Energy News Monitor | Volume XI; Issue 13

[Independent energy regulators are good “deal” makers]

                             “Putting an Independent Regulator in Oil and Gas, fully empowered to license production and determine prices, can have similar advantages in “deal making”. The consuming public recognizes that business is all about deal making. What it abhors, is the secrecy and lack of access to information, associated with oil and gas deals…”

 

 

 

 

 

 

NEWS BRIEF

[NATIONAL: OIL & GAS]

September 8, 2014. Oil and Natural Gas Corporation Ltd (ONGC) is gearing up to substantially enhance its crude oil and gas output through the development of multiple fields. Though the state-run oil and gas explorer has already received approval for the development of Daman project at an investment of ` 5,219 crore and the re-development Bombay High North project with an investment of ` 5,707 crore, it is at an advance stage to finalise the field development plan of KG-DWN-98/2 block, otherwise called KG-D5 fields off the east coast of India, which promises substantial reserves of gas and crude oil. Apart from gas reserves, the field had substantial reserve of crude oil. It is estimated to get 70,000-90,000 barrels of oil per day. The operations will spread over 500 sq km in the KG basin. A project management team has been set up. ONGC is yet to quantify the size of investment in this filed as the Field Development Plan (FDP) is still under preparation. FDP is likely to be ready by the end of the calendar year. The Daman project, expected to start production by mid-2016 would enhance production of natural gas and condensate in the Tapti Daman Block in Arabian Sea. The cumulative production till 2034-35 is pegged at 27.67 billion cubic meters of gas and 5.01 million cubic meters of condensate. The implementation of the Mumbai High (North) project will lead to incremental gain of 6.997 million tonne crude oil and 5.253 billion cubic metres gas by 2030. Shortly ONGC is also coming with Bombay South Development plan.  www.thehindu.com)

September 7, 2014. Cairn India's prolific Rajasthan oil block, which completed five years of operations, has contributed over ` 35,000 crore to the exchequer in taxes and profit petroleum. Cairn began production from Mangala oilfield, India's largest onshore oilfield, on August 29, 2009 and has been producing continuously for five years. During this period, Mangala and other fields in the Barmer basin Rajasthan block have contributed over Rs 35,000 crore in taxes and profit petroleum to the government. Crude oil production from the block has helped in gross cumulative import bill reduction by ` 119,000 crore ($22 billion) till end of last fiscal year. For a nation that imports about 80 per cent of its oil requirements, the output from the Rajasthan fields accounts for close to 25 per cent of domestic crude production. Cairn currently sells 8-9 million standard cubic feet per day (mmcfd) of gas from the Raageshwari Deep gas field, which it plans to more than double to 22 mmcfd by the end of the current fiscal and take it to 90 mmscfd by FY16. The company estimated an in-place resource potential of about 10 billion barrels of oil and oil equivalent gas in the Rajasthan block. Of this, 5.2 billion barrels of oil equivalent (boe) has already been established and another 0.6 billion boe have been discovered. The rest 4.2 billion boe is yet to be drilled. Cairn has made 8 discoveries since resumption of exploration a year back to add 1.2 billion boe. Its Mangala, Bhagyam and Aishwariya or MBA oil fields hold 2.2 billion boe. Cairn, which is investing USD 3 billion in raising oil production from the Rajasthan block, produced 181,894 barrels per day of oil in April-June quarter while gas output doubled to 8 million standard cubic feet per day. (economictimes.indiatimes.com)

September 3, 2014. An activist lawyer and a former bureaucrat moved the Delhi High Court seeking its intervention in ONGC's petition accusing Reliance Industries Ltd (RIL) of exploiting gas worth ` 30,000 crore from the PSU's natural gas block in Krishna-Godavari basin. Justice Manmohan issued notice to the Centre, RIL and Oil and Natural Gas Corporation (ONGC) and sought their responses on the intervention application of former Secretary to the Government of India EAS Sarma and advocate Kamini Jaiswal who have alleged that the PSU is being pressured to withdraw its writ petition. They have claimed that apart from the earlier government's alleged pressure on ONGC to withdraw its plea, the present regime has also supported RIL and admonished the PSU for filing the petition. On May 29, ONGC submitted before the court that it has suffered loss of gas worth ` 30,000 crore as a result of RIL exploiting gas from its block in Krishna-Godavari basin. In its plea, ONGC contended that RIL has drawn out 18 billion cubic meters of natural gas from the combined reserves of both companies since 2009. ONGC has alleged that the current situation arose due to lack of vigilance on the part of Directorate General of Hydrocarbons (DGH) and the central government and their failure to take precautionary measures resulted in loss of several thousands of crores of rupees to it. It said that DGH should have insisted upon joint development of the blocks. ONGC has claimed that of the said total quantity of gas exploited by RIL from its block adjoining that of the PSU, more than half belongs to it. RIL has said that the blocks were given to it in 2006 and it made the same operational. While it has admitted that it is drawing gas from its block, it said that the independent expert panel will have to determine if the well of the company is connected with that of ONGC. (economictimes.indiatimes.com)

September 3, 2014. ONGC Videsh Ltd (OVL), the overseas arm of state explorer Oil and Natural Gas Corp (ONGC), has signed an agreement with Argentinian energy firm YPF SA for jointly investing in oil and gas fields in Latin American nation and elsewhere. OVL and YPF signed a Memorandum of Understanding (MoU) to cooperate in the hydrocarbon sector, the company said. OVL is India's largest international oil and gas company with stakes in 35 projects in 16 countries including Azerbaijan, Bangladesh, Brazil, Colombia, Iraq, Kazakhstan, Libya, Mozambique, Myanmar, Russia, South Sudan, Sudan, Syria, Venezuela and Vietnam. It currently produces about 160,000 barrels of oil and oil equivalent gas per day and has total oil and gas reserves of 637 million tons of oil equivalent as on March 31. (economictimes.indiatimes.com)

September 7, 2014. Hindustan Petroleum Corp Ltd (HPCL), which had last September announced setting up of a refinery at Barmer in Rajasthan, has expressed hope it will be able to go ahead with the ` 37,230-crore project as scheduled and will be meeting state officials over the next 10 days to iron out key issues. The government-run refiner is also confident that it will be able to get the environmental clearance and invite EPC (engineering, procurement and construction) bids shortly as the public hearing on the JV project is over. The 9-million tonne refinery was the pet project of the previous Congress government headed by Former Rajasthan chief minister Ashok Gehlot and its foundation stone was laid by Congress president Sonia Gandhi in September. Gehlot had agreed to provide an interest-free loan of ` 3,736 crore annually for 15 years from the date of commissioning of the refinery-cum-petrochem complex at Pachpadra in Barmer, in which Rajasthan government holds 26 per cent and HPCL the rest of the equity. (economictimes.indiatimes.com)

September 8, 2014. Ahead of the second meeting called by Prime Minister Narendra Modi to review infrastructure progress, the Oil Ministry is proposing viability gap funding to meet the target of doubling gas pipeline network to 30,000 km. Finance Minister Arun Jaitley had in his maiden Budget in July outlined NDA government's ambition to double gas pipeline network to 30,000 km in next few years. New pipelines, however, have not moved from drawing board level to execution stage as developers questioned their viability in absence of gas supply source and customers. Oil Secretary Saurabh Chandra said the country has over 15,000 km of gas pipelines and another 11,000 km has been authorised by the Petroleum and Natural Gas Regulatory Board (PNGRB). The authorised pipelines like the Paradip-Surat line of Gujarat State Petroleum Corp (GSPC), are not taking off because of uncertainty about supply source and customers, Chandra said. To overcome this, a viability gap funding (VGF), similar to such support given to roads and airport projects, for cross-country gas pipelines is being considered. Chandra said already work on the long delayed Jagdishspur-Haldia pipeline has started with state gas utility GAIL India Ltd ordering route survey. (economictimes.indiatimes.com)

September 6, 2014. Announcing ` 4,500 crore expansion plans for Odisha, Union Petroleum Minister Dharmendra Pradhan said petrol, diesel and LPG network would be expanded to benefit all the consumers in the state. After reviewing the work of Indian Oil corporation, Hindusthan Petroleum Corporation and Bharat Petroleum and their marketing network in Odiaha, Pradhan said the state has LPG consumer base of 28 per cent of the population and it would be raised to 33 per cent this year and 50 per cent household in three years. At present the national average of LPG consumer base is 60 per cent. The endeavour of his ministry would be to bring Odisha at par with national average, he said. Pradhan said three new product pipelines would be constructed between Paradip-Ranchi, Paradip-Durgapur and Paradip-Raipur. The new pipelines will go through several areas of the state, which will carry petroleum products to the most parts of the state. The Minister said under new expansion plan LPG distribution centres will be established within 15 km radius in all Gram Panchayats of Odisha. He said new expansion plan would create direct jobs to about 5,000 persons. Now over 10,000 people are employed in various petroleum projects of central oil companies in Odisha. Reviewing petrol pump network in the state, the Union Minister said the state had 1449 petrol pumps working at present. Within next three years 300 more petrol pumps will be added to the network. (economictimes.indiatimes.com)

September 5, 2014. The government is expanding the list of foreign firms that can sell crude oil to state-run oil companies, by including global giants like Italy's Eni and Russian companies. Besides national oil companies of oil producing nations, the government had on May 21, 2001 permitted state refiners to buy crude oil from top 10 foreign firms. Of this list, a few firms have subsequently merged and some are no longer major players in global oil production and supply business. The Oil Ministry has now decided to revise the list of multinational companies with whom the PSU oil companies can enter into term contracts for supply of crude oil. Currently, refiners like Indian Oil Corp are allowed to buy crude oil from 10 MNCs -- Exxon (which has merged with Mobil), Shell, BP, Elf (merged with Total Fina), texaco (merged with Chevron), South Korea's SK, Chevron, USX of USA, Spain's Repsol and Nippon Mitsubishi of Japan. In the new list now being prepared, suppliers from South Korea, Spain and Japan as well as USX of USA have been dropped while Eni, Valero Energy, Russia's Lukoil, Conoco Phillips, Occidental and Marathon have been added. The new list comprises of 13 MNCs. Oil refiners buy crude oil from suppliers in Middle East and elsewhere on term or fixed quantity contracts as well as through spot tenders. Term quantities are fixed at the beginning of the year and contracts entered into. For 2014-15, state refiners IOC, Bharat Petroleum Corp (BPCL), Hindustan Petroleum Corp (HPCL) and Mangalore Refinery and Petrochemicals Ltd (MRPL) require 125.12 million tons of crude oil. Of this, 25.52 million tons will be sourced from domestic fields and the remaining 99.60 million tons will be imported. Of the imports, 80.51 million tons will be done on term contract and the remaining 19.09 million tons on spot tender basis. IOC plans to buy 44.40 million tons on term and another 10.30 million tons spot tender basis. BPCL will import 13.48 million tons on term, HPCL 10.90 million tons and MRPL 11.73 million tons. State refiners together account for about 56 per cent of the nation's refining capacity. The term contracts will be on the basis of official selling price of that country. (economictimes.indiatimes.com)

