[Energy Budget: Highlights & Comments]

                             “Direct benefits transfers like for domestic LPG good step but why can’t the same step can be taken for PDS kerosene, a superior and costlier fuel then LPG and  which is more prone to black marketing and adulteration. Conversion of existing excise duty on petrol and diesel into road cess to fund investment in roads and other infrastructure is positive  but how will this translate into  development of  rural India is  an open  question…”

Energy News

[GOOD]

If increasing coal supply is decreasing power prices, what we need is more coal, not more politics!                                   

                                                                                                        [BAD]

Arunachal’s dream of hydro-dollars may come at the cost of the environment!

[UGLY]

Why is it so difficult to withdraw LPG subsidies from the well off?

NEWS BRIEF

[NATIONAL: OIL & GAS]

March 10, 2015. Indian energy majors are slashing their capital expenditure and have initiated cost cutting measures, responding to the weak crude prices and dismal price recovery outlook for 2015-16. Crude oil prices have plummeted almost 45% since June due to oversupply in the market. Benchmark Brent crude touched lows of $45 per barrel in January as against a high of $115 last summer. Oil has seen gains recently and reached $60 a barrel again for the first time this year but the outlook remains muted as demand is unlikely to see a pick-up. Global energy majors have cut capex, trimmed human resource and are taking severe cost saving measures, something that Indian companies have now started doing. Cairn India has reduced its capex by less than half to $500 million from $ 1.2 billion for 2015-16 and has also laid off 250 of its 1,800 staff. Reliance Industries continues with its capex plans across its businesses, but is implementing "austerity measures" in its exploration and production business, given the challenging times. Essar Energy is holding back capex plans and is also believed to be exploring cost saving steps. While state-run ONGC bucks the trend by increasing capex, it is trying to negotiate lower rates for new tenders to keep costs low. Cairn India has said it will undertake only economically viable projects, and has the board's approval for Raag Deep Gas Project, but will defer rest of the plans. It is also working on reengineering projects and re-negotiating contracts to reduce costs. The Union Budget 2015-16 stated that state-run oil firms would invest over ` 76,565 crore on capex in 2015-16, up 5% on year. Of this, ONGC alone would invest ` 36,250 crore, as against target of ` 34,813 crore in the current fiscal. Global oil and gas companies have already announced cut in capex to the extent of over $85 billion from their 2015 budgets to protect themselves from low oil prices, according to industry estimates. RBC Capital Markets said in a note that the 122 global companies in its coverage could see a 20% decline in capital expenditure in 2015 to $349.2 billion. (economictimes.indiatimes.com)

March 9, 2015. Cairn India has obtained the regulator's nod to commercially produce gas in its prolific Rajasthan block, making it eligible to seek a longer extension after the contract for the block expires in 2020. Under the production sharing contract (PSC), a block is considered for a five-year extension if it produces oil, and for 10 years if it produces natural gas. This norm was earlier used by the regulator to turn down the request of Gurgaon-based subsidiary of London-headquartered diversified metals and mining company Vedanta Resources to extend the contract by 10 years, after the initial agreement to operate the Barmer block ends. Barmer oil block accounts for nearly a fourth of India's local oil production. But a gas discovery in the Raageshwari field in the RJ-ON-901 Barmer block will give government the flexibility to consider it a gas block and thus offer a 10-year extension. Cairn India said that it has received the management committee's approval for the Raageshwari Deep Gas Project. A managing committee comprises representatives of the upstream regulator DGH (Directorate General of Hydrocarbons) and the operator, and its approval is crucial for an operator to start commercial production in a new discovery of oil or gas. (economictimes.indiatimes.com)

March 9, 2015. Indian Oil Corporation (IOC) is seeking a rare aviation turbine fuel, or jet fuel, cargo - its first such requirement in more than three years. The company is seeking about 5,000 tonnes of jet fuel for delivery into Vasco da Gama, on the west coast in Indian state of Goa, over March 25 to 28. The state-owned company's rare spot requirement is due to a planned maintenance at its Koyali refinery in Gujarat. The tender closes on March 12 and is valid until March 13. IOC had last sought a jet fuel cargo in 2011. The company is expected to secure its diesel needs from Indian private refiners such as Reliance Industries and Essar Oil with whom it has term purchase contracts. IOC is planning to shut four crude distillation units with a total capacity of 220,000 barrels-per-day and several secondary units at the Koyali refinery from March to April. (businesstoday.intoday.in)

March 9, 2015. Rajasthan Chief Minister (CM) Vasundhara Raje said her government is re-negotiating and reviewing Barmer Oil Refinery, the previous Congress government's high profile project in the state. A loan of ` 56,000 crore is provided to this project, but only 26 percent share is given to the state. This is a peculiar package in which ` 3,736 crore interest free loan is to be provided to HPCL for 15 years, she said. On her budget proposals, Raje said people would feel satisfied as the government had put up a roadmap for all-round development of the state and it would be pursued in next three years. (economictimes.indiatimes.com)

