[Facing Downside Risks –The Oil Price Slump and how it might affect Gas Prices]

                             “Although the share of crude oil in the worldwide energy consumption is continuously declining for the benefit of cleaner forms of primary energy as natural gas or renewables but also coal, its significance for serving as a global reference price marker for energy remains unbroken. After a long period of rather unusual stability crude oil is caught in a quite significant and constant downward trend…”

 

NEWS BRIEF

[NATIONAL: OIL & GAS]

November 17, 2014. An expert panel headed by Vijay Kelkar has recommended the current production sharing regime for oil and gas exploration over the revenue-sharing model that is being considered for the next round of auction. The 10-member Committee, headed by former petroleum and finance secretary Kelkar, said the Production Sharing Contract (PSC) regime was more suited for Indian conditions rather than the revenue-sharing model based on the Rangarajan panel which was adopted by the previous UPA government. Under the present regime, oil companies can recover all costs - of successful and unsuccessful wells - from sales of oil and gas before sharing profit with the government. The Comptroller and Auditor General of India (CAG) had criticised this approach on grounds that it encourages companies to increase capital expenditure and delay the government's share. A panel headed by the then Prime Minister's Economic Advisory Council Chairman C Rangarajan had suggested moving to a revenue-sharing regime that requires companies to state upfront the quantum of oil or gas they will share with the government from the first day of production. The Kelkar Committee, which was last year formed to suggest 'Roadmap for Reduction in Import Dependency in Hydrocarbon Sector by 2030', in its final report said PSC model was more suited to attract investments. It suggested two fiscal regimes - PSC linked to investment multiple with modified contract administration including self-certification of costs by the contractors, or PSC with biddable supernormal profits tax. For boosting local production of oil and gas, the Kelkar committee has suggested improving contract stability and administration as also maintaining contract stability and sanctity and prevent retrospective contract changes. It also favoured contract extension for perpetuity or up to the end of the economic life of the asset and empowering boards of state-owned oil companies for approving equity participation in fields they had got from the government on nomination basis. (economictimes.indiatimes.com)

November 16, 2014. Oil and Natural Gas Corp (ONGC), India's biggest energy explorer, will invest ` 10,600 crore in raising production from its western offshore fields. ONGC has approved third phase of redevelopment of its prime Mumbai High South oil and gas field at a cost of ` 6,069 crore and integrated development of Mukta, Bassein and Panna formations at an investment of ` 4,620 crore, the company said. The project is designed to carry forward the success of the previous two phases of redevelopment project and give a new lease of life to the giant field, which has been in production for over three decades. The project comprises drilling 36 new wells and 34 sidetrack wells, and facilities. The facilities under the project are scheduled to be installed by April, 2017. Drilling of wells and the overall project completion is scheduled for March, 2019. The Integrated Development of Mukta, Bassein and Panna Formations, located at a water depth of 50-70 meters and about 80-90 kilometres from Mumbai coast, is designed to carry forward the success of the previous two phases of redevelopment through installation of booster compressors. The incremental production is expected to start in 2014-15 with peak incremental production rate of 10 million standard cubic meters per day of gas, 950 barrels of oil per day and about 1100 cubic meters of condensate a day by 2017-18. The cumulative production till 2027-28 is pegged at 19.56 billion cubic meters of gas, 1.97 million cubic meter of condensate and 1.83 million tons of oil. The gas and condensate will be evacuated to Hazira Plant. The project envisages drilling of 18 wells including 5 subsea Wells, installation of one new process platform having gas processing and compression facilities, one nine-slot well head platform and other facilities, associated pipelines and one living quarter platform. The project is scheduled for completion by April 2017. (economictimes.indiatimes.com)

November 14, 2014. Canada's Niko Resources Ltd said it was evaluating plans for its oil and gas assets in India, citing uncertainty related to the outlook for natural gas prices in the country. Niko owns 10 percent in the D6 Block, off the eastern coast of India. BP Plc has a 30-percent stake in the block, while the rest is owned by India's Reliance Industries Ltd. The company also holds a stake in the Hazira field in western India. Gas output from the block has fallen sharply over the past few years. Reliance says the decline is due to the geological complexity of the block, while the Indian government believes contractors have failed to drill the promised number of wells. Demand for gas in India far outstrips production, but prices have been kept low for important industries such as fertilizer production and power generation, deterring investment in the sector. The Indian government increased gas prices by 33 percent to $5.61 per million British thermal unit from Nov. 1 and is expected to revise rates every six months. Domestic gas producers such as Reliance Industries and ONGC insisted on a price hike because the cost of exploring new reserves is more than the current price, leaving them reluctant to take the risk. Niko said it would receive a cash benefit of $4 million thanks to the jump in gas prices, but added that it remained concerned about long-term prices. (in.reuters.com)

November 17, 2014. PSU refiners, who account for about two-thirds of the country's oil processing capacity, are seeking more flexibility in import contracts as they look to tap new sources of supply flushed out by the U.S. shale boom. India, the world's fourth-biggest oil consumer with refining capacity of 4.3 million barrels per day, imports 80 per cent of its crude needs and has traditionally relied on the Middle East for heavy oil supplies and West Africa for lighter, sweet crude. A push to include both fixed and optional volumes in contracts would allow refiners to fill some of their needs from cheaper spot cargoes now on offer from suppliers such as Algeria, Latin America and Canada as U.S. demand has dwindled. The Indian government is also looking to help the industry by changing regulations to lower shipping costs, and widening a list of multinationals eligible to supply oil under term deals. Bharat Petroleum Corp Ltd (BPCL) has negotiated a flexible contract with Chevron for West African grades and with Malaysian state oil firm Petronas. Hindustan Petroleum Corp Ltd (HPCL) has similar contracts with Total for Iraqi Basrah, Petronas and Kuwait. The company has also offset the impact of a fall in global oil prices to four-year lows by paying for spot crude on the basis of prices in the month of loading and the subsequent month, rather than just the month of loading. Mangalore Refinery and Petrochemicals Ltd (MRPL) bought oil from Argentina while Indian Oil Corp (IOC), which has small term deals with Latin American nations, shipped in Canadian barrels. (economictimes.indiatimes.com)

November 16, 2014. Prime Minister (PM) Narendra Modi is likely to inaugurate the much awaited ` 35,000 crore refinery project of Indian Oil Corp (IOC) in March next year, Union Petroleum Minister Dharmendra Pradhan said. The 15 million tonnes per annum (mtpa) capacity oil refinery project of IOC in final stage of completion, is expected to be commissioned in March 2015, Pradhan said while laying the foundation stone of a Poly-Propylene plant. Recalling that former Prime Minister Atal Bihari Vajpayee had laid the foundation stone for the refinery project, Pradhan said its inauguration would be done by Modi. Describing the state-of-the-art refinery as the largest of its kind in the country, the Minister said it would refine all kinds of crude and produce petrol, diesel, LPG, propylene and ATF. Paradip Refinery, which is set to be among the most advanced refineries in the country, would cater to the energy needs of Odisha, Andhra Pradesh, Madhya Pradesh, Uttar Pradesh, Bihar, Jharkhand, Chattisgarh and West Bengal, he said. To draw full advantage of the industrial growth that would be ushered in by Paradip refinery, and to enlarge the kitty of value added products, several other petro-chemical projects have also been envisaged in the area, IOC said. (economictimes.indiatimes.com)

November 13, 2014. Indian Oil Corp (IOC) has deferred a planned shutdown of key units at its Koyali refinery in western Gujarat state to March-April 2015 from around October this year to capitalize on sliding crude prices. IOC had initially planned maintenance shutdowns of a cooling tower, the fluid catalytic cracker and other facilities at Koyali in September-October. IOC had already cut throughput at five refineries in September after heavy rains curbed demand for diesel in northern and eastern regions of the country. The maintenance shutdown in March-April means most of the five crude units at Koyali, which has a refining capacity of 274,000 barrels per day (bpd), will not operate for 10-30 days. (economictimes.indiatimes.com)

November 12, 2014. Indian Oil Corp (IOC) has cleared the ` 5,150 crore Ennore-LNG Terminal project, to be set up jointly with Tamil Nadu Government. The land for the project has been acquired and the plant will have 5 million tonne capacity. IOC and Tamil Nadu Industrial Development Corp (TIDCO) had signed pacts for setting up the terminal. The terminal is expected to be commissioned by 2017. Indian Oil, which has stakes in British Columbia and Petronas in Malaysia, would look for import of LNG once the Ennore plant comes into operation. While Indian Oil holds 45 per cent stake, 5 per cent is with TIDCO and the remaining 50 per cent with investors. The company is also in discussions with several companies for a Joint Venture on the Ennore-LNG Terminal project. On the status of LPG project in Tamil Nadu, IOC said the ` 78 crore LPG plant is expected to soon be commissioned in Tirunelveli. On the Paradip Refinery project, IOC said 97 per cent of it was completed and was expected to be commissioned by March 2015. On whether the company would look at setting up new projects in Andhra Pradesh, IOC said the oil major was looking at setting up a pipeline, connecting Paradip to Hyderabad. IOC has set up a toll free number 1800-233-3555 for receiving complaints related to supply of LPG. (economictimes.indiatimes.com)

November 18, 2014. With global energy firms refusing to participate in the ambitious TAPI gas pipeline, India may propose getting a Chinese company to lead a consortium that will build the USD 10 billion Turkmenistan-Afghanistan- Pakistan-India (TAPI) gas pipeline. French giant Total SA had initially envisaged interest in leading a consortium of national oil companies of the four nations in the TAPI project, but backed off after Turkmenistan refused to accept its condition of a stake in the gas field that will feed the pipeline. Since the four state-owned firms, including GAIL of India, neither have the financial muscle nor the experience of cross-country line, an international company that will build and also operate the line in hostile territories of Afghanistan and Pakistan, is needed. Turkmenistan has clearly indicated that its law does not provide for giving foreign firms an equity stake in upstream gas field, without which western energy giants will not be interested to take the risk. The issue of quickly getting a consortium in place will be discussed at the 19^th Steering Committee meeting of TAPI pipeline project in Turkmenistan where India will be represented by Oil Minister Dharmendra Pradhan. New Delhi may present three options at the meeting. First, to get a US firm as the consortium leader after Turkmenistan allows US to enter its upstream sector. Alternatively, the consortium of four partner countries or Turkmen Gas of Turkmenistan can become the leader. This option was acceptable to Afghan side and in case India agreed, the Pakistan side too may agree. But this option is fraught with funding and regional security issues. As a last option, a Chinese company can be brought in as a consortium leader. The Chinese are less likely to insist on an upstream stake in this project as they are already present in Turkmenistan. GAIL, along with national oil companies of Turkmenistan, Afghanistan and Pakistan set up TAPI Pipeline Company, a firm that will build, own and operate the gas pipeline across the four countries. The Asian Development Bank is helping the four nations build a 56-inch diameter pipeline from Turkmenistan's giant Galkynysh gas field to serve energy markets in Afghanistan, Pakistan and India. The TAPI pipeline will have a capacity to carry 90 million standard cubic metres a day (mmscmd) gas for a 30-year period and will be operational in 2018. India and Pakistan would get 38 mmscmd each, while the remaining 14 mmscmd will be supplied to Afghanistan. TAPI will carry gas from Turkmenistan's Galkynysh field, better known by its previous name South Yoiotan Osman that holds gas reserves of 16 trillion cubic feet. From the field, the pipeline will run to Herat and Kandahar province of Afghanistan, before entering Pakistan. In Pakistan, it will reach Multan via Quetta before ending at Fazilka (Punjab) in India. (economictimes.indiatimes.com)

November 17, 2014. India bought 60 percent more Iranian oil in October than a year ago as refiners held to higher volumes despite signs that world powers and Iran might not reach a final agreement on Tehran's disputed nuclear programme before a Nov. 24 deadline. A year of negotiations has not resolved deep disagreements between Iran and the major powers, and a final deal is unlikely by the November date. Any agreement would likely be followed by a rapid increase in Iran's oil exports at a time when global markets are already under pressure from a supply glut. India, Iran's top oil client after China, imported about 309,900 barrels per day (bpd) of crude in October from Tehran, tanker arrival data obtained from trade sources shows, the highest since March and up 28 percent from September. India's oil imports from Iran rose about 40 percent over January-October, partly due to a surge in the first quarter as an interim agreement easing Western sanctions went into effect. Growth in Iranian oil imports this year was also due to a bounce off the low base of last year, when shipments were hit hard due to insurance problems triggered by the sanctions, particularly over the April-August period. Private refiner Essar Oil was the biggest buyer of Iranian oil in October followed by Mangalore Refinery and Petrochemical Ltd (MRPL). (in.reuters.com)

November 17, 2014. The government is backing distributor Indraprastha Gas Ltd (IGL) in the Supreme Court in its dispute against the Petroleum and Natural Gas Regulatory Board (PNGRB) over transportation tariffs for the fuel supplied in Delhi through pipelines. The outcome of the case will likely determine the future of the regulator when it comes to regulating prices of compressed natural gas delivered to vehicles and piped natural gas to homes in the city. The regulator issued a notification in April 9, 2012, fixing network tariffs and compression charges to be levied by IGL with effect from April 1, 2008. It also asked IGL, which has a monopoly over gas distribution in Delhi, Noida, Ghaziabad and Greater Noida, to reveal these two specific components to consumers in its invoices in the interests of transparency. IGL challenged this in the Delhi High Court and won. It argued that it cannot be forced to reveal cost components as this was commercial information and contested the board's powers on this score. IGL had always submitted tariff data to it and this was part of the process of fixing these two components. But the high court ruled that since the government had not yet notified Section 11(e) —which empowers the board to monitor natural gas prices— of the Act under which the regulator was set up, it could not fix these rates. (economictimes.indiatimes.com)

