984. A pledge to spur power output may be harder to implement as regulators force electricity retailers to sell below cost to ensure affordability, limiting their capacity to pay for more supplies. (www.bloomberg.com)

June 16, 2014. Power Minister Piyush Goyal said transmission links in the city will be restored by June 22, paving the way for regular supplies, even as he asked Delhi Lieutenant Governor Delhi Najeeb Jung for an action plan to permanently end the national capital's electricity woes. The city has been suffering extended outages amid hot and humid weather after a storm damaged parts of the transmission and distribution network. The central government has asked the Lieutenant Governor to draft the plan at the earliest and come up with a permanent solution to strengthen transmission and distribution in the city in a time-bound manner, the minister said. Goyal also asked Jung to make provisions in the plan for strict action against under-performing or non-performing power distribution companies. If the discoms are not performing well and not reacting to consumer complaints, then serious penalties should be imposed on them, Goyal said. He said that if Delhi elects a government, it would help quicken reforms in the National Capital Region's power sector. Delhi has been under President's rule after Arvind Kejriwal resigned as chief minister on February 14. BJP MLAs led by Vijay Goel met Goyal and discussed the power crisis in the capital. They suggested that a check be kept on water from underground resources and reservoirs as supplies may be affected due to prolonged power cuts. (www.business-standard.com)

June 15, 2014. Multi-modal International Cargo Hub and Airport at Nagpur (Mihan) project is likely to get a new boost as the government has asked Maharashtra Airport Development Company (MADC) to supply electricity to the investors at subsidised rates. Chief Minister Prithviraj Chavan asked the development company to purchase electricity from the exchanges or enter into short-term agreements with power producers for supplying electricity to the investors who have set up their businesses at Mihan. Chavan has said the electricity supplied by MADC will be almost 30-35 per cent cheaper compared to that supplied by state discom Mahavitaran. The move comes after certain investors stalled operations due to higher electricity costs. (www.business-standard.com)

June 15, 2014. State-owned power producer NTPC will soon invite bids to develop its Pakri-Barwadih coal block in Jharkhand. NTPC has already cancelled ` 23,000-crore contract with Thiess Minecs India to develop this block due to delays. The company also conveyed it to the Coal Ministry that NTPC was pursuing the case with the Jharkhand government and the block is expected to start production from December, 2014. Mining plan, environment clearance and forest clearance pertaining to the mine have been obtained, it said. (economictimes.indiatimes.com)

June 15, 2014. The Centre needs to adopt measures to ensure that grid discipline is maintained and states over-drawing power from the transmission lines are penalised, industry body Assocham said. It suggested that aerial patrolling of transmission lines both at the national and state levels along with better emergency restoration systems should become priorities. Assocham said, over-drawal of power by states and the inability of distribution networks to cope with emergency situations like thunder storms, etc, are the biggest risks which can snap power lines for long hours and even days. (economictimes.indiatimes.com)

June 13, 2014. Despite long hours of power cuts at various cities, the official data for power shortage every day continues to vary between zero and 50-60 MW. The officials at the agencies say they are correct figures. According to National Load Despatch Centre (NLDC), the organisation that controls the flow of electricity in the country, power supply shortage during the evening peak period in Delhi was just about 43 MW, while households saw power cuts of more than two-three hours. Similarly the data suggests that there were no shortage in Punjab, Haryana and Rajasthan. In fact, in the last few days, peak shortage in Delhi, Punjab, Haryana and Rajasthan was zero - meaning there was not shortfall during the evening peak period. NLDC said that this data is provided by the power utilities who supply electricity to consumers in their licensed area. Evening peak period, on paper, is the time when demand touches its highest during a day. According to official data, it is between 8 pm and 8.30 pm - a half hour window. However peak period in reality starts around 6.30-7 PM and continues till midnight every day, the time during which consumers turn their air conditions on after returning from work. (economictimes.indiatimes.com)

June 12, 2014. State Bank of India (SBI) has rejected a bid by India Power- a company partly owned by SREI Infrastructure - to buy a power plant built by the Abhijeet Group of companies and invited fresh bids as the previous one undervalued the assets. The bank believes the terms of offer by SREI is loaded in favour of the bidder and that the assets were worth more than what is being offered. The new bidding process is expected to draw bigger firms at better prices as the economic upswing adds to the value of the project. (economictimes.indiatimes.com)

June 12, 2014. Power companies in Delhi stepped up local electricity production even as supplies reached the season's highest, indicating an improvement in the capital power situation though some parts of the city still faced outages. Delhi's three distribution companies supplied 5,470 MW of electricity, the highest for this summer season. The record is 5,653 MW, set in June last year. The discoms are still struggling with transmission lines which were snapped in the May 30 thunderstorm. As this has affected their ability to draw power from outside the state, the central government asked state-run gas utility GAIL to increase gas supplies to the Bawana power plant, one of the suppliers to Delhi's discoms. (economictimes.indiatimes.com)

June 11, 2014. Congress leaders staged a protest against the ruling Bharatiya Janata Party (BJP) for its failure to provide 24 hours water and electricity supply in Delhi. Congress leaders slammed the government for making false promises to the people. Another leader from the Mundka Vidhan Sabha said that under the leadership of Amarinder Singh Lovely, they will do a sit in outside Union Power Minister, Piyush Goyal's house. Comparing Congress and BJP, the protesters appreciated the former's governance saying that "Congress worked hard for 15 years to provide proper water and electricity supply to people but BJP ruined everything within 15 days," said a protester. The protesters also demanded reduction in power bills saying that the reason behind the protest was that under BJP's rule people are not getting power for seven to eight hours, which was not the case when Congress was in power. (www.business-standard.com)