March 9, 2015. Trans-Afghanistan gas pipeline connecting Turkmenistan, Afghanistan, Pakistan and India may become a reality soon as negotiation for the ambitious project is at the final stage, Oil Minister Dharmendra Pradhan said. The Minister said government will also take a decision on a project to bring natural gas from Iran through a pipeline passing through Afghanistan and Pakistan. He said India has been procuring crude oil from 25 countries and it was not correct to say that the country was over-dependent on the Middle-East for crude supplies. The Minister said India has imported ` 5,81,111 crore worth of crude oil, ` 59,085 crore worth of petroleum products and ` 46,712 crore liquefied natural gas during 2014-15 (till December 2014). In 2013-14, India had imported ` 8,64,875 crore worth crude oil, ` 74,605 crore petroleum products and ` 51,699 crore liquefied natural gas. The Minister said in order to reduce dependence on imports of oil and gas to meet the energy needs of the growing Indian economy, a number of steps have been taken by the government for enhancing domestic production including improved oil recovery, enhanced oil recovery implemented by exploration and production companies for increasing oil recovery from fields. (economictimes.indiatimes.com)

March 9, 2015. Sahaj e-Village Ltd has signed an MoU (memorandum of understanding) with Indian Oil Corp (IOC) for selling 5 kg FTL (Free Trade LPG) Indane cylinders through its Common Service Centers across the States of Assam, Bihar, Odisha, Tamil Nadu, Uttar Pradesh and West Bengal. For the first time IOC is venturing into a Pan India tie up with a private company for selling 5 kg Indane cylinders. Indane is one of the largest packed-LPG brands in the world. Having launched LPG marketing in the mid-60s, IOC has been credited with bringing about a 'kitchen revolution,' with the introduction of clean and efficient cooking fuel. As present 142 million rural Indian households use firewood and other solid fuels, such as animal dung, charcoal, crop waste and coal, as their primary source of household energy. The soot generated not only results in air pollution caused by fumes from cooking, heating and lighting activities but also shortens life spans of Indians in rural India. As per current data, 4,183 agencies had been commissioned as part of the plan to take LPG to rural India. Nearly 9.5 million of 17.8 million LPG consumers are now in rural areas, according to the corporate communication department of Indian Oil Corporation Ltd, a public-sector oil company. Sahaj is present across the 6 States of Assam, Bihar, Odisha, Tamil Nadu, Uttar Pradesh and West Bengal with more than 27000 Common Service Centers (CSCs) located across remote locations, reaching out to a rural consumer base of more than 2700,00,000. (timesofindia.indiatimes.com)

March 10, 2015. The Union Cabinet will soon consider a policy to develop marginal oil and gas (O&G) fields. If approved, it will pave way for the auction of 69 smaller fields on a revenue-sharing basis, a first for the country's hydrocarbons sector. The proposed policy has been readied by the oil ministry to attract private investors to smaller fields lying unexploited for years for want of enough attention, capital and technology. Sixty-three such blocks earlier allocated to Oil and Natural Gas Corp (ONGC) and six to Oil India Ltd, both state-run firms, will get auctioned under the proposed policy. The new policy would offer a revenue-sharing model, whereby bidders can offer a certain share of revenue from the fields to the government. The ones with the offer of the highest revenue share to the government will get the block to develop. At present, all oil and gas blocks have been auctioned on a profit-sharing model, which many have blamed for allowing operators to jack up cost leaving lower than expected amount of profit for sharing with government. In the past, a profit-sharing model has led to disagreements between operator and government on project cost and resulted in legal battles. A revenue-sharing model can probably help check that. (economictimes.indiatimes.com)

March 10, 2015. There are no plans to withdraw the facility of subsidised LPG cylinders to financially well off people, even as 1.46 lakh such consumers have voluntarily given up the subsidy, the government said. As on February 23, 2015, approximately 1.46 lakh consumers have voluntarily given up LPG subsidy on their domestic LPG connections, Minister of State for Finance Jayant Sinha said. However, government has launched an initiative for such LPG consumers to voluntarily give up their subsidy, he said. The minister said that components of cash subsidies are transferred to individuals or institutions in their bank accounts electronically on DBT platform. Accurate targeting of intended beneficiary through DBT provides full protection to the weaker sections of the society, he said. (economictimes.indiatimes.com)

March 9, 2015. Oil Ministry is keen to protect state-owned ONGC from subsidy burden in the March quarter as volatility in crude oil prices have taken a hit on its finances, Oil Minister Dharmendra Pradhan said. Oil and Natural Gas Corp (ONGC) met over 54 percent of the ` 67,091 crore loss that fuel retailers incurred on selling diesel, kerosene and LPG at government-controlled rates during the first nine months of the current fiscal. The government chipped in only one-third by way of cash subsidy despite slump in international oil prices leading to halving of the net price realised by ONGC. Pradhan said his ministry was "in touch" with the Finance Ministry for compensation of losses to be incurred by state oil companies during January-March quarter. Out of the ` 67,091 crore loss incurred on selling diesel at subsidised rates between April and October 17 and domestic LPG and kerosene through public distribution system (PDS) in the first nine months, the government provided ` 22,085 crore as cash subsidy. ONGC provided ` 36,300 crore while Oil India Ltd (OIL) ` 5,523 crore. Another ` 1,000 crore was provided by gas utility GAIL India Ltd. For January-March, the under-recovery or revenue loss is being pegged at around ` 7,000-8,000 crore. Pradhan said considering the volatility in crude oil prices, the interest of ONGC needs to be protected. The fall in international oil prices has meant that ONGC's realisation has dipped and after paying for fuel subsidy, which is in form of discount on crude oil it sells to refiners, it is left with only few dollars per barrel that are hardly sufficient to meets its expenditure. Oil Ministry had proposed to exempt upstream producers from payment of any further subsidy, but the proposal is yet to be accepted by the Finance Ministry. Under-recoveries or revenue retailers lose on selling fuel below cost, is projected at ` 74,773 crore in full 2014-15 fiscal. Out of this, ` 67,091 crore was in the first nine months (April-December). (economictimes.indiatimes.com)