November 13, 2014. State run natural gas company GAIL (India), along with state gas companies of Turkmenistan, Afghanistan and Pakistan has set up a company that will build, own and operate 1,800-kilometer of gas pipeline across Turkmenistan-Afghanistan-Pakistan-India (TAPI). The company has been incorporated as a Special Purpose Vehicle (SPV) in the Isle of Man, a British Crown dependency and has been named TAPI Pipeline Company. It would be responsible for finance, design, construction, operation and maintenance of the TAPI pipeline. Turkmenistan's national gas company Turkmengas, Afghan Gas Enterprise, Inter State Gas Systems (Private) and GAIL will own equal stake in TAPI Pipeline Company. The TAPI pipeline will export up to 33 billion cubic meters of natural gas a year from Turkmenistan to Afghanistan, Pakistan, and India over 30 years. This will enable the landlocked Turkmenistan, which has the world's fourth-largest proven gas reserves, to expand its gas export market while supplying fuel to energy starved Afghanistan, Pakistan, and India. The pipeline is expected to carry 90 million standard cubic metres per day (mmscmd) gas, of which India and Pakistan would get 38 mmscmd each. Afghanistan's share would be 14 mmscmd but the country has indicated that it may only take 1.5-4 mmscmd, which will result in the balance being shares equally by India and Pakistan. ADB, the advisor for the TAPI gas pipeline project, had advised setting up a TAPI pipeline company such that a consortium leader can be identified to spearhead the operation of the pipeline. (economictimes.indiatimes.com)

November 18, 2014. India expects foreign investment in the petroleum sector, Oil Minister Dharmendra Pradhan said. He said Indian trade has got a boost after Narendra Modi became the Prime Minister. Pradhan, who will represent India at the 19^th Steering Committee meeting of TAPI pipeline project in Turkmenistan, said the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline will benefit India enormously. He said that the matter of quickly getting a consortium in place will be discussed at the meeting. (economictimes.indiatimes.com)

November 18, 2014. The government has turned to oil diplomacy to secure better fuel supply contracts, a move that industry officials say can cut India's import bill by at least ` 10,000 crore. The initiative comes at a time when the members of the Organization of the Petroleum Exporting Countries (OPEC) are battling for market share amid competition from new energy suppliers. Gulf countries too have shown heightened interest in investing in India, particularly after Narendra Modi became the prime minister. India depends heavily on term contracts with Middle East countries, which announce a monthly official selling price. Oil industry executives and officials say the country will save about ` 9,000 crore a year for every $1 reduction in price. Recently, Saudi Arabia raised the price for Asian buyers, but cut it for the US, where the shale revolution has lifted oil output to the highest in three decades. India feels that as one of the largest importers from the Middle-east it too is entitled to such concessions. OPEC heavyweights like Saudi Arabia are fighting to protect their market share, and have resisted calls for a supply cut even after crude prices slumped 30 per cent. Oil Minister Dharmendra Pradhan has recently been to Saudi Arabia, OPEC's biggest supplier. (economictimes.indiatimes.com)

November 17, 2014. In first signs of dissent over the new gas pricing, Gujarat government firm GSPC has demanded market price for its output from KG basin fields saying it cannot be forced to sell fuel at a rate which is less than the cost of production. Days after the October 18 government decision to raise natural gas prices to $5.61 per unit from $4.2, Gujarat State Petroleum Corp (GSPC) shot off a letter to the Oil Ministry, demanding “market determined price” for its ready-to-produce Deen Dayal West (DDW) fields in Bay of Bengal. The firm owned and run by the Gujarat government had discovered a market formula that gives a price of about $10.5 per million British thermal unit at current oil rate of $80 per barrel. (freepressjournal.in)

November 17, 2014. An early call of the Narendra Modi government, urging people to voluntarily give up subsidies on cooking gas cylinders has signed up just 0.006% of the customer base of 15 crore connections. In three months since the government exhorted people to give up subsidies on their gas cylinders, just 8,868 people or entities have opted to voluntarily part with subsidies, an embarrassing civic consciousness statistic in a country that takes pride in its ever expanding list of millionaires. And, hardly any of them are occupants of bungalows in Lutyen's Delhi or Mumbai's plush Cuff Parade areas. There are many expatriates, embassies, schools and people from lesser known parts of the country including Begusarai, Cuttack, Guntur, Bhavnagar, Ladakh and Durg, who have chosen to pay the market price for cooking gas. Many posh localities in New Delhi and Mumbai get supply of non-subsidised piped natural gas, hence names of ministers and industrialists are not shown on the list of people who have surrendered their subsidy claims. Oil Minister Dharmendra Pradhan plans to launch an aggressive campaign to persuade about one crore people to give up subsidy. This will save about ` 3,500 crore in the annual LPG subsidy bill. The oil ministry had first appealed to executives of oil companies to voluntarily give up LPG subsidy through a specially created portal in July this year. In August, Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp directly sent text messages to millions of customers to surrender their subsidy claims in the name of nation building. According to data provided by some gas agencies, government and private schools and embassies in New Delhi have taken a lead in giving up subsidy, which will save about ` 4-5 crore in subsidy bill annually. (economictimes.indiatimes.com)

November 15, 2014. Diesel prices in Punjab went up by about 77 paise a litre with SAD-BJP-led government raising value added tax (VAT) on diesel by 1.5 per cent to 11.25 per cent. The hike in VAT on diesel has led to diesel price jumping to ` 53.38 a litre from ` 52.61. The diesel rates in the state vary from area to area due to transportation charges. The opposition party Congress has lashed out at the state government for increasing VAT. Significantly, the fresh hike in VAT on diesel in Punjab came barely after one and half month with new rate of VAT being fixed at 11.25 per cent (excluding 10 per cent surcharge). Earlier, Punjab government had raised VAT on diesel by one per cent to 9.75 per cent with effect from October 1, the move which had led to fuel prices going up by 55 paise a litre. As per notification issued by Punjab Excise and Taxation department regarding 'change in rate of diesel', the VAT rate on diesel other than premium diesel has now been revised to 11.25 per cent. Punjab also levies 10 per cent surcharge on VAT rates. Petroleum dealers said that they received the message from Punjab Excise and Taxation department about increase in VAT on diesel. Notably, the recent reduction in diesel prices by the Centre had caused revenue loss of up to ` 20-25 crore per annum to Punjab. While Punjab levies tax on petroleum items as per 'ad valorem' method, any increase or decrease in prices of fuel cause affect in tax mobilisation to the state kitty. As per 'ad valorem' method, the tax is charged as per value of goods or services. Punjab annually collects about ` 2,100 crore of tax from petrol and diesel. Interestingly, Union Territory Chandigarh slashed VAT on diesel from 12.5 per cent to 9.68 per cent in order to bring parity with the tax rate in Punjab, thus giving a relief of ` 1.40 per litre in diesel rates. Meanwhile, Congress Legislature Party leader Sunil Jakhar described the SAD-BJP government move of raising VAT as anti-farmer and anti-industry. (economictimes.indiatimes.com)

November 15, 2014. All consumers will have to buy cooking gas at market rates from New Year's Day as the government has issued firm instructions that the subsidy will be transferred directly to bank accounts as it seeks to end illicit supplies to restaurants, cars and factories, besides slashing the subsidy bill and boosting private investment. After recently eliminating the diesel subsidy, which had ballooned to ` 62,837 crore, Oil Minister Dharmendra Pradhan has ordered state oil companies to ensure that the scheme — which is being launched as a pilot for 2.33 crore customers in 54 districts — is smoothly expanded to the entire country on January 1, 2015. Some oil industry executives had expressed doubts about the successful rollout of the scheme to the entire country in barely six weeks of the launch in 54 districts after the UPA government botched up the programme after expanding it to 291 districts just before the general election. It had been forced to withdraw the programme after Congress leaders said it was costing them votes. The oil ministry is, however, confident about success this time around. Under the modified DBTL (direct benefit transfer of LPG), a consumer will be eligible for subsidised LPG cylinders even without the Aadhaar number, Pradhan said. Consumers without the unique ID will also receive cash directly in their bank accounts. They can switch to Aadhaar-based cash transfers once they have been enrolled by informing dealers and banks. Customers have six months to tell LPG dealers their bank account numbers without losing the subsidy amount. While subsidised cylinders will be delivered to them in the first three months, they will have to buy at market rates after that. The subsidy will be remitted to their bank accounts within the next three months. For the first subsidy payment, the money will be transferred to the bank account of consumers as soon as they make the first booking for a cylinder after joining the scheme, prior to delivery. This advance ensures that consumers have extra cash to pay for the first cylinder at market price. The permanent advance shall be notified for consumers now joining the scheme separately. (economictimes.indiatimes.com)

November 14, 2014. The government has raised the excise duty on petrol and diesel by ` 1.50 a litre to raise ` 6,000 crore in the current fiscal without raising retail prices, as crude oil's sharp fall is helping both consumers and the exchequer. Oil companies were earlier planning a big cut in petrol and diesel prices after the fortnightly review. The increase in excise duties would significantly reduce the reduction in rates. They may also defer the price cut and offer a bigger reduction by the end of the month during ongoing polls in Jaharkhand and Jammu and Kashmir. (economictimes.indiatimes.com)

November 13, 2014. Days ahead of the first payment by customers at the new gas price, the Oil Ministry is grappling with the issue of how to bill the gas produced from Reliance Industries' main fields in the KG-D6 block. As per the 15-day billing cycle, gas producers are to raise the first invoice at the revised price of $ 5.61 per million British thermal unit (mmBtu). However, there is still no clarity on how to invoice the fuel from RIL's D1&D3 fields, which is to be sold at the old rate of $ 4.2 per mmBtu. While announcing an across-the-board 33 per cent hike in natural gas prices, the government had stated that customers of D1&D3 gas will pay the revised rates but RIL will get only $ 4.2, with the difference being deposited in a gas pool account maintained by GAIL. The Oil Ministry is still grappling with the easier option of allowing RIL to raise bill at new rate of $ 5.61 and then depositing $ 1.41 in the gas pool account. (economictimes.indiatimes.com)

November 12, 2014. In a bid to make it easier to produce oil and gas, the government has notified a set of rules granting operational flexibility to firms like Cairn India and ONGC to start producing from several discoveries that are mired in contractual disputes. The Petroleum Ministry in a notification relaxed rigid timelines prescribed in the Production Sharing Contract (PSC) for development and production of oil and gas. Operational flexibility has been provided in enforcing contracts by way of relaxing some of timelines prescribed for discoveries so that E&P activities do not suffer on account of excessive rigidity in decision making. The PSC between the government and the explorer has rigid timelines for each stage of exploration and actions have been initiated against firms even if deadlines are missed by a day. The notification said 3-6 months extension in the current 18-60 month timeframe for submission of declaration of commerciality (DoC) of discoveries, a prerequisite before investment plans can be finalised, can be given. Also, the deadline for submission of investment plan for the discoveries too would be extended by up to six months. The PSC provides for time period for submission of field development plan (FDP) for hydrocarbon discovery after DOC. There is no provision in the PSC for extension of this time period and non-acceptance of FDP due to late submission results in non-monetisation of discoveries. Also, upstream regulator DGH has been given flexibility to accept discoveries for which operators had failed to provide prior notification to the government. The notification also provided for reduction in committed work programme in case a block or its part is not available for exploration activities consequent to denial of permission by government agencies. Currently, discoveries, mostly of Cairn, ONGC and GSPC are stuck because of lack of flexibility in timelines. These include 10 finds of Cairn in Rajasthan which have not been endorsed by the Directorate General of Hydrocarbons (DGH). Besides FDP approvals for more than two dozen finds are held up for some or the other reason. Fifteen discoveries lie abandoned in areas that have been relinquished by operators. (economictimes.indiatimes.com)

November 12, 2014. State oil firms plan to cut petrol rates for the seventh time since June and diesel for the third time since the fuel was decontrolled on October 18 as Indian consumers gain from the sharp fall in global oil prices before polls in Jharkhand and Jammu & Kashmir. Industry experts said according to current trend Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL) are likely to reduce pump price of petrol and diesel by about ` 1 per litre. For consumers, the two fuels are already 10%-13% cheaper than their peak earlier in the year. IOC, BPCL, HPCL to go for round III of fuel price cuts, reduction likely on November 15 The cuts could be steeper depending on further slide in international prices of auto fuels in next four days. The government has allowed state fuel retailers to align pump prices of petrol and diesel with international market. Benchmark Brent crude dropped four years low at around $82 per barrel. Last time, oil companies reduced petrol prices by ` 2.41 per litre and diesel by ` 2.25 on Oct 31. So far, companies have reduced petrol prices by 13% or ` 9.36 per litre in six consecutive rate revision. They reduced diesel price by about 10% or ` 5.62 per litre in just two revision since the fuel price was deregulated on Oct 18. Currently, petrol is sold at ` 64.24 per litre in Delhi and diesel at ` 53.35 per litre. Companies are also expected to marginally reduce revenue losses on cooking gas, where they are losing about ` 394 per 14.2 kilogram cylinder. The government deregulated diesel prices last month. Companies also enjoys petrol pricing freedom since June 2010. But, this freedom is not absolute as companies would require tacit approval of the oil ministry before changing pump prices of petrol and diesel. It is likely that the government would not pass the entire pricing benefits to the consumer for political reasons. The international oil market is highly volatile and a cushion is required to absorb pricing shock if rates move north, especially during month-long assembly elections. (economictimes.indiatimes.com)

 [NATIONAL: POWER]