June 17, 2014. Power producers such as Adani Power, Tata Power, Jindal Steel & Power, JSW Energy, Sterlite, CLP and GMR Energy decided to withdraw from the race for building two ultra mega power projects (UMPPs) with capacity of 4,000 MW each. Opposing the existing bidding terms, developers from private sector requested the government to come up with investor friendly clauses for proposed UMPPs at Tamil Nadu and Odisha. They are apprehensive about taking long term risks of fuel availability and its price besides terms under which they have to transfer the project to the government after the tenure of the agreement. Big ticket investors threw their first big challenge before the newly formed government that came in power with its development agenda less than a month back. Association of Power Producers, which consists of almost all major power producers, wrote to the Prime Minister office and power ministry to come out with comprehensive review of bidding under design - build - finance - operate - transfer model. Tata Power and Reliance Power that commissioned their UMPPs at Mundra and Sasan respectively sought higher tariff saying that their operation costs have gone up due to higher fuel costs and other changes in the economic conditions. On behalf of six out of nine shortlisted bidders for proposed Cheyyur UMPP, Adani Power, CLP India, Jindal Steel & Power, JSW Energy, Sterlite and Tata Power - APP told government that it would be difficult to further submit price bid. Other eligible bidders are L&T and state PSUs NTPC and NHPCB. Similar stand was taken by the bidders for Odisha UMPP. The association stated that Reliance Power that won bids for three out of four UMPPs also endorsed the views of other developers from the private sector. (economictimes.indiatimes.com)

June 17, 2014. Jharkhand Chief Minister, Hemant Soren, alleged that BJP was responsible for the shortage of electricity as MoUs signed during its regime in the energy sector had failed to increase a single unit of power in the state. Soren said it was the saffron party’s “politics over electricity” and had nothing to do with the concerns of the people. The chief minister said work in power department was going on in full swing after the process of unbundling of Jharkhand State Electricity Board was completed. (indianexpress.com)

June 17, 2014. The new government's resolve to pursue economic reforms appears set to catalyse the power sector's biggest revival in recent years. On the back of positive market sentiment, distressed power projects are finding buyers, companies are putting in equity and equipment orders are getting finalised. This comes after a nearly four-year-long dry spell, during which shortage of funds and policy issues hobbled development. Experts say the sector is recovering faster than expected as companies believe a pick-up in economic growth will lead to a surge in electricity demand. (economictimes.indiatimes.com)

June 17, 2014. The government is expected to resolve the contentious issue of coal quality supplies between power producer NTPC and Coal India Ltd (CIL) within a couple of weeks. At a meeting with the officials from the Coal Ministry, CIL and NTPC, Power and Coal Minister Piyush Goyal has said that the government will soon end the coal quality woes affecting the two state-owned companies. The Power Ministry and NTPC have alleged that the quality of coal supplied by CIL is low grade and stones and boulders are being dispatched in supplies even after the introduction of the third party sampling mechanism. Besides, the power producers have raised concerns pertaining to coal companies - Coal India subsidiaries - charging project developers 40 per cent premium over Coal India notified price for supply of coal. (economictimes.indiatimes.com)

June 16, 2014. India and Bhutan acknowledged the importance of cooperation and mutual benefit arising from the hydropower sector between the two countries. Prime Minister Narendra Modi and his Bhutanese counterpart Tshering Tobgay expressed satisfaction on the progress being made in the hydropower sector, and reiterated their commitment to achieving the 10000 MW target. The two nations expressed satisfaction with the completion of the Supreme Court building and the imminent commencement of the construction of the Kholongchhu Hydroelectric Project. (www.newkerala.com)

June 16, 2014. Jammu and Kashmir (J&K) Chief Minister (CM) Omar Abdullah reaffirmed his government's determination to revolutionise power generation and provide an upper hand to the state in energy availability. The Chief Minister was launching 2^nd phase of Re-structured Accelerated Power Development Reforms Programme (R-APDRP) for Jammu division to tone up the power supply system in the city and eleven towns of Akhnoor, Bhaderwah, Doda, Jammu, Kathua, Kishtwar, Poonch, Rajouri, R. S. Pura, Samba and Udhampur to benefit 237002 consumers on account of power supply and distribution. Two Data-cum-24X7 Consumer Care Centres have also been inaugurated by the Chief Minister under this programme at Jammu and Srinagar for the facilities of the consumers. Omar said dozens of power projects in the various stages of execution will accrue benefits to the people in near future. He said these will make the state self-reliant in power generation to meet its domestic, agricultural and industrial needs. It would also enable the state to sell the surplus energy and earn substantial revenue for meeting development requirements in all sectors. (economictimes.indiatimes.com)

June 16, 2014. The Power Ministry has requested the Coal Ministry to ensure that Coal India Ltd (CIL) signs fuel supply pacts with 10 power units of companies such as Abhijeet, Lanco and DVC for 4000 MW. Some of the power producers that are yet to enter into FSAs include Lanco Babandh Power Ltd, DVC's Chandrapura unit 8 and Abhijeet MADC Nagpur Energy (P) Ltd. Although Lanco has achieved all the milestones for signing of the FSA have been achieved, MCL (Coal India subsidiary) is yet to sign the pact with it. The government had earlier stated that the timelines for signing of fuel supply pacts for power projects of 78,000 MW capacity should be met. (economictimes.indiatimes.com)

June 16, 2014. Against the backdrop of Coal Ministry imposing a bank guarantee of ` 138.6 crore on NTPC for delays in developing its mine in Jharkhand, the power PSU has requested the government to consider waiver of the amount as its block is at an advanced stage. Pakri Barwadih coal block in North Karanpura coalfields of Jharkhand was allocated to NTPC in October, 2004. The mine has geological reserves of 1,600 million tonnes. The decision to impose the bank guarantee was taken following the recommendation of the Inter-Ministerial Group (IMG) on coal blocks. The government had formed the IMG in 2012 to review the progress of coal blocks allocated to firms for captive use and recommend action, including de-allocation. (economictimes.indiatimes.com)

June 12, 2014. Quality and price of coal were top issues in the meeting between the Power Minister Piyush Goyal and Gujarat Energy Minister Saurabh Patel. The state government wanted NTPC to swap the imported coal it receives through Gujarat for its thermal power projects in Chhattisgarh with the raw material available at the Bilaspur mines. In return, Gujarat will utilise that imported coal. The plan is aimed at reducing transportation expenses at both the ends. NTPC operates two projects — Korba (2,600 MW) and Sipat (2,980 MW) — in Chhattisgarh.  The total installed power capacity of Gujarat is 27,647 MW. (www.business-standard.com)

June 12, 2014. Noted human rights activist and Padmashree awardee Avdhash Kaushal said propagation of various alternatives to hydro electricity in Uttarakhand was the handiwork of vested interest groups and not a viable option. Uttarakhand alone has the potential of generating 37,000 MW of power from hydroelectricity projects, Kaushal said. Referring to Chief Minister Harish Rawat's recent statement that he would soon take up the issue with the Centre for starting three of the state's gas-based power projects, Kaushal said "it is not a viable option." (economictimes.indiatimes.com)

