[The Environment or the People: Who is important?]

                             “The enforcement of ‘environment’ focussed approach that marginalises people is an artificial way of restricting energy supplies in the developing nations which can increase their energy cost significantly. The effect will be devastating for the nations having the least ability to pay, thereby impacting the rate of economic developing and living standards in these developing nations…”

 

 

 

NEWS BRIEF

[NATIONAL: OIL & GAS]

November 24, 2014. The board of Oil and Natural Gas Corporation (ONGC) has given its nod to Cairn India’s gas development plan for Rajasthan fields. The ONGC board in its meeting had approved the plan to increase production from the Raageshwari Deep Gas fields in the Rajasthan block to 100 million standard cubic feet a day (2.83 mscmd) by fiscal 2017. Cairn had submitted a revised development plan to ONGC in April. While ONGC was still deciding on the plan, there were hints of the public sector company wanting to raise its stake in the block from the current 30 per cent (Cairn India owns 70 per cent), and using delaying tactics to get its way. According to the Rajasthan production sharing contract (PSC), the operator can get unconditional extension for five years if it is producing oil, and 10 years in case of expected gas production. But this extension will be on terms mutually agreed between the two parties. The Rajasthan PSC expires in 2020.

In the short term, Cairn India is on course to double the Raageshwari Deep Gas daily production by the fourth quarter of the fiscal 2015. At present, it is producing 0.25 mscmd of gas. Meanwhile, it has floated tenders in the market for constructing a gas processing terminal, availing itself of drilling and fracking services. Cairn India is also leaving no stone unturned to exploit the full resource base of 300,000 barrels of oil equivalent per day from its Barmer block. In December, it will conduct roadshows in Calgary (Canada) and Houston (US) to tap into the oil field services companies, offering technology and technical solutions. (www.thehindubusinessline.com)

November 24, 2014. Adani Group along with the towel-to-pipe conglomerate Welspun is studying liquid-rich shale and oil sands assets in the US and Canada for acquisitions as the two home-grown business houses look to build a formidable oil and gas enterprise. Adani, owned by Gautam Adani, who has close ties to Prime Minister Narendra Modi, and Welspun, controlled by B K Goenka, have a strategic partnership for oil and gas business and the duo hold interests in conventional blocks in India, Thailand and Egypt. The partners plan to invest $1.5 billion towards stake purchases in select Louisiana and Texas shale fields in the US and some Alberta oil sands projects in Canada as they bet big on unconventional resources.

The two groups feel that shale and oil sands, which have significant potential, will play a greater role in the world's total energy mix and, hence, want to invest in these areas, said sources familiar with the matter. However, unlike their earlier strategy where the joint venture firm, in which Adani owns majority shares, bought exploratory blocks and then had to discover oil, this time around the plan is to buy interest in oil-producing assets. With oil prices collapsing, valuations have become attractive, offering buyers like Adani Welspun Exploration opportunities to pick up high-quality unconventional acreage, said an investment banker. Weakening global demand and an oversupply in the US has pulled down crude oil prices to a more than four-year low of $75 a barrel, trimming the once-high valuations of shale and oil sands assets.

If Adani Welspun works out a deal in the North American region, which is known for its rich reserves in unconventional resources, it will mark the Ahmedabad and Mumbai-based groups' first investment in shale and oil sands properties, following in the footsteps of private-sector explorer Reliance Industries and state-run GAIL, IOC and Oil India, which have acquired stakes in similar assets. Indian firms have so far invested over $10 billion in US shale gas, of which Reliance alone has invested over $7 billion.

While the joint venture has an overall investment plan of $1.5 billion for overseas energy assets, it seeks buys entailing a minimum investment of $300 million. Adani Welspun has been on the learning curve in the oil and gas business with some oil blocks yet to be commercially viable. For instance, its Assam block turned out to be a dud, while the Mumbai and Gulf of Kutch offshore blocks have met with some success. Indian companies have been scanning oil and gas assets abroad to meet the growing energy demand of Asia's third largest economy, which meets four-fifths of its crude oil and about a fourth of its gas requirements through imports. (economictimes.indiatimes.com)

November 23, 2014. Reliance Industries Ltd (RIL) has contested CAG's draft observations on some payments the company made to contractors of KG-D6 fields, saying the auditor had not considered the contract requirement of factoring consequences of delays in procurement of goods and services on the project. RIL in a presentation at an Exit Conference called by CAG at the end of its second audit of KG-D6 for 2008-09 to 2011-12, stated that the auditor was using hindsight to question project efficiencies and procurements made 8 years back. The Production Sharing Contract (PSC) procurement procedures were intended to differ from Government/PSU procurement procedures and to promote investment efficiency, faster decision making in the interest of the project. CAG in its draft report had questioned euro 200 million payment to Allseas Marine Contractors beyond the contracted amount. Stating that the payment was essential to get the project completed in time after some sub-contractors defaulted in timely delivery of goods, the firm drew a parallel of a similar instance with ONGC. ONGC faced with delay in supplies of certain equipment for its shallow water G-1 field in same Krishna Godavari basin from Clough Engineering of Australia. ONGC terminated the contract that resulted in the Australian firm going for arbitration. The state-owned firm, RIL said, settled for an out-of-court settlement to get the project going but the cost has shot up from ` 1,263 crore approved in November 2004 to ` 3,437 crore and yet no sign of the project being completed soon. While government/PSU procedures focus on piece meal & individual tenders taken on standalone basis, avoiding delays and cost of not doing things becomes a primary consideration in PSC procurement. RIL said the CAG appears to conclude that the Contractor was required under the PSC to achieve the levels of gas production estimated in the approved field development plan and that the government is entitled disallow cost recovery for under-utilisation of facilities. (economictimes.indiatimes.com)

November 25, 2014. State-run oil refiner-marketer Bharat Petroleum Corporation Ltd's Assam based refinery, Numaligarh Refinery Ltd (NRL) has projected huge increase business opportunities with the proposed massive capacity addition. According to the refinery, NRL at present is rolling out business worth ` 400-500 crores annually, which will increase to the level of ` 1500-2000 crores once the Refinery expansion project takes off. (economictimes.indiatimes.com)

November 25, 2014. Reliance Industries Ltd (RIL) has sought interest on $1.41 a unit that buyers of its KG-D6 gas are paying into a gas pool account operated by GAIL India, saying the state-run firm ought to invest the amount due to RIL in good interest-bearing instruments. The government had hiked domestic natural gas prices by 33 per cent to $5.61 per million British thermal unit. In case of RIL's main gas field in KG-D6 block, it, however, ordered buyers to pay the firm old rate of $4.2 and deposit the balance $1.41 in the gas pool account. The incremental $1.41 would become due to RIL if it can legally prove that Dhirubhai-1 and 3 gas output dropping to a tenth of projected 80 million cubic meters per day was due to geological reasons, and not because of hoarding. RIL has written to the Oil Ministry saying it is entitled to getting the principal amount together with market interest rate in case it wins the legal case. (conomictimes.indiatimes.com)

November 24, 2014. Public sector Bharat Petroleum Corporation Ltd (BPCL) will be deploying a speed boat with a contingent of CISF Quick reaction team as part of enhancing the security of the Single Point Mooring (SPM) terminal in the Arabian Sea. Kerala Home minister, Ramesh Chennithala, will formally launch the speed boat at a function at Wellington Island. BPCL had set up the SPM terminal about 19.5 km off shore for receiving crude oil from very large crude carriers through subsea pipe line into storage tanks located at Shore Tank Farm (STF) at Puthuvypin in 2007. Crude oil is thereafter pumped to Kochi refinery for refining. For the security of SPM, BPCL had deployed Marine guards on the Maintenance and located adjacent to the SPM on a round the clock basis. The state government had declared SPM as a prohibited area for a distance of about one nautical mile to prevent fishing boats approaching closer to SPM to avoid any damage to SPM and floating hoses, BPCL said. A review conducted by defence minister had recommended deployment of a speed boat for further protection of the SPM. BPCL has sourced a boat with a speed of 20 knots for this purpose. The deployment of the speed boat with a contingent of CISF Quick Reaction team will help in preventing any intrusion to the protected area around SPM. (economictimes.indiatimes.com)

November 20, 2014. With construction of the USD 10 billion pipeline stuck for want of a credible operator, India and three other nations in the Turkmenistan-Afghanistan- Pakistan-India pipeline project set themselves a three-month deadline to resolve all pending issue. The four-nations to the TAPI pipeline, who met in Ashgabat (Turkmenistan), decided to start work on the project by 2015. Besides Pradhan, the TAPI Steering Committee Meeting was attended by Petroleum Ministers of Turkmenistan, Afghanistan and Pakistan. Asian Development Bank (ADB), which is the transaction advisor to facilitate the project, also participated in the meeting. Pradhan used the sidelines of the meeting to hold bilateral talks with Pakistani Oil Minister Jam Kamal Khan to discuss expediting the TAPI project, as also the possibility of supply of LNG to Pakistan from India. He discussed TAPI in separate bilateral meetings with Afghanistan Minister for Mines and Mineral Resources Barikzai. TAPI project has remained on drawing board since the four nations have not been able to get an international firm to head a consortium, which will lay and operate the 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 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 19, 2014. Natural gas, a very highly consumed commodity in India, is at present supplied from two sources: domestic production and imported liquefied natural gas (LNG). Energy demand and supply projections indicate that by 2021-22, due to rising demand, India will also need to start sourcing natural gas from cross-border pipelines to fill the gap between demand and availability. In such a situation, India will have to examine its options carefully to minimise the cost of imports and consider appropriate sources of natural gas to keep the import bills under check. Importing LNG is a rather costly process, but unavoidable because the sources of gas are far away. This cost can be avoided if gas is imported through pipelines and then transported across the country through existing and future-planned pipelines in India. India, as on April 1, 2013, had 14,578 km of pipelines, including 1,146 km of offshore pipelines. (economictimes.indiatimes.com)

November 25, 2014. A panel headed by oil regulator DGH will by December 24 submit its report on the reasons for delay in developing gas discoveries in ONGC's Krishna Godavari basin (KG basin) KG-D5 block, Oil Minister Dharmendra Pradhan said. ONGC's KG-D5 (KG-DWN-98/2) sits next to Reliance Industries' eastern offshore KG-DWN-98/3 or KG-D6 block in Bay of Bengal. Both blocks were awarded in the first round of auction under New Exploration Licensing Policy (NELP) in 2000. While Reliance Industries Ltd (RIL) began oil production from its KG-D6 block in September 2008 and gas output in April 2009, ONGC, which has made 11 oil and gas discoveries in KG-D5 block, still is at least four years away from first gas. The ministry wants to investigate the reasons for the delay. The panel, he said, is likely to submit its report within two months from the date of its meeting held on October 24. As per ONGC estimates, gas production from the KG-D5 block is planned to begin in 2018 and oil output in 2019. KG-D5 will produce up to 90,000 barrels per day (4.5 million tonnes per annum) - the largest from any field on the east coast. ONGC will produce 17 million standard cubic meters per day of gas from the block. KG-D5 is divided into a Northern Discovery Area (NDA) and Southern Discovery Area (SDA). NDA holds an estimated 92.30 million tonnes of oil reserves and 97.568 billion cubic metres of in-place gas reserves spread over seven fields. ONGC bought 90 per cent interest in Block KG-DWN-98/2 from Cairn Energy India Ltd in 2005. Cairn subsequently relinquished its remaining 10 per cent interest in favour of ONGC. (economictimes.indiatimes.com)