November 18, 2014. International Coal Ventures Pvt Ltd (ICVL), the Indian group that bought Rio Tinto Group’s coal-mining assets in Mozambique for $50 million this year, plans to build a power plant in the country. The coal-fired facility will be developed “very soon,” ICVL, as the New Delhi-based group is known, said. ICVL is already exporting coking coal for steelmaking from Mozambique, ICVL said. The plant ICVL plans at the Benga asset will be one of a number of power projects proposed for the northwestern Mozambican province of Tete. The province is home to the country’s richest coal deposits and also the 2,075 MW Cahora Bassa dam and hydroelectric plant, which supplies Mozambique, South Africa, Zimbabwe and Zambia. ICVL comprises Steel Authority of India Ltd and Rashtriya Ispat Nigam Ltd, iron-ore miner NMDC Ltd, power generator NTPC Ltd and coal producer Coal India Ltd. It completed a transaction to buy London-based Rio Tinto’s 65 percent stake in the Benga coal mine along with its undeveloped coal assets at Zambeze and Tete East. (www.bloomberg.com)

November 17, 2014. Bharat Heavy Electricals Ltd (BHEL) has commissioned the second module of ONGC Thermal Power Corp's gas-based power plant in Tripura, completing the combined-cycle power project that would use gas from Oil & Natural Gas Corp's adjoining fields in the northeastern state. The plant comprises two modules of 363.3 MW each, equipped with fuel efficient advanced gas turbines. BHEL commissioned the first module of 363.3 MW in January 2013. BHEL has so far commissioned 911 MW of gas-based and hydroelectric stations in Tripura, accounting for 100% of the state's generation capacity. Across the country, it has built nine modules of power turbines in the combined cycle mode, where waste heat from a gas turbine generator is used to run a steam turbine to produce additional electricity. BHEL has previously commissioned 14 gas turbines in Tripura, but their capacity was limited to a maximum of 21 MW because constraints to transport equipment to project sites. The Palatana project is the largest of its kind in the entire northeastern part of India. BHEL is executing another gas-based project of 100 MW for North Eastern Electric Power Corp at Monarchak in Tripura. (economictimes.indiatimes.com)

November 16, 2014. India and Nepal are likely to sign an agreement for the construction of a 900 MW power project and another one for starting a direct bus service between Kathmandu and New Delhi during the visit of Prime Minister Narendra Modi for the upcoming SAARC summit. The agreement for the Arun Hydropower Project being developed by Satluj Vidyut Nigam will be signed after the two countries had finalised a Power Development Agreement (PDA) for constructing the 900 MW Upper Karnali power project being developed by GMR consortium. (economictimes.indiatimes.com)

November 13, 2014. Tyuni Palasu and Aracot Tyuni, two key hydel projects which were allotted to the Uttarakhand irrigation department, are yet to see the light of day despite the acute power shortage being faced by the hill state. Both the projects are in various stages of clearances, the irrigation department said. After the allotment of the two hydel projects in 2008, the department had decided to set up a corporation to develop power plants in the hill state. But after Uttarakhand Parvitya Vikas Priyojana Nigam came into existence, the irrigation department officials did not show any interest to join the new corporation. Though the department is hopeful of bagging more contracts in the near future to develop hydel projects in the state, the corporation remained in dormant stage during the last 3-4 years. This despite the fact that the hill state has 20,000-30,000 MW of hydropower potential whereas only 3600 MW has been tapped till date. (www.business-standard.com)

November 18, 2014. State-owned Power Grid Corporation said its board approved two transmission projects worth over ` 1,000 crore. The transmission major would be implementing two projects valued at ` 1,046.71 crore, it said. The company would carry out sub-station works associated with system strengthening in Southern region for import of power from Eastern Region at an estimated cost of ` 972.42 crore. This project is to be commissioned within 36 months from the date of investment approval. Besides, Power Grid Corporation of India would be implementing a "Common Transmission Scheme associated with ISGS Projects in Nagapattinam / Cuddatore Area of Tamil Nadu - Part-A1(b) at an estimated cost of ` 74.29 crore". This project has a completion schedule of 30 months. (economictimes.indiatimes.com)

November 17, 2014. JSW Energy has acquired two of Jaiprakash Power Ventures’ hydro power plants, with a combined capacity of 1,391 MW, for ` 9,700 crore. Jaiprakash Power Ventures, a fully owned subsidiary of the Jaypee group, has approved the 100 per cent transfer of businesses of its operating power plants — the 300-MW Baspa-II hydroelectric plant (commissioned in 2003) and the 1,091-MW Karcham Wangtoo plant (commissioned in 2011), in Himachal Pradesh. The price paid by JSW Energy was higher than what analysts has estimated. Reliance CleanGen had decided to buy Jaypee’s entire hydro portfolio but that deal had run into regulatory troubles. Before that, Abu Dhabi’s Taqa had pulled out of a deal to buy the assets for ` 9,689 crore. After the acquisition, JSW Energy’s aggregate installed and operational power-generation capacity has reached 4,531 MW. (www.business-standard.com)

November 14, 2014. Sterlite Grid Ltd, a subsidiary of Sterlite Technologies Ltd, commissioned India’s first Ultra Mega Transmission Project. The first line in this project connecting Purnea and Bihar Sharif was commissioned in September 2013, which was the first 400 KV line to cross the river Ganges since Independence. The second line, which is about 225 km long, connects Bongaigaon in Assam to Siliguri in West Bengal. The 400 KV double-circuit quad transmission line was commissioned making the East-North Interconnection Company Ltd (ENICL) fully operational. ENICL project transmission lines were identified as one of the highest priority lines by Power System Operation Corporation Limited (POSOCO) as they provide critical connectivity for transfer of power from the power plants in the North Eastern (NE) region. Also, this project will address the critical issue of power shortfall during non-monsoon months bringing significant relief to the residents of Assam. Transmission lines in this project pass through some of the most difficult terrains in Bihar, West Bengal and Assam. The construction of these lines were completed by overcoming several challenges including natural calamities like floods & earthquakes, crossing of large rivers such as Ganges, Teesta, Kosi etc., riots in Kokrajhar and right-of-way hurdles. (www.business-standard.com)

November 13, 2014. Power engineering companies are looking up to the ambitious Integrated Power Development Scheme (IPDS) announced by the government. IPDS, announced in the Union Budget this year, aims to strengthen the transmission and last mile connectivity and metering of power entailing an investment of ` 32,600 crore. According to ABB India, many state electricity boards are now investing in transmission infrastructure and upgrading the grid with better technology. Under IPDS, the Centre would help by way of extending financial assistance to the state to create distribution infrastructure in urban and semi urban areas. Besides the IPDS, regional transmission plans could also push up investment. One such programme, recently approved by the Union Cabinet, was strengthening of the intra-state transmission and distribution system in Arunachal Pradesh and Sikkim at a cost of ` 4,754.42 crore. Indian Electrical and Electronics Manufacturers Association (IEEMA) reported a fall in manufacturing for the sector during 2012-13 - the first time in 10 years. Manufacturing of electrical equipment was growing at 11.3 per cent and 13.7 per cent in 2009-10 and 2010-11, respectively, decelerating to 6.9 per cent in 2011-12. The transmission and distribution equipment sector witnessed a negative growth of 7.8 per cent in 2012-13. In 2013-14, there was a minuscule growth of 3.5 per cent in the production. (www.business-standard.com)

November 12, 2014. East Godavari district superintendent engineer S Gangadhar said that electrical repair works worth ` 62 crore have been done in Visakhapatnam, worst-effected by cyclone HudHud that hit the Andhra coast. Gangadhar said that 3,500 staffers were engaged to expedite the work of power restoration in the cyclone-ravaged district. Power supply has been restored and 2,83,636 service connections repaired in 491 villages of 24 mandals of Visakhapatnam district, he said. During the work, staffers of the electricity board in East Godavari tirelessly worked in the power restoration process in the neighbouring district. (economictimes.indiatimes.com)

November 12, 2014. India, the world's third-largest buyer of overseas coal, may be able to stop imports of power-generating thermal coal in the next three years as state behemoth Coal India steps up production, Power and Coal Minister Piyush Goyal said. Prime Minister Narendra Modi's government has asked Coal India, the world's largest miner of the fuel, to more than double its output to 1 billion tonnes by 2019 to feed existing and upcoming power plants. Modi has promised round-the-clock power to all Indians by 2022 and recently announced that the nationalised coal industry would be opened up to allow private firms to compete with Coal India, which accounts for 80% of the country's output. Declining shipments to India would drag on global coal markets grappling with oversupply as top consumer and importer China tries to shift towards cleaner fuels. Coal generates three-fifths of India's power, but a shortage of the fuel means millions still go without electricity and power cuts are common. Around 60 of India's 103 power plants had enough coal for less than a week's usage as of November 2 due to lower supplies from Coal India. Imports of coal have been surging as a result, equating to about 1% of India's economy. Shipments rose to 168.4 million tonnes (MT) last fiscal year, and the government estimated earlier this year that the domestic shortage would range between 185 and 265 MT by 2016-17. Some analysts, however, were sceptical the country would be able to end imports soon. (www.business-standard.com)

November 12, 2014. The battle to grab high-end consumers in Mumbai has escalated as government-owned Brihanmumbai Electric Supply & Transport Undertaking (BEST) plans to approach the Supreme Court to inhibit Tata Power from cherry-picking valued customers in Mumbai. BEST, which charges the highest tariff in the city, had earlier approached the state and the central power regulators. It plans to increase rates by 14% to 16% from April. The company buys the bulk of its power requirement of close to 932.5 MW from Tata Power despite their rivalry. The Maharashtra Electricity Regulatory Commission (MERC) had issued a distribution license to Tata Power expanding its network of operations to include Mumbai, which was previously only served by BEST. It had also revoked all earlier directions issued by the commission restricting Tata Power's network expansion and supply to identified categories, consumers or areas. Already a section of high-end BEST consumers are keen to migrate to Tata Power in order to avail of cheaper power tariffs, and certain commercial entities operating in the island city have already applied to TPC for load consumption of nearly 45 MW. BEST had warned that it will have no choice but to hike electricity tariffs, as well as bus fares if Tata Power is allowed to enter the city, that stretches from Colaba to Mahim. The company said that if Tata Power is allowed to come in, it needs to restructure its finances especially as it was cross-subsidising its transport wing with the profits it makes in the power business. Currently, the BEST charges its low-end consumers in the city, who consume less than 300 units a month, ` 3.36 per unit, while highend consumers like factories and corporate offices are charged ` 9.99 per unit. The average BEST billing rate of ` 10.93 per unit is almost 40% higher than that of the TPC rate of ` 7.10 per unit. (economictimes.indiatimes.com)

November 18, 2014. Delhi's power regulator DERC is unlikely to effect any hike in power tariff before the assembly polls though it has sought from private discoms details about cost of power purchase to take a final call on re-introducing a surcharge. The power department said there was no possibility of any hike in electricity tariff even as private discoms have been pressing for it citing financial crunch. DERC said the Commission had sought additional information about cost of power purchase from the discoms and a decision on the tariff hike will be taken after examining the details. The Delhi Electricity Regulatory Commission (DERC) withdrew a tariff hike of up to seven per cent less than 24 hours after announcing it, apparently coming under political pressure. The DERC had hiked the tariff by re-introducing the power purchase adjustment cost (PPAC) surcharge to help the discoms meet the rise in power purchase cost. Withdrawing the hike, the DERC had said it was rolled back "realising" that a number of power generation companies including NTPC, which supply electricity to the city, provided only part information about price of fuel such as coal and gas. (economictimes.indiatimes.com)

November 18, 2014. Indian billionaires seeking to regain lost coal mining permits face rising debt at their companies when they take part in auctions the government plans to hold early next year. Aggressive bidding may increase acquisition costs, while staying away isn’t an option as that would wreck projects, according to Hindalco Industries Ltd, Jindal Steel & Power Ltd and Monnet Ispat & Energy Ltd. India’s top court in September cancelled almost all of the 218 coal mining permits given since 1993, terming the allocations arbitrary and illegal. Indian metal makers, utilities and cement producers are among those hurt most by the Supreme Court decision that came amid cooling demand and the slowest pace of economic growth in a decade. The companies are looking to get the assets back to protect earnings as the government, according to the coal ministry, plans to auction 74 coal mines by March 31, including 40 operational ones. The nation’s top court rescinded the licenses tainted by graft allegations after the state’s auditor in 2012 found that giving away the mines without an auction may have cost the exchequer ` 1.86 trillion ($30 billion). India changed its law in 2010 to adopt a policy of auctions for granting coal mining permits to companies for their own use. No mine has so far been awarded through bids. (www.bloomberg.com)

November 18, 2014. At a time when Maharashtra Chief Minister (CM) Devendra Fadnavis is looking to roll out the red carpet to investors, the state finance ministry has come out against the power subsidy announced by the previous government. The state bears a monthly subsidy burden of ` 706 crore after the Prithviraj Chavan government approved 20% cut in power tariff across categories for Maharashtra State Electricity Distribution Company (MahaVitaran) users. With the revenue deficit rising to ` 26,000 crore during the current fiscal from ` 4,500 crore earlier, finance minister Sudhir Mungantiwar has made a strong case for reconsideration of the subsidy. Taking a cue from the Aam Aadmi Party government in Delhi, the Chavan government had on January 20, 2014 approved a 20% cut in power tariff for MahaVitaran users. Of MahaVitaran’s 21.4 million consumers, 14.3 million are residential, 3.7 million agricultural, 1.47 million commercial and 3,70,000 industrial of which 12,000 are high-tension power consumers, with a monthly consumption of 1 MW or above. The state government was to provide ` 606 crore of the ` 706 crore and the balance ` 100 crore was to be equally shared by MahaVitaran and the Maharashtra State Transmission Company (MahaTransco). The government had projected an annual burden of ` 8,472 crore with this move, which was in addition to an annual subsidy of ` 11,000 crore provided to agricultural consumers and ` 1,100 crore to power looms. (www.business-standard.com)