September 9, 2014. A gas price of over $6.5 per million British thermal unit is a prerequisite for early monetisation of discoveries made by Reliance Industries Ltd (RIL), Deutsche Bank said. A four-member panel of secretaries is likely to submit its report on a new gas pricing mechanism to the government. The committee was formed as the Rangarajan price formula, which would have doubled the gas price to $8.4, was found unacceptable to the government. It expected RIL to focus on development of R-series and satellite gas discoveries in the eastern offshore KG-D6 block as well as coal-bed methane (CBM) block in Madhya Pradesh and discoveries in NEC-25 block once clarity emerges on gas price. Commissioning of expanded capacities in petrochemicals and refining will drive RIL's earnings growth and valuations in FY16 and FY17. Over the past month, regional refining margins have strengthened to over $5 per barrel from close to $3 in August. Oil Minister Dharmendra Pradhan said that the NDA government decided to review the pricing formula keeping in mind public interest and recommendations of the Parliamentary Standing Committee. Parliamentary Standing Committees on Finance as well as Petroleum had called for a review of the formula suggested by the Dr C Rangarajan headed panel, saying gas price should have some linkage with the cost of production. (economictimes.indiatimes.com)

September 9, 2014. India is considering a cut in diesel prices for the first time in seven years amid global crude price dropping below $100 a barrel for the first time in more than a year, a move that could take some of the sting out of inflation as a patchy monsoon threatens a rise in food prices. That in turn could allow the central bank to ease up on its interest-rate stance at the next monetary policy announcement, boosting revival prospects. This comes as the government has been considering freeing up diesel prices, since subsidy has been narrowed by incremental, monthly price increases. The government is still evaluating the political situation in pollbound states before deregulating the fuel. Benchmark Brent crude fell to a 14-month low of $99.59 per barrel, dropping below $100 for the first time since June last year because of sluggish demand from major importers, particularly China. Meanwhile, the rupee has appreciated marginally against the dollar, which has almost aligned pump prices of diesel with market rates. According to the oil retail industry, pump prices of diesel have not been cut in the last seven years except for a marginal reduction on July 25, 2012, because of changes in distribution costs. Oil companies review petrol and diesel prices every fortnight. While petrol prices change on the 15^th and 30^th of every month, the government has been raising diesel prices by 50 paise every month since January last year. The previous UPA government had decided to raise diesel rates in small monthly doses until pump prices were aligned with market rates and it could be deregulated. According to oil companies, a petrol price cut is imminent for the fourth time in a row. (economictimes.indiatimes.com)

September 8, 2014. As the fall in international oil rates brings domestic diesel retail price at par with cost, the Oil Ministry has not yet moved Cabinet for deregulation of the nation's most consumed fuel. Under-recovery or the gap between retail selling price and the cost of imports, this month dipped to an all-time low of 8 paise a litre, helped by the monthly increases and softening in international oil rates. Originally, petrol and diesel prices were deregulated in April 2002 when NDA government was in power. Administered pricing regime, however, made a back-door entry towards the end of NDA regime in the first quarter of 2004. Congress-led UPA controlled rates as international oil prices went through the roof. In June 2010, however, it freed petrol price from its control and rates have since them moved more or less in tandem with cost. In January 2013, the UPA decided to deregulate diesel prices in stages through monthly 50 paise a litre increases. Rates were last raised on August 31 after which losses have dipped. Rates have cumulatively risen by ` 11.81 per litre in 19 instalments since January 2013. Oil Ministry said once the under-recovery is eliminated, a proposal would be put to the Cabinet Committee on Political Affairs for deregulation of diesel prices as was done for petrol. Deregulation would empower state-owned oil firms to change rates in tandem with cost like they do for petrol. (economictimes.indiatimes.com)

September 4, 2014. Indian Prime Minister Narendra Modi is closer to scrapping controls on diesel prices that led to $66 billion of losses on sales of the fuel in the past decade. The loss has fallen to ` 0.08 (less than 1 U.S. cent) a liter from ` 13.4 in September last year after Modi continued with gradual price increases that began in January 2013, Oil Ministry data show. The ministry will seek Cabinet approval to remove diesel controls once losses end. Modi is vying with counterparts including Indonesian President-elect Joko Widodo to woo investors by curbing petroleum subsidies, which frees up funds to invest in infrastructure for faster growth. The government and state-run crude producer Oil & Natural Gas Corp (ONGC) bore the brunt of the ` 4 trillion cost of cushioning diesel in the last 10 years. (www.bloomberg.com)

September 3, 2014. An association of top energy firms, including Reliance Industries, Cairn and BP has demanded a natural gas pricing policy that is "legitimate, relevant and credible" to maintain investor interest in Indian E&P sector. In its submission to the four-member panel of secretaries working out a new gas pricing mechanism, Association of Oil and Gas Operators (AOGO) said the government had awarded areas for exploration of oil and gas under New Exploration Licensing Policy (NELP) "on the basis of maximising government share and not lowest price of hydrocarbons." The Production Sharing Contracts (PSC) government entered into firm like RIL for exploration and production (E&P) provides for marketing freedom to contractors for sale of gas within India at arm's length to the benefit of all the parties to the contract. The government, as per PSC, has limited role of only "approving a formula or basis for sale of gas," it said. A four-member panel of secretaries from different ministries is holding consultations to work out a new gas pricing mechanism, as the Rangarajan formula of doubling rates to USD 8.4 per mmBtu was not acceptable to the new government. AOGO said any country looking for private sector participating to explore its vast unexplored basins needs to maintain the sanctity of contract. Domestic exploration can be expedited only if price is fair and competitive. AOGO said a higher price will substantially increase government revenues from tax, royalty and profit share which can be used to subsidise priority sectors. AOGO said globally all economies particularly energy deficit ones are moving towards freer market prices. (economictimes.indiatimes.com)

 [NATIONAL: POWER]

September 8, 2014. Power crisis in Uttar Pradesh deepened with acute shortage of coal being reported from many power plants. Coal reserves in Parischa and Harduaganj power plants was on the brink and Tanda, Rihand, Singrauli and Roza power plants were already non-functional. Aanpara requires about 28,000 metric tonnes of coal against its present stock of 7,500 metric tonnes. The combined production of these power plants is around 4,000 MW and due to paucity of coal the production over the weekend has slipped to a precarious 1800 MW. For a state, already battling for power with a demand and supply deficit of 2000 MW, this is being seen as a body blow. Alarmed at the power crisis, likely to cast a shadow in the forthcoming state assembly by-polls, Chief Minister Akhilesh Yadav has written a letter to the union government seeking immediate redressal. The issues like coal supply will only be in order post Sep 15. To meet the emergency of a grim power scenario, the Uttar Pradesh Power Corporation Limited (UPPCL) has begun purchase of over 15 million units of power through energy exchange. (economictimes.indiatimes.com)

September 7, 2014. Odisha Power Generation Corporation (OPGC) has halted power generation at its Jharsuguda facility as both of its units, of 210 MW each, have been shut down due to technical glitch. While unit 1 stopped working after getting hit by lightning, the company authorities decided to halt power generation from unit 2 suspecting fluid leakage. OPGC produces 420 MW power from two of its coal-fired power units situated at Banharpali in Jharsuguda district. These plants, set up in 1995, often face maintenance problems. OPGC is investing heavily to upgrade these plants along with plans to increase its capacity by establishment of two more power units. The state load despatch centre (SLDC) which tracks and monitors power supply from different generator in the state, showed zero power supply from OPGC. However, there will not be major supply problem due to OPCG power shortage as the state is getting sufficient supply from hydro generation these days, because of monsoon rains this year. Apart from hydropower generation of nearly 1,150 MW, the state is getting ample power from its share from central power stations, independent power producer such as Sterlite Energy and many captive power generators to meet its nearly 2,700 MW daily demand. (www.business-standard.com)

September 7, 2014. With 3,000-4,000-MW worth thermal projects expected to be kicked off in various states during the current fiscal, Larsen & Toubro (L&T) expects to bag at least one-two large projects, the company said. The company is confident of bagging at least one or two large projects. The company bagged a ` 5,100-crore EPC (engineering, procurement and construction) order from the Madhya Pradesh state utility to set up a 1,320-MW super critical thermal power plant. (www.business-standard.com)

September 5, 2014. The Andhra Pradesh (AP) government has allotted 1,200 acres of land on lease basis to NTPC for setting up 4,000 MW power project in Visakhapatnam, with an investment outlay of ` 20,000 crore. According to an order issued by the government, NTPC has committed to complete the project before March 2019, and, once completed, it will be the biggest single location power project in Andhra Pradesh. The land was allotted based on request by the PSU for setting up a coal-based 5x800 MW (4,000 MW) Super Thermal Power Station at Vishakhapatnam. The power producer has sought the land in the district as it is suitable for the new project and also is close to NTPC's existing Simhadri power project. (economictimes.indiatimes.com)

September 5, 2014. The exclusivity period of the pact for Reliance Power's proposed acquisition of Jaiprakash Associates' hydro power portfolio in a ` 12,000 crore deal is likely to be extended by 60 days. Reliance Power announced that it had signed an initial agreement to acquire all the three hydroelectric power plants of Jaiprakash Associates Ltd. Jaiprakash Power Ventures Ltd (JPVL)'s hydroelectric power portfolio has an aggregate capacity of nearly 1,800 MW, fully in operation. (economictimes.indiatimes.com)

September 9, 2014. Lanco Infratech said it planned to sell power projects to raise ` 5000 crore ($825 million) and pay down its debts. Lanco will sell 3,000 MW of generating capacity assets. The company will use the proceeds to reduce its debts of ` 15000 crore. Weighed down by large debts, a slowdown in the domestic economy and delays in completing new projects, many of India's private power producers are trying to sell plants to raise cash. (economictimes.indiatimes.com)

September 9, 2014. Tata Power has lost the motivation to continue with its investment in Indonesian mines KPC as international coal prices drop. The company, which sold a five per cent stake in these mines along with a 30 per cent stake in related power infrastructure companies in July for $250 million, said a sale of the remaining holding could "follow soon." Tata Power bought a 30 per cent stake in two Indonesian thermal coal producers PT Kaltim Prima Coal and PT Arutmin Indonesia and the related trading company owned by PT Bumi Resources in early 2007 for ` 4,740 crore. According to analysts, the remaining 25 per cent stake in the coal mines is valued at a little over $1 billion (` 6,000 crore).