November 25, 2014. The battle for alcohol between the liquor industry and oil companies is likely to end. The government plans to allow petrol blending with ethanol produced from non-edible plants. Currently, ethanol produced from sugarcane is the only source for blending, which makes it scarce for alcohol and chemicals manufacturing. The oil ministry has recently moved a proposal for the Cabinet to allow blending petrol with cellulosic ethanol produced from biomass such as switchgrass, paper pulp, sawdust, municipal waste and non-edible parts of plants. This would be an alternative to ethanol made from molasses, a byproduct of sugar manufacturing, the government said. This would help in reducing India's dependence on energy imports, keep cities and villages clean and avoid confrontations with liquor and chemical industry, the oil companies said. The government had launched sale of ethanol blended petrol in 2003 and gradually made 5% blending mandatory in 20 states and four Union Territories, subject to availability of the biofuel. (economictimes.indiatimes.com)

November 25, 2014. Spot liquefied natural gas (LNG) prices are plunging and are expected to fall further notwithstanding the onset of winter, which traditionally drives prices higher. The fall is not just an outcome of drop in oil prices, but also a strategic shift in the demand-supply balance, and augurs well for Indian consumers. India imported a total 13 million tonnes LNG in FY14 for $8.5 billion, according to the export-import data published by the ministry of commerce. India is the fourth biggest LNG importer with consumption of natural gas slated to grow faster than oil. Hence, the crash in spot prices is good for India. Recent spot LNG contracts were struck at prices as low as $10.5 per million British thermal units (mmBtu), nearly 45% down from year ago period and 25% down from those struck in October 2014. These contracts are for delivery after two months; hence, contracts in November related to deliveries in January 2015. There are indications the trend will continue well in future. (economictimes.indiatimes.com)

November 24, 2014. The share prices of some of the country's largest oil and gas exploration and production (E&P) companies may give the impression that the sector is yet to emerge out of its slumber, but a look at mid- and small-cap shares in the sector shows that they are enjoying a dream run on the bourses. The stock price of offshore services companies has given returns of up to seven times this year so far, and it is even more if one considers their rise from their annual lows. However, despite a sharp run-up in prices, there's a belief that there's steam left in the share price of these companies. Among the companies whose shares have risen despite a slack in the sector include Alphageo, Global Offshore, Dolphin Offshore, Duke Offshore, SEAMAC, Mercator, Shipping Corporation and Aban Offshore, to name a few. While the largest private E&P player in India, Reliance Industries, has underperformed the Sensex by a huge margin, the Oil and Natural Gas Corporation (ONGC) is up around 30 per cent, in line with the index. ONGC could be paying between $24,000 and $32,000 per day for each supply or rig-toeing vessel and also for services like blocking and deblocking of rigs. The charges are mainly based on the quality and life of the vessel. (economictimes.indiatimes.com)

November 24, 2014. Indian Oil Corp (IOC), which posted weak financial results for the July-September quarter, will see improvement in its credit profile because of diesel price deregulation and falling crude oil rates, Moody's has said. IOC's second quarter earnings were weak "because of lower refining margins and inventory valuation losses," Moody's Investor Service said in a report. The company reported a negative refining margin of $2 per barrel in the quarter as against $2.3 per barrel gross refining margin in first quarter. It projected weak regional refining margins over the next 12 months as new capacity comes online in the region against the backdrop of slowing demand growth. Moody's said the deregulation of diesel prices along with declines in oil prices is expected to reduce fuel under- recoveries to around ` 85,000 crore this fiscal compared to ` 140,000 crore in 2013-14. Borrowings will also fall when the government rolls out the Modified Direct Benefit Transfer Scheme from January 2015 in the entire country. Under this, the cost of subsidies for LPG cylinders will be directly transferred to the consumer and oil marketing companies, including IOC, will be able to sell their products at market prices. Also, earnings will improve on commissioning of new refinery at Paradip. (economictimes.indiatimes.com)

November 24, 2014. Government may invite fresh applications for top job at Oil India Ltd (OIL) after Public Enterprise Selection Board (PESB) did not find any of the six applicants, including the firm's Director (Finance) R S Borah, suitable. Public Enterprise Selection Board (PESB) interviewed six candidates including Borah, to select a new Chairman and Managing Director (CMD) of the nation's second biggest state explorer. With PESB not finding anyone suitable candidate, the government can seek fresh applications PESB was interviewing candidates to select a successor of incumbent S K Srivastava, who retires on June 30, 2015. Besides Borah none of the other three were qualified to appear for the interview. (economictimes.indiatimes.com)

November 22, 2014. The government has directed users of gas produced from the Reliance Industries Ltd (RIL)-operated KG-D6 gas field to pay the old rate of $4.20 a unit to the producer and deposit balance $1.41 a unit in a gas pool account operated by state-run GAIL India. The Cabinet approved a new gas pricing formula, which raised the domestic gas price from $4.20 a unit to $5.61 from November 1. It had, however, directed the oil ministry to credit the difference between the revised price and the old price to a gas pool account, pending final verdict of an ongoing arbitration between RIL and the government. According to government, GAIL will bear all administrative costs related to maintaining the gas pool account.

The government was favourably considering the option of directly transferring the differential amount to the gas pool account as there were legal or technical hassles in other two options. One option that was proposed by the contractor was to allow it to collect the entire sales proceeds and then deposit the differential amount in the gas pool account. The other option was to ask GAIL to collect gas revenues, pay RIL as per the old rate and keep the differential in the gas pool account. There could be legal problems with the first option because RIL had filed arbitration cases against the government over various disputes related to KG-D6, and allowing it to collect the entire sum could weaken the government's stand. The second option was technically cumbersome as customers have signed contracts with RIL and not GAIL, so the public sector company could not collect revenues without changing the contracts. The Cabinet decided that RIL should wait for the final verdict before getting new rates for gas produced from its controversial D1 and D3 fields. This is because the arbitration is over the government's power to prevent RIL from recovering its costs on account of a shortfall in production targets. While the production sharing contract allows the producer to recover costs, the government has disallowed some of the cost recovery on the ground that RIL had failed to produce the promised amount of gas. RIL says the government's action runs contrary to the PSC. (economictimes.indiatimes.com)

November 21, 2014. The oil ministry has asked the director general of hydrocarbons (DGH) to devise a transparent formula to determine the premium on natural gas produced from challenging deep-water, ultra deep water or high-temperature and high-pressure finds, the government said. The government had announced earlier that natural gas would be priced on the basis of a formula based on international benchmarks, but a premium would be allowed for discoveries made in regions where exploration and drilling is costly and challenging. It later said it would consult experts to determine the premium. Under the new formula, the gas price would rise from $ 4.2 to $ 5.61, but there would be an incentive for difficult terrains. The DGH said that specialists would be consulted for this purpose as it is a complex issue and the DGH was not involved in arriving at the formula for natural gas pricing. After the Cabinet approved the new formula, the oil ministry had stated stakeholders will be consulted on the mechanism of premium determination and pricing of these three categories. The ministry had said a transparent process would determine the premium and that the government would address apprehensions about the process being discretionary. (economictimes.indiatimes.com)

November 20, 2014. Vijay Kelkar, who headed a panel on energy security appointed by the UPA government, said the new gas pricing mechanism will not attract investments in exploration and criticized the decision to give a premium on price of gas from challenging deep-sea fields saying that it reflected a cost-plus approach. Government said the Russian price was reliable and closer to the Indian reality compared to the National Balancing Point price. With the new gas pricing formula the price works out to be $5.61. The UPA regime had approved the Rangarajan formula, which would have raised the price from $4.20 per unit to about $9.3 per unit based on its net calorific value. Government said the formula was based on international benchmarks, and even BP Plc described it as a step in the right direction although the British major wants more clarity and free market prices. (economictimes.indiatimes.com)

November 20, 2014. Comptroller and Auditor General of India (CAG) has sought an audit of Reliance Industries' spending on eastern offshore KG-D6 block in 2012-13, a request the company responded by asking the auditor to scrutinise records of not just that year but also 2013-14. CAG, in the third round of audit of KG-D6 as well as three other oil and gas fields, on November 11 wrote to Reliance Industries Ltd (RIL) seeking records to audit spending in 2012-13. To this, RIL responded with a request to add financial year 2013-14 to the scope for the audit of KG-D6. It offered full co-operation to CAG for this audit but cautioned that audit should be in letter and spirit of the Production Sharing Contract (PSC) signed by the government for KG-D6 fields. The company said it is agreeable to such an audit whose scope and nature should be in line with what was spelt out in the Oil Ministry's letter of January 2013. The Ministry had in January 2013 agreed that the audit under PSC should be a financial scrutiny and not a performance audit of the company. (economictimes.indiatimes.com)

November 20, 2014. Numaligarh Refinery Ltd (NRL) has been conferred with the prestigious Jawaharlal Nehru Centenary Award for Energy Performance of Refineries for 2013-14. The award is given by the Centre for High Technology (CHT) under the aegis of the Ministry of Petroleum and Natural Gas. The company won the third prize in the category of refineries having composite energy factor greater than or equal to 7.5, NRL said. Refineries with minimum Specific Energy Consumption, which is a measure of energy efficiency, are conferred with this award by CHT. (economictimes.indiatimes.com)

November 19, 2014. Local oil product sales declined 0.99 per cent in October, its first decline in about 11 months, government data showed, as diesel demand continued to ease indicating lower industrial growth during the month. Local oil product sales, a proxy for oil demand in the world's fourth-largest oil consumer, totalled 13.09 million tonnes last month, according to data from the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry.

Diesel consumption, which makes up over 40 per cent of local fuel sales, declined 3.02 per cent, while gasoline demand rose 10.49 per cent from a year earlier. India shipped in about 3.74 million barrels per day of oil in October, a growth of about 2.97 per cent from a year earlier. Imports of oil products increased by 5.38 per cent, while exports rose nearly 1.17 per cent. (economictimes.indiatimes.com)

November 19, 2014. India will soon pay a third tranche of $400 million to Iran ahead of a Nov. 24 deadline to an interim deal with six world powers that allows Tehran to recover part of its overseas frozen oil revenues. Indian oil refiners are preparing to release the payments. Mangalore Refinery and Petrochemicals Ltd and Essar Oil will make the bulk of the payment. The other refiners that will also make payments are Indian Oil Corp and Hindustan Petroleum Corp. India has already paid $900 million in two instalments under the interim deal that allowed Iran to recover $2.8 billion of its funds held in foreign banks, in addition to $4.2 billion paid between January and July. The latest payments would be made using an existing mechanism of a series of back-to-back transactions in different currencies that are initially channelled through the Reserve Bank of India (RBI). Iran will eventually get paid in Dirhams from the central bank of United Arab Emirates. Iran's top oil client after China, India has imported 40.3 percent more oil from Tehran in the first ten months of this year than in the same period last year, data obtained from trade sources show. (www.reuters.com)

November 19, 2014. The government may alter terms of Cairn India's Rajasthan oil block after Law Ministry opined that fiscal terms can be renegotiated while granting extension beyond contractual period. The government can look at raising its share of oil from the fields from a current cap of up to 50 per cent as well as allowing Oil and Natural Gas Corp (ONGC), which is the licensee of the block, to raise its stake. Cairn's contractual term for exploring and producing oil from the Rajasthan Block RJ-ON-90/2 expires in 2020 and the company has made a formal application for extending the license by another 10 years saying the block also has significant potential to produce natural gas. The Law Ministry said the Production Sharing Contract (PSC) for the Rajasthan block clearly states that extension can be granted on "mutually agreed" terms and conditions. (economictimes.indiatimes.com)