November 18, 2014. The government is considering financial relief for about 16,000 MW of stranded gas-based power plants by way of lower interest rates and extension of loan tenures. The ministries of power, finance and oil are working on various proposals that include lowering interest rates to base levels or even lower, extending loan repayment period to about 25 years from 10 years and allowing these plants to capitalise losses over a certain period after the start of commercial operations. Companies such as Reliance Power, Essar Power, GMR Energy, Lanco Infratech and GVK Group will benefit if the proposals are accepted. The proposals are being mulled to support the Centre's plan to offer domestic and imported gas at 'pooled' price to the fuel-starved power plants. The additional proposals have been made to reduce an expected ` 17,000 crore support that the Centre proposed to draw in three years from National Clean Energy Fund to keep electricity tariffs under check at ` 5.5 per unit. (economictimes.indiatimes.com)

November 17, 2014. The government of India is pushing ahead aggressively with plans to raise about $3.6 bn by selling a 10 per cent stake in state-backed mining group Coal India, taking advantage of buoyant local stock markets which hit new record highs. The Coal India divestment comes alongside a second move to raise about $3 bn by offloading a 5 per cent stake in public sector energy explorer Oil and Natural Gas Corp (ONGC), a sale that is likely to be launched in December. By pushing the Coal India stake sale, Prime Minister (PM) Narendra Modi’s government seeks to take advantage of strong demand from investors, who view Asia’s third-largest economy as the brightest prospect among major global emerging markets, say those involved in the process. The stake sale is being led by a consortium of banks, including Goldman Sachs, Credit Suisse, Bank of America Merrill Lynch and Deutsche Bank. The urgency behind the sale comes as Modi races to meet a self-imposed target to raise about $10 bn from the sale of minority stakes in state-backed businesses. That goal in turn is a crucial component of his plans to cut India’s fiscal deficit to 4.1 per cent of gross domestic product by March 2015. The sale is being accelerated despite a number of potential problems facing Coal India, the world’s largest miner by output, including the fact that the position of chairman, the organisation’s most senior executive, is currently vacant. (www.ft.com)

November 17, 2014. Adani Enterprises won support from the State Bank of India (SBI) and an Australian state to help it build a $7 billion coal mine, defying a slump in coal prices to 5-1/2-year lows that has stalled rival projects. The infrastructure conglomerate, whose founder, Gautam Adani, has close ties to Prime Minister Narendra Modi, has signed a memorandum of understanding for a loan of up to $1 billion from the SBI for the mine, rail and port project, which it aims to build by end-2017. The loan, which would be one of the largest extended by an Indian bank for an overseas project, was announced as Adani was in Brisbane with a business delegation for the G20 summit, which Modi attended. Adani has enjoyed a rapid rise in Indian business circles in recent years, a rise often associated with Modi, who until this year headed the government in Gujarat state where Adani is based and where it has a huge coal-fired power plant. Adani also won a commitment from Queensland state government to take short-term, minority stakes in rail and port infrastructure needed to unlock the massive coal reserves in the untapped Galilee Basin. Coal from the region must be sent 400 km (250 miles) by rail to Australia's east coast. Adani aims to reach a final investment decision on the Carmichael project in late 2015. (in.reuters.com)

November 17, 2014. Bidding norms for executing ultra mega power projects may be revised soon, the Power ministry said. The standard bidding norms are under revision by the Advisory Group, which was earlier headed by Suresh Prabhu. After Prabhu took charge as Railway Minister, the top post of the Advisory Group is lying vacant. Private power producers, time and again, have expressed concerns over the bidding norms. The main concerns are on the model change which has been incorporated in the new standard bidding document for bidding for the UMPPs. The private power producers have also asked government to consider their suggestion to go on with build, operate, own model and not on the other model which is design, build, finance, operate and transfer (DBFOT) model. The companies have also sought governments' consideration on some changes to fuel charges on Odisha UMPP and Cheyyur in Tamil Nadu UMPP where the coal will be imported. Adani, Jindal Power, Sterlite and GMR pulled out of the race for UMPPs in Odisha and Tamil Nadu, leaving only NTPC in the fray for the proposed plants. The companies did not specify the reasons for the withdrawal. For the Odisha UMPP, NTPC, NHPC, Tata, Adani, JSW Energy, Jindal Power, Sterlite, CLP and L&T were among the pre-qualified firms while for the Cheyyur (Tamil Nadu) UMPP, NTPC, Adani, CLP, GMR, Jindal, JSW Energy, Sterlite, L&T were among the pre-qualified parties. The preliminary bids for these projects were invited last year. (economictimes.indiatimes.com)

November 16, 2014. BJP has alleged irregularities in the MoUs signed by the Arunachal Pradesh government with various hydro power developers and urged the Centre to review them. In a letter to Union Minister of State for Energy Piyush Goyal, state BJP Vice-president Sotai Kri urged him to review the MoUs signed by the state government to build dams and other hydro power projects across the state. Drawing attention of the minister to the "unsuccessful" mini-hydel projects, Kri in his letter claimed that due to embezzlement and irregularities 75 per cent of the mini hydel projects had failed to materialize. Demanding a CBI probe into the matter, he said the project opposite to the Parshuram Kund was a threat to the holy site. He requested the minister to review the project so that it could be shifted at least 5 km away from the present location. (economictimes.indiatimes.com)

November 16, 2014. The Odisha Integrated Power Ltd (OIPL), a fully owned subsidiary of Power Finance Corporation (PFC), has disbursed compensation worth ` 494 crore towards acquisition of private land for the 4,000 MW ultra mega power plant (UMPP) coming up at Bhedabahal near Sundargarh. OIPL is the special purpose vehicle (SPV) formed for implementing the UMPP. Total compensation for acquiring 2,733 acres private land has been worked out at ` 620 crore. (www.business-standard.com)

November 16, 2014. Commercial operation of the first 1,000 MW unit at Kudankulam Nuclear Power Project (KNPP) is expected to happen only next year with the Central Electricity Regulatory Commission (CERC) agreeing to the petition filed by Nuclear Power Corporation of India Ltd (NPCIL). The CERC by its Nov 10 order has permitted NPCIL to feed infirm power into the southern gird till Jan 22, 2015 on a petition by the Indian atomic power plant operator. Infirm power is the one that is generated by a power unit that has not begun commercial operations. The NPCIL had made the application to CERC seeking its permission to feed infirm power till Jan 22, 2015 or till the unit achieves commercial operation, whichever is earlier. The CERC had earlier permitted NPCIL to feed infirm power into the grid till Oct 10, 2014 from the first KNPP unit. However, the unit stopped operations Sep 26 as its turbine blades and diaphragm were damaged. The NPCIL is replacing the components from the second unit being set up there. According to NPCIL, the turbine problem is expected to be resolved by Dec 22, 2014 and one month's time is needed for eventualities. India's atomic power plant operator NPCIL is setting up two 1,000 MW Russian reactors at Kudankulam in Tirunelveli district, 650 km from here. The total outlay for the project is over ` 17,000 crore. The first unit attained criticality, which is the beginning of the fission process, on July 2013. The unit has started power generation and has been connected to the southern grid. (economictimes.indiatimes.com)

November 15, 2014. Union Power Minister Piyush Goyal said that the Narendra Modi government has decided to provide "uninterrupted electricity through dedicated feeders to farmers" across the country in the next two years. Goyal said that farmers in Gujarat get uninterrupted electricity through dedicated feeders under Deendayal Upadhyay Gram Jyoti Yojna. Goyal said that the scheme will be launched in Bihar soon. He said that all the pending power projects in Bihar would be completed to ensure adequate power to the state. According to him, the Modi government is doing everything to improve the power situation in the eastern states, particularly in Bihar. (economictimes.indiatimes.com)

November 15, 2014. The Delhi Electricity Regulatory Commission (DERC) rolled back the up to 7% power tariff hike cleared for the national capital, saying the power generating companies have not submitted details regarding fuel cost. DERC said that the Commission has sought necessary information from the generating companies, including NTPC, and the revised orders for tariff revision will be taken in the next two to three weeks. DERC clarified that the decision to roll back power tariff, a politically sensitive issue, was not influenced by the impending Assembly elections in Delhi. The regulator had approved 'power purchase cost adjustment charges' (PPAC) to the tune of 7% for BSES Yamuna, 4.5% for BSES Rajdhani and 2.5% for Tata Power Delhi Distribution. The rise would have affected 4.8 million power consumers in the city for next three months starting November 15. (economictimes.indiatimes.com)

November 15, 2014. Bihar will get a 4,000 MW Ultra Mega Power Plant (UMPP) and Centre will allocate sufficient number of coal blocks for it, Union Power Minister Piyush Goyal announced. Four more 660 MW units would be set up at the Barh Super Thermal Power Plant (STPP), which will take its power production capacity to 3300 MW. These units will be completed within four years. Goyal said the two 195 MW units at Kanti would be renovated within a year and he would try to get the approval for 132 MW hydel project at Baghmara in Supaul district. These were part of Prime Minister Narendra Modi's special attention towards the eastern states for improving their power situation, he said. The union minister said Bihar Chief Minister Jitan Ram Manjhi as well as senior BJP leaders Sushil Kumar Modi and Nand Kishore Yadav had met him with a list of proposals, including uninterrupted electricity supply and the Centre assured them of all help. The Deendayal Upadhyay Gram Jyoti Yojna to provide uninterrupted power to farmers through dedicated feeders would be launched in Bihar soon. (economictimes.indiatimes.com)

November 14, 2014. The proposal for setting up a SAARC electricity grid, that will help in meeting the power deficit faced by member nations, is expected to be approved by the region's leaders during their meeting later this month. The ambitious plan for establishing the grid, which has been in the works for quite some time, was discussed during the SAARC Energy Ministers held last month. Devendra Chaudhry, who is Special Secretary in the Power Ministry, said that India and other SAARC countries are working on the grid proposal. South Asian Association for Regional Cooperation (SAARC) is a grouping of eight nations including India. Other members are Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka. The 18^th SAARC summit is scheduled to be held on November 26-27. Once in place, excess production of electricity in one country of the region can be utilised to address the shortage faced elsewhere in the region. About 30 per cent of SAARC region's energy demands are met through imports and having a common grid would help in addressing electricity shortages. Already, India imports power from Bhutan and has electricity transmission links with Bangladesh. Meanwhile, Chaudhry said the government is working on various efforts, including state-specific action plans, to ensure electricity for all. Millions of households in India do not have access to power. With regard to coal block allocation, Chaudhry said the government would address the issue of affordability in terms of fuel cost. (economictimes.indiatimes.com)

November 13, 2014. Maharashtra Governor C Vidyasagar Rao announced that the Bharatiya Janata Party (BJP) government will frame a new energy policy. The emphasis of the policy will be on augmenting power supply by improving plant load factor of thermal plants and through proper coordination between the state and central governments to rationalise coal linkage to increase availability of domestic coal and bring down overall cost of generation. The state’s current thermal power capacity is about 7,600 MW. The government will encourage power generation using non-conventional energy sources such as solar, wind and bio-mass. (www.business-standard.com)

November 13, 2014. West Bengal Chief Minister (CM) Mamata Banerjee will dedicate the 600 MW thermal power plant of CESC on November 26. Built at a cost of ` 4,600 crore, the plant will be commissioned at a time power utilities were grappling with coal block de-allocation problem. On the same platform, CESC Chairman Sanjiv Goenka is expected to announce some investment plans by the group in the power sector, mostly into transmission and network infrastructure to cope with future demand. The 600 MW power plant was executed by CESC's subsidiary Haldia Energy Ltd and total investment is ` 4600 crore, he said. Initially, the plant will be operational with first unit of 300 MW and by February 2015, another 300 MW will come into being. The coal linkage for the plant is with Mahanadi Coalfields Ltd. The plant has come up on 317 acres of land and the main plant is on 13.5 acres. Shanghai Electric Corporation and Punj Lyod were the main contractors for the main plant. Goenka claimed it had rehabilitated 400 families that lived in the project area and the company has constructed a model village which is among the best in the country. The project had built a power evacuation network that include country's two highest river crossing towers of 240 metres each. (economictimes.indiatimes.com)

November 12, 2014. The government has sought a report from the Coal Controller on delay in mining by NTPC from a Jharkhand mine which was alloted to the PSU about a decade ago. The Coal Ministry has asked the Controller to inquire into non-mining of coal by NTPC on the basis of a complaint received from Bhu Visthapit Jagran Samiti, an association of villagers of Pakri Barwadih in Jharkhand. The coal block, having geological reserves of 1,600 million tonnes, was alloted to NTPC in October, 2004. NTPC had earlier conveyed it to the ministry that the block is expected to start production from December. The company had said that the mining plan, environment clearance and forest clearance pertaining to the mine have been obtained. The coal ministry had issued a show cause notice to NTPC seeking an explanation for delays in the development of the coal mine. (www.business-standard.com)

November 12, 2014. A special court directed CBI to further investigate a coal blocks allocation case involving Navbharat Power Pvt Ltd (NPPL) and its officials in which the agency has filed two final reports. Special CBI Judge Bharat Parashar ordered further probe in the case and directed the CBI to file its progress report on December 16. The Supreme Court-appointed special public prosecutor R S Cheema had differed with the CBI on giving clean chit to ex-coal secretary H C Gupta and two other serving public servants, saying they had 'illegally allocated' coal blocks to the firm. Cheema had said that CBI's supplementary final report, giving clean chit to Gupta and public servants, was kind of a full charge sheet and if the court feels, it can take cognisance of the offences. The charge sheet was filed against NPPL and its officials for offences under sections 120-B (criminal conspiracy) read with 420 (cheating) of IPC for allegedly misrepresenting facts, including inflated net worth, to acquire coal blocks in Rampia and Dip Side of Rampia in Odisha. CBI had earlier alleged that the net worth of the firm applying for coal blocks was an important factor to determine its financial strength and NPPL had fraudulently claimed in its application that it was supported by Globeleq Singapore Pvt Ltd, Navbharat Ventures Ltd and Mahalaxmi Group Ltd. (www.business-standard.com)

 [INTERNATIONAL: OIL & GAS]