March 9, 2015. During one of the meetings that Prime Minister Narendra Modi had with secretaries of all Central Ministries, he reportedly asked the Secretary, Ministry of Petroleum and Natural Gas, if he knew that women in small towns and villages placed their domestic gas cylinders in a horizontal position when they became empty. The Secretary promptly said he would come back with details. Modi then told him that by placing the cylinder in a sleeping position, families ensured three more days of gas supply. An empty cylinder placed vertically still retains at least 3 p.c. of the LPG, which, Modi elaborated, meant that every 34^th refill would come for free for oil companies. Upendra Tripathi, Secretary, New and Renewable Energy, narrated this anecdote, highlighting the Prime Minister’s awareness of the practices of thrifty rural households. A representative of a public sector oil marketing company said this may not always be true, or amount to 3 p.c. savings, although a miniscule amount of gas may remain in the cylinder if there is some wetness in it. (www.thehindu.com)

March 7, 2015. In a quest that could answer all the concerns over India’s energy security for the next century, the Geological Survey of India (GSI) in collaboration with National Institute of Oceanography (NIO) has launched an exploration to locate traces of gas hydrate reserves off the East Coast, particularly in the Krishna-Godavari offshore basin. Gas hydrates are solidified mixtures of compressed natural gas (CNG) and water that could meet the energy requirements of the entire nation. Samurdra Ratnakara, an advanced research vessel of the GSI, set off from Mangalore on the mission three weeks ago, and is likely to conclude its first phase this month. Monitored by NIO scientists, the GSI vessel would make attempts to locate the gas hydrate reserves, which are found in the shallow sediments along the continental margins at about 1-2 km below the seabed. About 20 scientists from the GSI branches in Mangalore, Kochi and Visakhapatnam along with the scientists from the Goa headquarters of the NIO, are participating in the study. In the seismic survey, it is proposed to cover an area of 19,000 sq km in the Cauvery-Mannar offshore basin, and another 6,100 sq km in the Krishna-Godavari offshore basin. The gas hydrates can expand by about 140 times under normal temperature and pressure to produce CNG for domestic and industrial usage. According to the scientists at National Geophysical Research Institute (NGRI), methane within the gas hydrates is estimated to be more than 1,500 times of the present natural gas reserves available in the country. Though it is too early, the scientists are of the view that the utilization of even 10 percent from this natural reserve is sufficient to meet the country’s energy requirement for about a century. A batch of Indian scientists from various organisations ranging from the NGRI to the NIO and the GSI to Directorate General of Hydrocarbons (DGH) have been on the mission to find out the reserves of gas hydrates for the past few years. The DGH has set itself a deadline of mid-2015 to commence commercial production of methane from gas hydrates, as part of the Gas Hydrate Programme. (www.newindianexpress.com)

March 7, 2015. The State Government is planning a ‘Petrochemical Park’ next to the BPCL refinery in Kochi to tap the potential of downstream industries in the petrochemical sector, Kerala Governor P Sathasivam announced in his policy address to the Assembly. The park will use feedstock from BPCL which is set to enhance its refining capacity. The government has also reiterated its commitment to assist Gas Authority of India Ltd (GAIL) to complete the LNG pipeline project calling it ‘critical to the development of the state. (www.newindianexpress.com)

March 4, 2015. Gujarat government said that it has planned to set up two new Liquefied Natural Gas (LNG) terminals of 10 Million Metric Tonnes Per Annum (MMTPA) capacity. Gujarat Chief Minister Anandiben Patel, who handles the ports portfolio, stated that two such LNG terminals are already operational in the state. At present, Gujarat has two operational LNG terminals, one at Hazira in Surat and the another at Dahej in Bharuch district. She stated that both these terminals have a combined capacity to handle 17.5 MMT LNG per annum. She stated that the Gujarat government plans to set up two more such LNG terminals to handle imported LNG. The Gujarat government plans to set up two new LNG terminals, one near Jafrabad in Amreli district and another at Mundra port in Kutch district, she said. Patel said that an LNG port terminal with Floating Storage and Re-gassification Unit (FSRU) with a capacity of 5 MMTPA would be built in Jafrabad. (economictimes.indiatimes.com)

March 4, 2015. The Cabinet Committee on Economic Affairs (CCEA) approved the extension of PDS (public distribution system) Kerosene and Domestic LPG Subsidy, 2002, and Freight Subsidy (for far-flung areas) Scheme, 2002, up to March 31, i.e. by one year. The move will likely help reduce the under-recovery of oil marketing companies. A subsidy of ` 22.58 per 14.2 kg LPG and ` 0.82/litre on kerosene sold through the public distribution system was being provided under the scheme. The freight subsidy was being provided to consumers in far-flung areas. Both schemes had ended on March 31, 2014. The Centre had deregulated the sale of non-PDS kerosene to check black-marketing of the fuel sold through the PDS. Market-priced kerosene sells for ` 27.68/litre while PDS kerosene costs ` 15.14/litre. (www.thehindubusinessline.com)