November 19, 2014. Petroleum Minister Dharmendra Pradhan, on a three-day visit to Turkmenistan, sought assurance of gas supply from the central Asian nation’s President Gurbanguly Berdimuhamedov. Pradhan also met Pakistan’s Petroleum Minister Jam Kamal Khan on the sidelines of the TAPI Steering Committee Meeting between the petroleum ministers Turkmenistan, Afghanistan, Pakistan and India. Pradhan assured Khan of India’s cooperation on natural gas exports from India to Pakistan apart from expediting commission of TAPI project. The meeting between the two sides in Ashgabat comes amid revival of talks to set up the much-delayed TAPI gas pipeline project. As part of the project, a 1,800-km pipeline is being set up to export up to 33 billion cubic metres (bcm) of natural gas a year from resource-rich Turkmenistan to India via Afghanistan and Pakistan over 30 years. (www.business-standard.com)

 [NATIONAL: POWER]

November 25, 2014. The Andhra Pradesh (AP) government is signing four MoUs with Japanese global business giant Sumitomo Corporation and one of them corresponds to the setting up of a 4,000 MW ultra super critical power project as a joint venture project in collaboration with the state power utility AP Genco. Chief Minister N Chandrababu Naidu is betting big on Sumitomo's expertise ranging from power to agriculture to make a mark in the state. The AP government is signing two more MoUs, one with the Ministry of Economy, Trade and Industry (METI), Government of Japan, on industrial innovation and environmental fronts and the other with the New Energy and Industrial Technology Development Organisation (NEDO), Japan, for bringing energy-efficient technologies to the state. (www.business-standard.com)

November 23, 2014. Adani Power is all set to acquire Avantha group's Korba West Power, a wholly owned subsidiary of Avantha Power that has an installed generation capacity of 600 MW in Chhattisgarh and is implementing another 600 MW in the second phase for an enterprise value of about ` 4,200 crore. The second divestment will mark the Avantha Group's exit from the power generation business. In April this year, the Adani group announced it had become the largest private power producer in India, with an overall installed capacity of 8,620 MW. (economictimes.indiatimes.com)

November 21, 2014. Calcutta Electric Supply Corporation (CESC), the flagship company of the R.P.-Sanjiv Goenka Group, is all set to commission its ` 4,600 crore thermal power plant at Haldia in West Bengal's East Midnapore district. The plant will become operational early next year. Chief Minister Mamata Banerjee will inaugurate the 600 MW (two units of 300 MW each) plant, which has been set up by Haldia Energy Ltd., a wholly owned subsidiary of CESC. China-based Shanghai Electric Corp. supplied the boiler turbine-generator for the plant set up over 317 acres of land. Punj Lloyd was the engineering procurement and construction contractor for the project. (economictimes.indiatimes.com)

November 19, 2014. The country’s largest power producer, NTPC Ltd has evinced interest to develop the 2,400 MW coal-based power station proposed at Kamakhyanagar in Dhenkanal district through the joint venture (JV) route. The 2,400 MW coal fired plant is being developed by OdishaThermal Power Corporation Ltd (OTPCL), an equal JV between two state controlled entities- Odisha Mining Corporation (OMC) and Odisha Hydro Power Corporation (OHPC). Besides NTPC, engineering giant Larsen & Toubro (L&T) and Bharat Heavy Electricals Ltd (BHEL) were also inclined to pick up stake in OTPCL’s project. Both these central PSUs were keen for only 26 per cent stake and that too with a rider that their equipment would be used in the power plant. (www.business-standard.com)

November 19, 2014. The Damodar Valley Corporation (DVC) board has failed to invite Expression of Interest (EoI) for a strategic investor in the proposed 2,500 MW Raghunathpur power plant at Purulia. Facing acute funds crunch, the DVC was planning to bring in equity partners for the 2X600 MW phase-I and 2X660 MW Phase-II (Raghunathpur Thermal Power Project). The agenda in the board meeting included inviting EoI including from PSUs and private, state government to allow carrying out of due-diligence by new prospective bidders. (economictimes.indiatimes.com)

November 25, 2014. With the onset of winter, just one ultra mega power plant at full capacity is sufficient to meet India's shortfall that has shrunk to less than 4,000 MW. Although total demand has increased by 5,000-6,000 MW in the past one year, new capacities coupled with better grid management have led to the decline in the supply deficit. Uttar Pradesh (UP) and states in south India continue to show large demand-supply gap specifically due to grid congestion. UP's grid system isn't good enough to meet the demand for the power the state requires. (economictimes.indiatimes.com)

November 23, 2014. The labour unions of Coal India have called off a strike planned in protest against a stake sale and opening up of the industry, setting the stage for Prime Minister Narendra Modi to press ahead with energy reforms. Coal India holds a monopoly on commercial coal mining, accounting for more than 80 per cent of the country's total production. Union leaders met a senior coal ministry official and the strike was postponed until a meeting with the power and coal minister, said S.Q. Zama, secretary general of the Indian National Mineworkers Federation. The date of the meeting with the minister has not yet been fixed. Even before meeting, the government and Coal India officials were confident any strike would have little impact as one of the company's five unions, close to the BJP, had promised not to join. The government's sale of a tenth of Coal India could fetch a third of its $9.5 billion annual divestment target. Asset sales are running behind schedule, pressuring a deficit target of 4.1 per cent of GDP for the fiscal. Emboldened by the biggest electoral mandate in 30 years, Modi has also taken steps to let private companies mine and sell coal in India, for the first time in more than four decades. Zama said the unions would keep resisting any move that could undermine the position of Coal India. He said competition from private companies would make Coal India a "sick" company, risking the jobs of most of its 370,000 workers. (economictimes.indiatimes.com)

November 21, 2014. Union Cabinet chaired by the Prime Minister, Narendra Modi, has approved, North Eastern Region Power System Improvement Project (NERPSlP) for six States (Assam, Manipur, Meghalaya, Mizoram, Tripura and Nagaland) for strengthening of the Intra State Transmission and Distribution System at an estimated cost of ` 5111.33 crore including capacity building expenditure of ` 89 crore. The scheme is to be taken up under a new Central Sector Plan Scheme of Ministry of Power (MoP). The scheme is to be implemented with the assistance of World Bank loan and the budget of MoP. As the Intra-State Transmission and Distribution systems in the North-Eastern States have remained very weak, the Central Electricity Authority (CEA) developed a comprehensive scheme for the North East Region (NER) in consultation with the Power Grid Corporation of the India Limited (PGCIL) and State Governments concerned. The project shall be implemented through PGCIL in association with six NER States in 48 months from the date of release of funds to PGCIL. After commissioning, the project will be owned and maintained by the State Governments. Presently, all the six Northeaster states (NER) States are connected to transmission network at 132 KV and below. The 33 KV system is the backbone of power distribution system in the six NER States. (economictimes.indiatimes.com)

November 19, 2014. State-run NTPC, the country's biggest power generator and thermal coal consumer, plans to acquire at least 26 per cent stake in coal mines abroad to secure long-term fuel supplies for all its power plants. This is a shift from the company's earlier stance of seeking only minority stakes in such mines to ensure fuel for plants that operate only on imported coal. In the current fiscal, NTPC is targeting tie-ups for 17 million tonnes of imported coal. (economictimes.indiatimes.com)

November 25, 2014. Saskatchewan Province of Canada evinced interest in collaborating with Andhra Pradesh (AP) in the field of agricultural research, tourism, good governance, and clean technologies in the production of thermal and nuclear power. During the interaction with AP chief secretary IYR Krishna Rao, Saskatchewan deputy minister Doug Meon said his country was interested in having bilateral relations, especially in the areas of energy, security, food security and education. The visiting team showed interest in agricultural research, tourism, good governance, clean technologies, and possibility of collaboration in nuclear energy in consultation with the Government of India and the Nuclear Energy Corporation. (www.newindianexpress.com)

November 24, 2014. The government has appointed a consultancy firm to find ways to cushion power companies against a rise in generation costs after they buy coal blocks through e-auctions, and look at the possibility of passing a part of it on to consumers. Some power generation companies had been allotted coal blocks on the basis of their plants. They have also signed power purchase agreements (PPAs) with power utilities to supply electricity at a mutually agreed pre-determined price. PPAs are legally binding documents and increasing this contracted power tariff will lead to violation of the contract. The ordinance to auction coal blocks follows the Supreme Court's order cancelling allocation of several coal blocks, after the Comptroller & Auditor General estimated that coal worth ` 1.86 lakh crore was given away. At present, 42 producing blocks and 32 that are ready to start production will be offered — some through auctions and others through direct allocation to state utilities. The auction will commence on February 11 next year, and the winners will be informed by March 16. The government expects these 74 blocks to produce 210 million tonnes of coal a year. Coal blocks will be auctioned on the basis of their net present value, which is the current value of future earning from the block. The floor price for bidding will be fixed at 90 per cent of the net present value. Winners need to pay 10 per cent of the bid amount upfront. A successful bidder or allottee may utilise coal mined from a particular coal mine in any of its other similar end-use plants by giving a prior intimation to the central government in writing and the government will be free to impose terms and conditions it deems necessary. State utilities would be allocated blocks depending on per-capita power availability in the states and future requirements. They will not be allowed to bring in private firms as joint venture partners in such blocks. (economictimes.indiatimes.com)

November 24, 2014. The recently announced power sector reforms by the Indian government are a step in the right direction as easier and assured access to power will help boost productivity of the manufacturing sector, the Nomura report said. According to the Japanese financial services major, besides a shortage of supply, poor transmission and distribution (T&D) infrastructure and a large amount of pilferage are some of the key issues plaguing the power sector. The government approved three key projects in the power sector targeting improvement of T&D. It approved ` 43,033 crore rural electrification scheme, Deendayal Upadhyaya Gram Jyoti Yojana. This scheme would replace the existing Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY). The government approved ` 5,200 crore scheme for strengthening power transmission and distribution network in six North-east states. It also approved ` 32,612 crore scheme for strengthening sub-transmission and distribution network in the urban areas. (economictimes.indiatimes.com)

November 22, 2014. Private producers are seeking 10 per cent additional debt exposure by banks to the power sector to fund projects stranded by lack of fuel. In a presentation to Reserve Bank of India (RBI) Governor Raghuram Rajan, the Association of Power Producers (APP) sought easier rules for banks to fund stranded projects. The meeting was attended by executives of Reliance Power, Tata Power, Jindal Power, and the Adani, GMR, GVK, Essar, Indiabulls, Lanco and Welspun groups, among others. APP sought the banking sector’s support in creating an enabling environment for all participants in the power sector — project developers, lenders, distribution companies and consumers. The association gave a debt restructuring plan for power plants stranded by unfulfilled fuel linkages. Investments of ` 1,57,730 crore have been affected by the under recovery of fixed and variable costs in power projects due to factors beyond the control of developers. Close to ` 61,050 crore of investment is stranded in gas-fired power projects totalling 13,566 MW capacity. (www.business-standard.com)