November 18, 2014. Statoil ASA, Norway’s biggest energy company, said its Johan Castberg oil discovery in the Arctic Barents Sea can be developed profitably even after oil prices have tumbled more than 30 percent since June. Developing the find on with a floating production, storage and offloading unit remains the cheapest option, Erik Strand Tellefsen, vice president for field development in northern Norway, said. Nearby finds by Lundin Petroleum AB have increased the possibility that a combined development including a new onshore oil terminal at North Cape can be commercially viable, he said. Benchmark Brent crude has slid more than $35 to below $80 a barrel from a June high, putting pressure on the margins companies can expect from projects in areas such as the Arctic. The plunge comes as Statoil and other oil companies are also seeking to rein in investments after a decade of rising costs have hurt shareholder returns. Norway’s Barents Sea, estimated to hold 40 percent of Norway’s undiscovered resources and seen as key to halt a 13-year decline in the country’s crude production, lacks infrastructure including terminals and pipelines. The first oil field scheduled start production in the area, Eni SpA’s Goliat deposit, is headed for a 50 percent cost overrun when it starts output next year, according to the government. Statoil has turned to Lundin and OMV AG to discuss developing finds in the area that would include a land terminal, an option shelved last year on cost concerns. Output won’t start until the early 2020s, he said. Rystad Energy AS, an Oslo-based consult, said that the break-even price for a standalone development of Castberg was between $60 and $70 a barrel, and that a joint development with a land-based terminal wasn’t currently profitable. Statoil delayed Castberg for a second time in June after a disappointing exploration campaign that failed to boost volumes sufficiently. Statoil found oil in only two of five wells drilled near the breakthrough Skrugard and Havis discoveries from 2011 and 2012, and only one of the new finds is deemed commercially viable, Tellefsen said. Drivis contains 42 million to 54 million barrels of recoverable oil, while a second find, Skavl, which holds 20 million to 50 million barrels, isn’t commercial for now because it would require too many wells to exploit, Tellefsen said. That puts Statoil’s current resource estimate for Castberg, including Drivis, at between 450 million and 650 million barrels of oil, he said. (www.bloomberg.com)

November 18, 2014. Indonesia's Pertamina expects its overseas assets to contribute between 90,000 and 120,000 barrels of oil equivalent per day by the end of 2014, the company said, up from around 63,000 barrels per day of crude last year. The expected increase comes as the state energy firm moves aggressively to acquire oil and gas assets to meet the ballooning energy demands in Southeast Asia's largest economy. (www.rigzone.com

November 17, 2014. Brazil's state-run oil firm Petroleo Brasileiro SA (Petrobras) produced an average of 2.09 million barrels of oil per day in Brazil in the third quarter, up 9 percent from the previous year. Natural gas production of 441,000 barrels per day was up 7 percent while output of petroleum derivatives rose 4 percent to 2.204 million barrels per day. Fifteen producing wells were connected in the third quarter, Petrobras said. It expects 16 more producing wells to be connected in the fourth quarter. (www.rigzone.com)

November 17, 2014. Argentina and Chile's state-run energy firms said they had agreed to invest an extra $200 million to increase natural gas production off the southern tip of South America. The investment will help boost output from the Magellan Straits project to about 4 million cubic meters per day from the current 2.4 million cubic meters, Argentina's YPF said. YPF and ENAP also agreed to extend the joint production deal beyond the existing August 2016 expiry date. The length of extension will depend on negotiations between YPF and the central government and YPF and the federal province of Tierra del Fuego. (www.rigzone.com)

November 17, 2014. Italian major Eni said CEO Claudio Descalzi and Sonangol Chairman Francisco de Lemos Maria signed a strategic agreement to co-operate in developing gas resources in Angola. Eni and the Angolan national oil company plan to set up a joint team aimed at studying the potential of the non-associated gas present in the Lower Congo Basin – which Eni describes as a "highly promising area" in terms of hydrocarbon production located offshore Angola. (www.rigzone.com)

November 15, 2014. U.S. oil drillers put rigs back to work, lifting the number in operation from a three-month low in a push to home in on their most profitable fields after crude prices sank to the lowest since 2010. Rigs targeting oil jumped by 10 to 1,578 after sliding to the lowest level since August last week, Baker Hughes Inc. said. Those drilling for natural gas declined by six, the Houston-based field services company. While oil rigs fell in Texas’s Eagle Ford formation and the Cana Woodford of Oklahoma, they picked up in the Utica in the eastern U.S. and the Permian Basin of Texas and New Mexico. The oil-rig count has fallen from a peak of 1,609 on Oct. 10 as companies slow drilling in response to a 26 percent slide in crude prices over the past four months.

Hess Corp., one of the largest operators in North Dakota’s prolific Bakken shale formation, said that it plans to idle three rigs next year. The slump threatens to curb a production boom in U.S. shale fields that has helped bring gasoline prices at the pump below $3 a gallon for the first time since 2010 and shrink the nation’s dependence on imports. Domestic oil output climbed 92,000 barrels a day in the week ended Nov. 7 to 9.06 million, Energy Information Administration data show. While rigs have dropped, their productivity has surged to record levels across all major oil fields. New crude output per rig will rise to a record 543 barrels a day in the Bakken in December and to 550 in the Eagle Ford, the report shows. (www.bloomberg.com)

November 14, 2014. Canada-based Jura Energy Corporation (Jura) reported the successful full commissioning of the surface processing facilities at its Zarghun South gas field in the Zargun South Block in Balochistan province, Pakistan and a consequent significant increase in sale gas volumes from the field.

The field is producing approximately 17 million cubic feet per day or MMcf/d of sales gas, a significant increase from sales gas volumes during the Interim Arrangement of approximately 4 MMcf/d. The condensate to gas ratio is in the range of 1.2 to 1.9 barrel per MMcf. (www.rigzone.com)

November 13, 2014. New developments and the expansion of older oil fields are expected to lift deepwater Gulf of Mexico production of 1.9 million barrels of oil equivalent per day (boepd) in 2016, the first new production peak seen since 2009. However, production is expected to plateau for the remainder of the decade following the 2016 peak due to the depletion of legacy fields and a limited number of new projects coming onstream, according to Wood Mackenzie’s latest outlook on the deepwater Gulf.

Wood Mackenzie expects deepwater Gulf production to rise 18 percent per year from 2014 to 2016. Next year, production is expected to rise 21 percent from 2014’s production level, and the start of production from the Heidelberg field and ramp-up of the Jack/St. Malo project will intensify the rise in production. Heidelberg and Jack/St. Malo will produce 115,000 boepd in 2016, Wood Mackenzie said. Deepwater Gulf production growth also will be augmented by the redevelopment and extension of older fields, Wood Mackenzie said.

Fifteen field development projects are expected to come online between 2014 and 2016, while only eight developments will come online from 2017 to 2020. But the fields scheduled to come onstream at the end of the decade are important – including Lower Tertiary discoveries such as Stones, Shenandoah and North Platte – and will define the long-term success of the region. (www.rigzone.com)

November 13, 2014. A pullback by U.S. energy companies from Asia is opening the door for competitors looking to snap up unwanted oil and gas assets in the region. U.S. producers are facing pressure to cut spending, reduce exposure overseas and focus on the domestic market, where oil production is forecast to reach the highest in 45 years in 2015. Apache Corp. and Murphy Oil Corp. are among companies in disposal mode this year in the Asia-Pacific region. Apache is looking to sell its interest in an Australian liquefied natural gas venture, while Indonesia’s PT Pertamina agreed to purchase a stake in Murphy’s oil and gas assets in Malaysia for $2 billion in cash. (www.bloomberg.com)

November 13, 2014. Norway, western Europe’s largest crude oil producer, says it welcomes China as a partner in efforts to develop Arctic energy resources. The Nordic country is doing business with China’s Cnooc Ltd. as it tries to find oil off Iceland’s shores. The Chinese company is also looking into exploring Norway’s eastern Barents Sea, an area where licenses will be awarded in 2016. The world’s second-biggest economy is trying to gain access to energy sources needed to fuel its growth. Part of that plan involves the Arctic, which may hold more than 20 percent of the globe’s undiscovered oil and gas resources. (www.bloomberg.com)

November 12, 2014. Interra Resources Ltd reported that its jointly controlled entity, Goldpetrol Joint Operating Company Inc., has achieved a significant production gain at CHK 1180 in the Chauk oil field in Myanmar. Interra has a 60 percent interest in the Improved Petroleum Recovery Contract of the Chauk field and also owns 60 percent of Goldpetrol which is the operator of the field.

CHK 1180 was completed as an oil producer in February at 165 barrels of oil per day (bopd), but with natural decline, production had fallen to 75 bopd. Shallower zones were recognized as having considerable potential based on wireline logs and it was decided casing perforation of an additional 30 feet covering three reservoirs would be performed. The new oil from these reservoirs has been commingled with the existing reservoirs, and following production testing, the combined rate has increased to 185 bopd – a gain of 110 bopd. (www.rigzone.com)

November 12, 2014. The collapse in oil prices may deter investment in exploration and production projects predicated on $100 crude, according to Suhail Al Mazrouei, energy minister of the United Arab Emirates (UAE). Oil has fallen into a bear market this year on increased output of U.S. shale and other supplies.

The Organization of Petroleum Exporting Countries (OPEC), including the UAE, will meet Nov. 27 to assess the market and production. Saudi Arabia and Kuwait have resisted calls for the group to cut production, while Libya, Venezuela and Ecuador have asked for action to keep prices from falling lower. (www.bloomberg.com)

November 18, 2014. Halliburton Co. expects to sell just half the $7.5 billion in assets it’s committed to divest to win antitrust approval for a planned takeover of Baker Hughes Inc. The combined company is prepared to divest parts of at least three overlapping business lines to satisfy regulators worried about the loss of competition. Halliburton agreed to divest businesses that generate up to $7.5 billion in revenue to satisfy Baker Hughes’s concerns even though it doesn’t expect regulators will demand that much to be sold. Companies in line to pick up the assets include Weatherford International Plc and National Oilwell Varco Inc., according to analysts. Those businesses are drill bits, which are the tips for drilling wells; a service that helps drillers track where they are in a well as they dig; and offshore sand control, which prevents sand from spilling into a well. Antitrust scrutiny of the $34.6 billion deal was an initial worry for Baker Hughes in talks with Halliburton and it wanted a commitment that Halliburton agree to any divestitures required by regulators. Halliburton countered that wasn’t necessary, explaining where the companies’ products overlapped. Halliburton expects to close on the Baker Hughes purchase in the second half of next year. The Houston-based companies can choose which of the two will divest an overlapping business to address antitrust concerns. (www.bloomberg.com)

November 17, 2014. Speculators got more bullish on oil for the first time in three weeks, judging that a slump in prices to a four-year low will force OPEC to act. The net-long position in West Texas Intermediate (WTI) rose 8.7 percent in the week ended Nov. 11, U.S. Commodity Futures Trading Commission data show. Long holdings rebounded from the lowest level in 17 months while short bets contracted. WTI tumbled 29 percent since June as U.S. output climbed to three-decade high, adding to a global supply glut at a time when the International Energy Agency says demand growth is slowing. Ministers from the Organization of Petroleum Exporting Countries (OPEC) accelerated diplomatic visits last week, potentially seeking a consensus before the group’s Nov. 27 meeting in Vienna. OPEC last cut quotas in December 2008, trimming its target by 2.46 million barrels a day in response to the financial crash that sent WTI tumbling from a record $147.27 in July 2008 to $32.40 in December of the same year. OPEC produced 30.97 million barrels daily last month, data show. (www.bloomberg.com)

November 14, 2014. The U.S. Department of Energy gave two final approvals to Freeport LNG Development LP to export liquefied natural gas, or LNG, from its project in Texas to any country. The planned project in Quintana Island, Texas, would have the capacity to export up to 1.8 billion cubic feet a day of LNG once constructed. With domestic gas production booming, U.S. companies have lined up to ship the nation's abundant shale gas to energy- hungry consumers in Europe and Asia. The companies need special approval to export LNG to countries with which Washington does not have free trade agreements. The Federal Energy Regulatory Commission approved construction of the project in July. (www.downstreamtoday.com)

November 12, 2014. Russia’s deepening energy ties to China may not be all gloom for Australian natural gas. While Russia’s second gas-supply deal with China will lessen its dependence on Europe as a customer, on the flip side Europe is looking to reduce its reliance on Russia, according to Origin Energy Ltd., which is building a $22 billion liquefied natural gas export project in eastern Australia. China and Russia signed a preliminary gas-supply accord on Nov. 9, broadening their links after a $400 billion deal. The new Russian supplies will make it harder for proposed Australian LNG projects to compete in an already crowded market, according to a Macquarie Group Ltd. report. Some Australian suppliers also could benefit as Europe is looking at Australian gas as an option to cut its reliance on Russian energy supplies, the European Commission said. Origin is developing its LNG export project in Australia with ConocoPhillips. That development has already signed long-term customers and is due to start production next year. China Petrochemical Corp. is also a partner. (www.bloomberg.com)

November 12, 2014. The U.S. shale boom masks threats to global oil supply including Middle East turmoil, conflict in Ukraine and the difficulty of unconventional oil production beyond North America, the International Energy Agency (IEA) said. Global oil consumption will rise to 104 million barrels a day in 2040 from 90 million barrels a day in 2013, driven by demand for transport fuel and petrochemicals in developing countries, the IEA said. To meet that growth and replace exhausted fields will require about $900 billion a year in investment by the 2030s as oil companies develop fields from Canada’s oil sands to the deep waters off Brazil, the IEA said. Benchmark oil prices in New York have dropped more than 20 percent this year as crude production in the U.S. reached the highest in 40 years, driven by shale fields in North Dakota and Texas. That’s threatening investment in the global industry as companies try to insulate profits from the price fall. While the near-term picture is secure, the development of capital-intensive areas outside North America is at risk, the IEA said. (www.bloomberg.com)