March 4, 2015. India's annual oil products demand is forecast to grow 3.3 percent in the next fiscal year as Prime Minister Narendra Modi's focus on local manufacturing and economic expansion will raise consumption of industrial fuels. The country is expected to consume 166.87 million tonnes of refined fuels in 2015/16 versus an estimated 161.57 million tonnes this fiscal year, according to a forecast by India's energy data body the Petroleum Planning and Analysis Cell (PPAC). Modi's "Make in India" campaign to make the country a manufacturing powerhouse, plus a push on infrastructure projects and a likely average monsoon will boost demand for industrial fuels like diesel, bitumen and petroleum coke. Indian economy is projected to grow close to 7.4 percent this fiscal year to March 31. It grew at 7.5 percent in December quarter from a year ago. In 2015/16, India's GDP is estimated to grow at 8-8.5 percent. The growth in the demand for diesel, which accounts for more than 40 percent of refined fuel consumption in India, is set to rise 4.1 percent to 71.32 million tonnes while that of gasoline is expected to grow 7.2 percent to about 19.72 million tonnes. Availability of cheaper credit after a second rate cut by Reserve Bank of India in as many months is expected to drive up the sale of vehicles. India is expected to become the world's third-largest passenger vehicle market by 2019, from sixth place currently, consultant IHS Automotive estimates. Demand for refined fuels mainly diesel will also get a boost if global oil prices remain stable at the current level of about $61 a barrel compared to about $115 in June last year. In October last year, India ended subsidies on diesel sales and since then retail prices of the fuel have been reduced by about 15 percent. India's kerosene demand is forecast to decline 3.7 percent as the federal government is encouraging use of liquefied petroleum gas, consumption of which is expected to rise 3.5 percent. Use of naphtha and fuel oil is projected to fall by 5.3 percent and 4.9 percent in the next fiscal year, the data showed. PPAC has released fuel consumption data up to January. (in.reuters.com)

 [NATIONAL: POWER]

March 10, 2015. Tata Power commissioned 63 MW sized first unit of its 126 MW Dagachhu Hydro Power Corporation (DHPC) in Bhutan. This project is in line with Tata Power’s commitment to commission 120 MW of new Hydro Power Project this year as part of the centenary year celebration theme of Invisible Goodness, and is the first cross border project registered under UNFCCC’s Clean Development Mechanism (CDM), the company said. The Dagachhu project is a joint venture initiative between Tata Power and Druk Green Power Corporation, owned by Royal Government of Bhutan (RGoB), and National Pension & Provident Fund of Bhutan. With the commissioning of the project, Tata Power’s total hydro generation capacity stands at 513 MW and overall capacity at 8684 MW. The Dagachhu Project is 126 MW (2X63 MW) run of river hydro project located in Dagana Dzongkhag, Bhutan. The commercial flow of energy generated from the Dagachhu project to India officially started at 00:30 hours in the morning (Bhutan time) of 21^th February 2015. The test run for the second unit of 63 MW will also be immediately started and expected to be completed soon. DHPC has entered into a 25 year Power Purchase Agreement (PPA) with Tata Power Trading Company Limited (TPTCL) for sale of power from the project. The power generated from the project shall be sold by TPTCL in the Indian power market. (www.business-standard.com)

March 9, 2015. Arunachal Pradesh has signed pacts with power developers to execute 160 projects, entailing total installed capacity of 46,948 MW, in the state. Chief Minister Nabam Tuki informed that the state government has inked memorandum of understandings (MoUs) and memorandum of agreements (MoAs) with power developers to execute these projects. Responding to a question from opposition leader Tamiyo Taga, Tuki disclosed that three projects -- 2000 MW Lower Subansiri Hydro Electric Project (LSHEP), 600 MW Kameng project and 110 MW Pare project -- are under execution. Works on Lower Subansiri project at Gerukamukh was stalled in December 2011 after anti-dam protagonists opposed its construction apprehending cascading affect on the people living in the downstream of the river. When Taga wanted to know the steps taken by the state to identify the developers who were not interested in executing projects despite signing the MoUs/MoAs, Tuki said that the government had already taken decision and cancelled contracts with a few developers for violating the agreements. Responding to a supplementary from BJP member Japu Deru, the Chief Minister informed that a few minor projects were executed during 1970s, 1980s and 1990s. (economictimes.indiatimes.com)

March 9, 2015. RattanIndia Power, the erstwhile Indiabulls Power, said it has commissioned the fourth 270 MW unit of the 1,350 MW phase-I of its thermal plant at Amravati in Maharashtra. The company is developing a 2,700 MW coal-based plant in Amravati in two phases of 1,350 MW each. This unit is a part of the first phase of the project, it said. The first phase involves five units of 270 MW each. With the commissioning of the fourth unit, the total capacity of the first phase has increased to 1080 MW. (economictimes.indiatimes.com)