November 21, 2014. The Cabinet has approved the ` 32,600 crore Integrated Power Development Scheme (IPDS) that will strengthen the transmission and distribution networks and metering in urban areas and smarten it with information technology. It also approved a ` 43,033 crore scheme, which includes the requirement of budgetary support of ` 33,453 crore, for rural areas to separate agricultural supply from non-farm supply. Cutting transmission losses and improving distribution is a key element for the power sector, and the initiative follows steps to ease coal shortage and discussions to formulate a financial package for the sector, where thousands of megawatts of capacity are idling or operating sub-optimally because of fuel shortage or inadequate distribution network. The cabinet had approved last year a scheme for IT enablement of the distribution sector and strengthening of distribution network and laid down targets. It said the budgetary support needed for the scheme was ` 25,354 crore during the implementation of the scheme. (economictimes.indiatimes.com)

November 21, 2014. The government will spend ` 25,300 crore ($4.1 billion) to tackle rampant theft of electricity by rolling out metering in cities and upgrading old distribution networks, the power ministry said. Cutting electricity theft and reducing transmission losses are part of Prime Minister Narendra Modi's efforts to bring uninterrupted power to the whole country, a key policy plank since his election in May. Cheap or free power is viewed as a right rather than a privilege by many Indians, and poor policing and anitiquated transmission lines result in as much as 40% of electricity going unpaid for in some Indian states. As chief minister of Gujarat in 2005, Modi was credited with tackling power shortages by clamping down on theft, and by repairing the finances of local distribution companies hit hard by unpaid bills. Under the scheme, the government will roll out meters on distribution transformers, feeders and consumers in urban areas, the power ministry said in a statement, following cabinet approval of the project. The government will also strengthen sub-transmission and distribution networks. These projects will help cut technical and commercial losses and improve collection efficiency, the ministry said. They will cost ` 32,600 crore in total, of which ` 25,300 crore will come from the government. (www.business-standard.com)

November 20, 2014. The government is working on big-ticket financial package for about 1,30,000 MW thermal and hydro power plants worth over ` 6,00,000 crore that are hit by severe funds crunch while continuing to face cost and time overruns. The Department of Financial Services will shortly recommend a series of steps to the Reserve Bank of India. The recommendations are based on a report prepared by a committee led by India Infrastructure Finance Company Ltd on debt restructuring and moratorium scheme for stranded power plants. The department is likely to recommend to the RBI to provide additional debt to the projects that are facing time and cost overruns. The recommendations may also include shifting project completion timeline by banks. Restructuring the loans without classifying them as non-performing assets is also likely to be recommended. The government may also ask RBI to allow deferring interest payment by capitalising it and collecting it after a few years and reducing the interest rate to SBI's base rate till plants are operational. The government has been working overtime to address the problems of the sector. Leading private companies have invested huge sums to set up power projects in recent years but Coal India has not been able to raise production commensurately. Many gas-fired projects are also idling because the country's gas supply is inadequate. To ease the shortage of coal, the Power, Coal and Renewable Energy Minister Piyush Goyal is determined to make sure that state-run Coal India Ltd doubles its production to more than 1 billion tonnes a year. This will help stranded power plants to run at optimum capacity. (economictimes.indiatimes.com)

November 20, 2014. Seeking to resolve persistent power and coal crisis in Uttar Pradesh, Chief Minister (CM) Akhilesh Yadav would soon meet union minister of power and coal (independent charge) Piyush Goyal in New Delhi. On November 8, a similar meeting between Yadav and Goyal was called off at the last moment after the latter had cancelled his Lucknow visit. The proposed meeting was touted as a positive development juxtaposed to bitter exchange of words between the Centre and UP through statements and letters blaming each other for the state power crisis. In fact, the ruling Samajwadi Party and opposition Bharatiya Janata Party (BJP) had sparred in the state legislative assembly over power crisis. Even Yadav had participated in the discussion to fend off BJP's stinging attack on the issue. Yadav has revealed plans to call upon the union minister to discuss the issue and seek early resolution of the crisis.

The CM has reiterated alleged discrimination in allocation of power to UP from central pool. He also claimed the Centre was not providing coal as per requirement to run state thermal power plants adding to the woes. Citing the example of Delhi, Yadav said it had been allocated 70% of 5,788 MW of central power quota of UP, although Delhi's population was less than even half of it. The CM demanded to revisit guidelines for allocation of central power quota. Besides, UP thermal power generation had adversely been affected following sub-optimum supply of coal. Meanwhile, Yadav has requested for long term coal linkage to proposed power plants so that they are completed on time. (www.business-standard.com)

November 20, 2014. IL&FS Engineering and Construction Company Limited (IL&FS Engineering Services) has won ` 239.6 crore contracts for rural electrification (RE), the company said. IL&FS Engineering Services has bagged two contracts from PVVNL (Paschimanchal Vidhyut Vitran Nigam Limited), a discom of Uttar Pradesh state for RE works with value of ` 145.55 crores, and ` 94.05 crores respectively totalling ` 239.6 crores in Uttar Pradesh, the company said. The first contract involves RE work of villages in Moradabad district while the second pertains to villages of Amroha (JP Nagar) district in Uttar Pradesh under Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) on turnkey basis. The completion period for both these contracts is 24 months. (www.business-standard.com)

November 19, 2014. Fitch Ratings has assigned BBB- rating to NTPC's proposed $2 billion medium-term note programme. The ratings of BBB- are considered secure by Fitch. Fitch assesses that the linkages between NTPC and the sovereign are moderate, with strategic linkages being especially strong. NTPC's ratings benefit from stable operational cash flows due to the favourable regulatory framework. The company has long-term power purchase agreements (PPAs) for all its plants that allow for the pass-through of fixed costs as well as fuel costs. Its returns are regulated based on invested capital and a rate of return as per a transparent regulatory model. (www.business-standard.com)

 [INTERNATIONAL: OIL & GAS]

November 25, 2014. Russia's Gazprom Neft, the oil arm of the world's top gas producer Gazprom, agreed to develop Russia's Dolginskoye offshore Arctic oil field jointly with Vietnamese state energy company Petrovietnam. The companies signed a deal under which Gazprom Neft will supply ESPO-blend crude oil to Vietnam. Russian oil companies, including Gazprom Neft, have been hit by Western sanctions, which limit cooperation in offshore, deep water and tight oil production. The Dolginskoye field, with more than 200 million tonnes (1.5 billion barrels) in estimated reserves, is located near Prirazlomnoye field, Russia's first offshore Arctic field launched last year. Germany's Wintershall used the platform for one of its projects in North Sea. The company said that it completed drilling of an exploration well at Dolginskoye, while Saturn is set to be towed to the port of Murmansk. The company has said it is working out a plan for 2015. (www.rigzone.com)

November 24, 2014. Total SA “hinted” it may cut its exploration budget as much as 29 percent next year, Raymond James analysts said following the slump in world oil prices. Europe’s second-largest oil company by market value may lower the budget to $2 billion to $2.5 billion, the analysts including Bertrand Hodee said. The exploration budget for this year is $2.8 billion. The company is reducing or delay spending after benchmark Brent crude oil tumbled 30 percent from a high in June. The producer may also adjust the pace or details of its $10 billion of planned asset sales through 2017, including the possibility of disposing of less upstream assets if oil prices stay lower and more midstream and “non-core” infrastructure items, the Raymond James analysts said. (www.bloomberg.com)

November 24, 2014. Oil at $75 a barrel won’t affect U.S. output from shale much because investments in wells and production have already been made, said Andrew Liveris, chairman and chief executive officer of Dow Chemical Co. Some U.S. shale producers are already hurt by the drop in oil prices, though Dow, based in Midland, Michigan, sells enough different products that it can withstand lower crude, Liveris said. Chemical companies such as Dow use oil products and natural gas to make finished goods, which they sell at prices linked to crude. Oil prices plunged into a bear market last month, the result of a surge in shale drilling that lifted U.S. output to a three-decade high. Rising Organization of Petroleum Exporting Countries (OPEC) output and increasing signs of slower demand growth contributed to a 30 percent drop in Brent crude this year. Some of the biggest producers of the OPEC, which pumps 40 percent of the world’s oil, are resisting calls to reduce supply. Others such as Venezuela, Ecuador, Iran and Libya seek action to support prices ahead of the group’s Nov. 27 meeting in Vienna. (www.bloomberg.com)

November 24, 2014. Brazil's state-run oil company Petroleo Brasileiro S.A. (Petrobras) completed drilling of the first extension well in the massive Libra field off the coast of Rio de Janeiro, confirming good quality oil. Petrobras said the well reached a depth of 5,734 meters and is located 4 km from the original discovery well. Petrobras is the operator in the field with 40 percent stake, along with partners Royal-Dutch Shell and France's Total each with 20 percent. China National Petroleum Corp and CNOOC Ltd hold 10 percent stakes each. (www.rigzone.com)

November 20, 2014. Sanctions are forcing Exxon Mobil Corp. to look for alternative assignments for an offshore rig supposed to sail back to the Russian Arctic next summer. West Alpha, the rig owned by billionaire John Fredriksen’s North Atlantic Drilling Ltd. that made a billion-barrel oil discovery for Exxon and OAO Rosneft in the Kara Sea in September, could end up operating offshore Norway instead of going back to Russia in 2015, said Dominic Genetti, operations manager for Exxon in Norway. The U.S. and the European Union deepened sanctions in September to punish Russia for its support of separatists in eastern Ukraine. The sanctions seek to constrain Russia’s financial, defense and energy industries, restricting access to markets and the export of technology for Arctic, deepwater and shale-oil exploration and production, where Russian companies rely on western know-how and equipment. North Atlantic and Rosneft delayed the completion of a deal that includes $4.25 billion in offshore contracts for six rigs starting between 2015 and 2017. Those agreements include the West Alpha rig after it completes its current contract with Exxon and Rosneft’s joint venture, which is the operator of the Kara Sea license. North Atlantic is also looking for alternative assignments for two rigs scheduled to start on contract with Rosneft in 2015. (www.bloomberg.com)

November 20, 2014. Royal Dutch Shell Plc may close its Draugen oil field in the Norwegian Sea a decade earlier than in a prior assessment of the area’s potential lifespan because of rising costs and a slump in oil prices. Europe’s biggest oil company expects production in the field to extend until 2024 to 2027 after previously estimating a potential of as long as 2036, Odin Estensen, an asset manager at its Norway unit, said. Shell is among oil companies reining in spending as higher costs in the past decade eroded returns, delaying projects. Oil prices, down by about a third since June, will lead to more delays as profitability falls, the Norwegian Petroleum Directorate said. Draugen is one of Norway’s most efficient fields with a recovery rate of 70 percent and was initially set to be shut in 2013, according to Shell. From a peak 225,000 barrels of oil a day, the field’s output has declined to an average 30,000 barrels a day so far in 2014, Estensen said. Shell has currently only applied for a production extension to 2024, he said. Draugen would need new deposits tied in to its installations, which have spare capacity, as well as lower costs to allow the field to produce to 2036, he said. Shell in April shelved a project to boost recovery from the Ormen Lange gas field in the Norwegian Sea due to higher costs and uncertainty over reserves. It’s considering restarting work on the project in the first quarter of 2016, Estensen said. (www.bloomberg.com)

November 25, 2014. Operations at Aconcagua oil refinery in central Chile will be partially halted until next month, after a fire broke out at a key distillation unit, state oil firm ENAP said. The fire was brought under control within about 15 minutes, but parts of the refinery were closed as a precaution, ENAP said. Aconcagua should be running at full capacity again by the first half of December. Aconcagua has a refining capacity of around 104,000 barrels per day and produces the majority of fuel consumed in the capital Santiago. Chile has two major oil refineries, Aconcagua and Bio-Bio, both run by ENAP. According to ENAP, their total refining capacity is around 220,000 barrels per day and they can supply over 80 percent of Chile's requirements, as well as exporting a small amount to neighboring Peru. Chile imports nearly all the fuel it consumes, most of which is purchased, processed and sold to retailers by ENAP. (www.downstreamtoday.com)