June 12, 2014. Assuring that there would be no "blackout" like situation in the country's northern region, Power Minister Piyush Goyal has said the government is making adequate arrangements for supplying coal. As per latest CEA (Central Electricity Authority) report, as many as 20 power stations in the country have fuel stocks to last less than four days. CEA data also showed that 38 power stations have less than seven days stock. In the northern region -- Delhi, Haryana, Punjab, Uttar Pradesh, Himachal Pradesh, Uttarakhand, Rajasthan -- 6 power stations have less than seven days stock, of which 3 have less than four days fuel. In the western states of Gujarat, Chhattisgarh, Madhya Pradesh and Maharashtra, 16 power plants have less than a week stock, of which 10 plants are left with less than four days coal. (www.business-standard.com)

June 12, 2014. Gujarat, Bihar and Punjab sought the Centre's intervention in resolving issues like coal supply and fuel cost and quality that hinder electricity generation at thermal plants in these states. Union Power Minister Piyush Goyal held separate discussions on a range of issues concerning electricity situation in Gujarat and Bihar with Gujarat Energy Minister Saurabh Patel and a delegation of MPs from Bihar led by Sushil Modi. For Goindwal Sahib plant, coal will be sourced from Tokisud and Seregarha mines in Jharkhand. These blocks are yet to be developed and therefore Punjab has sought tapering linkage. Punjab's installed capacity 8379 MW. The Gujarat Minister discussed issues related to quality and price of coal. (www.business-standard.com)

June 12, 2014. With an aim to prevent energy loss from the transmission grid and reduce electricity maintenance charges, Tamil Nadu (TN) chief minister (CM) Jayalalithaa inaugurated several power projects valued at ` 394.49 crore, including setting up of a 110kV power station in Tiruchirapalli district. A total of 51 substations, three 230kV, 28 110kV and 20 33kV substations were inaugurated by the Chief Minister through video-conference from the Secretariat. She also inaugurated a Short Messaging Service alert facility for consumers to get details of electricity bills. The SMS facility would benefit two crore customers as they would receive information on usage of power, with electricity charges and the last date for payment of bill on their mobile phones, it said. (www.business-standard.com)

June 11, 2014. Aam Aadmi Party (AAP) leader Arvind Kejriwal will seek an appointment to meet Prime Minister Narendra Modi to discuss the power crisis which has gripped the national capital. The central government had asked for at least two weeks to resolve the power crisis. (www.business-standard.com)

OIL & GAS

June 17, 2014. Even as the decision to stop gas supplies to Ukraine aggravates tensions with the U.S. and Europe, Russia faces a dilemma: it still needs Exxon Mobil Corp., Halliburton Co. and BP Plc to maintain output from Soviet-era oil fields and develop Arctic and shale reserves. Russia will require Western companies to provide the modern drilling and production gear -- and techniques such as hydraulic fracturing -- that are essential to unlocking its $8.2 trillion worth of barrels still underground. The cutoff to Ukraine’s gas supply adds another layer of complexity for energy companies navigating a shifting geopolitical landscape in the search for new oil and gas supplies. Decision-makers from some of the West’s biggest oil explorers are gathering in Moscow at the World Petroleum Congress to pave the way to new deals. (www.bloomberg.com)

June 17, 2014. Brent crude was projected by Wall Street analysts to average as much as $116 a barrel by the end of the year. Now, with violence escalating in Iraq, how far the price will rise has become anyone’s guess. The international benchmark surged above $114 for the first time in nine months as militants routed the Iraqi army in the north and advanced toward Baghdad, threatening to ignite a civil war. The Islamic State in Iraq and the Levant, known as ISIL, has halted repairs to the pipeline from the Kirkuk oil field to the Mediterranean port of Ceyhan in Turkey. (www.bloomberg.com)

June 16, 2014. Exxon Mobil Corp. Chief Executive Officer Rex Tillerson talked up his company’s prospects in Russia, appearing in Moscow alongside OAO Rosneft CEO Igor Sechin, who’s been sanctioned by the U.S. government. Work between Texas-based Exxon, the world’s largest oil company by market value, and state-run Rosneft on Sakhalin Island in Russia’s Far East provides a template for further exploration, especially in the Arctic’s Kara Sea, Tillerson said at the World Petroleum Congress in Moscow. Exxon Mobil is pursuing a global alliance with Rosneft even after the U.S. imposed sanctions on Sechin, a close ally of President Vladimir Putin, as part of a package to punish Russia for annexing Crimea from Ukraine. The two companies plan to drill a well in the Kara Sea, targeting a formation that could hold more than 8 billion barrels of oil. (www.bloomberg.com)

June 12, 2014. Cnooc Ltd., China’s biggest offshore energy explorer, is expanding oil production in waters off its southern coast to reach a target missed since 2011. Cnooc is developing new projects based on findings near the island of Weizhou, 80 nautical miles east of the border with Vietnam. The Weizhou rigs produce 45,700 barrels of oil equivalent a day, about 4 percent of the Beijing-based company’s global output. Cnooc produced 412 million barrels of oil equivalent in 2013, including 61 million barrels that came from Canadian unit Nexen Inc. Weizhou is Cnooc’s biggest oil producer in the western part of the South China Sea, one of four major oil and gas producing areas off the shores of China. Cnooc started a new project in the Weizhou area last year, increasing the number of operational oilfields to four. Rigs WZ11-4, WZ11-1, WZ12-1 and WZ6-12 produce mostly crude oil. Cnooc, which started WZ6-12, has announced a new finding in an area called Weizhou 12-11. Cnooc’s state-owned parent China National Offshore Oil Corp. placed an oil rig near the disputed Paracel Islands off the coast of Vietnam, leading to confrontations between Vietnamese and Chinese boats. The move set off violent anti-China protests in Vietnam and prompted China to evacuate thousands of its citizens. Cnooc’s Zhanjiang unit, which runs the Weizhou projects, plans to increase oil and gas output in the western part of the South China Sea to 0.26 million barrels of oil equivalent a day by 2015, and 0.35 million barrels by 2020. (www.bloomberg.com)

June 11, 2014. Russian top oil producer Lukoil is producing more than 200,000 barrels per day (bpd) at its West Qurna-2 oilfield in Iraq and has fulfilled its contractual obligations, it said. The company also said it had successfully maintained an average daily production of at least 120,000 bpd for 90 days. (www.rigzone.com)