November 18, 2014. Indonesia’s central bank raised interest rates for the first time in a year, tightening policy in an unscheduled meeting to guard against inflation after President Joko Widodo boosted fuel prices. Bank Indonesia Governor Agus Martowardojo and his board increased the reference rate a quarter point to 7.75 percent, the central bank said in Jakarta. The price of subsidized gasoline was pushed up to 8,500 rupiah ($0.70) a liter from 6,500 rupiah and diesel has been raised to 7,500 rupiah a liter from 5,500 rupiah. Widodo, known as Jokowi, acted on an election pledge to reduce state energy subsidies less than a month after taking office, seeking to free up funds for development plans. The rupiah and local stocks rallied on optimism the president is taking steps to overhaul Southeast Asia’s largest economy, with Vice President Jusuf Kalla signaling a deeper revamp of the subsidy program is in store after fuel adjustment. The Indonesian government will consider letting the price of subsidized fuel float by keeping the subsidy at a fixed amount. The administration will suggest a permanent fixed subsidy rate, which might be 1,000 or 2,000 rupiah per liter, and the vice president expressed confidence that the new policy could be implemented next year. (www.bloomberg.com)

November 18, 2014. A “large” production cut by OPEC to prop up crude prices isn’t in the group’s interest because it’s likely to bolster an expansion of U.S. shale oil, according to Goldman Sachs Group Inc. While the slide in prices into a bear market increases the chances of a reduction, trimming output by more than 500,000 barrels a day would mean further cuts are needed starting 2016 as higher prices prompt more U.S. drilling, Goldman said. Some members of the Organization of Petroleum Exporting Countries (OPEC) including Saudi Arabia have resisted calls to decrease supply while others seek action to support crude. Oil has slumped about 30 percent since its June peak amid a surge in U.S. output to the highest level in more than three decades. OPEC, which meets Nov. 27 in Vienna, exceeded its 30 million barrel a day production target for a fifth consecutive month in October. Brent crude, the benchmark for more than half of the world’s oil slid as much as 46 cents to $78.85 a barrel on the London-based ICE Futures Europe exchange. Iraq, which pumped 3.3 million barrels a day last month, will be reluctant to enact production cuts, given the ongoing domestic instability, military funding needs and Kurdistan’s desire and ability to increase exports, according to Goldman Sachs. The Kurdistan Regional Government (KRG) announced an agreement on exports with Iraq, in which the semi-autonomous region’s oil will be exchanged for revenues from the administration in Baghdad. The KRG has placed 150,000 barrels a day of crude at the disposal of the central government. (www.bloomberg.com)

November 18, 2014. Venezuela is seeking help from nations outside of OPEC to halt a collapse in global crude prices, adding a new twist to oil-market diplomacy with nine days to go until the group’s next meeting. Nicolas Maduro, Venezuela’s president said that he was coordinating with Russia to hold a meeting “very soon” with countries that aren’t members of the Organization of Petroleum Exporting Countries (OPEC), as well as those within the group, to defend the price of oil. Venezuela and other Latin American countries have been among the hardest hit by plunging prices in part because the slump has been caused by surging supplies in North America. Combined output from the U.S. and Canada rose last year to the highest since at least 1965 as producers tapped stores locked in shale-rock formations and oil sands, according to BP Plc data. Venezuelan Foreign Minister Rafael Ramirez met with energy ministers from six producers this month as prices slumped, including the biggest non-OPEC oil exporter, Russia. Ramirez met Russian Energy Minister Alexander Novak in Moscow, according to the Venezuelan Foreign Ministry. Ecuador and Venezuela will ask OPEC members to trim production in excess of the group’s output ceiling of 30 million barrels a day. The group produced 30.25 million barrels a day last month, data from OPEC show. Oil analysts are split on whether OPEC will lower the output ceiling, with 10 of 20 oil analysts, traders, brokers predicting a production cut at the Nov. 27 meeting, according to a survey. (www.bloomberg.com)

November 18, 2014. Russia’s economy will sink into a recession next year if the price of oil slumps to $60 a barrel and the U.S. and its allies tighten sanctions over the conflict in Ukraine, Finance Minister Anton Siluanov said. The economy of the world’s largest energy exporter won’t grow faster than 1 percent in 2015 even if oil prices hold steady and the severity of sanctions remains unchanged, Siluanov said. The Russian economy will remain stable even under the “unfavorable” conditions of oil at $80 a barrel and sanctions staying in place until the end of 2017, central bank Governor Elvira Nabiullina said. The ruble exchange rate depends “directly” on energy prices, she said. The Bank of Russia said that growth may be zero next year as the economy succumbs to sanctions, while the weakening ruble ignites inflation and lower oil prices erode export revenue. The regulator forecast that sanctions will last through 2017 and oil will average $95 a barrel, compared with an estimate of $102 this year. Under current conditions of the ruble at about 47-48 per dollar and crude near $80 a barrel, oil and gas revenue that accounts for half of the budget will meet the targets in next year’s draft, according to Siluanov. The budget deficit will be 0.6 percent of GDP in 2015 after this year’s surplus of 0.1 percent to 0.3 percent, according to the ministry’s estimates. Federal revenue and spending may be balanced with an oil price of $90 per barrel next year, according to Siluanov. (www.bloomberg.com)

November 17, 2014. Russia’s financial crisis has become so severe that President Vladimir Putin found himself reassuring investors that the government would provide the support needed to the world’s largest oil company. With OAO Rosneft facing $21 billion of mostly foreign-currency debt maturities before April, Putin said the government will “definitely” help the company if necessary. After yields on Rosneft’s benchmark dollar bonds due in 2022 surged to a record 7.34 percent that day as oil sank to a four-year low, the statements may help restore investor confidence in the company, according to Commerzbank AG. Putin’s statement came three days after Alexei Kudrin, the former finance minister who designed Russia’s Wellbeing Fund, said Rosneft shouldn’t be allowed anywhere near it. Economy Minister Alexei Ulyukayev said that the company’s bid for more than $43 billion in state aid didn’t meet the fund’s requirements. Rosneft may get state aid after an assessment, Putin said. There’s “no hurry” as the company is in a good financial condition, he said. The oil producer may get 300 billion rubles ($6.4 billion) from the Wellbeing Fund. (www.bloomberg.com)

November 17, 2014. Finland and Estonia reached an agreement to build two liquefied natural gas (LNG) terminals, connected by a pipeline across the Gulf of Finland by 2019. A large regional terminal would be built in Finland while Estonia would get a smaller gas distribution terminal, the Finnish government said. The plan, which aims to cut the countries' dependence on Russian gas, was put on hold a month ago due to failure to agree on how the countries' gas companies can share EU financial assistance. Finland said that it remained unknown whether there would be adequate support available from the European Union (EU). The countries expect the EU to cover 75 percent of the pipeline's estimated cost of 200 million euros ($249 million). Together with the two terminals, the total cost of the project is seen at around 500 million euros. The deal also included future access to Latvia's underground gas inventories, Finland said. (www.downstreamtoday.com)

November 16, 2014. JPMorgan Chase & Co settled a lawsuit by Texas mineral-rights owners who accused it of cutting sweetheart deals with oil company clients to cheat them out of $681 million in compensation. The dispute centered on payments for rights to drill in the Eagle Ford, a shale formation underlying much of central and southwest Texas that has helped put the U.S. in competition with Saudi Arabia and Russia for title of world’s largest oil producer. Beneficiaries of the South Texas Syndicate Trust accused the bank, which was supposedly working on their behalf, of instead hatching favorable deals with commercial-banking clients Petrohawk Energy Corp. and Hunt Oil Co. for cut-rate prices on the trust’s rights in the Eagle Ford, the highest-yielding oil field in the U.S. The trust beneficiaries claimed they got only $32.5 million on rights that yielded benefits worth $1.1 billion because JPMorgan wanted to curry favor with its oil company clients at their expense. The bank rejected the claims as speculation and hindsight. Energy companies have spent the past five years scrambling to accumulate and drill as many acres as possible across a vast swath of Texas range. The energy companies, through JPMorgan, paid trust beneficiaries as little as $200 an acre in bonuses for drilling rights on some of the property, which is on top of royalties the mineral owners get on any oil or gas pumped out. Once JPMorgan’s commercial clients had the leases, they either produced the oil fields for their own benefit or flipped the drilling rights at much higher prices to other companies. Some of the trust’s rights were later sold for as much as 70 times what the initial buyers paid, according to the lawsuit. Ultimately, the trust beneficiaries complained, all of the financial gains from exploiting the Eagle Ford flowed to subsequent buyers, leaving the original mineral owners shut out with comparatively little. (www.bloomberg.com)

November 14, 2014. Oil prices could slide from a four-year low in the coming months as the market enters a period of weaker demand, increasing pressure on OPEC to reduce production, the International Energy Agency (IEA) said. Consumption will slide by about 1 percent to 92.6 million barrels a day in the first quarter from the current three-month period, the IEA said. Barring new supply disruptions, the seasonal demand slump will push prices lower, the IEA said. Members of the Organization of Petroleum Exporting Countries (OPEC) meet in Vienna to review their production target on Nov. 27. (www.bloomberg.com)

November 14, 2014. Saudi Arabia’s oil minister dismissed talk of a price war as having “no basis in reality” in his first public comments since crude plunged into a bear market last month. Brent crude futures plunged below $80 for the first time since September 2010 on concern OPEC is in no hurry to halt a four-month slide in prices. Saudi discounts offered to Asian customers in October triggered speculation that the Organization of Petroleum Exporting Countries’ largest member had changed policy and was seeking to preserve market share, instead of supporting prices by curbing supply. OPEC ministers will meet Nov. 27 in Vienna. OPEC won’t cut its collective output target at this month’s meeting, according to Kuwaiti Oil Minister Ali Al-Omair. Kuwait has no plans to trim its production, which is set to climb to 4 million barrels a day by 2020, Al-Omair said. It pumped 2.85 million a day in October, on par with the United Arab Emirates and behind Saudi Arabia and Iraq among OPEC nations. The U.S. Energy Information Administration (EIA) cut its 2014 and 2015 crude price forecasts in its monthly Short-Term Energy Outlook. The EIA trimmed its Brent crude estimate for next year to $83.42 from $101.67. (www.bloomberg.com)

November 14, 2014. Natural gas explorer Metgasco Ltd announced that it welcomes the New South Wales (NSW) Government’s recognition that gas supplies are essential to the future of NSW and that the gas industry in the Australian state can be managed safely. Metgasco is, however, concerned about the repeated changes in regulation and policy since the current Government came to office and the uncertainty the latest announcement has created.

Metgasco has invested approximately $104.4 million (AUD 120 million) over the past ten years exploring for natural gas in NSW and has established the second largest gas resource in the state. It did so with the expectation that its exploration rights would be respected. Metgasco is seeking a meeting with the Minister for Resources and Energy to clarify the impact of the new policy on the potential of the significant gas resource in the Northern Rivers region. (www.rigzone.com)

November 13, 2014. Egypt plans to repay all of the $4.9 billion debt owed to foreign oil and gas companies within six months, the oil ministry said, a move it hopes will prompt them to step up exploration and ease the worst energy crunch in decades. Egypt has delayed payments to oil and gas firms as its economy has been hammered by almost three years of instability since a popular uprising ousted autocrat Hosni Mubarak. Gas production has steadily declined in Egypt while consumption keeps rising, but firms have been reluctant to increase investment in exploration and production, particularly in costly offshore areas, until the government pays them back.

The oil ministry said that Egypt planned to borrow $2 billion to help it finance the repayments, seeking to pay back 60 percent of the arrears by year-end. Egypt said in October it had repaid $1.5 billion of the money owed, leaving $4.9 billion outstanding. (www.rigzone.com)

November 13, 2014. The U.S. Energy Information Administration (EIA) cut 2014 and 2015 crude price forecasts amid rising global output and sluggish demand. The agency reduced its 2015 U.S. oil production outlook for the first time this year. West Texas Intermediate (WTI) will average $77.75 a barrel in 2015 versus the October projection of $94.58, the EIA said. The EIA said U.S. production will rise to 8.57 million barrels a day this year and 9.42 million in 2015, the most since 1970, up from 7.46 million last year. This 2015 forecast was reduced from 9.5 million in last month’s report. Horizontal drilling and hydraulic fracturing, or fracking, have unlocked supplies in shale formations in North Dakota, Texas and other states. The increase in global production and slower demand growth has pushed prices for both WTI and Brent down more than 20 percent from their June highs. WTI will average $95 a barrel this year, down from last month’s projection of $97.72, the report showed. Brent is forecast to average $101.04 this year, lower than the October estimate of $104.42. Gasoline at U.S. pumps will average $2.94 a gallon in 2015, down 44 cents from last month’s estimate of $3.38. The average retail price dropped 0.3 cent to $2.923 a gallon, the lowest since December 2010, according to Heathrow, Florida-based AAA, the nation’s biggest motoring group. The EIA cut its forecast for global oil consumption this year to 91.38 million barrels a day from 91.47 million last month. The forecast for 2015 demand was cut to 92.5 million from 92.71 million. (www.bloomberg.com)

November 12, 2014. EmiratesLNG, a joint venture between United Arab Emirates (UAE) state-controlled International Petroleum Investment Co (IPIC) and Mubadala Petroleum, will start output from a yet-to-be-built liquefied natural gas (LNG) import facility by mid-2018. The results of a tender to build the facility, which will be located at the busy oil port of Fujairah, will be announced in early 2015. Once complete, the terminal will be capable of supplying an average of 1.2 billion standard cubic feet (bcf) of natural gas per day to the UAE. Dubai already imports LNG through ports in the Gulf, and the UAE gets a modest volume of Qatari gas by pipeline, which helps feed power and desalination plants at Fujairah. (www.downstreamtoday.com)