November 25, 2014. China's Sinopec opened a new 16-million-barrel commercial crude storage base in southern China's Hainan province, receiving a first crude shipment of 100,000 tonnes, or roughly 5 percent of its tank space, the state energy group said. The start-up of the Sinopec tank farm came amid market talk that Chinese oil refiners may be taking advantage of low global oil markets to stock up. Sinopec's Yangpu base has about 16 million barrels of storage capacity, with 25 100,000 cubic metre crude tanks and one 50,000 cubic-metre tank, the company said. (www.downstreamtoday.com)

November 24, 2014. Kuwait National Petroleum Co (KNPC) plans to spend $40 billion in the period to 2022 on projects including a new refinery and a clean fuels project. The Clean Fuels Project would also include the expansion and modernising of the Mina al-Ahmadi and Mina Abdullah refineries, with a focus on producing high-grade products such as diesel fuel and kerosene for exports. The new refinery, al-Zour, which is due to be completed in 2019, will be the largest in the Middle East with a capacity of 615,000 barrels per day (bpd). Kuwait currently has three refineries with a combined capacity of 930,000 bpd. The oldest, Shuaiba, with a capacity of 200,000 bpd will be closed after al-Zour goes on stream. Under the project, the capacity of the Mina al-Ahmadi refinery will drop to 347,000 bpd from 466,000, while Mina Abdullah's will rise to 454,000 bpd from 270,000. (www.downstreamtoday.com)

November 19, 2014. Iraq’s biggest oil refinery at Baiji is set to restart processing in about three months after government troops forced Islamic State armed militants away from the facility. Iraqi troops will expel the militants from areas near a pipeline supplying the refinery 130 miles (209 kilometers) north of Baghdad, Colonel Khalaf al-Jabouri, a member of Iraq’s anti-terror forces, said. It will take about three months to restart the plant because workers have fled to other provinces, refinery units need maintenance and militants still control part of the pipeline network, according to Saad al-Azzawi, an engineer at Baiji. The Baiji plant has been at the center of repeated attacks since June as Islamic State militants attempted to seize the facility, seeking to secure fuel and funding for an Islamic caliphate they proclaimed in areas stretching across the Iraqi-Syrian border. Militants controlled the 310,000 barrel-a-day plant for about a week in June. Iraq has started to assess damage at the facility and is removing any unexploded ammunition found nearby, said Fayyad Al-Nima, Iraq’s deputy oil minister for refining affairs. The assessment may take one week, he said. Baiji has about 40 percent of Iraq’s refining capacity and its halt prompted the government to import more oil products and fuel, and tap strategic reserves to prevent shortages. State-run North Oil Co. manages the facility. (www.bloomberg.com)

November 25, 2014. Cyprus and Egypt agreed to accelerate talks on the potential export of Cypriot gas to Egypt, once the resources come on line. Cyprus discovered natural gas offshore in late 2011, while once gas-rich Egypt has turned into a net importer from an exporter in recent years. Egyptian Minister of Petroleum and Mineral Resources Sherif Ismail and his Cypriot counterpart Yiorgos Lakkotrypis said they had agreed to expedite discussions regarding natural gas exports to Egypt. The best option for exports at present appeared to be via a pipeline. The pipeline could be direct to Egypt, Ismail said. (www.rigzone.com)

November 24, 2014. Nigeria's oil exports were disrupted after Shell's local unit shut a pipeline that carries a key grade after it discovered a leak, the company said. The pipeline carries one of Nigeria's main export grades, Bonny Light. About six cargoes of the crude are exported each month, or around 180,000-200,000 barrels per day. The 24-inch pipeline has been shut since Oct. 18 last year for repair and integrity checks. Nigeria's oil industry suffers from rampant oil theft. A report by a national conference convened by President Goodluck Jonathan in March, said the country was losing an estimated $35 million a day to oil theft. In March this year, Shell said it lost nearly $1 billion in 2013 through theft and various disruptions to its Nigerian oil and gas operations. The oil major has since sold some of its onshore producing fields in part due to these problems. (www.downstreamtoday.com)

November 24, 2014. A unit of energy infrastructure company IEnova, the Mexican subsidiary of U.S. firm Sempra Energy, said that Mexico's state power company CFE had awarded it a 25-year contract to build and operate a natural gas pipeline in the north of the country. CFE has said the 254-km natural gas pipeline will need an investment of about $400 million. CFE announced various infrastructure projects near Mexico's northern border with the United States that are part of the company's aim to boost U.S. natural gas imports and help lower electricity rates via cheaper inputs and more modern power infrastructure. (www.downstreamtoday.com)

November 24, 2014. Iran will have to wait to boost oil exports after agreeing to an extension in talks aimed at limiting its nuclear program in return for an end to sanctions. The U.S. and five other global powers agreed to continue negotiating with Iran after failing to reach an agreement during talks over the past year. The parties will have until March 1 to agree to a political framework for a deal and July 1 to settle final details. International sanctions imposed over Iran’s nuclear program are curtailing crude exports, the nation’s main income source. The extension in the talks beyond deadline may have little impact on crude prices because markets anticipated the decision. Members of the Organization of Petroleum Exporting Countries (OPEC) stepped up diplomatic visits before their Nov. 27 meeting to discuss how to react to the plunge in prices to a four-year low. Iran’s Oil Minister Bijan Namdar Zanganeh will meet his Saudi counterpart Ali Al-Naimi before OPEC gathers in Vienna, to discuss a proposal that the group cut 1 million barrels a day of output. Prices are falling as economic growth slows in China and U.S. shale output rises, hurting exporters. Iran’s challenge is made tougher because sanctions limit foreign investment needed to maintain its oil fields. Zanganeh said his country could double crude exports within two months of the removal of sanctions. The U.S. gave waivers to China, India, Japan, South Korea, Taiwan and Turkey to buy a combined average of about 1 million barrels a day of Iranian crude during the nuclear talks. Iran’s exports fell to 1.25 million barrels a day in August, the Joint Organisations Data Initiative (JODI) said. That was the lowest since at least January 2002 when JODI began publishing data. Iran delivered 1.06 million barrels of crude a day to customers in Asia in October, the International Energy Agency said. (www.bloomberg.com)

November 21, 2014. Venezuela is sending its first shipment of crude mixed with Algerian light oil to China, according to state oil company PDVSA and traders. Venezuela recently started importing Saharan Blend from Algerian state-run Sonatrach to dilute its extra heavy crude from the Orinoco oil belt. PDVSA had previously imported costlier naphtha to use as a diluent. The Carabobo supertanker carrying 1.8 million barrels of Merey heavy crude will arrive in China in 46 days, PDVSA said. The OPEC country's oil ports are struggling to load and unload cargoes on time due to an increase in fuel imports prompted by trouble at PDVSA's 1.3 million-barrel-per-day domestic refining network. Venezuela, which has the world's largest crude reserves, has steadily increased its commercial and financial ties with China, to whom it ships around 600,000 bpd of oil, much of it part of an oil-for-financing agreement. (www.downstreamtoday.com)

November 20, 2014. Iran leased oil storage at Dalian port in China and has made at least two deliveries of crude from there to India and one to South Korea. Iran, besides having to cope with western sanctions that have cut its oil exports by more than half, has been battling along with other Middle East producers to hold onto market share in Asia as softening global prices have hit its economy. Saudi Arabia and the United Arab Emirates have already been leasing storage in Japan and South Korea for a number of years to give them supply depots near their largest customers. Iran's lease of oil storage in China came to light in August when Indian customs questioned state oil company National Iranian Oil Company (NIOC) about a cargo of crude for delivery to Mangalore Refinery and Petrochemicals Ltd. The vessel carrying the cargo, the Varada Lalima, had appeared to come from Malaysia, but the loading port was listed as being in Iran. (economictimes.indiatimes.com)

November 20, 2014. The US has welcomed the decision of establishing the ambitious TAPI gas pipeline project, a joint venture company for the transportation of up to 33 billion cubic meters of natural gas a year from Turkmenistan to Afghanistan, Pakistan and India. The project, if realised, would further diversify Turkmenistan's energy market options, provide revenue and jobs for Afghanistan at a crucial time in its economic development, and bring clean fuel to the growing economies of Pakistan and India. The US also stressed on the need for the four countries to engage an international energy company in the successful completion of the project. When completed, TAPI gas pipeline project will supply 15 billion cubic meter of gas to India from Turkmenistan through Afghanistan and Pakistan. It will export up to 33 billion cubic meters of natural gas a year from Turkmenistan to Afghanistan, Pakistan and India over 30 years. The total length of the pipeline will reach 1,735 kilometres. Some 200 kilometres of which will run through Turkmenistan, 735 kilometres through Afghanistan, 800 kilometres through Pakistan to the settlement of Fazilka, located on the border with India. The company will build, own and operate the ambitious gas pipeline. (economictimes.indiatimes.com)

November 20, 2014. Environmental foes of the Keystone XL pipeline are using their narrow victory in the U.S. Senate to raise funds for the next showdown on the project. The League of Conservation Voters, which lobbies for environmental causes, sent out emergency alerts to its 40,000 members nationwide, urging them to contact their senator to offer thanks, or criticism, for their vote. Since TransCanada Corp., a Calgary-based pipeline maker, applied to build Keystone in September 2008, it has become a proxy in broader political debates over jobs, U.S. energy security and climate change. Keystone XL would have the capacity to carry 830,000 barrels of oil a day, linking Alberta’s oil sands to refineries along the U.S. Gulf of Mexico coast. Environmental groups say the pipeline is a symbol of fossil-fuel development that must be defeated, and they’ve used it to galvanize public support and raise cash. Republicans are using delays approving Keystone to blast Obama as an enemy of jobs and energy independence. (www.bloomberg.com)

November 20, 2014. With its $34.6 billion purchase of Baker Hughes Inc., Halliburton Co. will add a new technology that’s aimed at replacing the well-known nodding donkey pumps that have been a symbol of the oil business for a century. The new system, unveiled by Baker Hughes in May, offers a way to retrieve the final drops of crude from aging oilfields, and should help fill a gap in Halliburton’s offerings. The $14.8 billion global market for boosting output in aging wells is expected to almost double by 2020, delivering growing profits as plunging crude prices force some producers to cut drilling budgets. Halliburton is now No. 11 in the market. The new device, ready for use early next year, is part of a Baker Hughes product portfolio that’s expected to help boost the combined company to the No. 2 spot. (www.bloomberg.com)

November 25, 2014. Hedge funds turned less bullish on crude oil as Organization of Petroleum Exporting Countries (OPEC) failed to signal it will act to halt the collapse that drove prices to a four-year low. Money managers reduced net-long positions in West Texas Intermediate (WTI) by 4.1 percent in the week ended Nov. 18, U.S. Commodity Futures Trading Commission data show. Long positions sank to an 18-month low. Outstanding futures contracts dwindled to the lowest level in more than two years. Members of the OPEC will meet in Vienna to decide on production after oil plunged 30 percent since June. Leading producers, including Saudi Arabia, are resisting calls to reduce output while others such as Venezuela seek action to support prices. The 20 analysts surveyed are perfectly divided, with half predicting a cut and the rest no action. (www.bloomberg.com)