The stake purchase followed Tata Power winning a bid for the imported coal-based 4,000 MW Mundra Ultra Mega Power Project (UMPP). Its calculations were based on plans to import coal from Indonesia when international prices were around $40 a tonne at the time of bidding in 2006. But global coal prices surged past $100 a tonne in 2011 and the Indonesian government banned exports below a notified price from September 2011. This made import of coal unviable for Tata Power. (www.business-standard.com)

September 8, 2014. The central government’s advisory group on power distribution reforms favours state-specific plans, instead of one model for the country. It has also pushed debt recovery, rate rationalisation and addressing of distribution losses, which, in some states, are 45-80 per cent. The Prabhu panel has already given reports on the coal sector and thermal power projects. It has asked the Union ministry of power, Power Finance Corporation and Rural Electrification Corporation to work out state-specific action plans. (www.business-standard.com)

September 8, 2014. Despite Odisha attracting 12 per cent share in the new investments in the country's power sector, energy supply in the state has worsened due to rise in deficit, industry body ASSOCHAM said. In attracting new investments in the power sector, Odisha ranks second after Gujarat. Despite this achievement, condition of power supply in Odisha has worsened over the years as power deficit in the state had increased by about 2.5 per cent during the course of 2004-05 and 2012-13, it said. This is mainly due to high growth in power demand as compared to that in power availability, the study titled "State-wise analysis of power sector: Consumption, demand & investment" said. Besides, another worrying aspect is that only 43 per cent of households in Odisha have electricity facility available to them, it said. (economictimes.indiatimes.com)

September 6, 2014. Indiabulls Power promoter Rajiv Rattan said he may look at acquisitions once the company's ongoing projects are on stream, even as he brushed aside speculations about him looking to exit power business. Rattan has made a fresh investment of ` 360 crore in the company through a preferential allotment of shares, a message to the market that he isn't looking to sell out.

Indiabulls Power is building 5,400 MW of coal-based power projects at Amravati and Nashik in Maharashtra. Of that, it has already commissioned 810 MW. Rattan is confident of putting Indiabulls Power on the growth path after the Maharashtra Electricity Regulatory Commission allowed the company to increase tariff for power from the Amravati project by ` 1.55 a unit to meet increased fuel costs. He said the company's capacity will reach 2,700 MW by the end of 2015. (economictimes.indiatimes.com)

September 4, 2014. Siemens Limited said it has delivered 1200 kilovolts transformer to central transmission utility Power Grid Corporation for the latter's test station at Bina in Madhya Pradesh. Spanning over long distances and with a transmission capacity of 8,000 MW, the new 1200 kV system will have low transmission losses, Siemens said. Power Grid plans to move country's transmission system to 1200 kV, the highest capacity power transmission system voltage in the world, by year 2017. (www.business-standard.com)

September 9, 2014. In an affidavit to the Supreme Court (SC), the government has said it isn't pressing the apex court "to not cancel selected coal blocks". The court is scheduled to hear a case on coal block allocations between 1993 and 2010. The government had urged the court to consider exempting 46 blocks from de-allocation. Citing India's dismal power situation, the Centre has sought a speedy court verdict in this regard, a move that has left companies such as Jindal Power, Hindalco and GVK, which have blocks in the list of 46, without its backing. The Supreme Court has termed all coal block allocations carried out through the screening committee and the government dispensation routes illegal under the Coal Mines Nationalisation Act. This has cast a shadow on the government's plan to open the coal sector to commercial mining. The coal ministry said the government wanted to refrain from suggesting any specific course of action to the apex court. The Centre has requested the Supreme Court to consider levying an additional charge of ` 295 a tonne on the 46 operational blocks. (www.business-standard.com)

September 9, 2014. It is believed that the government plan to get stranded power projects moving through coal supplies is meant to benefit consumers and not any private company. It would also not come at the cost of existing projects with firm coal supply agreements or letters of assurance from Coal India Ltd (CIL). The plan envisages granting linkages - supply allotment from Coal India mines - to the stranded plants with a combined capacity of 18,000 MW in the public and private sector. Some 10,000 MW belongs to private sector and 8,000 MW is in the public sector, including projects of central generator NTPC, MAHAGENCO, Karnataka Power Corporation Ltd and APGENCO. Besides, CIL's supply agreements would not have any penalty clause. In other words, CIL would supply coal to plants under consideration only if it is left with additional coal after meeting its commitment to existing customers. Rather, the plan is to raise allocation to post-2009 plants and ensure that allotments to units that have come on stream before 2009 are not affected. The plan being discussed in government provides that linkages from Coal India will be given only to generators that sign long-term power purchase agreements with state utilities. The coal ministry is also on board and has helped improve the plan. (economictimes.indiatimes.com)

September 8, 2014. Nine private companies stand to make a killing of over ` 6,000 crore per year at the cost of existing generation stations if the government clears the power ministry's proposal to give coal linkage — supply allotment from Coal India Ltd's mines - to new and upcoming power projects stranded in the absence of fuel supply arrangements.

The nine private power projects account for 10,580 MW, and as government documents indicate, would corner over 24 million tonnes of domestic coal a year — enough to run a 5,000 MW plant or feed Delhi's demand. They would get this coal at a price of ` 1,500 per tonne notified by the government. Without government intervention, they would have to source coal from the open market - either import or buy in Coal India Ltd's e-auction - at roughly ` 4,000 a tonne. The price differential works out to a benefit of ` 6,083 crore per year. The total benefit over the 25-year life span of a power project would be ` 1.52 lakh crore - a tad lower than the ` 1.86 lakh crore windfall gains to private firms estimated in the federal auditor's Coalgate report. (economictimes.indiatimes.com)

September 8, 2014. As the government awaits Supreme Court's decision on the mines allotted since 1993, Ministry of Power and Coal is firming up plans to commence the auction process by the end of current financial year (2014-15). The apex court will continue the hearing on the fate of coal blocks allotted between 1993 and 2011. The Supreme Court had held that all 218 allocations made from 1993 to 2011 are illegal and arbitrary. The Ministry of Power and Coal is planning to auction the blocks, allocation of which may be scrapped by the apex court, by the end of the fiscal. (www.business-standard.com)

September 8, 2014. A government panel has recommended the Coal Ministry may consider allocating eight mines to the power sector under government dispensation route, amid Power Minister Piyush Goyal promising 24x7 power to all. The eight coal blocks are in the states like West Bengal, Odisha and Maharashtra. The coal blocks includes, Burapahar mine in Ib valley of Odisha, Palasbani East and Dip side of Palasbani East mines in Talcher coalfields of Odisha, Kapasdanga-Bharkata mine in Birbhum coalfields of West Bengal and Hiwardhara-Sinwadona mine in Wardha valley coalfields in Maharashtra.

Goyal had said the government is committed to bring about a tranformative change in the power sector and ensure 24X7 power for all homes, industrial and commercial establishments and adequate power for all. He also said the government is striving to ensure adequate coal for power plants by targeting production of 1 billion tonnes by 2019. (www.business-standard.com)

September 8, 2014. Stating that the NDA government is committed to ensure affordable 24x7 power for all homes, industrial and commercial establishments and adequate power for farms within five years, Power and Coal Minister Piyush Goyal has laid out the Modi government's plans to ensure supply of electricity. Goyal said the government is working towards providing power to the last man standing in the country and has commenced taking various measures for the same. We take a look at eight steps that Goyal outlined for the same:

1) Rationalise coal supplies: Goyal said his ministry is aiming to rationalise supplies by supplying fuel nearest to the plant as well as implement long term measures to raise output. Goyal said that Coal India will spend ` 5,000 crore to purchase 250 rail rakes for faster evacuation of dry fuel from mines. The minister also assured that there will be speedy action after the Supreme Court's decision on illegal coal mine allocation to get the process rolling and enhance coal output to 1 billion tonne by 2019.

2) Coal Regulator: The minister said that the government will bring in a statutory and robust coal regulator to replace the proposed Coal Regulatory Authority.

3) Civil nuclear cooperation agreement: The agreement to operationalise civil nuclear cooperation agreement with Australia is likely to be ready in the next 3-4 months, Goyal said. The pact is significant given that Indian nuclear plants generate around 4,680 MW of power, of which the 2,840 MW was from indigenous uranium while 1,840 MW was from imported fuel.

4) Tighten surveillance at major coal mines: The government plans to tighten surveillance at all major coal mines to control coal theft. A proposal for a multi-disciplinary security force is also under consideration, he said. The government said that in this way there would be three-pronged monitoring of the major coal mines which would ensure coal theft could be reduced.

5) Hydel potential: Announcing a slew of measures for supporting electricity generation in Jammu and Kashmir, Goyal said the state should study its hydro-power generation potential and develop plants on a fast track basis.

6) Environmental clearances: Government will speed up environment and forest clearances to projects, said Goyal. Together it would be a major step forward for our vision of 24x7 consistent power, he said. Green Energy Corridor for evacuation of renewable power is being expedited as well, he said.

7) Gas based capacity: Several steps are being taken to resolve stranded gas based capacity (24,148 MW) issue and plans have been made to use gas primarily to meet peak load demand since electricity generation can be ramped up at a short notice, Goyal said.

8) Solar ultra mega power plant at Sambhar: The Centre is waiting for the state government's clearance for setting up the proposed ultra mega solar power project in Sambhar near Jaipur. The state government has expressed ecological and environmental concerns about the project in that area which is the prime site for migratory birds and may cast adverse impact on the ecology. (economictimes.indiatimes.com)

September 7, 2014. The government has initiated the process for appointment of Coal India Chairman and Managing Director (CMD). The Coal and Power Minister Piyush Goyal said that the step will help in fast tracking the decision making process. The post of Coal India CMD has been lying vacant after Narsing Rao resigned in May. Meanwhile, Additional Secretary A K Dubey has been given the additional charge of CMD of the company on June 26 for a period of three months. The government had earlier said it was open to hiring chairman and managing director of Coal India Ltd from the private sector. He had emphasised that there is need to look for the larger talent pool available in the private sector. Amid fuel shortages, Coal India, which accounts for over 80 percent of the domestic coal production, is drawing flak for missing the production target. The company produced 462 million tonnes coal as against the target of 482 million tonnes. (economictimes.indiatimes.com)

September 7, 2014. West Bengal government has set the ball rolling for Centre's proposed mega merger of all state-owned hydro electric units. The state government has decided to hand over its upcoming four hydro power projects with a combined capacity of about 290 MW to National Hydroelectric Power Corporation (NHPC). The projects were under West Bengal government-run power agency West Bengal State Electricity Distribution Company Limited (WBSEDCL). The four projects include: Rammam I, Teesta I & II, Teesta Intermediate and Teesta V. This comes in the wake of Narendra Modi government's proposal to merge all central hydro power companies and create a mega entity. Although, the Centre has no stake in WBSEDCL, West Bengal government's move is likely to give a boost to the Union Power ministry's mega merger plan. The Centre has appointed NHPC, the largest of all hydro PSUs, to evaluate the prospects of the merger. According to a report prepared by SBI Caps at the behest of NHPC, the plan is to turn NHPC into a mega hydro power entity with a market value of over ` 51,000 crore and a government stake of up to 81%. Meanwhile, NTPC, India’s single-largest thermal power company generation capacity of over 43,000 MW, also indicated that it may consider transferring its hydro projects to NHPC if the government takes such an initiative. NTPC is currently constructing 1,500 MW hydro capacity, which are in the various stages of implementation. (www.business-standard.com)

September 7, 2014. Coal India Ltd (CIL) is planning to take steps to clear fuel supply bottlenecks, including augmenting output to 615 million tonnes by FY'17, against the backdrop of the power sector reeling under fuel shortages. The development of sidings is another thrust area that will help in increasing coal supplies, the 'Maharatna' status firm said.