June 12, 2014. PT Trans Pacific Petrochemical Indotama (TPPI) has stopped production at its Tuban plant in East Java after an agreement with Indonesia’s state oil company ended. The subsidiary of Tuban Petrochemical Industries is negotiating with PT Pertamina, overseas suppliers and the country’s upstream oil and gas regulator for condensate feedstock to restart the plant in July or August, the company said. The company known as TPPI can process 100,000 barrels a day at its Tuban unit in East Java, which turns condensate into products including naphtha. (www.bloomberg.com)

June 12, 2014. Hyundai Engineering has selected INEOS Technologies' Innovene S process for Turkmengas' $3 bn petrochemical complex. The complex will feature a high-density polyethylene (HDPE) facility using Innovene S technology, which will produce 386,000t per annum (tpa), and a 50,000tpa INEOS Black Compounding line. (refiningandpetrochemicals.energy-business-review.com)

June 11, 2014. U.S. fuel imports fell to a 15-year seasonal low as refineries processed increasing domestic crude output, moving the nation closer to energy independence. Deliveries slid 653,000 barrels a day to 1.68 million in the week ended June 6, the fewest for the period since 1999, the Energy Information Administration (EIA) data showed. The 28 percent drop was the biggest decline since the week ended June 18, 2013. Fuel imports peaked at 4.97 million barrels a day in October 2005. Shipments to the U.S. from abroad have dropped as the shale boom provided refiners with an ample supply of cheaper domestic crude to make fuel. West Texas Intermediate (WTI), the U.S. benchmark crude, has traded at an average discount of $12 to Brent oil from the North Sea over the past four years. WTI traded at an average premium of more than $1 to the European grade from 1988 to 2008. U.S. crude output rose 77,000 barrels a day to 8.46 million, the EIA said. Production reached 8.47 million barrels a day in the week ended May 23, the most since October 1986, according to the EIA. The combination of horizontal drilling and hydraulic fracturing, or fracking, has unlocked supplies from shale formations in the central U.S., including the Bakken in North Dakota and the Eagle Ford in Texas. Refineries in the U.S. have operated at an average 88.4 percent of capacity so far this year, up from 85.5 percent during the same period a year earlier, EIA data show. (www.bloomberg.com)

June 17, 2014. Royal Dutch Shell Plc, Europe’s largest oil company, is selling most of its 23 percent stake in Woodside Petroleum Ltd., raising about $5 billion in Australia’s biggest energy deal. Shell is selling 78.3 million shares to investors, while the Australian company is buying back the same amount of stock from Shell, The Hague-based company said. That’s about 19 percent of Woodside, whose attraction as a potential takeover target may be revived. (www.bloomberg.com)

June 16, 2014. Norwegian oil workers and employers will start mediation talks to bridge differences and avoid a strike that threatens to halt about 115,000 barrels of oil a day from fields operated by Exxon Mobil Corp., GDF Suez and Statoil ASA. The negotiations are the first to reach mediation of four broken-down talks for different professions in Norway’s oil and gas industry, including workers in oil services and at supply bases. The risk of a strike comes two years after a 16-day conflict over pensions forced the government to step in to restore production. Norway is western Europe’s biggest oil and gas producer and gets about 22 percent of its economic output from the industry. (www.bloomberg.com)

June 16, 2014. Ukraine said Russia cut natural gas supplies after demanding advance payments for the fuel, the first time shipments have been affected in this year’s crisis in relations between the two countries. Russia’s OAO Gazprom is only providing enough gas to Ukraine’s pipeline system to meet demand from European customers and not the country’s needs, Ukraine’s state gas company said. Ukraine must pay its debt and then will only receive gas paid for up front, Gazprom said. The European Union (EU), dependent on Russian gas piped through Ukraine for about 15 percent of its demand, has been trying to broker a deal to maintain shipments and overnight negotiations in Kiev ended without a deal. A supply cutoff may have less impact in the European summer, when consumption is lower and stockpiles higher. (www.bloomberg.com)

June 16, 2014. Oil exports from the U.S. in April rose to the highest level in 15 years as Canadian refineries replaced more expensive imports from Europe and West Africa with shale oil from North Dakota and Texas. The U.S. shipped 268,000 barrels a day in April, the Energy Information Administration reported. That’s the most since April 1999, and a more than sixfold increase since April 2012. Federal law allows exports of unrefined crude to Canada and restricts them to most other destinations. The increase in exports follows a boom in oil production driven by horizontal drilling and hydraulic fracturing, or fracking, in places like North Dakota and Texas. The surge in output has increased supplies in the U.S., driving down prices relative to the rest of the world. (www.bloomberg.com)

June 11, 2014. Australia-listed Energy World Corp Ltd expects its nearly $1 billion liquefied natural gas hub and power plant in the Philippines to be running by early 2015, paving the way to a new market for imports of the super-chilled fuel. Purchases by the Southeast Asian nation would be welcome news for major LNG producers such as Chevron, ExxonMobil and Total, which are facing uncertainty about longer-term demand in Japan and South Korea, the top two buyers of the cleaner fuel. That time frame would foreshadow the construction of two other LNG import and storage terminals in the next five years in separate projects proposed by Royal Dutch Shell Plc and local firm First Gen Corp. (www.downstreamtoday.com)

June 17, 2014. Kurdish troops were defending Iraq’s fourth-biggest oilfield against Islamist militants after deploying outside their semi-autonomous region in the country’s north to seize the deposit claimed by the central government. More than 100,000 Kurdish fighters, known as peshmergas, are guarding a “front line” from Iraq’s eastern border with Iran to the northern town of Fishkabur near Turkey. They now occupy areas around the contested city of Kirkuk where BP Plc has been in talks with Iraq’s government to help reverse declining output at the oilfield discovered in 1927. Iraq’s army abandoned Kirkuk amid an offensive by militants from the Islamic State in Iraq and the Levant. Peshmergas now control all energy facilities and oil deposits in the Kirkuk area other than a refinery in Baiji, 50 miles (80 kilometers) to the southwest, which ISIL forces have surrounded. The Islamic State in Iraq and the Levant, known as ISIL, also seized part of a pipeline for oil exports from Kirkuk to Turkey. Crude flows through the pipeline have been halted for security reasons since March 2, according to Iraq’s oil ministry. Prime Minister Nouri al-Maliki’s Shiite-led government is seeking to reverse the battlefield gains of ISIL, a breakaway al-Qaeda Sunni Muslim group that captured the northern city of Mosul and then advanced south toward Baghdad. Sectarian strife is pushing the second-largest oil producer in the Organization of Petroleum Exporting Countries (OPEC) closer to civil war, three years after the U.S. withdrew its forces from the country. Iraq, excluding the Kurdish region, holds 150 billion barrels in proven crude reserves, the world’s fifth-biggest deposits. The Kurdistan Regional Government controls 45 billion barrels and has attracted international oil companies including Exxon Mobil Corp. and Total SA with financial terms many investors see as more generous than those available in the rest of the country. (www.bloomberg.com)