March 4, 2015. Adani Power has signed a binding share purchase agreement with Avantha Power and Infrastructure to acquire 100 percent of its Korba West Power Company valued at ` 4,200 crore. Korba West Power Company Ltd (KWPCL) is a special purpose vehicle (SPV), valued at ` 4,200 crore, which has commissioned a coal-based thermal 600 MW power plant, Avantha Power and Infrastructure said. With this buy, the installed base of Adani Power will increase to 11,040 MW. The company has set a target of 20,000 MW capacity by 2020. (economictimes.indiatimes.com)

March 9, 2015. Power prices at exchanges have dipped to nearly ` 1 per unit following monopoly miner Coal India's bid to meet annual target by pushing larger volumes in the last few weeks of the financial year amid a decline in demand. The state-run producer is trying to clear supply backlog to power plants, with the result that producers have accumulated about 20 million tonne of coal, the highest in the past few years. The surplus stock has pushed prices down by about ` 1.50 per unit over the past month. According to Coal India, by end of January, the miner was short of its annual target by about 120 million tonnes. In order to meet its yearly quota, the company produced and sold about 40 million tonnes of coal. By the end of February, though, it was still short of target by about 70 million tonnes. Coal India is unlikely to meet its annual target, officials said, although the miner is trying to sell as much as it can until March 31. Power demand is not likely to rise substantially by the end of the month as the weather is not forecast to see a rapid rise in temperatures. (economictimes.indiatimes.com)

March 9, 2015. Distribution losses, including theft, have caused a staggering ` 69,108 crore damage to power utilities in 2012-13, Power and Coal Minister Piyush Goyal said. These losses include distribution losses including theft of electricity, gap between average cost of supply and average revenue realisation, inadequate metering, poor billing and collection efficiency, the Minister said. The aggregate losses, after tax on accrual basis, incurred by utilities selling directly to the consumers was ` 69,108 crore during 2012-13, he said. The Minister said the transmission loss was the highest in Bihar at 54.63 percent and the lowest in Kerala at 9.13 percent followed by 9.53 percent in Himachal Pradesh. He said peak power shortage in the country reported by states during April-January period of the current fiscal stood at 7,006 MW. He said a target of 1,000 units per capita electricity consumption has been set for the year 2014-15 compared to 957 units in 2013-14.

Goyal said an estimated USD 250 billion investment target has been set for the power sector in next 4-5 years. Of this, USD 100 billion was planned to be used in the renewables, USD 50 billion in transmission and distribution sector, USD 60-70 billion in the power generation sector and USD 25 billion for the modernisation of old plants among others. (economictimes.indiatimes.com)

March 9, 2015. In a country that had failed to carry out distribution sector reforms and lacks adequate transmission capacity, creating surplus electricity generation capacities may have disastrous fallout. Ask the Tripura government, that attracted the largest investment in power sector in North-East over the last decade, and you will know why. The gas resource-rich Tripura banked heavily on power capacity addition to serve the dual purpose of industrialisation and earning revenues through sale of surplus power. True to its expectation, it is now flooded with electricity but at its own peril. The first unit of 2 X 363.3 MW ONGC Tripura power (OTPC) is already commissioned. The second unit, which has been on stream for sometime, is expected to declare commerciality from this month. The 104 MW NEEPCO project is also expected to start generation from March. It means, beginning April, the total availability of power to Tripura will move up from 250 MW to 450 MW. Considering a peak demand of 250 MW in the evening hours, the State’s exportable surplus will be between 200-300 MW a day. For a State of mere ₹3,000 crore revenue budget, Tripura lost a mammoth ₹100 crore in electricity sales in 2013-14. State Power Minister Manik Dey says the loss may increase in 2014-15. This is because, in the absence of buyers, the State had to resort to either distress sale or pay up the generation utility for not lifting its quota. (www.thehindubusinessline.com)

March 9, 2015. Mumbai-based SRM Energy Ltd is planning to sell Cuddalore thermal power plant in Tamil Nadu. The power plant had been transferred to a wholly-owned subsidiary SRM Energy Tamilnadu Pvt Ltd. The parent company is in the process of implementing a 3X660-MW super critical thermal power plant based on imported coal, in Cuddalore. (www.business-standard.com)

March 7, 2015. The Power Grid Corporation of India Ltd (PGCIL) will invest ` 30,000 crore for the improvement of transmission infrastructure from northern States to southern States, Union Minister of State for Power and Coal Piyush Goyal said. Goyal said that the investment would be made over a period of two and a half years to three years. The Minister announced that Tamil Nadu would receive ` 1,000 crore under the Deendayal Upadhyaya Gram Jyoti Yojana (DDUGJY) for improving the electricity network in rural areas. Also, nine towns in the State had been chosen under the Integrated Power Development Scheme, for which ` 363 crore would be given.

Disclosing that the Finance Commission had granted ` 1,051 crore for renewable power projects, Goyal said the amount would be released this month. The Minister said it had been decided to give 100 MW of unallocated power from the second unit of the Kudankulam Nuclear Power Plant to Tamil Nadu, in addition to 100 MW from the first unit. This would mean that the State's share would be 1,125 MW out of 2,000 MW to be generated by the two units. (www.thehindu.com)

March 7, 2015. The Haryana government has said that state-owned power generation and distribution companies have accumulated a massive debt of ` 38,345 crore in the last 10 years. These firms have piled up a loss of ` 27,333 crore in the past one decade, as per White Paper released by Haryana government. Unfolding the broad contents of second part of White Paper, the Haryana Chief Minister Manohar Lal Khattar said in the last ten years, the losses of state owned Haryana Power Generation Corporation increased by 500 percent and debt by 200 percent. Likewise, the losses and debts of power distribution companies Uttar Haryana Bijli Vitran Nigam and Dakshin Haryana Bijkli Vitran Nigam increased by 2,600 percent and 1,900 percent respectively.