The PSU dispatched 353.83 million tonnes of coal to the power sector in the FY'14. The stock level at power stations as on March were sufficient for 14 days consumption and stood at an aggregate level of 20.19 million tonnes. The company is hopeful that its efforts to ease the bottlenecks, that have impeded the growth in the past, would fructify in the years to come. The company said that it is planning to increase production in abandoned underground mines with increased mechanisation. (www.business-standard.com)

September 7, 2014. The government said that there was no low coal supply and dry-fuel based power production has increased by about 22% in the three months of Narendra Modi-led government. Power and Coal Minister Piyush Goyal said that coal shortage at power stations was due to stocks being consumed faster for higher electricity generation. He also said the government will ensure quick action after the Supreme Court's decision on illegal coal mine allocation to get the process rolling and enhance coal output to 1 billion tonne by 2019. The Supreme Court had said that all coal blocks during last 17 years since 1993 by various regimes at the Centre have been allocated illegally and arbitrarily, bringing uncertainty to the fate of 218 block allocations and consequential investments to the tune of around ` 2 lakh crore. As on September 4, 28 power plants across the country had coal stocks of less than four days. Goyal said that Coal India will spend ` 5,000 crore to purchase 250 rail rakes for faster evacuation of dry fuel from mines. (www.business-standard.com)

September 7, 2014. Power and Coal Minister Piyush Goyal said non-cooperation of the Uttar Pradesh government and poor law and order situation are responsible for power crisis in the state. The minister said he does not want to do any politics on the issue and wants to extend all possible help to the state to tackle the problem. He said the state had stopped taking 377 MW power provided from unallocated power since May 16. The minister said that after that when the state government sent a letter, 377 MW power was again provided, but after a month or so, the state once again stopped taking it. Goyal said as far as central pool was concerned, honouring Gadgil formula, maximum 6,384 MW power was being provided to the state. (www.business-standard.com)

September 6, 2014. India's nuclear power programme reached a new milestone after Unit 5 of the Rajasthan Atomic Power Station (RAPS) become the second longest running reactor in the world by being in operation for 765 days continuously. The Unit 5 of the RAPS, a 220 MW Pressurised Heavy Water Reactor (PHWR), in Rawatbhata has been in uninterrupted operation since August 2, 2012 and it has been operating at full power with a capacity factor of 105 per cent. It has since then generated around 4,258 million units of electricity. The plant, commissioned in February 2010, has been running at the capacity of 98.5 per cent and until now generated 8,663 million units of electricity. Department of Atomic Energy (DAE) said the development was bigger than the Kudankulam Nuclear Power Station (KKNPP) unit 1 reaching its criticality as the success was a outcome of India's indigenously developed PHWR technology and it has sent an important message of "India's superiority". The DAE said in 1970 they would often make 3-4 trips in a month to RAPS because of the grid failure. The Unit 5 of RAPS would be shut for maintenance, a mandatory procedure which is to be followed. Unit 7 of Canada's Pickering nuclear plant holds the world record of running the largest operating plant that ran continuously for 894 days. The plant is expected to start its operations in a month after undergoing maintenance. RAPS has 6 units of which five are in operation. Work on units 7 and 8 are expected to be in operation by 2017-2018. (economictimes.indiatimes.com)

September 6, 2014. Australia and India signed an agreement for civil nuclear cooperation, opening the door for uranium sales to the South Asian nation as it battles power shortages. Exporting uranium to India, which is seeking to curb power shortfalls crippling the economy, will help Australian miners such as BHP Billiton Ltd. and Rio Tinto Group-controlled Energy Resources of Australia Ltd. The deal comes as uranium is poised to enter a bull market amid tightening supply as producers shut mines and delay projects, more than three years after the Fukushima nuclear disaster in Japan sent prices lower. Both India and Australia are seen by President Barack Obama as important supporters of the U.S. pivot into the Asia-Pacific, designed to counter China’s growing influence and territorial claims in the region. India and Australia said they will increase their defense cooperation and plan to hold their first bilateral naval exercises in 2015. India’s government plans to spend about $175 billion over the next two decades to alleviate power shortfalls. Power cuts are hurting industrial production amid an average 5 percent shortfall in peak power supply, according to the Central Electricity Authority. When India suffered from a 10 percent peak power deficit, as recently as 2012, it cost 1.2 percent of the country’s annual gross domestic product, according to the Planning Commission. Australia, the world’s third-biggest uranium exporter behind Kazakhstan and Canada, in December 2011 overturned a ban on uranium exports to India initiated because the nation wasn’t a signatory to the Nuclear Non-Proliferation Treaty. While Australia has the world’s largest known resources, with 31 percent, it has three operating mines. India has signed civil nuclear agreements with countries including the U.S., France and Russia after a three-decade ban on uranium supplies was lifted in September 2008 by the Nuclear Suppliers Group, which is charged with reducing proliferation by controlling the transfer of materials used to develop an atomic weapon. (www.bloomberg.com)

September 4, 2014. Power minister Piyush Goyal approved swapping of coal between state-run generation utility NTPC and power plants operated by Gujarat government utility with a view to rationalizing railway freight and cut transportation delays. The move signals the way forward for Goyal's big-ticket plan to redraw the country's coal supply map by swapping coal supply linkages - allotment of coal supply from mines to power plants. The scheme envisages changing the allocations to mines nearer to power plants. Present linkages see coal hauled from eastern region to power plants in the west, while generation units in the east get fuel from mines in central and western regions. Besides increasing freight charge, this system also delays delivery of coal due to bottlenecks in the railway network — ranging from congestion on tracks to shortage of locomotives and wagons. Rationalizing the supply chain has the potential to save ` 500 crore annually, Goyal said. The NTPC-Gujarat swap would remove the anomaly. NTPC now imports coal at Gujarat port and wheels it all the way to Chhattisgarh to bridge shortfall. In contrast, Gujarat power plants get coal from Korea-Rewa mines of South Eastern Coalfields Ltd. (economictimes.indiatimes.com)

September 4, 2014. Narendra Modi led government is likely to face its first serious test on governance over the next few weeks. The country is literally sitting on a power crisis time bomb with 56 thermal power plants sitting on less than a week’s inventory of coal. According to Central Electrical Authority (CEA) out of the 100 power plants that it monitors, 27 of them have less than four days of coal. The northern region is already facing a shortfall of 5,000 MW as power companies are unable to generate more electricity. Coal shortage is already creating a panic situation in the power ministry. Power minister has started blaming everyone including the past government, Coal India, rains and imports for the current crisis. (www.business-standard.com)

September 4, 2014. The Centre plans to ensure 24x7 supply of power to Delhi, Rajasthan and Andhra Pradesh. Power Minister Piyush Goyal said the government wants to ensure that the national capital, Andhra Pradesh and Rajasthan don't suffer from power cuts. The minister said he has already met chief ministers of Punjab, Haryana, Jammu and Kashmir, Rajasthan, Gujarat, Jharkhand and Andhra Pradesh besides the Delhi LG on the issue of power. He said he didn't have the opportunity to meet with CMs of Telengana and Uttar Pradesh so far. He denied that the government is worried of the impact on power sector if the Supreme Court scrapped all the 218 coal block allocations. According to him, the government has sped up work on increasing coal production and measures are in place. The minister said the government has also put in a plea to the court to consider exempting 40 coal blocks which are already in production and produced 37 million tonnes of coal last year and are expected to produce 50 million tonnes this year. He said another six coal blocks are ready and their lease for mining is to start. The government will abide by all court orders and has told the court that "If the court desires, it may consider allowing these coal blocks to function". Asked about possibility of reduction in power tariff, he made it clear that while the government had no way to regulate rates, it planned to make the power production system efficient to increase production and even out the prices. Goyal mentioned the Centre's policy decision to replace power plants that are more than 25 years old by super ultra critical thermal plants to increase efficiency. Since there are huge costs involved, the Centre could facilitate some of the states, the minister assured. He pointed out power theft as a major problem in the sector and said one of the effective models to curb the menace has come up in non-BJP-ruled state. Prime Minister Narendra Modi wanted other states to adopt the same measures, he said. (economictimes.indiatimes.com)

September 3, 2014. Maharashtra government ordered an inquiry into the massive power outages faced in several parts of south and central Mumbai. Inquiry will be conducted by the state energy secretary to fix responsibility and suggest short and long term measures to avoid such incidents in future. Chief Minister Prithviraj Chavan informed that the decision to hold an in-depth probe was taken at the state cabinet meeting. Tata Power's Trombay plant has a generation capacity of 1,580 MW. However, about 700 MW of its capacity was not immediately available partly because of repairs and the request from BrihanMumbai Electric Supply & Transport (BEST) not to supply from unit 6 which runs on oil and gas. (www.business-standard.com)

 [INTERNATIONAL: OIL & GAS]

September 4, 2014. BHP Billiton Ltd is preparing to join the bidding to develop Mexico’s deep-water oil fields when the nation opens its offshore resources to foreign explorers next year. The Australian mining company, which has been expanding its oil and natural gas business in North America, has been meeting with Mexican officials and state-owned Petroleos Mexicanos, known as Pemex, to gather data for assessing the best prospects, BHP said. Mexico finalized plans in August to allow foreign companies to bid on the rights to drill for its oil and gas resources, ending a 76-year state oil monopoly. Pemex wants to form joint ventures with other companies in 10 onshore and offshore fields by next year.

Mexico’s Energy Ministry plans to auction 169 blocks - 109 for exploration and 60 for production - in the country’s first competitive bidding round next year. Of the blocks auctioned, 28 will be in deep waters, including 11 in the Perdido area near the U.S.-Mexico maritime border in the Gulf of Mexico. The deep-water resources amount to a prospective 4.8 billion barrels of crude equivalent, according to the ministry.

Mexico’s move comes amid a North American energy boom that has included soaring output from onshore shale formations and deep-water oil fields in the Gulf. Some of those same prospects extend into Mexico, which has 13.4 billion barrels of proven oil reserves, according to Pemex data. A move into Mexican waters would expand BHP’s interests in the Gulf of Mexico, which includes two platforms it operates and a stake in production from three others. The company produces the equivalent of about 100,000 barrels of oil a day in the Gulf. (www.bloomberg.com)

September 4, 2014. Russia's Rosneft has started oil production at one of its Sakhalin fields, North-end of Chaivo, Rosneft Chief Executive Officer (CEO) Igor Sechin said. Sechin said the field will produce around 1.5 million tonnes of oil a year (30,000 bpd) at its peak. (www.rigzone.com)

September 3, 2014. Royal Dutch Shell Plc (RDSA)’s natural gas discoveries near the Pennsylvania-New York border indicate that the Utica shale formation extends hundreds of miles farther east than originally thought. Two gas finds in Tioga County, Pennsylvania, announced by Europe’s largest oil company are more than 300 miles away from the epicenter of Utica shale drilling in Monroe County, Ohio. Shell said it owns drilling rights across about 430,000 acres in the discovery zone, an area five times the size of Philadelphia.