June 13, 2014. With new rules that took effect June 1, North Dakota is aiming to reduce flaring, the burning of natural gas that cannot be used or sold, to 10 percent of natural gas produced at the wellhead, Governor Jack Dalrymple said. Addressing fellow governors at the 2014 annual meeting of the Western Governors' Association, Dalrymple said he was “embarrassed to say” oil and gas companies currently flare about one-third of the roughly 1 billion cubic feet of gas they produce a day in North Dakota's Bakken shale play. He said ONEOK Partners of Tulsa, Okla., has made a $6 million investment in North Dakota to capture more natural gas at wellheads. The rule approved by the North Dakota Industrial Commission requires producers to have gas capture plans for all applications for permit to drill after June 1. Dalrymple said the goal is to have the industry achieve a 90 percent gas capture rate by 2020. (www.bloomberg.com)

June 13, 2014. Twelve of the world’s most powerful petroleum ministers gathered around a horseshoe of tables in Vienna to pass judgment on the oil market. One of them sounded happier than the rest. “This is the best time for the market,” Ali al-Naimi, Saudi Arabia’s minister, told journalists before the meeting of the Organization of Petroleum Exporting Countries (OPEC) on June 11. A day later, U.S. and European crude prices, which have exceeded $100 a barrel for a record time, surged to multi-month highs, spurred by worsening conflict in Iraq, the group’s second-biggest producer. Libya, with 48 billion barrels of reserves, is pumping 10 percent of what it can because of unrest. (www.bloomberg.com)

June 12, 2014. OPEC, which supplies about 40 percent of the world’s crude, kept its production target unchanged in a widely anticipated move that left the group’s output below forecast demand for the rest of the year. The Organization of Petroleum Exporting Countries (OPEC) reaffirmed its production ceiling of 30 million barrels a day for a fifth consecutive meeting. The group forecasts demand for its crude of 30.4 million barrels a day in the coming six months, while its 12 members produced 29.6 million barrels a day in April, the organization’s data show. OPEC ministers said at a meeting in Vienna that they were at ease with supply and demand in global oil markets. While the formal limit remains unchanged, the burden will fall to Saudi Arabia to increase output to meet higher demand in the second half as political turmoil constrains Libyan output and sanctions curb Iranian exports, according to Barclays Plc, Societe Generale SA and Energy Aspects Ltd. (www.bloomberg.com)

June 11, 2014. A four-decade-old U.S. ban on crude exports should remain until a “saturation” point when domestic refining capacity can’t absorb increased oil production, according to Goldman Sachs Group Inc. Maintaining the statutory curb on shipments overseas will deliver the “highest value” to the U.S. economy, the bank said. At current extraction costs, the export ban may start to weigh on U.S. output growth in coming years, it predicted. Rising production from shale formations has allowed the U.S., the world’s biggest oil consumer, to import less crude, fueling speculation that the curb on exports could be lifted. A 1975 federal law bans most shipments overseas, with only deliveries of refined products including gasoline and diesel allowed. Supporters of the ban say keeping U.S.-produced oil at home helps reduce fuel prices for industry and consumers. Uncertainty over the future of the ban is probably delaying investment in U.S. refining capacity, according to Goldman. Oil companies are seeking ways around it by using simple, one-step plants capable of turning crude into products for exports. BP Plc signed on to take at least 80 percent of the capacity of a new $360 million mini-refinery in Houston that will process just enough to escape the restrictions. (www.bloomberg.com)

POWER

June 17, 2014. The Asian Development Bank (ADB) has signed grant and loan agreements with the Government of Solomon Islands to boost energy access and renewable energy generation in Auki, the capital of Malaita province. The assistance package includes a $6 mn loan and a $6 mn grant. A project agreement has also been signed by Solomon Islands Electricity Authority. ADB said the Fiu River Hydropower Plant will almost completely displace diesel generation in Auki. The project will assist in installing hydropower generation for the Solomon Islands Electricity Authority in order to replace diesel generation in the third-largest load center in Solomon Islands while extending the distribution grid to peri-urban households. (hydro.energy-business-review.com)

June 16, 2014. Siemens has received an order for supply of a turbine island for the Jaworzno III steam power plant in Poland. With the powerful SST5-6000 steam turbine the plant will have an installed electrical capacity of 910 MW. The maximum net capacity is specified as 843.5 MW, with a net efficiency of approximately 45.9 percent. This will make the Jaworzno lll plant, with its ultra-supercritical steam parameters, one of the most efficient steam power plants in Europe. Commissioning is scheduled for April 2019. The new plant will replace older units currently installed by Tauron. This will result in reduction of CO₂ emissions by around 25 percent. The customer is SPV-Rafako, a 100 percent affiliate of Rafako, who will erect the plant for Tauron Polska Energia in a consortium with Mostostal Warszawa. The order volume for Siemens is approximately EUR208 million. (www.pennenergy.com)

June 16, 2014. A Chinese company Harbin Electric International has expressed its willingness to establish 660 MW coal-based power plant at Thar coal field Block -4. A delegation of the company called on Sindh Chief Minister (CM) Syed Qaim Ali Shah at CM House, who welcomed the offer of the Chinese company, saying that government will provide all out support to foreign investors. The cost of proposed power project offered by the Chinese company is estimated $2.5 billion. CM Sindh said that his government is deeply interested in the generation of coal-based electricity to meet with energy crisis. He said that China is best friend of Pakistan and many other companies are working here for the development of other sectors as well. He assured the company for all facilities and incentives provided they are qualifying for the project. The Chief Minister Sindh however asked the participating delegates to complete the project within shortest period if awarded to them. (www.nation.com.pk)