November 24, 2014. Russia’s Energy Minister Alexander Novak said his country hasn’t decided to cut oil production as he prepares to meet with OPEC ministers to discuss the crude market. Russia is already helping to balance the oil market by keeping output steady, he said. There’s only a small chance the Organization of Petroleum Exporting Countries (OPEC) will agree to reduce output at a meeting, he said. Russia may cut production by 300,000 barrels a day next year to support OPEC reductions of more than 1 million barrels. The group is considering action to boost prices after oil plunged more than $30 a barrel since July. Novak will travel to Vienna together with Igor Sechin, head of Russia’s largest oil producer, OAO Rosneft, to meet OPEC ministers before the group’s Nov. 27 meeting. Russia plans to maintain its oil production at 505 million (about 10 million barrels a day) to 520 million tons a year, already a contribution to stabilizing world prices, Novak said. The country will produce about 525 million tons this year, according to the ministry. (www.bloomberg.com)

November 24, 2014. Saudi Arabian Oil Co. will push ahead with plans to expand and integrate its refining and chemicals businesses even amid the decline in oil prices, Chief Executive Officer Khalid Al-Falih said. The state-run oil company, known as Saudi Aramco, has a target of producing petrochemicals from 10 percent of all crude processed at its refineries, he said at an industry conference in Dubai. Oil producers in the Persian Gulf can withstand a period of low crude prices because countries in the region are fiscally strong, Al-Falih said. Brent crude, a global benchmark, has tumbled 30 percent this year. Middle Eastern oil and natural gas producers are expanding petrochemical and refining operations to make fuel and other products that fetch higher prices than crude. Boosting petrochemical output is a long-term strategy for them to create jobs and build new industries in plastics and consumer goods. Petrochemical producers in the Gulf should use more naphtha and other liquids as feedstocks because supplies of gas aren’t sufficient to support their expansion, Al-Falih said. Petrochemical makers should upgrade older plants so they can operate using both gas and liquids as fuel, he said. (www.bloomberg.com)

November 24, 2014. Ghana's government has given Italian energy firm Eni the final green light to develop gas resources in the Offshore Cape Three Points (OCTP) block, expected to begin production in 2017, it said. The government, hoping to boost oil and gas production, said in a statement that it also planned to acquire a third floating production storage and offloading (FPSO) vessel, to be used for the $6 billion offshore project which must now be approved by Ghana's parliament. Ghana National Petroleum Corporation (GNPC) said the $6 billion total covers all costs leading to production of oil and gas, including the initial cost of the FPSO, which will be leased. Eni operates the OCTP block, in partnership with commodities trader Vitol and GNPC. Ghana produces around 100,000 barrels per day from the offshore Jubilee field, which also produces 120 million cubic feet of gas. It plans to start production of oil and 50 million cubic feet of gas in 2016 from the Tweneboah Enyeara and Ntomme offshore field. (www.rigzone.com)

November 24, 2014. Colombia’s central bank Governor Jose Dario Uribe says his biggest concern has become the slump in oil prices that is damping government revenue. The price of crude, which now accounts for about half of exports, has fallen 20 percent since Colombia last raised interest rates at the end of August. Finance Minister Mauricio Cardenas is pushing to raise taxes to try to plug a 12.5 trillion peso ($6 billion) funding gap next year that is equivalent to 1.6 percent of gross domestic product. Government revenue from royalties, taxes on oil companies and dividends from state-controlled oil producer Ecopetrol S.A. are equivalent to about 5 percent of GDP, according to the National Association of Financial Institutions, or ANIF, a Bogota-based think tank. (www.bloomberg.com)

November 24, 2014. Iran may propose that OPEC cut its output target by as much as 1 million barrels a day to halt the slide in crude prices when the country’s oil minister consults with his Saudi counterpart before the group gathers. Iranian Oil Minister Bijan Namdar Zanganeh and Saudi Arabia’s Oil Minister Ali Al-Naimi will talk on the sidelines of the meeting in Vienna of the Organization of Petroleum Exporting Countries (OPEC), seeking to define a common view among its 12 members for supporting prices. OPEC, supplier of about 40 percent of the world’s oil, will meet Nov. 27 in the Austrian capital to assess its collective output amid a supply glut and a 27 percent drop in prices this year. Half the analysts in a survey forecast that OPEC would cut production to shore up prices, while the other half said they didn’t see it deviating from an official 30 million barrel-a-day production target. Zanganeh may also meet with Alexander Novak, Russia’s energy minister, in Vienna. Russia, while not an OPEC member, said it will send Novak and Igor Sechin, head of state-controlled OAO Rosneft, the country’s largest crude producer, for meetings with OPEC officials. Two-thirds of global oil production comes from non-OPEC producers, Suhail Al Mazrouei, the U.A.E.’s energy minister, said. (www.bloomberg.com)

November 22, 2014. US Vice President Joe Biden welcomed an agreement between Iraq’s central government and its northern Kurdistan region over the management of oil exports, a step forward in a feud that has threatened the unity of Iraq. After years of friction, the two sides struck a deal in which Kurds will give half of their overall oil shipments to the federal government and Baghdad will pay overdue civil servants’ salaries in the region. Oil has been at the heart of a feud between the Arab-led government in Baghdad and the ethnic Kurdish-run northern enclave, which dispute control over oilfields, territory and crude revenues shared between the two regions. Baghdad has said it alone has the authority to control exports and sign contracts, while the Kurds say their right to do so is enshrined in the Iraqi constitution. Biden also said that Washington supported the development of an oil pipeline from southern Iraq’s Basra oilfields to Turkey’s Mediterranean port of Ceyhan, a project which Turkey has long advocated despite reluctance in Baghdad. (gulfnews.com)

November 20, 2014. Norway’s central bank is adapting its policy to ensure plunging crude prices don’t disrupt the economy of western Europe’s biggest oil and gas producer. While central banks elsewhere grapple with the threat of deflation, policy makers in Norway face “problems and challenges that are in a different class,” Governor Oeystein Olsen said. The price of crude oil dropped to just under $80 a barrel this week from $115 as recently as June, putting pressure on a nation that relies on energy resources for its wealth. Oil companies in Norway led by state-controlled Statoil ASA may cut spending by as much as 18 percent next year to adapt to the tougher environment, according to a September survey by the statistics office. The oil price development over the past five months has already forced the central bank to alter its forecasts, Olsen said. (www.bloomberg.com)

November 19, 2014. Indonesia’s efforts to cut energy subsidies is poised to curb the nation’s demand for imported supplies, reducing profits from making fuels in Asia. President Joko Widodo raised retail gasoline and diesel by more than 30 percent as he sought to free funds for development plans. Every 10 percent gain in pump prices will reduce the nation’s oil consumption by 2 percent, Morgan Stanley said. Indonesia, Southeast Asia’s largest economy, imports more than half of the gasoline and about 20 percent of the diesel it consumes, according to Energy Aspects Ltd., a London-based energy consultant. While falling oil prices offer Widodo, known as Jokowi, room to limit domestic increases, he has yet to say if he will scrap the decades-old system of fuel subsidies. (www.bloomberg.com)

 [INTERNATIONAL: POWER]

November 25, 2014. The 4^th Arab States-China Cooperation Forum (ACCF) on Energy 2014, which marked the signing of an accord on peaceful nuclear energy use, concluded in Riyadh recently. Energy for sustainable development was the forum’s theme. Both parties identified areas of strategic cooperation for the peaceful use of nuclear energy and the establishment of Chinese factories in the Arab world, with technology transfer and investment in electricity projects. The cooperation agreement underlined the need to enhance capacity building in the peaceful uses of nuclear energy, especially in power generation and desalination of seawater, and the development of industry and technology in the Arab world in this field. The objective is to achieve industrial growth and develop uses of nuclear energy technology for peaceful purposes. The two sides agreed on the need for the maintaining the role of ACCF in the field of energy. They emphasized the importance of the implementation of the memorandum of understanding between the Arab League and the National Energy of China on the mechanism of cooperation in the field of energy and strengthen the existing cooperation, especially in the fields of oil and gas, electric power, renewable energy and peaceful uses of nuclear energy. The two sides expressed satisfaction at the progress made in cooperation between the Arab Atomic energy Agency and China National Authority for Nuclear energy, by jointly organizing training activities for Arab engineers in nuclear energy programs in their countries. (www.arabnews.com)

November 21, 2014. The Federal Government (FG) has signed agreements with generation and distribution companies, independent power producers, international oil companies and the Nigeria Gas Company for the supply of gas. This is to further boost power generation which hit a historic high of over 4,500 MW recently in the country. The Federal Government announced a N213 billion intervention facility to offset gas legacy debts and address the revenue shortfall in the electricity market. The Minister of Power, Professor Chinedu Nebo, said the ministry had developed an operator platform to ensure that transparency was maintained in the market. (www.tribune.com.ng)

November 24, 2014. Britain’s plans to keep the lights on this winter have been thrown into fresh doubt after a power plant supposed to provide back-up electricity supplies failed during testing. The Peterhead gas-fired station in northern Scotland was unable to generate power as expected during a test, it has emerged. The plant was one of three power stations handed a contract by National Grid to be paid to guarantee they could fire up if needed, as part of emergency measures to prevent blackouts. The plans were drawn up after a series of power plant closures eroded Britain’s spare electricity generation capacity – the safety buffer between peak supply and demand – to wafer-thin levels. The three back-up power plants recruited under the emergency plans were supposed to guarantee they would be available if required between 6am and 8pm on weekdays from November to February. (www.telegraph.co.uk)

November 22, 2014. When it comes to exporting American coal, the West Coast’s loss is the Gulf Coast’s gain. While environmental opposition has stymied plans to build terminals in California and the Pacific Northwest, the Mississippi River town of Darrow, Louisiana, has a new $300 million export facility. It’s part of a regional expansion that will increase capacity by 66 percent to 119 million metric tons by 2017, or more than half the national total, according to New York-based Doyle Trading Consultants LLC. At least $898 million, or 64 percent of the total $1.4 billion companies such as Ambre Energy Ltd. were planning to invest on the West Coast, is being spent on terminals in the Gulf of Mexico. Even as U.S. coal exports have fallen by 23 percent since 2012, producers are betting that foreign sales will rebound because a supply glut means their prices are now below competing cargoes from Australia and South Africa. Exports from Galveston, Texas, surged 29-fold since 2000 while volume at Mobile, Alabama doubled and New Orleans saw a more than 15-fold increase, government data show. (www.bloomberg.com)

November 25, 2014. Nepal has given an Indian company permission to build a 900 MW hydropower plant, the government said, as the Himalayan state looks to ease chronic energy shortages by opening up its rivers to its larger neighbour. The two countries will sign an agreement for the $1.04 billion project, which provides Nepal with free electricity and India energy for its power-hungry economy, later this week when South Asian heads of state meet for a regional summit in Kathmandu, Nepal's Law Minister Narahari Acharya said. Indian firms are investing billions to develop Nepal's hydropower potential, encouraged by an electricity trading pact signed between the two countries and pushed by Indian Prime Minister Narendra Modi. Growing investment in Nepal's energy industry comes as New Delhi looks to grow its influence in its smaller neighbours, where China is increasingly active. The project, which will be built by Satluj Jal Vidyut Nigam (SJVN) Ltd, was originally cleared in 2008 but never implemented after Kathmandu lobbied for greater benefits. Indian firms are negotiating with the government for power plants that would produce a total of 8,250 MWs and Kathmandu estimates $7 billion will be invested in its hydropower industry over the next 5 years. Nepal has the potential to generate 42,000 MW of hydropower but produces 800 MW -- less than demand of 1,400 MW. (economictimes.indiatimes.com)