Since the discovery of Utica four years ago, exploration has been dominated by a handful of domestic wildcatters such as Chesapeake Energy Corp. and Gulfport Energy Corp. Oil majors including Exxon Mobil Corp. were late to the race after initially assuming the formations wouldn’t yield hefty returns. Shell’s discoveries, known as Gee and Neal, were found about two miles underground. The Gee well was producing 11.2 million cubic feet of gas a day when output began a year ago, Shell said. The Neal well saw a peak in daily production of 26.5 million cubic feet after drilling ended in February. (www.bloomberg.com)

September 3, 2014. Halliburton Co.’s agreement to pay $1.1 billion to settle most of the lawsuits over its role in the biggest U.S. offshore oil spill helps it avoid billions more in potential penalties down the road. The oilfield services company, accused of doing defective work on BP Plc’s Macondo well before it exploded in 2010, killing 11 men and dumping millions of barrels of crude oil into the Gulf of Mexico, said the agreement resolves “a substantial majority” of its liability in the disaster.

Halliburton’s settlement comes as the federal judge overseeing oil-spill cases weighs fault for the accident, and averts the risk of a more costly judgment against the company in favor of some spill victims. The agreement removes much of the uncertainty that has plagued Halliburton for the past four years as investors waited to see how much the company might be hurt by payouts in the case. With its biggest piece of liability resolved, Halliburton can refocus its attention on developing new oilfield technology that will help it boost profits worldwide. (www.bloomberg.com)

September 5, 2014. CHS is planning to invest $406 mn in its refinery in Laurel, Montana, US to enhance efficiency and increase diesel production. The company will invest $406 mn in a new hydrogen plant and crude unit modifications in order to boost crude oil throughput and increase diesel production as well as in modifications of hydrocracker to increase diesel production, reduce production interruptions, and allow the refinery to process additional crudes.

All current Montana and Kansas refinery projects, which are slated for completion in 2019, will bring the total refining capacity of CHS by as much as 33% from 120,000 barrels per day to an estimated 160,000 barrels per day. (refiningandpetrochemicals.energy-business-review.com)

September 4, 2014. Iran will soon launch the Shourijeh gas storage facility, which is considered to be the largest in the Middle East. The Shourijeh gas facility can deliver 20 mcm/d of gas in winter. The gas storage facility is expected to boost the nation's gas delivery capacity by more than 9mcm next winter while eliminating the need to import gas from neighboring countries. Currently, the gas volume injected into the facility stands at 7.5 mcm/d. The facility comprises a refinery with the processing capacity of 20 mcm of gas. The storage facility will transfer gas to North Khorasan, Khorasan Razavi, Mazandaran, Guilan and Ardebil provinces in north, northeast and northwest of Iran. (transportationandstorage.energy-business-review.com)

September 4, 2014. Gary Klesch, the billionaire who’s buying an oil refinery in Wales, said he plans to purchase five or six more in Europe. The owner of Klesch Group is considering investments over the next two years in England, Germany, Italy, France and central Europe, he said. His Geneva-based company agreed to buy the Milford Haven refinery from Murphy Oil Co. at the end of July, a transaction scheduled to close next month. The plant is the U.K.’s smallest, handling 135,000 barrels a day. Klesch is betting some plants can be profitable by processing a higher proportion of fuels for domestic markets. He said when the Milford Haven deal was announced that his first step would be to increase diesel output. Companies including Eni SpA and Total SA say they are anticipating closing plants because of overcapacity. Sixteen refineries representing about 16 percent of the region’s processing shuttered in the past six years, according to the International Energy Agency. Klesch said he favors buying oil refineries where there’s union backing and the plants can start processing crude soon after a transaction is completed. Milford Haven stopped in May and he hopes to have it producing fuels within weeks of the deal being finalized, he said in July. Total, Europe’s biggest refiner, plans to adapt its refining capacity in France to cope with a drop in fuel demand. Eni, Italy’s largest oil company, began negotiations in July to shut as much as half of its refining capacity. While oil majors are viewing refining as a less profitable sector when compared with their upstream assets, Klesch believes the sector is still profitable if each plant is viewed in isolation. (www.bloomberg.com)

September 4, 2014. ExxonMobil is to pump more money into European refining, with the upgrade of a unit at its Slagen refinery in Norway, bucking an industry trend which has seen some plants in the region closing, and others on death watch. Exxon said it planned to install a new processing unit to enable the production of high quality vacuum gas oil. A new residual flash tower will produce the gasoil, replacing the production of lower value heavy fuel oil, the company said. The move comes after Exxon said in July it would invest $1 billion in its 320,000 barrels per day Antwerp refinery, even as many firms pull back from a European industry hammered by low refining margins. Exxon had a refining capacity in Europe of 1.6 million barrels per day from its European refineries out of a total worldwide throughput of 5.3 million bpd in 2013. (www.reuters.com)

September 9, 2014. Shipping activity in the Northern Sea Route (NSR), an Arctic passage that can cut transit times by half for vessels traveling between north Europe and Asia, will open late this year, according to the NSR Information Office. The Northern Sea Route is traditionally open from July through November, and some 71 ships made the voyage, data from South Korea’s Yongsan University showed. No ships have completed their transit voyages through the NSR, according to the Norway-based NSR Information Office. A journey from Murmansk in northwest Russia to Japan through the Arctic is 6,010 miles and requires about 18 sailing days, compared with a distance of 12,291 miles and 37 days through the Suez Canal in the Middle East, the NSR Information Office said. (www.bloomberg.com)

September 9, 2014. Brent crude dropped to a 16-month low as falling Chinese imports bolstered concern that slower growth will worsen a global oil surplus. West Texas Intermediate (WTI) slipped to the lowest level since January. The European benchmark fell 0.6 percent while WTI decreased 0.7 percent. Total Chinese imports slumped 2.4 percent in August, data from the Beijing-based customs administration show. Economic growth in China, the biggest oil consuming country after the U.S., will drop to 7.4 percent this year, the weakest pace since 1990, according to economist estimates. Brent has tumbled 13 percent since June 19 as economies from Europe to Asia show signs of slowing while oil output climbs. Oil markets in the U.S. and Europe face a glut amid constrained consumption and the recovery of supplies from Libya, the International Energy Agency said. (www.bloomberg.com)

September 8, 2014. Europe’s reliance on Russian natural gas shipments via Ukraine is declining after the region pumped a record volume of the fuel into underground inventories, minimizing the risk of shortages during the coming winter. Russia, which meets about 15 percent of Europe’s gas demand through Soviet-era pipelines across Ukraine, halted supplies to its neighbor in a dispute over debt and prices, echoing similar spats in 2006 and 2009 that left European customers short of fuel. OAO Gazprom assumes countries that get their gas via Ukraine understood the possible risks in the spring and filled up storage sites at a faster pace. Natural gas flows from Russia to the EU haven’t been affected in the current crisis. Storage sites in Slovakia, which had to seek emergency imports after its supplies were cut in 2009, were 92 percent full on Sept. 4, according to Gas Infrastructure Europe. (www.bloomberg.com)

September 8, 2014. California, the nation’s largest gasoline market, has cut its oil-by-rail volumes from Canada by 86 percent this year while buying more crude made in America. The most populous U.S. state received 3,142 barrels a day by rail from Canada in July, down from 6,669 in June and a peak of 22,871 in December, California Energy Commission data show. Meanwhile, it more than doubled the oil delivered by rail from Colorado, took a record amount from Utah and brought in more barrels from New Mexico and North Dakota. The oil-by-rail shipments have surged to a seasonal record as the state’s refiners, lacking direct pipeline access, turn to trains to bring in production from U.S. shale formations. The boom has boosted domestic output to the highest level in 28 years, bringing the nation closer to energy independence. (www.bloomberg.com)

September 6, 2014. When Exxon Mobil Corp. kicked off construction of its largest U.S. chemical investment, a trio of factories outside Houston, business unit chief Steven Pryor said he’d never seen a project with better economics. By the time the plants start operating in 2017, the numbers may not look so rosy. Exports are poised to absorb the country’s excess ethane, a natural gas liquid that’s become the main raw material for U.S. chemical makers as increased drilling in shale formations makes it abundant and cheap. Interest in ethane exports has soared since Enterprise Product Partners LP announced April 22 its plan to ship 240,000 barrels a day from its Texas terminal starting in 2016. Space is nearly sold out and Enterprise is eyeing an expansion. Saudi Basic Industries Corp. and India’s Reliance Industries Ltd. are among those lining up to buy U.S. ethane, and Reliance has ordered specialty ships. (www.bloomberg.com)

September 5, 2014. The course of TransCanada Corp’s proposed $5.4 billion Keystone XL pipeline runs through Nebraska’s highest court, which can either speed the project on to U.S. President Barack Obama or delay it indefinitely. Governor Dave Heineman is asking the state Supreme Court to reverse a trial judge’s decision to kill legislation allowing the out-going Republican and the Canadian company to chart the pipeline’s course through Nebraska. The president’s approval is required because the 1,179-mile conduit starts in Hardisty, Alberta, and crosses the U.S. border en route to a junction in Steele City, Nebraska. (www.bloomberg.com)

September 5, 2014. China National Offshore Oil Corp (CNOOC) has started oil product exports, the company said, joining oil majors Sinopec and PetroChina to conduct overseas sales from its own refinery. The sales by CNOOC are expected to drag on margins for oil products in Asia at a time when new refining capacity and upgrades have sharply increased supply in the region. CNOOC loaded its first 12,000-tonne jet fuel cargo for export from its Huizhou refinery in the southern province of Guangdong, the company said. The cargo will supply Hong Kong airport. The company will export more oil products from its 240,000-bpd Huizhou refinery later on. CNOOC won approval in March from the National Development and Reform Commission to export oil products processed from imported crude oil. CNOOC received a quota from the government to export about 100,000 tonnes of oil products in the second half of the year. Under the quota, CNOOC will be able to export diesel, kerosene, gasoline and naphtha depending on the market situation. (www.downstreamtoday.com)