Haryana Finance Minister Capt Abhimanyu said Haryana Power Generation Corporation Limited (HPGCL) had a cumulative loss of ` 87 crore in 2004-05. This loss increased by 500 percent to ` 438 crore in 2013-14. Since 2004-05, the company has remained in profit for four years and in losses for six years. Capt Abhimanyu said that power distribution companies -- Uttar Haryana Bijli Vitran Nigam (UHBVNL) and Dakshin Haryana Bijli Vitran Nigam (DHBVNL) remained in losses in all ten years since 2004-05. (economictimes.indiatimes.com)

March 4, 2015. Western states sold a little over 1,000 million units or 27 percent less electricity in February due to power transmission bottlenecks in the region, India Energy Exchange (IEX) said. The Exchange continued to experience severe congestion on inter-state transmission system, especially on the western-southern region and western-northern region. The month of February also witnessed decrease in power demand and reduction in prices at IEX.

The average daily trade of 72 MUs (million units) was 5 percent lower than 75 MUs traded last month. Almost 2.03 BUs (Billion Units) was traded in February whereas 2.34 BUs were traded in January, 2015, IEX said. With sell bids at 3.40 BUs and buy bids at 2.89 BUs, the supply of power exceeded the demand. (economictimes.indiatimes.com)

March 4, 2015. Infrastructure major GMR India is to enter into an agreement with Bangladesh to export 500 MW electricity from two hydropower projects it is constructing in Nepal. GMR has already signed an agreement with the Nepal government to build the 900-MW Upper Karnali project in western Nepal and is in the final stages of acquiring permission for constructing the 600-MW Upper Marsyangdi-II project in central Nepal.

An agreement for the export of power to Bangladesh will be signed during the three-day regional energy conference starting in Kathmandu where energy ministers and officials looking after cross-border energy cooperation in India, Nepal, Bangladesh and Bhutan will be participating, according to Nepali officials.  Nasrul Hamid, Bangladesh minister of state for power, energy and mineral resources, and Harvinder Manocha, GMR's country head for Nepal, will sign the relevant agreement which will be witnessed by Nepal Prime Minister Sushil Koirala. Once the memorandum of understanding is signed between the two parties, a power purchase agreement will be signed between GMR and Bangladesh Power Division. Nepali officials have welcomed the development as this will also pave the way for regional energy trading and also open avenues for other types of trading in sub-regional way. India's nod is also quite important as transmission lines would need to cross over to Bangladesh through India, and Bangladeshi officials are in talks with Indian authorities in this regard. (bdnews24.com)

March 10, 2015. Arunachal Pradesh will earn revenue of ` 445 crore annually as revenue from 12 percent free power after the commissioning of three ongoing hydropower projects in the state, Chief Minister Nabam Tuki said. Tuki said the 110 MW Pare project and 600 MW Kameng project by North East Electrical Power Corporation (NEEPCO) were expected to be commissioned by this year and next year respectively. Work on the stalled on the 2000 MW Lower Subansiri hydro electric project would start soon, he said. All the power developers would have to give 12 percent free power to the state, which would get annual revenue of ` 17 crore from the Pare project, ` 95 crore from Kameng project and ` 333 crore from Lower Subansiri project, Tuki said. By harnessing all the hydropower potential, Arunachal Pradesh could be a self-reliant in the power sector and immensely benefit other states of the north east, he said. Terming Arunachal Pradesh as the 'power house' of the country with 60,000 MW hydropower potential, Tuki said the state could meet 40 percent power requirement of the nation. The state hydropower policy was in tune with the central policy and the consulting policies of other states of the country, particularly Himachal Pradesh, he said. (economictimes.indiatimes.com)

March 10, 2015. Banks will have to rethink existing and future loan agreements with power companies if the latter get a loan for a power plant given by the government through a tender or a contract for a certain time period. According to the new accounting norms notified by the government recently, if a power company has done a power purchase agreement (PPA) with any state for such a plant, where it will get an assured return from the government, the plant may be considered a "financial asset" in the company's balance sheet. Banks give loans to power companies against the fixed assets on their balance sheets. Power companies categorise such power plants as fixed assets to avail such loans. All such power plants will be considered financial assets or intangible assets, instead of fixed assets. Most of the current PPAs (solar or otherwise) and agreements for ultra mega power projects will fall under this criterion. According to Appendix-C of the Indian Accounting Standards (IndAS) 115, relating to service-concession agreements, all such PPAs where the government controls the purchase of power and its price will be considered a fixed asset in the government's books and financial assets in the power company's books. However, in case a power company establishes a power plant on its own, and enters into a PPA with the government or any other buyer later, the power plant will remain in the power company's balance sheet as a fixed asset. If a company finds it difficult to apply this norm retrospectively, it may be allowed to apply the new norms from a transition date. The government has asked all companies, listed and unlisted, with a net worth of more than ` 500 crore, to start following these accounting standards for the accounting periods beginning April 2016. (www.business-standard.com)