November 24, 2014. Ghana has created a new ministry for power in response to an energy crisis, as erratic power supply and uncoordinated outages haunt the economy, affect business operations and damage electric gadgets. The establishment of the new ministry is part of the government's efforts to restructure the power sector to ensure more stability and security. (www.theafricareport.com)

November 20, 2014. Ontario Power Generation (OPG) has been given approval by the province's energy regulator for a 10 per cent increase in the rate it is paid for electricity. The Ontario Energy Board says OPG had requested an increase of 23.4 per cent, which it says would have added $5.31 to the typical monthly residential hydro bill. However, the board decided on "a significant reduction" in OPG's request, and approved an increase of approximately 10 per cent, but it did not estimate the impact on residential ratepayers. The Energy Board cut $100 million a year from OPG's proposed operations, maintenance and administration budget for both the nuclear and hydroelectric sides of the utility. (www.ctvnews.ca)

 [RENEWABLE ENERGY / CLIMATE CHANGE TRENDS]

November 25, 2014. India plans to more than double the share of renewables in the mix of fuels it consumes, an effort to reduce the dominance of coal. Renewables such as solar and wind may account for 15 percent of India’s energy supply in the next five years, up from 6 percent currently, the Power, Coal and Renewable Energy Minister Piyush Goyal said. Prime Minister Narendra Modi wants to speed up clean energy deployment in India as it tries to attract more than $100 billion of investment for the industry in the next four years. At present, coal generates 60 percent electricity in a nation that suffers from chronic blackouts. The minister reiterated his previously stated view that renewables can’t count on government subsidies for too long. He said the industry should focus on convincing banks to make funding for projects as easily available as loans for cars. Modi’s administration reintroduced a tax break for the wind industry earlier this year. Goyal said he hopes those will help turbine installers add 8 GW of capacity every year, a level that would make India one of the biggest wind markets in the world. India plans to require power purchasers and generators to include renewable energy in their suppliers and will penalize those that don’t, he said. India will host a renewables conference from Feb. 15 to Feb. 17 to encourage growth in the industry. (www.bloomberg.com)

November 25, 2014. The Power Ministry will soon approach the Cabinet with a proposal to introduce stringent rules for buyers and sellers of renewable energy, besides making amendments to the provisions in the overall tariff policy, Union minister Piyush Goyal said. At present, under the RPO (Renewable Purchase Obligation) mechanism, the state power distribution companies have to mandatorily purchase electricity generated through renewable energy sources during the year. On similar lines, the government is contemplating the RGO (Renewable Generation Obligation), which will make it compulsory for thermal power producers to also generate electricity through renewables. The changes in the tariff policy are also being looked at in order to provide for long term power purchase agreements (PPAs), trying to provide intermediary companies to make such PPAs more bankable considering the poor health of several discoms. (www.business-standard.com)

November 25, 2014. Maharashtra needs a clear policy on allowing grid connectivity to roof top solar power generators in homes even as the Centre is taking steps to promote and popularise solar power across the country, according to clean energy activists. Activists of city-based Vidarbha Industries Association (VIA) said that using electricity generated from roof top generators at homes and offices could attract penal action as there is no clear policy on grid connectivity to such sets. The Central government has been striving since five years to give a big push to solar power. The Jawaharlal Nehru National Solar Mission (JNNSM) was established for this purpose and a target of generating 20,000 MW of solar power by year 2022 has been envisaged. But the state government is not keen and has failed to issue a clear guideline or notification to allow setting up of roof top solar generators that are available and affordable to a vast chunk of urban consumers, said Sudhir Budhay, an energy activist. (www.business-standard.com)

November 24, 2014. Installing solar panels on the Pakistan border, using super-chilled LNG to build cold storage and warehousing facilities, and putting barcodes to stop illegal use of subsidised cooking gas — the Modi mantra is making its presence felt in the energy domain and forcing officials to sit up and think out of the box. During discussions about seemingly routine and uninspiring energy issues, Prime Minister (PM) Narendra Modi comes up with unusual ideas, which soon become tightly monitored instructions. The Cabinet Secretariat maintains a log of efforts made by departments responsible for implementing these ideas. The PM's vision is to harness cold temperatures at LNG terminals where gas in liquid form - at 160 degrees Celsius below freezing point - lands from cryogenic ships. At an LNG terminal, the super-cool liquid is gradually warmed up and gasified again in a process that can cool surrounding areas. The Prime Minister's Office has shown keen interest in renewable energy. Modi recently advised the Ministry of New and Renewable Energy (MNRE) to explore using barren land close to the country's borders to generate solar energy. Solar projects need a lot of land, which is scarce and costly outside arid regions such as the Rajasthan desert and the uninhabited border regions, where electricity supply is a problem. (economictimes.indiatimes.com)

November 23, 2014. A step ahead in the government's ambitious plan of setting up 25 solar parks, the Ministry of New and Renewable Energy (MNRE) has identified 12 locations in various states where such power projects can come up. The scheme envisages setting up of 25 solar parks over the next five years with a total capacity of around 20,000 MW, with each park housing a plant with a capacity ranging from 500-1,000 MW. The installed solar capacity has touched 3,000 MW in the country, according the latest ministry data, and the government aims to increase it to 100,000 MW by 2022. (economictimes.indiatimes.com)

November 22, 2014. The Ministry of External Affairs is facilitating a programme to train professionals from Nepal, Afghanistan and many other African countries in solar energy system under the ITEC (Indian Technical and Economic Cooperation) fellowship programme. The National Institute of Solar Energy, a Delhi-based government institute, has been imparting solar energy training programme to these foreign professionals. There are 30 students on a three-week training programme. The course module covers the basics of system design in photo voltaic for generating electricity from solar energy and thermal applications. The course also covers general aspect of economics and climate change. The training programmes develops better understanding in generating electricity from solar power and efficient use of materials for standardized output. Solar Energy programmes between India and Nepal generate expertise which in turn will help to improve the renewable energy sector. Arun Neupane, who works as lecturer in Kathmandu, believes that the training in India will help him to promote solar energy in Nepal. India has been partnering with developing countries in improving resource development. Students from Afghanistan and Nepal have been imparted skill development trainings in various institutions in India. (www.newkerala.com)

November 21, 2014. Railways, one of the biggest consumers of energy, is moving towards harnessing green power with a 26 MW windmill proposed to be built in Rajasthan. The project, the biggest renewable energy initiative by the national transporter, is to be set up in Jaisalmer at a cost of ` 150 crore and targeted to be completed in about nine months. Railway Minister Suresh Prabhu pointed out that the Railways is one of the biggest consumers of energy and therefore, using even a small percentage of green energy by the national transporter, will make a substantial difference. Prabhu said there is a need to change the energy mix so that long term dependence on fossil fuel can be reduced. Prabhu asked the Railways to undertake a comprehensive and structured energy audit so as to ensure the best and optimal utilisation of energy and also identify the energy saving potential. (www.dnaindia.com)

November 21, 2014. The Union ministry of environment, forests and climate change has directed the principal secretary of the state urban development department to issue appropriate directions to the Pimpri Chinchwad Municipal Corporation (PCMC) to implement the Plastic Waste (Management and Handling) rules, 2011, in letter and spirit. The ministry has also sent a letter to the Maharashtra Pollution Control Board's member secretary in this matter. The Union ministry has framed the rules and amended them under the Environment Protection Act, 1986. The municipal corporation is the authority for enforcement of the provisions relating to use, collection, segregation, transportation and disposal of plastic waste. (timesofindia.indiatimes.com)

November 20, 2014. The Tata group's renewable energy arm is in talks to invest in a wind energy firm, revving up deal activity in a sector that has lured General Electric, Goldman Sachs and the Asian Development Bank, as the company seeks to achieve its goal of adding as much as 300 MW to its portfolio annually. Tata Power Renewable Energy Ltd (TPREL), a wholly owned subsidiary of Tata Power, was incorporated in 2007 to house the company's renewable energy assets. India's renewable energy sector has drawn investors, especially after Prime Minister Narendra Modi said clean energy will play a key role in the government's goal of providing electricity to all 400 million Indian homes that are currently without power. TPREL is currently developing two wind projects in Maharashtra, a 126 MW hydro project in Bhutan in a venture with the Government of Bhutan that is close to being commissioned, 185 MW of hydro power projects in Georgia and wind projects in South Africa. (economictimes.indiatimes.com)

November 19, 2014. Lok Sabha Speaker Sumitra Mahajan has said that sustainable development and a victory in the war against climate change cannot be attained on the backs of the poor. India has been under pressure from developed nations to reduce its greenhouse gas emissions even though it could put its poverty fighting programmes at risk. Though India is often portrayed as the third worst emitter of carbon dioxide, after China and the US, its per capital output of carbon dioxide is only 1.7 tonnes against 17.6 tonnes for the US in 2010, according to the World Bank. Mahajan reiterated Prime Minister Narendra Modi's concept of saving the environment by promoting frugality and respect for nature. (www.business-standard.com)

November 19, 2014. India is expected to add solar power capacity at more than twice the speed of this year in 2015, after a disappointing 2014 when installations of photovoltaic cells have fallen short of previous year's levels, a solar consultancy firm said. India's total solar installations have crossed the 3 GW capacity mark with addition of 734 MW so far this year, and the country is expected to end the year with total additions of 800 MW, as much as 20% less than in 2013. Land acquisition delays due to elections and uncertainty caused by an anti-dumping issue contributed to the slowdown in installations. In its quarterly update on the Indian solar market, Mercom Capital Group forecast 2015 installations to reach about 1,800 MW. India dropped plans to impose anti-dumping duty on solar panel imports. The duty, aimed at protecting local manufacturers, would have increased the import cost of local project developers who rely mostly on countries like the US, China and Taiwan for the photovoltaic cells.