September 4, 2014. Officials from North Dakota and other upper Midwestern states urged U.S. regulators to pressure railroads to fix the logjams that are blocking grain shipments as harvest season approaches. Congestion on the rail lines operated by Canadian Pacific Railway Ltd and Berkshire Hathaway Inc.’s BNSF railroad, caused by a harsh winter and growing demand for railcars to accommodate North Dakota’s oil boom, is already costing farmers millions of dollars, U.S. Senator John Hoeven, a Republican, told the Surface Transportation Board at a Fargo, North Dakota, hearing. As grain produced sits in storage, waiting for trains to carry the crops to market, the bottlenecks may get worse without immediate steps as an anticipated record grain harvest begins, officials warned. Rail executives said they were investing hundreds of millions of dollars to improve the system, and extreme measures by regulators weren’t necessary. The railroads disputed criticism that that they were favoring crude oil over agricultural products. The railroads are also working with shippers to find alternative routes to avoid congestion between St. Paul, Minnesota, and Chicago. BNSF expects grain shipments will rise as much as 15 percent from a year ago over the next four to six months. Oil production exceeding 1 million barrels a day has outpaced pipeline construction. About 60 percent of the crude produced in North Dakota in August left by rail, according to the North Dakota Pipeline Authority. (www.bloomberg.com)

September 3, 2014. Andrew John Hall -- known as the God of Crude Oil Trading to some of his peers -- has built his success on a simple creed: Everyone who disagrees with him is wrong. For most of the past 30 years, that has been a killer strategy. Like a poker player on an endless hot streak, Hall has made billions for the companies for which he’s traded by placing one aggressive bet after another. He was one of the few traders who anticipated both the run-up in and the eventual crash of oil prices in 2008. Hall was so good that he bagged a $98 million payday in 2008, when he ran Citigroup Inc.’s Phibro LLC trading unit, and was up for about $100 million more in 2009. His wager that oil prices would rise and rise has run headlong into an unanticipated energy revolution -- the frenetic push in the U.S. and elsewhere to wring crude out of shale. Shale drilling has boosted U.S. oil output to the highest level in 27 years; it helped the U.S. supply 84 percent of its energy demand last year. Oil prices, far from taking the upward trajectory Hall predicted, have been essentially unchanged since 2011. (www.bloomberg.com)

September 3, 2014. Israel is in advanced negotiations to supply natural gas from its vast Leviathan field to Arab peace partner Jordan under a 15-year, $15 billion agreement. The deal would involve the supply of 1.6 trillion cubic feet of gas over the course of the agreement to Jordan's National Electric Power Co., Texas-based Noble Energy, a partner in Leviathan, said. While a memorandum of understanding has been signed between the parties, negotiations over the price, regulatory approval and other details are only expected to be finalised by the end of the year. It is the second international contract to be signed by Leviathan - jointly owned and operated by Noble and two units of Israeli energy group Delek - following a deal with BG, estimated to be worth $30 billion over 15 years. That deal will involve providing gas to an LNG plant in Egypt. Under the Jordan deal, the gas would be transferred directly across the border between the two countries following the completion of a pipeline. While the price is still being negotiated, it is likely to be linked to Brent oil prices. (www.rigzone.com)

September 9, 2014. GDF Suez SA was ordered by France’s antitrust authority to share customer data with competitors as part of a probe into whether the country’s former natural gas monopoly abused its dominant market position. GDF Suez must start providing the data by Nov. 3, the Autorite de la Concurrence said. That will put competitors on an “equal footing” and allow consumers to “lower their gas bills,” it said. A final ruling on the investigation could come next year, and if the utility is found to have abused its dominant position it could be fined as much as 10 percent of global revenue, which amounted to 81.3 billion euros ($105 billion) last year. The nation’s biggest gas utility denies abusing its position and may challenge the ruling, it said. French authorities are trying to stimulate competition in the power and natural gas markets, which remain largely in the hands of GDF Suez and another former monopoly Electricite de France SA. The ruling followed a complaint by Direct Energie, the alternative power and gas supplier that combined with Poweo SA in 2012, that GDF Suez was unfairly using client information gained during its years as a monopoly when converting customers from regulated rates to market contracts. At the end of last year, new entrants, not including EDF, controlled 5 percent of the household gas market and 13 percent of the business market, according to the antitrust authority. France’s regulated prices for power and gas have caused friction between GDF Suez, EDF, the government and smaller suppliers. The failure of successive governments to allow prices to reflect costs led to losses for GDF Suez and difficulties for new market entrants. (www.bloomberg.com)

September 8, 2014. Russian Prime Minister (PM) Dmitry Medvedev said that the state oil champion Rosneft, in need of funds to service its huge debt, may receive 1.5 trillion roubles ($40.6 billion) from state coffers over time. The company's head Igor Sechin has asked for 1.5 trillion roubles from the National Wealth Fund, one of Russia's sovereign wealth funds, to help the company weather western sanctions against Moscow for its policy on Ukraine. The prime minister said that Rosneft, which accounts for 40 percent of Russian oil output, may still receive the help. (www.rigzone.com)

September 8, 2014. BP Plc got support from the U.K. government in its U.S. court fight over the level of compensation required under a settlement of lawsuits stemming from the 2010 Gulf of Mexico oil spill. The U.K. told U.S. Supreme Court judges in a filing that decisions to authorize payments to people who were not injured by the spill raises “grave international comity concerns by undermining confidence in the vigorous and fair resolution of disputes.” The filing shows the government’s interest in the treatment of one of the country’s most prominent companies. The U.K. government’s intervention isn’t related to a decision last week by U.S. District Court Judge Carl Barbier to find BP’s actions in the run-up to the explosion on the Deepwater Horizon grossly negligent. That exposed BP to a potential additional $18 billion in fines. The U.K. said the previous rulings could weaken efforts to encourage corporate responsibility by limiting incentives for companies to enter into voluntarily settlements. The U.S. and U.K. conduct more than $200 billion in trade each year, it said, noting that U.K. businesses are responsible for 17 percent of all foreign direct investment in the U.S. -- more than any other nation. (www.bloomberg.com)

September 5, 2014. BP Plc acted with gross negligence in setting off the biggest offshore oil spill in U.S. history, a federal judge ruled, handing down a long-awaited decision that may force the energy company to pay billions of dollars more for the 2010 Gulf of Mexico disaster. U.S. District Judge Carl Barbier held a trial without a jury over who was at fault for the catastrophe, which killed 11 people and spewed oil for almost three months into waters that touch the shores of five states. The case also included Transocean Ltd. and Halliburton Co., though the judge didn’t find them as responsible for the spill as BP. Barbier wrote in his decision in New Orleans federal court that BP was “reckless,” while Transocean and Halliburton were negligent. He apportioned fault at 67 percent for BP, 30 percent for Transocean and 3 percent for Halliburton. The ruling marks a turning point in the legal morass surrounding the causes and impact of the disaster. Four years of debate and legal testimony have centered on who was at fault and how much blame each company should carry. BP Exploration & Production Inc. is “subject to enhanced penalties under the Clean Water Act” because the discharge of oil was the result of its gross negligence and willful misconduct, Barbier held. BP said it “strongly disagrees” with the decision and will challenge it before the U.S. Court of Appeals in New Orleans. (www.bloomberg.com)

September 4, 2014. President Nicolas Maduro’s removal of his main economic and oil policy maker improves Venezuela’s chances of tapping more of the world’s largest crude reserves, according to Barclays Plc and Medley Global Advisors LLC. While Rafael Ramirez’s exit from the posts of vice president for economy and energy minister dims hopes for economic reform, it may give his successor at Petroleos de Venezuela SA the opportunity to focus more on the job of pumping oil. Besides running PDVSA, Ramirez oversaw the exchange system and housing programs among other non-oil duties. Even so, PDVSA’s capacity to invest may be constrained by Del Pino’s lesser political clout than Ramirez, they wrote. Venezuelan bonds tumbled in the past two days as the overhaul brings into question the status of a proposed lowering of fuel price subsidies and PDVSA’s planned sale of U.S. refineries. Venezuela’s oil production peaked under Ramirez’s tenure as president of PDVSA in 2008 at 3.2 million barrels a day, never approaching his goal of 5.8 million by 2012. PDVSA, based in Caracas, plans to invest $302 billion through 2019 in partnership with local and international oil companies to reach 6 million barrels a day from about 2.9 million in 2013, according to its annual report. The company also wants to increase gas and condensate output, build six new oil upgraders and increase domestic refining capacity. PDVSA signed a financing agreement with an unnamed international lender for about half of a project valued at $3 billion to expand the Puerto La Cruz refinery in eastern Venezuela. The company is increasing the refinery’s capacity to 180,000 barrels a day of heavy crude oil to cover national and export demand for products including gasoline, jet fuel and diesel. (www.bloomberg.com)

September 3, 2014. One of Mexico’s largest oil service provider’s plans to sell stocks or bonds for the first time in anticipation of new projects as the country opens the energy industry to private capital. Grupo Diavaz -- a closely held company that works with Petroleos Mexicanos, Petroleo Brasileiro SA and China Petroleum & Chemical Corp. in Mexican fields -- will hold talks with stock exchange officials in the coming weeks with a view of debuting in capital markets next year, Chairman Luis Vazquez Senties said. As many as 12 energy companies are considering equity or debt sales as Mexico allows private competition in the industry for the first time in 76 years. The government takeover of Oceanografia SA, the Ciudad del Carmen-based oil services provider that was accused of defrauding Citigroup Inc. for $400 million, has tarnished the oil services industry’s reputation and temporarily hindered Diavaz’s ability to obtain funding from banks, Vazquez said. The opening of Mexico’s oil and natural gas industry has generated interest from 515 companies, Energy Minister Pedro Joaquin Coldwell said. The entrance of foreign producers probably will generate more than $50 billion in private investment by 2018, according to the Energy Ministry. Diavaz, which offers oil services primarily to Pemex and gas production services to Brazil’s state-run Petrobras in northern Mexico, has been in talks with Exxon Mobil Corp. about potential partnerships in one or two of the 10 fields where Pemex is seeking so-called farm-outs or partners to increase production, Vazquez said. Diavaz produces about 14,000 barrels of oil a day at the Ebano field and plans to become an operator with exploration and production capabilities, Vazquez said. (www.bloomberg.com)

September 3, 2014. Indonesian President-elect Joko Widodo may raise subsidized fuel prices as early as next month when his term begins, aiming to free up state funds and invest in Southeast Asia’s largest economy. Indonesian bonds and stocks rose on Widodo’s show of commitment to fixing the fuel-subsidy program, which has spurred demand for energy imports and deprived the nation of funds for infrastructure development. Widodo’s economic team will discuss with the current government how to adjust next year’s budget by reallocating funds from goods expenditure to capital spending, and focus on increasing investment to lift growth to as much as 8 percent after 2015. The team is considering three options for raising fuel prices to curb subsidies: a one-time price increase, a gradual adjustment done every quarter or fixing the subsidy amount. The administration of Widodo, known as Jokowi, will find ways to prevent spikes in food prices and minimize the impact on public transportation when fuel costs rise. (www.bloomberg.com)

 [INTERNATIONAL: POWER]