November 12, 2014. Liquefied natural gas (LNG) spot prices for Japanese buyers rose for  a second straight month in October, the government said, as seasonal demand climbed with utilities stockpiling for the approach of winter in the Northern hemisphere. Spot LNG contracted in October for delivery to Japan averaged $15.30 per million British thermal unit (mmBtu), up from $13.20 from a month earlier, the Ministry of Economy, Trade and Industry (METI) said. Cargoes arriving averaged $12.40 per mmBtu, compared with $11.30 in September. Asian spot LNG prices rose to $15 per mmBtu in late September, but have declined steadily since then to $12.90 per mmBtu, bucking a seasonal rise in prices at this time of the year. Japan, which takes about a third of the world's LNG imports, shipped in a record 87.73 million tonnes in the year through March. The average spot price is based on about 10 percent of the nation's purchases of the super-chilled fuel. (www.downstreamtoday.com)

November 12, 2014. The decision OPEC faces at this month’s meeting isn’t just over whether to cut oil production. It’s a choice of whether the group is willing to fight to maintain the sway it has had over crude markets for decades. The Organization of Petroleum Exporting Countries (OPEC), buffeted by plunging prices, could reassert control by cutting output, said Societe Generale SA, ceding more market share to U.S. shale oil producers. The alternative -- waiting to see if lower prices choke off the North American shale boom -- would usher in a “new oil order” where pricing power is handed to drillers in Texas and North Dakota, according to Goldman Sachs Group Inc. (www.bloomberg.com)

November 12, 2014. Efforts by Indonesia's new administration to attract investment to the country's troubled energy sector are being viewed favourably by energy giants Exxon Mobil and Chevron. President Joko Widodo has ordered his cabinet to simplify bureaucracy and de-bottleneck problem areas, Widhyawan Prawiraatmadja, a special assistant to the new energy minister, said. According to new Coordinating Maritime Minister Indroyono Soesilo, who also oversees the energy ministry, the administration is compiling a list of areas the industry wants fixed, including a tax on land use being applied to oil and gas exploration. Indonesia has struggled to attract investors to develop unconventional reserves such as the East Natuna gas field, the biggest untapped gas reserve in Asia. (www.reuters.com)

 [INTERNATIONAL: POWER]

November 18, 2014. Ghazi Fabrics International Limited, a listed company, has decided to set up 8.1 MW heavy fuel oil based captive power plant at budgeted cost of ` 130 million. The Karachi Stock Exchange (KSE) retained suspension of three companies including Schon Textiles; Cass Pak Industries and Pan Islamic Steamship Co. KSE has placed around 80 corporates in the ‘defaulters’ segment and as many companies have been separately classified under the head “companies under suspension.” (www.dawn.com)

November 18, 2014. Ayala Corp. will require a total of $1.6 billion in financing to develop large coal power projects in Luzon and Mindanao that will make the conglomerate one of the country’s top power producers. The funding will support two coal-fired power projects: A 600 MW project in Lanao del Norte province in Mindanao and a 1,000 MW project in Bataan province. (business.inquirer.net)

November 17, 2014. The Volta River Authority (VRA), Ghana’s main power generator has projected that about $1.5 billion is needed to improve the country’s power generation to end the crisis. With the country currently struggling to generate enough power to meet increasing demands, the VRA believes an aggressive investment in the sector is the solution. Ghana is currently facing difficulties in managing a load shedding scheme that power generators, transmitters and distributors have put in place to manage shortfalls in generation. Ghana Grid Company (GRIDCO) has explained that the erratic power supply to consumers currently is as a result of the difficulty in getting gas from Nigeria. Ghana is still struggling with 2,800 MW of power and the country must start investing or else “as the load keeps growing our problems will get worse.” (www.ghanaweb.com)

November 15, 2014. The U.S. West power market that PacifiCorp, part of Warren Buffett’s Berkshire Hathaway Inc., and California’s grid operator created Nov. 1 is generating “pricing anomalies”. The market, which allows utilities to trade power across California and PacifiCorp’s territories, is at times creating abnormally high prices in PacifiCorp’s region because not enough supply is being bid into the system, California Independent System Operator Corp. said. It’s seeking to waive tariff terms for 90 days to prevent the high prices while the resource pool expands. Buffett has invested at least $26 billion on power plants, transmission lines and wind farms in the western U.S., data show. The system created with the grid operator can unite those holdings under a single market capable of automatically dispatching power every five minutes from plants with a combined capacity of 68,846 MW, enough to supply 51.6 million homes. (www.bloomberg.com)

November 14, 2014. Welcoming the signing of Power Trading Agreement and Project Development Agreement between Nepal and India, an autonomous organisation here has asked the government to introduce reforms and legal framework to pave way for power trading between the two countries. Nepal, which is a power deficit country till now, will be in a position to export surplus power to India during rainy season, after 2017, Independent Power Producers' Association of Nepal (IPPAN) said. The power connectivity between Nepal and India should be well-established with regulatory frameworks and a trading company to facilitate power trading between the two countries, IPPAN said. Nepal is currently producing 755 MW hydroelectricity, just one per cent of its total hydro-potential of 83,000 MW and the projects with the capacity of 1200 MW are currently under construction. Nepal government has signed Project Development Agreement (PDA) with GMR Consortium for constructing 900 MW Upper Karnali power project. It is set to sign another PDA with Sutlaj Jalavidyut Nigam of India to generate 900 MW power from the Arun III Project. (economictimes.indiatimes.com)

November 14, 2014. Toshiba Corporation is planning to invest about $30 million in a power transmission and distribution (T&D) business in India. The new investment will be for expanding the production capacity of Toshiba Transmission & Distribution Systems (India) Pvt. Ltd. in Hyderabad. This investment is part of the $100 million Toshiba plans to invest in T&D business in India by 2016. Toshiba is seeking to secure a 20% share of the Indian market by 2018, and also reinforce Toshiba Transmission & Distribution Systems (India) Pvt. Ltd. as a core T&D production base for other major markets, including Europe, ASEAN, and Africa. India continues to record high economic growth, and long-term capital investment for infrastructure is expected in key areas such as electricity and transportation. In T&D, the Indian government is promoting measures to increase the number of 765kV substations, toward increasing the country's transmission capacity five times by 2017. This policy is driving demand for large power transformers and high voltage switchgears. (www.energysector.in)

November 17, 2014. The government will reduce Israel Electric Corp's debt if it sells a power station. The State will increase Israel Electric Corporation (IEC) equity and decrease its debt if it takes steps to sell power plants in 2015, said Israeli Government Companies Authority Director General Ori Yogev to the IEC board of directors. Yogev explained that he expects IEC to decide to publish tenders to sell a 1,000 MW capacity power station in Ramat Hovav, and land for a 500 MW power station in Alon Tavor. Yogev’s proposal revives an arrangement that was included in the recommendations of the committee he headed to advance reform in IEC and the electricity market, in the chapter on strengthening the company’s capital structure. The Yogev Committee’s recommendations also included the sale of the 912 MW Ashdod power plant. (www.globes.co.il)

November 14, 2014. The Norwegian government extended a grant to fund the South Asia Sub-regional Economic Cooperation (SASEC) Power Expansion Project which aims to increase electricity access and help overcome power shortage in Nepal. The Asian Development Bank (ADB) will administer a grant equivalent to ` 5.85 billion from the Government of Norway for implementation of the SASEC Power System Expansion Project. The project will strive to achieve 100% electrification by assisting connection to marginalised households in the new distribution corridors. The project also aims to export surplus power to neighbouring India by strengthening and increasing the power transmission capacity and network in the country. The SASEC Power System Expansion project is expected to be completed by 31 December 2021. (www.thehimalayantimes.com)

[RENEWABLE ENERGY / CLIMATE CHANGE TRENDS]

November 18, 2014. The Madhya Pradesh (MP) government is likely to commence the bidding process for the 750 MW ultra mega solar power project from March next year. The 750 MW project, which would require an investment of over ` 4,000 crore, is being developed on public private partnership (PPP). Thirteen hectares of land spread over four villages of Barseta, Ramnagar, Latar and Badwaar have been chosen for locating the plant in Gurh tehsil of Rewa. The government plans to execute the project in phases and no single bid will be of less than 250 MW. The project is partly funded, around 50 per cent of the cost by the World Bank, while the developer will have to pump the remaining share. The electricity from the plant would be available at around ` 5 per unit, which would be the lowest in the country. Power Minister Piyush Goyal had said the government would provide fiscal and financial incentives to domestic and foreign players in order to promote generation of renewable energy. (economictimes.indiatimes.com)

November 18, 2014. Indian Renewable Energy Development Agency (IREDA), a body under the Ministry of New and Renewable Energy, signed a preliminary agreement with US Exim Bank for a $1 billion loan from the American entity to undertake development activities in the clean energy sector. The Memorandum of Understanding (MoU) was signed by K S Popli, Chairman & Managing Director IREDA, and Fred P Hochberg, Chairman and President, Export-Import Bank of the United States. This initial pact is intended to establish a framework for cooperation in the financing of credit worthy entities for renewable energy projects and to facilitate export of goods and services of US origin or manufacture in India besides various forms of collaboration between the IREDA & US-Exim Bank. The proposed credit facility carries no specific commitment on the part of IREDA and will depend on the import of US equipment to India and attractiveness of credit facility to the project developers in India. The US Exim Bank facility will be available for financing of imported US equipment besides loans for 30 per cent of domestic component. The credit facility will be available for a repayment period of 18 years with the same fixed rate of interest. The other detailed terms and conditions shall be decided upon signing of MoU. (economictimes.indiatimes.com)

November 17, 2014. India said its renewable-energy industry must eventually learn to live without government support and that it’s seeking to generate five times more power from solar by 2022 than is currently installed. Renewables need to be a “self-sustained industry and not dependent on government subsidies,” Coal and Power Minister Piyush Goyal said. The government is targeting 100 GW of solar capacity in the next eight years, putting India’s ambition for photovoltaics on par with China’s, he said. India may find it difficult to achieve its solar target without subsidies as the country has added only 3 GW so far and the previous government was talking about adding only 20 GW. The country wants to attract $100 billion of investment in clean energy over the next five years. Companies and lenders say that will require a shift in policy from India’s current auction-based system, which caps installations to control the scale of solar fitted and the amount of subsidy payments incurred. India led the world in competitive bidding -- followed by Brazil and South Africa -- which helped push down the cost of solar power by about half since 2010. (www.bloomberg.com)

November 16, 2014. Prime Minister (PM) Narendra Modi proposed a global virtual centre for clean energy research and development, with adequate public funding and also invited G20 countries to invest in India's expanding energy sector. Modi made the proposal while observing that increased access to affordable, assured and clean energy supply for all should be a primary goal of the global community. The Prime Minister made the reference to issues relating to energy during his intervention at the plenary session of the G20 summit. He invited the G20 countries which is a grouping of industrialised and emerging economies to come and invest in the energy sector in India. Modi believed that change in lifestyle and economy in consumption will be the most enduring response to energy challenges. The Prime Minister also called for an ambitious and innovative effort to make renewable energy, especially solar energy, competitive with conventional energy. The Prime Minister said there should be a discussion on innovative funding models to ensure rapid expansion of renewable energy in a decentralised manner in rural areas. In countries like India, there are vast opportunities for those wishing to invest in clean coal technology, since India's dependence will not reduce very soon, he said. Modi said G20 can be effective in promoting an integrated natural gas market, ensuring freer trade in gas and ensuring that the markets operate more efficiently. Referring to nuclear energy, Modi said it can still be a safe, reliable and clean source of energy. (economictimes.indiatimes.com)

November 13, 2014. India will use the G-20 forum to demand the early capitalisation of the Green Climate Fund (GCF). The fund set up to help developing countries tackle climate change needs $10 billion to begin work, a downscaling from the initial $15 billion. So far, the Fund has managed to garner just $2.9 billion, a figure that falls far short of the intended target. New Delhi has been at the forefront of keeping the pressure on the developed countries to meet their commitment to provide climate finance. India has made it clear that a robust global agreement in Paris next year is directly linked to the predictable availability of financing through the Green Climate Fund. So far, the Fund has failed to even touch the $5 billion mark. The GCF is convening a High-level Pledging Conference on 20 November in Berlin, the aim will be to ensure that the fund has $10 billion ahead of the Lima-round of negotiations. (economictimes.indiatimes.com)

November 13, 2014. MEIL Green Power Ltd (MGPL), a unit of Hyderabad-based Megha Engineering Infrastructure Limited (MEIL), commissioned a 50 MW concentrated solar thermal power (CSP) plant at Nagalapuram village in Anantapur district of Andhra Pradesh. Spread over an area of 600 acres, the plant has been built at a cost ` 848 crore, which is stated to be the largest investment in a solar plant in south India till now. This is also claimed to be the first CSP plant to be commissioned in the south. It provides direct employment to 80 people and indirect employment to 20 persons. A CSP plant uses energy from sunlight to generate heat, which is used in steam cycles to produce electricity. CSP was originated and has a widely commercialised market in Spain and the US. So far in India, 470 MW of CSP projects (seven plants) have been promoted. Of these, the MGPL plant is the only one to be set up in the south. The rest are being established in Rajasthan and Gujarat. According to MEIL, the plant contributes 110 million units of power. This is helpful to AP and Telangana as NTPC allocates four times additional power (440 million unit) from unallocated quota to both the states as a part of the contract. MGPL was awarded the 50 MW power project as a part of the Jawaharlal Nehru National Solar Mission by NTPC Vidyut Vyapar Nigam, which has been appointed as the nodal agency for entering power purchase agreements with solar power projects. (www.business-standard.com)

November 13, 2014. The Centre has agreed to provide ` 1,350 crore from the National Green Energy Fund (NGEF) towards construction of evacuation lines for solar and wind power projects in Andhra Pradesh (AP). Further, the central government has also directed the Western Coal Fields (WCL) Ltd to supply additional quantum of 1 million tonne of coal to AP, which is beneficial to bring up the coal stock position for comfortable operation of the thermal plants. Appreciating the efforts of Andhra government in implementation of the 'Power For All' (24X7) programme, the Power Ministry, in a high level review meeting held at New Delhi, has declared various sops to AP, which will immensely benefit the state and stakeholders. (economictimes.indiatimes.com)