The Ministry of New and Renewable Energy's (MNRE) new target is to increase solar installations by fivefold to 15 GW by 2019 via solar parks - large areas and infrastructure set aside by states to accommodate installations of 500-1,000 MW. The ministry has also asked public sector units to set up large solar projects to meet their obligations on using renewable energy. At the request of the Prime Minister's office, the ministry is also working on a plan to increase the installation goal under the Jawaharlal Nehru National Solar Mission to 100 GW, it said. (economictimes.indiatimes.com)

November 19, 2014. The state-run National Thermal Power Corporation (NTPC) has decided to invest in Odisha's solar energy sector. The PSU has signed MoUs with the Andhra Pradesh government for generation of 1,000 MW solar energy and with Madhya Pradesh for 750 MW, NTPC said. NTPC said Telangana and Rajasthan were also looking at NTPC for investments in the solar energy sector. NTPC is building a 1,600 MW power plant at Gajamara in Dhenkanal district. It will set up a power engineering institute at Dhenkanal which is linked to its Gajamara plant. It is also setting up a 1,600 MW super thermal power project at Darlipalli in the state's Sundargarh district which is expected to be commissioned by 2018. (economictimes.indiatimes.com)

November 19, 2014. IREDA, an agency under Union New and Renewable Energy Ministry, expects to disburse nearly ` 12,500 crore in the next three years and to raise the share of total lending for solar-related projects to over 60 per cent. The Indian Renewable Energy Development Agency (IREDA) disbursed around ` 2,471 crore in FY14 out of which lending to solar projects was nearly 11 per cent or ` 266.61 crore. The agency has forwarded its proposal to the government for sanctioning of loans. This year, the agency has already increased its lending for solar projects, and expects the trend to continue in the future. The Narendra Modi government has set a target of 100 GW of solar power by 2022. The FY15 Budget has proposed setting up of mega solar power projects in Rajasthan, Gujarat, Tamil Nadu and J&K with a funds allocation of ` 500 crore. The government has also announced a scheme for solar power driven agricultural pump sets and water pumping stations, for which ` 400 crore has been earmarked in the fiscal plan. (economictimes.indiatimes.com)

November 25, 2014. China, the world’s largest greenhouse gas emitter, plans to start a nationwide carbon market in the next two years following a pledge to cap emissions by 2030. Opening in 2016, the market would have matured by 2020, the National Development and Reform Commission (NDRC) said. China, which is working on an absolute control plan for carbon emissions, may announce rules for carbon-permit trading as early as the end of the year, NDRC said. Seven test regions in China traded a combined 13.75 million metric tons of carbon dioxide as of October, totaling 500 million yuan ($81 million). China’s energy use per gross domestic product unit fell by 4.6 percent between January and September from the same period last year and its carbon intensity dropped by 5 percent. China aims to cut its 2020 carbon intensity by 45 percent from the 2005 level and expects all nations to review their climate change targets set before 2020 in the meeting at Lima due to take place from Dec. 1 to Dec. 12. (www.bloomberg.com)

November 25, 2014. Andrew Mackenzie, head of the world’s biggest mining company, says work on technology to capture and store carbon emissions must be accelerated to help combat greenhouse gas pollution. As BHP Billiton Ltd.’s Chief Executive Officer, Mackenzie is weighing investments in developing the technology, aiming to create projects of sufficient scale to curb pollution from power stations in China, the largest greenhouse-gas emitter. About eight new major carbon capture and storage projects are scheduled to begin operation by 2016, as the U.S. and China, the two biggest polluters, seek methods of meeting their pledges to reduce greenhouse gases. Coal supplied about 80 percent of electricity in China and 70 percent in India in 2012, according to Rio Tinto Group, the world’s second-biggest miner. Carbon capture works by separating out carbon dioxide as coal, oil or natural gas are burned. It can then be injected into geological systems underground in a liquefied state. BHP has accepted the science on climate change for two decades and argues it’s a global challenge posing a significant risk to the environment and to social and economic development. It spent $340 million on emissions reductions and energy efficiency projects between 2007 and 2012. Extending carbon capture technology to coal-fired power stations and to the iron and steel sectors remains a challenge, according to the Melbourne-based Global CCS Institute. The world’s first large-scale capture project in the power sector opened at SaskPower International Inc.’s Boundary Dam coal-fired power station in Canada. Under a deal struck, the U.S. agreed to cut greenhouse gas emissions to 26 to 28 percent below 2005 levels by 2025, as China committed to reduce its carbon dioxide emissions by about 2030. Fossil-fuel emissions must be halted within the next six decades to prevent irreversible impacts that may stem from a warming planet, according to the United Nations Environment Program. The number of major projects -- those capable of trapping 800,000 metric tons of carbon dioxide a year at power stations, or 400,000 tons a year at other sites -- has jumped 50 percent since 2011, with 22 either operating or being built, according to the Global CCS Institute. Without the broader use of carbon capture, about two-thirds of proven fossil-fuel reserves cannot be developed if the increase in global temperatures is to remain below 2 degrees Celsius (3.6 degrees Fahrenheit), according to the International Energy Agency. Chinese President Xi Jinping in June pledged to phase out coal plants that fail to meet environmental standards. (www.bloomberg.com)

November 24, 2014. A Chinese company offered 4.34 billion kroner ($640 million) to buy REC Solar ASA, one of the last makers of solar panels in Western hands, a move that may help circumvent trade disputes in the U.S. and Europe. The deal by a unit of China National Chemical Corp. would follow a surge in demand for solar panels, absorbing much of the production that companies supported by the government in Beijing built in the past decade. Authorities in Brussels and Washington have imposed restrictions on Chinese solar panel imports after accusations from competitors that products were sold below cost. That has required Chinese companies that dominate the panel manufacturing industry to establish subsidiaries with factories abroad that are outside sanctions. China National Chemical’s unit China National BlueStar Co. will complete the deal through a Norwegian unit, Elkem AS, which employs 2,100 making solar-grade silicon and other alloys. REC Solar has 1,700 workers mainly making panels at a factory in Singapore. It was spun off in October 2013 from Renewable Energy Corp (REC) ASA, which had closed all its solar manufacturing capacity in Norway and focused on its solar polysilicon business, now known as REC Silicon ASA. Solar panel producers are recovering from a plunge in prices that followed a surge in manufacturing as Chinese companies expanded factory capacity in the past decade, building the leading companies in the industry including Yingli Green Energy Holdings Co. and Trina Solar Co. China controls all of the top 10 solar companies except Hanwha Corp. of South Korea and Arizona-based First Solar Inc. At least two dozen U.S. and European companies were sold off or went bankrupt in the past decade. (www.bloomberg.com)

November 24, 2014. An agreement between the U.S. and China to curb greenhouse-gas emissions won’t slow global warming enough to prevent extreme weather that damages crops, World Bank Group President Jim Yong Kim said. President Barack Obama committed the U.S. to cut emissions more quickly under the deal, announced Nov. 12 in Beijing with Chinese President Xi Jinping. For its part, China pledged for the first time to cap its emissions. The accord won’t prevent global temperatures from rising by 2 degrees Celsius (3.6 degrees Fahrenheit), an increase scientists expect to drive a spike in extreme weather events, Kim said. Global emissions are growing about 2.5 percent a year, a pace that will probably cause the 2 degree threshold to be breached within 30 years, according to a World Bank report on climate change. That would lead to lower crop yields, an increase in extreme heatwaves and a spike in tropical storms from rising sea levels, the World Bank said. The world’s poor will be hit hardest by the changes, which may trigger major migration shifts as people flee arid regions. The report comes as the United Nations prepares to convene climate-change talks in Lima, Peru, starting Dec. 1. Under the new target set by Obama, the U.S. would cut greenhouse gas emissions to 26 to 28 percent below 2005 levels by 2025. The previous U.S. target was to reach a level of 17 percent below 2005 emissions by 2020. Xi committed China to begin reducing its carbon dioxide emissions by about 2030. The two nations account for more than a third of global emissions. (www.bloomberg.com)

November 22, 2014. The U.S. Interior Department rejected a proposal to build a 200 MW solar farm in Southern California. It’s the first time the agency’s Bureau of Land Management (BLM) has denied a permit for a solar plant outside certain zones that have been designated as preferred locations for solar power, the administration said. Iberdrola SA’s plan to build the photovoltaic power plant in California’s Silurian Valley would have had negative impacts on wildlife and recreational activity that “could not be mitigated”. Iberdrola’s renewable energy unit is disappointed in the decision and is considering whether to appeal within the 30 days allowed by BLM. The project was given extra scrutiny by the administration because it fell outside the almost 284,918 acres of solar energy zones designated as preferred locations for development in 2012. The BLM has approved 18 wind, solar and geothermal power plants on public lands in California since 2010. (www.bloomberg.com)

November 21, 2014. The U.K. Green Investment will invest in a 110 million-pound ($172 million) plant to generate power and heat from waste wood in the country’s northwest. The bank will provide 16.9 million pounds of loans and 13.2 million pounds in equity via a fund managed by Foresight LLP. The plant will have 20 MW of power capacity and 7.8 MW of heat. The project is expected to start working in 2016 and will have a life of about 20 years. (www.bloomberg.com)

November 21, 2014. Europe faces power shortages in the next decade unless it balances its drive for low-carbon energy with investment in clean-coal and nuclear generation, according to the International Energy Agency (IEA). Policy makers must boost incentives for coal-fired power that includes carbon-capture technology and spur investment in new atomic plants to replace aging reactors, the IEA said. The investment in round-the-clock, or baseload, power is needed to cover intermittent wind and solar supply, the IEA said. Europe needs 120 GW of new baseload generation in the next decade, 1.6 times the U.K.’s existing total power capacity, according to IEA estimates. About 150 GW of capacity will be retired in the period and lawmakers need to find ways to attract the $2 trillion of power-plant investments needed in Europe through 2050, the Paris-based agency said. (www.bloomberg.com)

November 21, 2014. Setting stringent targets for emission cuts for the world, a UN body wants countries across the globe to collectively cut carbon emission to zero (achieve carbon neutrality) by 2070 and bring down emissions to net zero for all greenhouse gases, including methane, nitrous oxide and climate damaging refrigerant HFC, by 2100. The timeline for desired emission cut was suggested by the United Nations Environment Programme (UNEP) in its annual emission gap report, released in Washington. The report wants the nations to follow the timeline diligently so that the world can contain temperature rise under the level considered disastrous. Meanwhile, many countries assembled in Berlin to pledge money for the Green Climate Fund (GCF) — a financial instrument aimed at helping poor countries adapt to climate change and be part of the global effort to achieve the target of emission cuts. However, the GCF could not attract as much money as was expected by developing countries. The target set by the emission gap report assumes significance as it came just 11 days ahead of the crucial Lima climate talks where countries would negotiate how to reach a global climate deal in Paris next year. The roadmap, chalked out by the UN body, and the poor show by rich nations in contributions to the GCF will likely be major debating points, specifically in the context of the turnaround year (2020) as suggested in the report and its focus on cutting other greenhouse gases like methane and HFC. Rich nations invariably try to corner their developing counterparts, including India, over the issue of reduction in farm methane and refrigerant gas, blaming the latter as being the primary reason for such emissions. (timesofindia.indiatimes.com)

November 20, 2014. Latest data from China's National Energy Administration shows that 8.85 GW of new wind power capacity was installed in the first nine months of 2014, bringing its total capacity to nearly 85 GW, a year-on-year increase of 22 percent. Accounting for 6.6 percent of China's total installed power capacity, wind exceeds nuclear power in installed capacity and electricity production, has become the third major power source following coal and hydro. By the end of September, wind power connected to the grid totaled 106 billion kWh, rising by 7.6 percent year-on-year. During the none-month January-September period, wind energy curtailment in the country amounted to 8.6 billion kWh, a decrease of 28.3 percent year-on-year. The average wind power curtailment rate had dropped to 7.5 percent by the end of September, a fall of 3.36 percentage points on a yearly basis. (www.renewableenergyworld.com)

November 21, 1014. Nearly one lakh premature deaths take place annually due to air pollution in India and some other countries which can be avoided by 2030 by improving energy efficiency measures in transport and industrial sectors, a UN report said. The fifth Emissions Gap Report 2014 by the United Nations Environment Programme (UNEP) said that countries across the globe need to "shrink" greenhouse gas emissions to net zero between 2080 and 2100 in order to limit global temperature rise to two degree Celsius. The report said that improving energy efficiency can be an excellent opportunity for linking sustainable development with climate mitigation. (ibnlive.in.com)

November 20, 2014. Spanish wind energy firm Gamesa plans to invest 100 million euro in the next five years and will produce larger turbines at the new production line at its plant. The inauguration of the production line is part of the investment outlay by the company to strengthen Indian operations. The company has two facilities in Gujarat - a Blade manufacturing plant and a tower facility, which is part of joint venture with Daniel Alonso Group. The company also has an integrated turbine monitoring and service training centre at Red Hills near Chennai. In 2013, Gamesa India added around 400 MW and this year, expects to close around 700 MW. (economictimes.indiatimes.com)

 

 

 

 

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