March 10, 2015. Karnataka is ready to lock horns with Andhra Pradesh (AP) to get a nuclear power plant, which was originally meant to come up at Haripur in West Bengal. Andhra Pradesh and Karnataka have expressed readiness to offer land for the project. The positive response from the two states has come as a respite for the Union government which had approached Kerala and Odisha, apart from West Bengal, for possible nuclear plant sites. These states had, however, expressed reluctance in providing sites. The site selection committee, constituted by the Union government, had allocated the Haripur site to build the nuclear power reactor with Russian collaboration. However, the project did not take off due to stiff resistance from the locals, backed by political parties. In 2011, Rosatom, the Russian counterpart of India’s Department of Atomic Energy (DAE), asked India for an alternate site. During Russian President Vladimir Putin’s visit to India in December last year, Russia, which has offered to build 12 more nuclear power reactors, had again exerted pressure on India over the issue. Karnataka Energy Minister D K Shivakumar said that the state government has a positive approach towards the proposed 1000MW nuclear power plant. (www.newindianexpress.com)

March 10, 2015. French nuclear technology company Areva SA is ready to discuss transfer of technology with the Indian Government in order to speed up the process for signing a contract for the Jaitapur nuclear power project in Maharashtra. As ‘Make in India’ has become a key policy of the Indian Government, Areva is open to any kind of technology transfer for this policy. But the components need to meet quality standards and be at a lower cost, Erwan Hinault, Chairman and Managing Director of Areva’s Indian arm said. Nuclear Power Corporation of India (NPCIL) is building the 10,000-MW power project in Jaitapur. Areva is hoping to sign a deal for supplying reactors for the project. In January 2009, a memorandum of understanding (MoU) was signed between the companies for building two EPR reactors, each having 1,650 MW capacity. But the final commercial agreement is yet to be signed. The EPR is a third generation pressurised water reactor. The main design objective of the reactor is enhanced safety. Once the agreement is signed, the entire nuclear supplier chain will open up for the Indian companies, said Hinault. In the Jaitapur project, Areva will supply the main reactor and other critical nuclear components. Six years have passed since the MoU, but the companies have not been able to reach a final commercial contract. NPCIL wants the final price of per unit of power to be ₹ 6.5 when the plant becomes operational. Hinault said regular meetings are under way with NPCIL for reaching the target of ₹ 6.5 a unit. Earlier the plan was to set up the plant by 2021, but given the delay, the commissioning could get postponed till 2024, he said. The French company had reported a loss of €4.83 billion ($5.37 billion) for its global operations for fiscal 2014. The company is putting in place a cost-cutting strategy. Hinault said the company continues to be bullish about the opportunity in India. (www.thehindubusinessline.com)

March 10, 2015. Delhi power minister Satyendar Jain has asked the power department for details of the power purchase agreements with NTPC. In a meeting, Jain said that the details of these agreements need to be studied to find out why Delhi is paying more for its power compared to other states. Drawing a parallel with Gujarat, where NTPC is supplying power at ` 2.13 per unit against Delhi, which is getting power for ` 4.14 per unit, while there might be any number of reasons, and perfectly legitimate ones, for the difference in price, it needed to be worked out whether Delhiites could pay less for their power. Delhi discoms for long have been demanding that power from central sector plants should be reallocated as per location and requirements. Discoms said that comparing Delhi's power sector with Gujarat was not feasible as the latter had invested massively in internal generation. (economictimes.indiatimes.com)

March 9, 2015. Coal bearing States may have to wait longer to enjoy the financial benefits of the coal block auctions, as the Coal Mines (Special Provisions) Bill 2015 continues to face hurdles in the Rajya Sabha. The Bill was expected to be taken up, but due to the Opposition’s demand for Prime Minister’s statement on release of a separatist Kashmiri leader, it is now likely to come up. Even the Mines & Mineral Bill will now be taken up. Already passed in the Lok Sabha, both the Bills aim to replace their respective ordinances. The Ordinances have to be replaced by Acts of Parliament by April 5, but both the houses will break for a one month recess on March 20. The Centre has decided to transfer the entire proceeds from the auction of the coal blocks to host States such as Jharkhand, Odisha, West Bengal, Chhattisgarh, Madhya Pradesh and Maharashtra. (www.thehindubusinessline.com)

February 9, 2015. A Parliamentary panel has sought suggestions on the proposed changes to the Electricity Act which seeks to provide choice of power suppliers to consumers and propel growth in the sector. Power and Coal Minister Piyush Goyal had said that amendments to the Electricity Act, to bring in various reforms including improvement in power supply and allowing consumers to choose their supplier, should come into effect by April. The amendments proposed will promote competition, efficiency and improvement in the supply of electricity resulting in capacity addition and benefiting consumers. The Cabinet, in December, approved various amendments to the existing Electricity Act 2003. (zeenews.india.com)