September 9, 2014. One of the biggest hurdles to building new power plants in Japan is finding a place that’s safe from earthquakes and tsunamis. That place may turn out to be 30 miles at sea. Sevan Marine ASA, a Norwegian builder of offshore oil-drilling vessels, is proposing a $1.5 billion natural gas-fired power plant that will float on a cylindrical platform bigger than a football field moored off the Japanese coast. It’s one of several innovative efforts Japan is considering for generating electricity after the Fukushima nuclear disaster in 2011 prompted widespread public concern over how the country will produce electricity -- and where. Already, plans are being made to dot the coast off Fukushima with some of the largest floating wind turbines in the world. The Sevan proposal has won supporters within the transport ministry, which has encouraged Japanese companies to expand into offshore equipment after losing ground to Chinese and South Korean rivals in shipbuilding. The gas-fired project will have 700 MW of capacity, about two-thirds the capacity of a modern nuclear reactor. (www.bloomberg.com)

September 6, 2014. Nigeria's electricity generation is getting a steady climb reaching a two-year high of 4,044 MW, though it is still below the peak generation level achieved two years ago. The country's power generation capacity currently stands at 6,000 MWs and is to the expected to grow to 40,000 MW by 2020. The special assistant to Nigeria's Minister of Power, Mr. Frank Edozien said it was due to the combined efforts of the government and the private sector, while promising that the parties involved in the power business would sustain the tempo and improve on it. However, Nigeria's electricity generation is still below its peak generation level of about 4,517.6 MWs recorded in December, 2012, which industry analysts say, could be met and surpassed in no distant time if the upward trend continues. Inefficient power supply has been Nigeria's greatest economic bane, but the tide seems to be turning for the better with massive investments in the sector through public private partnerships. (allafrica.com)

September 6, 2014. Iran will build an energy power plant in the much disputed Abu Musa Island, in the eastern Persian Gulf. A power plant with an annual power generation capacity of 500 MW will be built on Abu Musa Island, the largest island in the Persian Gulf. The power plant will be constructed with private sector investment. With the plant's activation, the island's water and electricity shortage problems are expected to diminish in a few years. (www.worldbulletin.net)

September 4, 2014. Mozambican state electricity company EdM is building a new power transmission line linking the administrative post of Ressano Garcia, in Maputo province, to the district of Macia, in Gaza province, the company said. According to the EdM this line is already one of the benefits arising from construction of the Ressano Garcia Power Plant fired by natural gas from the Pande and Temane gas fields. The choice of Ressano Garcia for the installation of the new power plant was due to the proximity of the gas line that links the Pande and Temane region with South Africa as well as the fact that Ressano Garcia is close to the power grid. The new power plant diversifies energy sources in Mozambique, which to date has been 99 percent dependent on electricity generated by hydroelectric facilities, 94 percent of which from the Cahora Bassa dam. The new line linking Ressano Garcia to Macia is expected to be operational in 2016. (www.macauhub.com.mo)

September 3, 2014. Uranium is poised to enter a bull market amid tightening supply as producers shut mines and delay projects, more than three years after the Fukushima nuclear disaster in Japan sent prices lower. The atomic fuel has advanced as much as 18 percent from a May 20 low of $28 a pound, according to data from Ux Consulting Co. in Roswell, Georgia, which provides research on the nuclear industry. Prices closed 0.5 percent higher at $32.65 and have averaged $31.80 in 2014. Uranium slumped as much as 60 percent since March 2011 when an earthquake and tsunami caused the meltdown of Tokyo Electric Power Co.’s Fukushima Dai-Ichi plant and led to the shutdown of Japan’s nuclear fleet. The nation is seeking to restart reactors as it conducts safety checks, while producers from Kazakhstan to Australia cancel projects and close mines. The reduction in spot supplies has led to increasingly competitive offers and bids in the market place, driving prices higher, Joel Crane, an analyst at Morgan Stanley in Melbourne, said. While there are signs of restarts in Japan, there is probably a high level of inventory still held by utilities that may weigh on market sentiment, he said. (www.bloomberg.com)

September 5, 2014. Australia and India have reached an agreement over civil nuclear cooperation, which opens the door for uranium sales to the South Asian nation as it battles power shortages. Exporting uranium to India, which is seeking to curb power shortfalls crippling the economy, will help Australian miners such as BHP Billiton Ltd. and Rio Tinto Group-controlled Energy Resources of Australia Ltd. The deal comes as uranium is poised to enter a bull market amid tightening supply as producers shut mines and delay projects, more than three years after the Fukushima nuclear disaster in Japan sent prices lower. Both India and Australia are seen by President Barack Obama as important supporters of the U.S. pivot into the Asia-Pacific, designed to counter China’s growing influence and territorial claims in the region. (www.bloomberg.com)

September 5, 2014. Tanzania's state-owned power producer announced the country plans to double power generation to a total of 3 GW by 2016. Tanzania Electric Supply Company said the nation aims to add 1,500 MW of power at cost of approximately $1.21 billion. The majority of the new capacity will come from natural gas-fired plants; however, plans also include the addition of 50 MW of wind power. A mix of private and public investment will help finance the increase in power production. A report from the International Monetary Fund said Tanzania has had major offshore natural gas discoveries that could help provide energy for natural-gas plants in the country and abroad. (www.pennenergy.com)

September 4, 2014. Yuko Obuchi, the daughter of a former premier, was appointed Japan’s first female trade and industry minister, one of five women Prime Minister Shinzo Abe named to his new cabinet. As Economy, Trade and Industry minister, Obuchi will oversee the government’s unpopular plan to restart nuclear reactors shuttered after the 2011 tsunami and Fukushima disaster, a policy that polls indicate is opposed by a majority of the nation’s women. (www.bloomberg.com)            

 [RENEWABLE ENERGY / CLIMATE CHANGE TRENDS]

September 9, 2014. Tata Power Solar said it has won an order to supply entire module requirement for the 10 MW project in Rajasthan. The solar project belongs to the L N BANGUR Group and is held under under its renewable energy arm, LNB Renewable Energy (Pvt) Ltd. The 45,000 modules needed for the project will be manufactured at Tata Power Solar' manufacturing facility in Bangalore, the company said. (www.business-standard.com)

September 9, 2014. In a bid to make Andhra Pradesh (AP) power surplus, the state government is shortly entering into a Memorandum of Understanding (MoU) with the NTPC for setting up a mega solar power unit with a capacity of 1,000 MW at Ananthapur. The Government is also working on establishing another 1500 MW solar power projects in Kadapa and Kurnool districts. (economictimes.indiatimes.com)

September 9, 2014. The 15-month-old Siddaramaiah regime has come up with a scheme for the agriculture sector, which if goes according to the script, might turn farmers net sellers of solar power to the grid. The government is geared up to roll out what it calls the solar farmer scheme. With the help of subsidies or on his own, a farmer can switch to solar-powered irrigation pump (IP) sets. He can use as much electricity as he needs and sell the surplus to the grid. If the farmer has invested on his own, he will get a tariff of ` 9.56 per unit. If he has taken subsidies, he will get a tariff of ` 7.20 per unit. The energy department is targeting the farm sector because it accounts for an estimated 38-40% of the total power consumed in Karnataka. There are an estimated 2.5 million IP sets in use, and they run on free electricity. The power subsidy to the farm sector has grown at an average rate of 18% since 2007, and the government has budgeted ` 6,700 crore for this fiscal year. The Karnataka Renewable Energy Development Limited (KREDL) has plans to replace 2500 IP sets in five districts with solar-powered pump set systems of 5 HP-capacity this year. Since most farmers can't afford a solar pump system as it requires an investment of ` 1.25 lakh per kilo-watt (KW) capacity, the government is working on plans to rope in the private sector. According to KREDL, a farmer running a 5 KW solar photo-voltaic panel and selling one third of the power generated can earn about ` 23,900 a year as one KW panel can generate an average of 4.5-5 units a day. The Union Ministry of New and Renewable Energy (MNRE) provides subsidy for IP sets only up to 5 HP, and Karnataka has written to MNRE urging it to increase it to 10 HP. (economictimes.indiatimes.com)

September 7, 2014. NTPC may be forced to tap international solar plant suppliers due to shortage in domestic capacity. NTPC was laying emphasis on developing a solar power portfolio and had invited tender for 1,000 MW of solar power project open to only domestic suppliers. NTPC has an aggressive target and aims to set up 3,000 MW of solar power projects over the next 3-3.5 years. NTPC was in talks with states like Madhya Pradesh, Andhra Pradesh and Rajasthan, who are keen on developing solar energy parks. (www.business-standard.com)

September 5, 2014. Homes for poor being built under the government's ambitious rural housing scheme will now get a clean cooking energy solution too. Noting that traditional "chulha" has a direct impact on the health of inhabitants of the house, especially women, the Centre directed the states to converge its 'Unnat Chulha Abhiyan' which envisages developing a cost-effective improved biomass cook-stoves in the country with the rural housing programme 'Indira Awas Yojana' (IAY). The 'Unnat Chulha Abhiyan" is an initiative of the New and Renewable Energy Ministry. The government's new initiative assumes significance in times of global effort to reduce carbon emissions and reducing health hazards associated with the emissions. The programme would also address the issue of unsustainable collection and use of fuel wood that puts pressure on forest resources. Improved Chulhas (biomass cook-stoves), that burn biomass more cleanly and efficiently, can help mitigate climate change by reducing black carbon and other emissions resulting from burning biomass for cooking. (economictimes.indiatimes.com)

September 4, 2014. Hindustan Power Projects Pvt Ltd (HPPPL) said it has invested ` 400 crore at its Anuppur facility in Madhya Pradesh, to introduce environment friendly technologies to check pollution levels. The filtration device removes fine particles like dust and smoke from flowing gases using the force of an induced electrostatic charge, minimally impeding flow of gases through the unit. In addition to this, high concentration slurry disposal has been adopted to dispose of ash from the 1,200 MW Anuppur thermal plant. Hindustan Power Projects Ltd is one of the biggest integrated power companies in India operating in four major verticals of the energy sector, namely solar power, hydro power, thermal power and mining services. (economictimes.indiatimes.com)

September 9, 2014. Divergent tax policies mean Norway risks missing out on most of a $6 billion wind-power boom while neighboring Sweden benefits. Norway, which aims to triple wind capacity by the end of the decade, has erected one turbine for every seven installed in Sweden since the countries signed a pact to share renewable production two years ago. Norway, western Europe’s biggest oil and gas producer, has so far installed less than 10 percent of what it’s expected to complete by 2020 under the accord.

The countries’ mismatched tax rules threaten to deny Norway investment in an industry where jobs will triple by 2030, according to the European Wind Energy Association in Brussels. While Statkraft AS, Norway’s state-owned power company, didn’t build any wind projects in its home country in the eight years through 2013, it spent as much as 7.5 billion kroner ($1.2 billion) on turbines in Sweden.