November 12, 2014. Wooing the 10-member ASEAN bloc to increase its economic engagement with India, Prime Minister (PM) Narendra Modi said his government has embarked on a "new economic journey" and places equal emphasis on ease of doing business in India as well as on making policies attractive. Modi said his government was laying stress on infrastructure, manufacturing, trade, agriculture, skill development, urban renewal and smart cities. He also invited the ASEAN bloc to "come and participate in building India's 100 smart cities and renewal of 500 cities". He proposed cooperation in science and technology and renewable energy. The prime minister also proposed a major ASEAN India Solar Project for research, manufacturing and deployment. (www.business-standard.com)

November 18, 2014. A unit of Nippon Telegraph & Telephone Corp. plans to build a 15 MW solar power station in northern Japan. The plant will be built inside a park in Oshu city, Iwate prefecture, NTT Facilities Inc. said. Operations are expected to start in October 2016. The company has been developing solar projects and its 35^th station started generation last month. (www.bloomberg.com)

November 18, 2014. With platinum prices at a five-year low, Anglo American Platinum Ltd. is seeking to boost demand for the metal with systems that produce electricity in remote areas. Anglo American and Canada’s Ballard Power Systems Inc. are testing the process to see if it can be used to light up an isolated village. The test in South Africa, the world’s biggest platinum producer, may lead to wider use of fuel cells as a source of power in developing regions. More than 1.3 billion people worldwide live without electricity, and almost half are in sub-Saharan Africa, according to the International Energy Agency. (www.bloomberg.com)

November 17, 2014. Australia’s Queensland state threw its support behind plans for the nation’s largest coal project, two days after U.S. President Barack Obama called on the country to step up the fight against climate change. The state will help fund a 388-kilometer (241-mile) rail line to link Adani Enterprises Ltd.’s Carmichael coal project to the port of Abbot Point near the Great Barrier Reef. Adani is seeking A$3.2 billion ($2.8 billion) from banks and South Korean lenders to help fund the project, Jeyakumar Janakaraj, chief executive officer and country head for the Adani Mining unit, said. Adani needs the rail line to develop the A$7.2 billion project and open up a massive new coal province in the Galilee Basin. The company is moving ahead even as coal prices languish and environmental groups say the development and route to market through the Barrier Reef threaten the planet’s largest living structure. Obama, in a Nov. 15 speech at the University of Queensland in Brisbane said the Pacific region is among the most vulnerable to the effects of a warming planet. Australia and the U.S. need to “step up” in cutting greenhouse gas emissions and tackling climate change, he said. China and Australia signed an agreement to cooperate on climate change, Foreign Minister Julie Bishop said. Adani sees the Australian government’s protections for the Barrier Reef as “very robust,” while the “best technology” will be used at Indian power stations to minimize emissions, Janakaraj said. (www.bloomberg.com)

November 17, 2014. Some 12 million German households' power bills will fall by an average 2.4 percent from January as 115 energy companies pass on lower wholesale prices and levies to support green power, internet portal Check24 said. The price of German retail power - one of the most expensive in Europe - is controversial because consumers are paying heavily towards the production of renewable energy. A four-person household using 5,000 kilowatt hours a year will see their average bill fall to 1,443.50 euros (1,150 pounds) for next year, compared with an average 1,478.70 euros, Check24 said. The portal, which compares consumer prices for services such as energy, telecoms and insurance, said bills would have been lower if it was not for higher network transport fees to be charged by most local grid firms next year. (uk.reuters.com)

November 17, 2014. Peru’s government is set to announce plans for a renewable-energy auction during a global climate conference to be held next month in Lima. The auction will be held in the first half of next year and will allow bids for solar, wind, biomass and geothermal energy projects, said Pedro Gamio, energy coordinator for the United Nations (UN)-organized climate talks. About half of Peru’s power, 3.9 GW, came from plants that burn oil and natural gas last year, and almost as much, 3.5 GW, came from large hydroelectric dams. The country is seeking to double its renewable-energy capacity and reduce its use of fossil fuels. Renewable energy produces about 2.7 percent of the country’s power, according to Gamio. The government has set a goal of 5 percent. Envoys from more than 190 nations will meet in Lima at the start of December for two weeks of negotiations organized by the UN. They’re working to craft a global agreement on carbon emissions that will be signed next year in Paris and take effect in 2020. Peru may eventually get as much as 60 percent of its power from renewable sources, including large hydropower plants, up from 50 percent now, Energy and Mines Minister Eleodoro Mayorga said. Power demand in Peru increased 5.4 percent in 2013, while gross domestic product gained 5.8 percent. The country attracted $3.4 billion in clean energy investments from 2006 to 2013. Auctions for renewable energy will give lenders more confidence that the industry will continue to grow. (www.bloomberg.com)

November 16 2014. A consortium of Egyptian investors is planning to build four solar powered electricity stations with a capacity of 50 MW each, the CEO of one of the participating companies said. Each station would cost $90-$100 million with an expected rate of return of 14 percent, OneraSystems CEO Wael Al-Nashar said. The consortium is comprised of three local banks, two local companies and two international companies, Al-Nashar said. They have already submitted an offer to the Ministry of electricity, to be decided upon 26 November. The ministry is currently accepting offers by investors to produce electricity through wind or solar energy. In September, Egypt's cabinet approved feed-in tariffs for renewable energy production, enabling solar energy producers to sell electricity to the government. OneraSystems and its partners will be able to sell electricity at 14.34 cents per kilowatt per hour for the maximum production tranche of 50 MW. Payment will be in domestic currency according to the exchange rate at the time of payment. The Ministry of Electricity is only accepting offers to produce a total of 2000 mW in renewable energy, Al-Nashar said. Land will be provided to private investors through usufruct agreements at competitive prices. For solar energy projects, land will be offered for 25 years whereas wind energy projects will have 20 years of land use. Egypt has been suffering from an energy crunch for almost four years, an issue that recently elected President Abdel-Fattah El-Sisi plans to solve by encouraging investment in electricity production. (english.ahram.org.eg)

November 14, 2014. The U.S. expects to earn $5 billion to $6 billion from the federal program that funded flops including Solyndra LLC, bolstering President Barack Obama’s decision to back low-carbon technologies. It’s the first time the Energy Department has released an estimate of the potential gains for the loan guarantee program, designed to back clean-energy projects when venture capital or financing from banks and other investors is unavailable. The department expects a loss rate of about 2 percent on $32.4 billion set aside for loans to spur energy innovation. The loan program, which opened in 2009, was targeted by Congressional Republicans who charged taxpayer money was wasted on startups including Solyndra, the solar manufacturer that closed its doors in 2011 after receiving $528 million. The program’s biggest success story has been Tesla Motors Inc. The Elon Musk-backed electric carmaker paid back its $465 million federal loan nine years early. Abengoa SA, which received a $132.4 million guarantee, opened in October a biofuels plant in Kansas. (www.bloomberg.com)

November 13, 2014. China, the world’s biggest solar market for two years running, is pushing to install more panels at factories, schools and even greenhouses as it seeks to meet its goals under a historic climate agreement with the U.S. China expects to install as much as 8 GW of small solar systems this year, more than 10 times what was built last year. The country had almost 20 GW of solar capacity at the end of 2013, a figure comparable to about 20 nuclear reactors. Most of that came from massive solar farms in remote locations and policy makers are now promoting smaller systems closer to where they’re needed. The push to promote wider use of rooftop solar comes amid growing health concerns tied to smog within its own population and from foreign companies. It also adds to the nation’s push to be a leader within the global climate community.

China is expected to add as much as 8 GW of distributed solar systems in 2015, out of 15 GW of total photovoltaic power. That forecast has China installing in one year about twice as many panels atop factories, office buildings and other distributed sites as there are currently in operation in Australia, one of the world’s sunniest countries. Chinese manufacturers sold about $5 billion of shares from 2005 to 2010, and wrested control of the market from companies in the U.S., Germany and Japan. The added capacity drove down prices and pushed dozens of manufacturers into bankruptcy. Solar panels sell for 72 cents a watt, compared with $2.01 at the end of 2010. The price has slipped 12 percent this year. JinkoSolar Holding Co. , China’s third-largest panel maker, arranged in July as much as 1 billion yuan ($161 million) in financing from China Minsheng Banking Corp. for distributed solar. An 88.8 million-yuan loan for a 20 MW rooftop solar project in Zhejiang province will be the first under the agreement. JinkoSolar is planning three more projects of comparable size in Jiaxing, also in Zhejiang province. (www.bloomberg.com)

November 13, 2014. European Union (EU) rules on low energy appliances, such as dishwashers and refrigerators, are among a welter of green laws the new European Commission is proposing to review or scrap, according to a document. Eco-design and energy labelling directives sparked a media furore in Eurosceptic Britain, where newspapers seized on public indignation that the EU had issued legislation dictating how powerful vacuum cleaners should be. Vacuum cleaners were not mentioned in the document. Some politicians and environmental campaigners accuse the Commission of bowing to populists and ignoring the economic and health benefits of saving energy and cleaning up the air. (uk.reuters.com)

November 13, 2014. Alberta, home to Canada’s oil sands, is prepared to follow the U.S. and China with stiffer carbon regulations for the fossil-fuel industry, Premier Jim Prentice said. As part of the agreement, the U.S. will cut greenhouse-gas emissions to 26 to 28 percent below 2005 levels by 2025, while China will begin to reduce carbon output by about 2030. Their new partnership toward a global limit is essential to draw countries whose emissions are rising into a deal that the United Nations intends to adopt at the end of 2015. Alberta’s oil sands are the fastest-growing source of greenhouse-gas emissions in Canada and Prentice has promised to update the province’s carbon levy of C$15 ($13.25) a metric ton on large emitters by the end of the year.

Environmental groups and U.S. and European legislators have highlighted the higher carbon intensity of Alberta’s oil sands, the world’s third-largest crude reserves, as a reason for slowing construction of pipelines like TransCanada Corp.’s Keystone XL and limiting exports to Europe. Prentice said the province needs to do more on environmental protection and plan to expand partnerships with environmental groups, and improve monitoring and the use of technology in the energy industry. (www.bloomberg.com)

November 12, 2014. Nuclear power is needed to help reduce global fossil-fuel emissions that are set to reach limits advocated by scientists by 2040, according to the International Energy Agency (IEA). The world will use up its budget to keep global warming below a level that averts the most severe climate change by 2040 as emissions from oil, natural gas and coal will rise about 20 percent, the Paris-based agency said. Nuclear power has helped cut the equivalent of two years of emissions at current levels since 1971, it said.

Public concern about nuclear safety must be addressed as the world needs the technology to displace other round-the-clock power plants amid plans to shutter almost half the reactors operational in 2013 by 2040 at a cost of more than $100 billion, the IEA said.

United Nations envoys are seeking to keep temperatures from rising more than 2 degrees Celsius (3.6 Fahrenheit) since the beginning of industrialization. Most of the 200 plants that will be closed by 2040, out of 434 operational last year, will be in Europe, the U.S., Russia and Japan, the IEA said. Regulators and utilities need to ensure effective policies and adequate funds to cover decommissioning costs, which are about 15 percent of the current investment costs for a nuclear power station. (www.bloomberg.com)

November 12, 2014. President Barack Obama pledged deeper U.S. cuts in greenhouse-gas emissions and China will for the first time set a target for capping carbon emissions under a historic agreement the two countries announced. Obama and Chinese President Xi Jinping outlined the accord, which they said would help drive other nations to seriously negotiate a global pact next year in Paris.

The climate deal capped two days of meetings and announcements of deals that Obama and Xi said marked a high point for U.S.-China cooperation. Obama is setting a new target for the U.S., agreeing to cut greenhouse gas emissions at 26 to 28 percent below 2005 levels by 2025. The current U.S. target is to reach a level of 17 percent below 2005 emissions by 2020.

Xi committed China to begin reducing its total carbon dioxide emissions, which have been steadily rising, by about 2030, with the intention to try to reach the goal sooner, according to the White House. China, the world’s largest greenhouse gas emitter, also agreed to increase its non-fossil fuel share of energy production to approximately 20 percent by 2030, according to the White House. The agreement by the two countries, often at odds on policy issues, is a boost for international negotiators in advance of the 2015 United Nations climate conference in Paris. (www.bloomberg.com)

November 12, 2014. Fossil fuels are reaping $550 billion a year in subsidies and holding back investment in cleaner forms of energy, the International Energy Agency (IEA) said. Oil, coal and gas received more than four times the $120 billion paid out in subsidy for renewables including wind, solar and biofuels, the IEA said.

The findings highlight the policy shift needed to limit global warming, which the IEA said is on track to increase the world’s temperature by 3.6 degrees Celsius by the end of this century. That level would increase the risks of damaging storms, droughts and rising sea levels. (www.bloomberg.com)

November 12, 2014. Australian Prime Minister Tony Abbott’s plan to cut the nation’s renewable energy target was rejected by opposition lawmakers on concern it will cost the nation thousands of jobs and billions of dollars in investment. Worries over the government’s renewable energy policies have prompted some companies to reconsider wind and solar farms. The industry has seen A$20 billion ($17 billion) of investment since the country set goals for clean energy in 2001. Talks with the opposition fell apart after the government stuck to its plan to cut the target by 40 percent, according to Mark Butler, the Labor leader on environment.

The government faces the prospect of trying to win sufficient backing in the Senate to get its proposals on the statute books. The government said it wanted to reduce the 2020 renewable-energy target to between 26,000 and 28,000 gigawatt hours from the current 41,000 gigawatt hours. The industry has been concerned the government may go further and get rid of the target. (www.bloomberg.com)

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