June 14, 2014. State-owned aluminium maker PT Indonesia Asahan Aluminium (Inalum) will spend around US$750 million on a steam-fueled power plant, which would double its production capacity, starting from mid-next year in anticipation of higher energy demand. Inalum said that the firm expected to cover 35 percent of the 600 MW power plant project from internal cash. It was now seeking to generate the rest from external sources. The new power plant project is part of $1.9 billion that Inalum will spend on a wide array of development projects over the next few years, including a new aluminium smelter and seaport. (www.thejakartapost.com)

June 13, 2014. The Industrial division of ARB, Inc. a unit of the West Construction Services segment of Primoris Services Corporation has secured a contract worth over $55 million for a new power plant in California. The contract was unanimously approved by the Pasadena City Council. The scope of work in the power plant for Primoris includes the demolition of the 50-year-old GT-5 steam generator which will be replaced by a new, more efficient and cleaner generator. The contract also comprises design, procurement and construction of this new generator. (www.zacks.com)

June 13, 2014. The Chana Power Plant in Thailand’s southern province of Songkhla has stopped operating for a one-month maintenance closure. Chana Power Plant, the main electrical power source in the Thai South, completely stopped power generation during the 28-day gas supply disruption from the Thailand-Malaysia Joint Development Area JDA-A18 well for maintenance by Thailand's PTT Public Company Limited in which power production capacity in 14 Southern provinces will drop by 710 MW. (www.pattayamail.com)

June 16, 2014. Gibraltar agreed to buy electricity from an ocean energy plant being developed by Eco Wave Power. Eco Wave plans to install the facility this year and will start producing power next year. It will cost about $5 million to build and the government of Gibraltar has agreed to buy the electricity for 25 years. The first phase of the plant will have a half a megawatt capacity, with Eco Wave planning to scale this up to about 5 MW. Gibraltar plans to produce 15 percent of its energy from renewable sources by 2020. (www.bloomberg.com)

June 12, 2014. India and its eastern boundary neighbor Nepal, are going to have a major augmentation in the power transfer lines in between on mutual interest. While India is keen on tapping unexplored hydropower from the Himalayan country, Nepal needs power during dry winter season from India. With high hydropower potential but low output level, severely power starved Himalayan country Nepal is in process of widening the bottlenecking identified as hindrance for the power promoters, mainly from India, to come forward. The country has a set objective to produce 25,000 MW extra hydropower by 2030. According to the Nepal Energy Ministry, the country is streamlining all areas including conflicting acts to fasten the pace of this development. As learnt, Nepal energy ministry is finalizing its response against a formal proposal on energy cooperation forwarded recently by the Indian government which is being considered as the first step to develop a well structured power Trade Agreement (PTA) between the two countries. Earlier Nepal also sent a proposal to sign Memorandum of Understanding (MoU) for PTA to India in 2010. But it could not reach implementation stage. According to the Independent Power Producers Association of Nepal (IPPAN), a Indo-Nepal PTA will give high momentum to hydropower development in Nepal. Several export-oriented hydropower projects are waiting for that to come up. (economictimes.indiatimes.com)

June 17, 2014. The Cabinet of Japan approved Japan's Energy White Paper 2013, which defines nuclear power as an "important base-load power source" and calls for a return to nuclear power generation, local media reported. According to the report, 88 percent of Japan's energy consumption depended on fossil fuels in 2013 after all the nation's reactors being offline in the wake of the Fukushima disaster in 2011. The reading is higher than the 80 percent at the time of the oil crisis in the 1970s. (www.shanghaidaily.com)

June 16, 2014. Indonesia is planning to construct a 2x28MW hydropower plant in the province of Lampung, aimed to boost power grid in Sumatra. Jointly financed by Japanese and South Korean investors, Semangka hydropower plant project is likely to commence operation no later than 2018. (hydro.energy-business-review.com)

June 16, 2014. The Federal Government (FG) signed a memorandum of understanding (MoU) with an American consortium, Team Africa, for the construction of a 400 MW power plant in Bayelsa State. The Minister of State for Power, Mr. Muhammad Wakil, who signed on behalf of the government, said the MoU would fast track the construction of the gas-fired plant. According to him, the Federal Ministry of Power had reached an agreement with the Bayelsa State Government on where to locate the plant, adding that the investors were determined to complete the project in record time. (www.punchng.com)

June 16, 2014. Coal dominated world energy markets last year by supplying the biggest share of demand since 1970, making it the fastest growing fossil fuel, according to an annual review by BP Plc. Consumption grew 3 percent last year, driven by coal use in developing nations, according to the Europe’s third-largest oil company. Use of renewables such as solar and wind also reached a record, accounting for 2.7 percent of all energy demand.

The findings are another indication that consumers are prioritizing cheap fuels over efforts to rein in greenhouse gas emissions blamed for global warming. Coal is the dirtiest fossil fuel, and use of it expanded at utilities from China to Germany. Coal’s share of global energy use reached 30.1 percent, just below the 32.9 percent share for crude oil, which lost market share for a 14^th consecutive year. China was the world’s biggest coal consumer, followed by the U.S. and India. (www.bloomberg.com)

June 11, 2014. The U.K. energy regulator has written to the largest energy suppliers, asking them why household bills haven’t been cut to reflect lower prices for gas and electricity in wholesale markets. Wholesale prices for the coming winter are 16 percent lower for gas and 9 percent lower for electricity than a year ago, yet the six biggest utilities have yet to reduce their prices, Ofgem said. A failure to explain the mismatch risks undermining public confidence in the energy market, it said. The regulator has proposed that the U.K.’s retail energy industry be referred for investigation by the Competition and Markets Authority after a report found the market isn’t working as well as it should. (www.bloomberg.com)

June 17, 2014. The Rajasthan government approved an amendment in the Wind Energy Act, 2012 to attract investment of ` 2,500 crore to produce 400 MW power from wind mills in the state. The cabinet chaired by Chief Minister Vasundhara Raje approved the amendment in the existing "Wind Energy Act, 2012" with an investment prospect of ` 2,500 crore by producing 400 MW power through wind mills, Rajendra Rathore, Parliamentary Affairs Minister said. A committee would also be set up to draw lines on purchase of lands (private and government) for wind mill installations in the state, Rathore said. (economictimes.indiatimes.com)