Under their renewable energy agreement, Norway and Sweden give tradable certificates to renewable energy producers for each megawatt-hour they generate for the first 15 years of a unit’s lifetime. Electricity suppliers must buy those certificates to match demand, the cost of which is passed on to residential ratepayers regardless of where the projects are. (www.bloomberg.com)

September 9, 2014. Levels of heat-trapping carbon dioxide in the atmosphere rose at a record-shattering pace last year, a new report shows, a surge that surprised scientists and spurred fears of an accelerated warming of the planet in decades to come. Concentrations of nearly all the major greenhouse gases reached historic highs in 2013, reflecting ever-rising emissions from automobiles and smokestacks but also, scientists believe, a diminishing ability of the world’s oceans and plant life to soak up the excess carbon put into the atmosphere by humans, according to data released by the United Nations’ meteorological advisory body.

The latest figures from the World Meteorological Organization’s monitoring network are considered particularly significant because they reflect not only the amount of carbon pumped into the air by humans, but also the complex interaction between man-made gases and the natural world. Historically, about half of the pollution from human sources has been absorbed by the oceans and by terrestrial plants, preventing temperatures from rising as quickly as they otherwise would, scientists say.           

The organization’s annual report on greenhouse gas levels was released ahead of a climate summit of world leaders at this year’s U.N. General Assembly meetings in New York. On Sept. 23, President Obama will meet with chief executives from dozens of other countries to discuss ways to lower industrial emissions of carbon dioxide, methane and other gases blamed for heating up the planet. (www.washingtonpost.com)

September 8, 2014. Sharp Corp, the Japanese electronics maker, is seeking to sell its U.S. solar-energy development unit Recurrent Energy. Sharp has retained Bank of Nova Scotia to help shop San Francisco-based Recurrent. The deal is Sharp’s latest step back from the solar industry. The company stopped making panels in the U.S. and U.K. this year and pulled out of an Italian panel-manufacturing joint venture. Profit in the Osaka-based company’s energy unit plunged 97 percent in its first fiscal quarter as its residential solar sales slumped in Japan. Sharp bought Recurrent in 2010 for $305 million. Selling the unit would help Sharp raise capital. Recurrent has developed and sold more than 680 megawatts of projects in the U.S. and Canada, and has more than 4.3 GW under development, according to the company. (www.bloomberg.com)

September 8, 2014. A vote for independence in Scotland may halt work on renewable power projects that support 14 billion pounds ($23 billion) of investment and 12,000 jobs by raising questions about how developers would get subsidies, an energy supplier said. Green Energy Plc, which sells electricity to almost 20,000 customers in the U.K., said breaking up the union between England and Scotland in a referendum on Sept. 18 would force the two countries to negotiate how to divide payment for electricity. Currently, Scottish projects get support though a nationwide program known as the renewables obligation, which may have no mandate north of the border if the two countries were split. Scotland exports as much as a quarter of its electricity and has about 43 percent of the U.K.’s wind power capacity. About 13 GW of power projects are on the drawing board currently in Scotland, about 15 percent of total U.K. capacity. (www.bloomberg.com)

September 8, 2014. Dubai residents will be able to produce electricity of their own within a month through solar energy. Dubai Electricity and Water Authority (Dewa) said that it had completed a draft bill which allows Dubai residents to generate electricity of their own using photovoltaic system. The law is in the final stages of approval and expected to be released within a month. Once the law is approved, Dubai residents can use photovoltaic panels on their villas or commercial buildings to generate electricity. The authority has completed, in cooperation with the Supreme Council for Energy, the draft law to facilitate production of solar power in the emirate with Dewa stations.

The technical work for the implementation of the project has been finished and the authority is ready to link solar energy panels with Dewa power lines. The solar energy production will allow emirate to diversify its resources. Dubai produces 21 MW of electricity through solar energy, out of which 13 MW is produced from the first phase of Mohammed bin Rashid photovoltaic power plant. The contribution of solar energy will increase in coming years as tender for the second phase of Mohammed bin Rashid photovoltaic power plant will be released in next October, adding 100 MW to emirate's electricity production. (www.zawya.com)

September 7, 2014. Trina Solar Ltd rose to a three-month high, leading a weekly rally among Chinese solar manufacturers in New York as the Asian nation moves to boost subsidies for the industry. The National Energy Administration asked local authorities to identify projects where power can be delivered to nearby customers, provide extra subsidies for public organizations and in rural areas and allow more projects to qualify for subsidies. Chinese import tariffs on U.S. and South Korean producers contributed to the increase in polysilicon spot prices. China, which imports most of the silicon it uses to make solar panels, affirmed the duties in January. (www.bloomberg.com)

September 7, 2014. The UK has become one of the world’s most climate-friendly countries in the past year after a record 34 per cent jump in renewable energy generation – despite the Conservative party abandoning its pro-green rhetoric. The closure of some coal-fired power stations and improved energy efficiency in factories and homes also helped the UK rise to second place in a global ranking of countries’ green economic performance. PwC’s latest study shows the UK cut its carbon intensity by 4.8 per cent in 2013 compared with a year earlier. This was four times the average global level and more than Britain achieved during its 1990s “dash for gas”, when emissions fell as power generators switched from dirtier coal. The 34 per cent growth in renewable energy in the UK was the biggest of any G20 country, according to PwC. The UK figures show renewables accounted for 15 per cent of UK electricity generation in 2013 – lower than Germany, Spain and other big renewable markets but still notable.

The PwC report underlines the growth of the green economy, the UK Green Investment Bank said. However, the broader picture of how countries are tackling climate change shows world leaders are still not doing nearly enough to reduce emissions to stop global temperatures rising more than two degrees centigrade above pre-industrial times. Scientists say that if temperatures rise above that level there could be risky and irreversible changes in the climate. Globally, countries should have cut their carbon intensity by 6 per cent last year to avoid two degrees of warming, PwC has calculated. Instead, they managed only 1.2 per cent, meaning the world is on track to reach 4 degrees of warming by the end of the century. Even the UK’s 4.8 per cent reduction is still 1 per cent short of what is needed, the study shows. (www.ft.com)

September 5, 2014. Former Treasury Secretary Henry Paulson is starting a climate-change program through his Chicago-based think tank to fund research and advocate for more aggressive environmental action. The Paulson Institute’s initiative will begin this month in Beijing and bring together Chinese and international specialists to share strategies on reducing the country’s air pollution and identify ways to measure compliance with government targets. Paulson said Chinese leaders are determined to act on environmental issues. Cleaning up China’s air also will benefit Americans because airborne pollutants ride the jet stream to the U.S., Paulson said. (www.bloomberg.com)

September 5, 2014. Construction has begun on a $1 billion solar power generating station in the Mohave Desert that officials say will produce enough electricity to power about 80,000 California homes when it is completed in 2016. The 250 MW project, dubbed Silver State South, will capture solar energy with panels spread across almost 4 square miles of federal land south of Las Vegas, according to a fact sheet obtained from a First Solar representative. (www.dailyfinance.com)

September 5, 2014. The dirtiest coal in the U.S. is becoming the most popular, thanks to tightening emission standards forcing power plants to reduce pollutants. Demand for the fuel from the Illinois Basin in President Barack Obama’s home state climbed last year to the highest level since 1990 as sales of nearby Appalachian coal dipped and consumption of the product from Powder River Basin mines in Wyoming grew at a slower pace. Illinois basin coal has greater sulfur content than the other coals, and either costs less or has a higher heat content, meaning it’s sought after by utilities forced to install scrubbers in their power plants by a succession of federal laws and Environmental Protection Agency rules. Its share of U.S. production will climb to 20 percent by 2040 from 13 percent currently, according to the Energy Information Administration (EIA).

Illinois has the second-biggest reserves in the U.S., with 104 billion tons of coal, enough to power the country for 163 years at 2014 consumption levels, according to the EIA. It fell from favor after 1990 with expansion of the Clean Air Act and limits placed on sulfur dioxide emissions, which cause acid rain. In response, utilities began to install scrubbers to remove the contaminants or just shut down older, less efficient operations. (www.bloomberg.com)

September 4, 2014. U.K. lawmaker Ian Swales has already watched one steel plant close in his district, and he never wants to see it again. It felt like a funeral, he said, when plunging demand led the Redcar blast furnace in northern England to shut its doors in 2010. The memory has Swales questioning his own party’s fight against global warming, as European climate policy threatens steel towns across the region. European Union leaders expect to reach a deal in October on climate and energy goals for 2030, and regulators are recommending a 40 percent cut in carbon dioxide emissions. Steel producers say that will drive up costs for heavy industry, threatening almost two centuries of steelmaking in the region and as many as 350,000 jobs. (www.bloomberg.com)

September 4, 2014. The top leaders of China and India aren’t planning to attend this month’s United Nations (UN) summit on climate change, signaling tepid support for a global pact to cut greenhouse gases among two of the largest emitters. President Xi Jinping of China and Indian Prime Minister Narendra Modi have told UN Secretary General Ban Ki-moon they won’t be at the day-long meeting of world leaders on Sept. 23. Their absence undercuts the summit, although it may not be fatal for negotiations set to wrap up by the end of 2015. China is the world’s top greenhouse-gas emitter, and India is third, after the U.S., according to World Bank data. Together China and India account for nearly a third of total emissions, and their carbon footprint is growing while it remains flat in the U.S. and Europe. Both China and India have pushed rich nations to pony up the $100 billion promised to poor countries to help deal with the threats of climate change, and have resisted sharp cuts in their own output. Both are also heavy users of coal, the most carbon-intensive fuel, and have announced their own internal efforts to boost renewable energy. The UN meeting on Sept. 23 is not a negotiating session but a gathering of world leaders, business executives and environmentalists to discuss ways to combat global warming, and how to mitigate its impact. The meeting includes three concurrent sessions in the morning at which leaders are to make “national action & ambition announcements,” according to the schedule. This UN meeting will be followed by a negotiating session in Lima in December, and then one in Paris next year at which leaders seek to hammer out a new global agreement on cutting emissions. The summit comes as scientists are increasingly warning of the risks of climate change. Humans risk causing irreversible and widespread damage to the planet unless there’s faster action to limit the fossil fuel emissions blamed for climate change, according to a draft UN report. (www.bloomberg.com)

September 3, 2014. Vaisala Oyj, a Finnish maker of meteorological equipment, plans to make the most of growing interest in renewables as investors including Warren Buffett put billions of dollars into the area. The company is harnessing its weather-forecasting expertise to boost growth by helping renewable energy producers prepare for calm and storms alike. Vaisala is betting increasing demand for wind and solar power will provide opportunities to expand beyond its traditional strong points in meteorology, land and air traffic weather systems. The company wants to grow its energy business more than 10 percent annually through 2018, compared with a 5 percent total growth target. Vaisala wants to grow its wind-forecasting business in the next five years in China, Brazil and India, according to Kai Konola, head of the company’s weather unit. Vaisala bought two U.S.-based energy technology companies, 3TIER Inc. and Second Wind Systems Inc., to upgrade its capabilities. Vantaa-based Vaisala currently provides forecasts to 130 GW of wind capacity worldwide and has helped developers secure more than $5.5 billion in solar-project investments, according to the company. (www.bloomberg.com)

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