June 17, 2014. DLF is set to become the first real estate developer in the country to generate power by installing solar panels on top of its office buildings, a move similar to the experiment in Gujarat, where the state government has installed such panels on top of government buildings in capital city Gandhinagar. The developer has signed a build-and-operate agreement with UK-based Aniron Solatricity and Azure Power India to install solar panels on top of commercial buildings owned by DLF as an initial pilot project to produce 3 MW of power. The solar power generated will be routed to the buildings and combined with the main power source. The developer's office buildings in Gurgaon, Delhi, Kolkata and Chennai are being used for this project. DLF had earlier installed a 100 MW captive power plant in its DLF Cybercity in Gurgaon that runs on gas. This plant provides an uninterrupted power supply to offices in Cybercity. (economictimes.indiatimes.com)

June 16, 2014. Inox Wind Energy, a subsidiary of Gujarat Fluorochemicals Limited, has bagged a ` 900-crore order from a subsidiary of Morgan Stanley to build wind power complexes of 170 MW capacity in Madhya Pradesh. The project will come up at Ratlam and Mandsaur districts of Madhya Pradesh and is one of the largest wind turbine orders in the country for a single project, Inox Energy said. The order is for 85 units of Inox Wind’s recently launched 2 MW wind turbine with 100-metre rotor diameter, a variant of its 2 MW wind turbine platform. (www.telegraphindia.com)

June 16, 2014. The first solar module of Delhi Metro's introductory inaugural 'Roof Top Solar Power Plant' was inaugurated at the Dwarka Sector 21 metro station. The plant, with a capacity of 500 kWp is expected to start generation by the end of July. With the beginning of power production from this 500 kWp plant next month, the Delhi Metro Rail Corporation (DMRC) will become the first ever metro system in the country to install this plant 'Roof Top Solar Power Plants' at its stations. The power produced from this plant will meet the power requirements of the DMRC at this station. A power purchase agreement (PPA) regarding the installation of the plant was signed between the Delhi Metro and a multinational firm that is engaged in installation of solar power plants. (economictimes.indiatimes.com)

June 15, 2014. As the residents in the national capital grapple with an acute power crisis, the New Delhi Municipal Council (NDMC) is doing its bit to ease the situation by daily contributing 16 MW of electricity generated from solid waste to 8,000 households in the city. The civic body is generating power using solid waste as fuel at a 'Waste To Energy' plant on NDMC land in Okhla. (www.business-standard.com)

June 15, 2014. The Haryana government said it has decided to implement an energy conservation action plan under which solar power generation will be made mandatory in different categories of buildings or areas with a suitable enforcement mechanism. Haryana Chief Minister Bhupinder Singh Hooda said this will lead to generation of 200 MW of power, annual saving of ` 151 crore on coal and 16.60 lakh kilo litres of water. The annual energy saving by implementing the mandatory provisions will be 320 million units. Three lakh MTs of annual carbon emission will also be prevented in the atmosphere, he said. (economictimes.indiatimes.com)

June 15, 2014. With power cuts reportedly continuing in some parts of the state, PMK founder S Ramadoss urged the Tamil Nadu government to speed up various solar and thermal power projects to manage the situation. Though the state government had unveiled the ambitious 'Tamil Nadu Solar Energy Policy 2012' which envisaged generating 3000 MW of power by 2015, it was yet to achieve desired results, he said. (www.business-standard.com)

June 13, 2014. A three-day exhibition on renewable energy sources, 'Renergy 2014' was held in Chennai. Hundreds of Indian and international companies set up stalls to exhibit products and participated in conferences and seminars that covered larger use of renewable energy sources. They discussed the use of solar energy, wind energy, waste to energy, biomass and energy efficiency in India. India is blessed with abundant sunshine and wind capacity and participants believed these resources were not being harnessed efficiently. (www.business-standard.com)

June 13, 2014. Residential colonies and commercial establishments could reduce the burden of their electricity bills if a study currently being carried out by Tata Power Delhi Distribution finds rooftop solar power generation projects feasible and the city joins the club of such power producers that includes Gujarat.

According to estimates, 33 km of Delhi's total area of 1,483 sq km can be used for rooftop solar photovoltaic projects to install 2,557 MW of capacity. However, Delhi's potential to produce solar power has not been exploited yet, even as power demand touches new heights almost every successive summer, which is the most productive season for solar power installations. (economictimes.indiatimes.com)

June 13, 2014. Indosolar Limited said it has signed the single largest solar cell supply contract of 60 MW under the Domestic Content Requirement (DCR) of National Solar Mission with Azure Power India Pvt. Ltd. Supplies will commence shortly and will be completed early Q1, 2015, keeping in mind the timeline of the National Solar Mission. (www.business-standard.com)

June 13, 2014. Delhi Development Authority (DDA)'s electricity-hungry sports complexes will produce their own power by year-end. DDA has signed an MoU with Solar Energy Corporation of India (SECI) and will produce 1 MW of electricity by the end of the current financial year.

Photo-voltaic cells will be set up on the roofs of three sports complexes-Siri Fort, Yamuna Sports Complex and Commonwealth Games Village-in a bid to help them foot their huge bills themselves. The monthly bills of each of the complexes run into lakhs. The DDA is learnt to have inspected the sports complexes recently, conducted energy audits and ordered officials to find a more affordable way to manage their electricity consumption.

The three sports complexes alone have capacity to generate over 2 MW of electricity. The only investment by DDA will be providing space. SECI will provide the technical expertise till right from the assessment stage to successful completion of project. As per DDA's plans, these projects will be executed in RESCO (Renewable Energy Service Company) mode wherein agencies approved by SECI will generate solar power on spaces provided by DDA. (economictimes.indiatimes.com)

June 12, 2014. A grouping of solar water heater manufacturers demanded that the government immediately pay them ` 350 crore in arrears related to unpaid subsidies. The pending subsidy includes ` 50 crore for 2012-13 and around ` 300 crore for the last fiscal, according to Solar Thermal Federation of India (STFI). To promote solar energy, the Ministry of New and Renewable Energy (MNRE) had launched a programme under which 30 per cent subsidy would be provided to solar water heater manufacturers for every unit sold. The subsidy scheme comes under the Jawaharlal Nehru National Solar Mission (JNNSM). (economictimes.indiatimes.com)

June 12, 2014. The consumers' attitude towards renewable energy sources is changing for the better, as nearly half of residential as well as commercial customers believe it is very important for India to develop and generate more solar power, says a survey. Solar energy has emerged as the most recognised source of renewable energy, as nearly 58 per cent of both groups strongly favour solar energy as a future source of energy generation for India, the survey by global communications and consulting firm Mercom Capital Group said. (economictimes.indiatimes.com)

June 11, 2014. Domestic manufacturers of solar cells have said that use of indigenous products can help keep cost of solar power low, countering the government's claim that it will escalate after imposition of dumping duty. According to domestic manufacturers, the cost of solar power could fall and remain at ` 7.5 per unit by 2020 if indigenous solar cells are used, compared with the ` 6.5-8 per unit at present.

The Ministry of New and Renewable Energy (MNRE) and power producers had expressed concern that the cost of solar power would double after the commerce department said it was considering imposing high dumping duty on imports of solar cells, the bulk of which comes from the US, China, Malaysia and Taiwan. (economictimes.indiatimes.com)

June 11, 2014. Rajasthan-based Rays Power Infra (P) Limited (RPIL) announced commissioning of its 10-MW solar power plant at Midjil in Mahabubnagar district of Telangana. The ` 65-crore project has an estimated annual output of 18 million Kwh. The power will be sold at competitive market prices, which are equivalent to commercial tariffs in Hyderabad. (www.business-standard.com)

June 15, 2014. Australia’s chief trade-deals negotiator has labeled the bid by President Barack Obama to cut U.S. power-plant emissions as lacking substance. Australian Prime Minister Tony Abbott, who is seeking to dismantle Australia’s carbon-price mechanism before it hosts Group of 20 leaders in November, isn’t supporting Obama’s bid to pressure India, China and other nations to help form a world-wide agreement to combat climate change. The president is seeking state-by-state limitations on carbon-dioxide emissions to limit the effects of man-made global warming, and proposed cutting power-plant discharges, the nation’s largest source of the gas, by 30 percent by 2030 from 2005 levels. (www.bloomberg.com)

June 13, 2014. The National Aeronautics and Space Administration (NASA) plans to launch July 1 its first satellite dedicated to measuring carbon dioxide levels in Earth's atmosphere. The $465 million Orbiting Carbon Observatory-2 (OCO-2) mission seeks to provide a more complete picture of human and natural sources of carbon dioxide globally, as well as sinks where carbon dioxide is absorbed. On average, the Earth's plants and oceans absorb about half of the nearly 40 billion tons of carbon dioxide added to the atmosphere each year from the burning of fossil fuels and other human activities. But while carbon dioxide emissions increase at a steady rate, the amount of carbon dioxide absorbed by surface sinks varies from year to year, Mike Gunson, one of the project's scientists, said. Gunson said understanding what drives these changes in the fate of carbon dioxide in the atmosphere will help scientists reduce uncertainties in global climate change projections. One of the biggest uncertainties is how much carbon dioxide will be put into the atmosphere, he said. (www.bloomberg.com)

June 13, 2014. Kazakhstan’s government set tariffs for energy produced by renewables in a bid to get 3 percent of electricity from cleaner sources by 2020. The price of 1 kilowatt-hour for energy produced by wind power plants was set at 22.68 tenge (12 U.S. cents), Environment and Water Resources Minister Nurlan Kapparov said. The price for 1 kilowatt-hour produced by small hydro-power plants is 16.71 tenge, and from biogas plants it’s 32.23 tenge, Kapparov said. Kazakhstan, the largest oil producer in Central Asia, needs to spend an average $3.2 billion a year along with investors to push the nation toward its green goals by 2050, the ministry said. The government plans to spend about a quarter of that sum itself. The move will help Kazakhstan cut carbon emissions by 40 percent in 2050 from 2012 level, the ministry said. (www.bloomberg.com)

June 13, 2014. Republicans will try to block the Environmental Protection Agency (EPA)’s proposed greenhouse-gas rule by denying the funding to implement it. The EPA’s proposed carbon rule, released, would require state-by-state limitations on carbon dioxide emissions that would reduce the national output by 17 percent from current levels by 2030. Because the spending bill must pass to keep the Interior Department and the EPA running, it’s an attractive vehicle for bringing media and public attention to the emissions issue. Republicans would embrace a pitched battle over a carbon rule they say will kill jobs in coal-rich parts of the country. (www.bloomberg.com)

June 11, 2014. The U.K. government may use its Green Investment Bank to lend money to projects in emerging markets that fight climate change. The government is exploring the possibility of using the bank to help manage some of the money from its 3.87 billion-pound ($6.5 billion) International Climate Fund (ICF). That fund supports climate adaptation and mitigation projects in developing countries. None of the bank’s own 3.8 billion pounds would be used overseas. The government is exploring the viability of a pilot that would use the Green Investment Bank as a vehicle for some of the Department of Energy and Climate Change’s International Climate Fund spending overseas. The institution so far has committed 1.3 billion pounds to 25 projects, mobilizing as much as 3.3 billion pounds in private capital. The ICF is managed by three government departments including the Department of Energy and Climate Change. It will invest its money from April 2011 to March 2016 to help the world’s poorest adapt to climate change, according to the government. As the Green Investment Bank grows, its ownership may be moved to a “mixed equity” model drawing on new sources of finance. It’s currently owned 100 percent by the U.K. government. (www.bloomberg.com)

June 11, 2014. Utilities have issued a plan to speed replacement of aging pipes and take other steps to cut climate-worsening leaks of methane, acting before the government can issue new rules. The American Gas Association, a trade association for companies that send natural gas to homes and businesses, has drafted voluntary guidelines calling on utilities to remove older pipes, prevent venting during maintenance and do more to prevent contractors from severing gas pipes during work. Methane emissions from natural-gas production, processing, transportation and distribution are drawing increased scrutiny as the boom in production using hydraulic fracturing has increased use of natural gas. Methane is 25 times more potent a greenhouse gas than carbon dioxide, although less prevalent. President Barack Obama’s administration is considering drafting regulations to curb emissions of the potent greenhouse gas. If it decides to develop new regulations, it would finish them in 2016. Obama’s proposed limits on carbon emissions from power plants will encourage greater use of natural gas, potentially resulting in more methane leaks. That risk has gotten increasing attention from environmental groups, and from Obama. The administration pledged to work with utilities to curb leaks in the transport and distribution of natural gas, and called for the Environmental Protection Agency to determine whether rules are needed. If it decides to develop new regulations, it would finish them in 2016. (www.bloomberg.com)

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