March 9, 2015. While the government seeks to reform the land acquisition law this week, it has decided to fast-track 10 power projects worth ` 90,000 crore planned by state-owned companies led by NTPC, which have been held up by land-related issues, identified in the Economic Survey as the biggest hurdle for stalled public sector investments. The power ministry turned to the cabinet secretariat's project monitoring group to help bring back on track stalled investments involving over 15,600 MW of capacity and critical transmission lines for states such as Jammu & Kashmir. After factoring in the 10 projects taken up by the power ministry, 305 projects worth ` 18.85 lakh crore are now awaiting government intervention to get off the ground, including 97 public and private sector power projects with investments of ` 6.33 lakh crore. The group, set up to unlock hurdles facing big-ticket and strategic investments, has so far resolved problems facing over 200 projects worth ` 6.9 lakh crore. These included about 100 power projects worth ` 3.53 lakh crore, though some of them have come back to seek intervention on new hurdles that have emerged on their road to commissioning. NTPC is developing eight of the 10 projects that the power ministry has sought to expedite, with investments of over ` 76,000 crore at stake to generate about 15,000 MW. This includes a ` 5,000-crore joint venture between the Indian Railways and NTPC for a 1,000-MW plant at Nabinagar in Bihar, where the ministry has attributed delays to 'land acquisition and security related' issues. Of the 1,521 acres required for the plant, the joint venture has got about 1,100 acres. (economictimes.indiatimes.com)

March 9, 2015. The government hopes to award two of the five ultra mega power projects (UMPPs) this year in the plug-and-play mode while the auction process for the remaining three announced in Budget 2015-16 may take at least another year to get off the ground. The first two UMPPs of 4,000 MW each, at Bedhabhal in Odisha and Cheyyur in Tamil Nadu, are ready with most clearances in place while awaiting review of the bidding norms. The auction for these projects was started in 2013 as per a model similar to the plug-and-play scheme proposed by the NDA government, but it was scrapped as private companies walked out in protest against the new bidding rules. An expert committee led by former Chief Vigilance Commissioner Pratyush Sinha is reviewing the bidding documents for the projects and is expected to submit its report to the power ministry soon. The committee has finished hearing concerns of all stakeholders, including companies, banks, electricity regulators and industry associations, which have recommended withdrawal of new norms that do not envisage ownership of the plants to the qualifying companies. The power projects will be transferred to the distribution utilities at the end of the concession period for a cost, as is done in case of other infrastructure projects in road and port sectors. Association of Power Producers said UMPPs have a great potential of success if these are offered in plug-and-play mode as stated in the Budget and the review committee balances the risk equitably. The government has identified land in Banka district of Bihar, Deogarh in Jharkhand and in Etah in Uttar Pradesh for setting up UMPPs. The sites for two additional UMPPs in Odisha have also been identified, the power ministry said. The situation will be clear by the end of March after the committee submits its report. However, auctioning projects in the plug-and-play model announced in the Budget will take longer as acquiring land as per the new law and obtaining environment and other regulatory clearances will take at least one year. Bidding process of UMPPs and their financial closure might take another year, the official said. Finance Minister Arun Jaitley had said in his budget speech that the government plans to set up five new UMPPs - requiring total investments of about ` 1 lakh crore - through the plug-and-play model, whereby unencumbered possession of land, all clearances and linkages will be in place before the projects are awarded through auction. (economictimes.indiatimes.com)

March 8, 2015. Nuclear power is substantially cheaper than most types of thermal sources of energy and hydro-electricity, claims the NDA government as it fast-tracked India’s nuclear energy target by three times. Soon after coming to power in July, 2014, the Narendra Modi government had set a target of tripling the existing nuclear capacity of 4780 MW in the next ten years. The government told Parliament why it made economic sense to harness the power of atom. The per unit cost of electricity from the nuclear source varies between 97-394 paise. This is comparable to non-pithead coal (375-529 paise), which is ferried to a power plant located at a distance as well as pithead coal (147-385) where the plant is located at the mine site. All other sources of thermal energy such as natural gas with and without the control of the administrative price mechanism, liquefied natural gas and liquid fuel like naptha or diesel, are far more expensive. Nuclear power plants, however, are more capital intensive than coal or gas fired plants. Four 700 MW units are under construction at Rawatbhatta in Rajasthan and Kakrapar in Gujarat. The construction of two 700 MW units in Gorakhpur in Haryana are slated to start in 2015-16. The second 1000 MW unit at the Kudankulam plant is likely to be commissioned in 2015. The large uranium mine and process plant at Tummalapalle in Andhra Pradesh is expected to start production soon. (www.deccanherald.com)

March 7, 2015. The Centre is committed to supporting the power sector in Tamil Nadu including allocation of a major share of power from the Kudankulam Nuclear Power Project, as part of addressing the acute power shortage in the state, Union Coal and Power Minister Piyush Goyal. He was talking to reporters after an interaction with Tamil Nadu Chief Minister O Panneerselvam and senior government officials at the Secretariat. He complemented the government besides officials for taking steps to bring down peak energy shortages to "a very small level". (economictimes.indiatimes.com)

March 4, 2015. The government aims to train as many as 7 lakh people for various segments in power generation in line with its ambitious plans of producing 1,75,000 MW renewable energy 2022. National Power Training Centre (NPTI), a body under the Ministry of Power will train 7 lakh people in the next three years across various branches of the sector. NPTI in its 40 years of existence has trained 2,67,000 people. Looking at the requirements of the power sector we have decided on a three-year roadmap. We have a programme to train 7,00,000 people, Power Minister Piyush Goyal said. Under the ambitious programme the ministry will train one lakh people in the power sector in 2015-16, 2 lakh in 2016-17, and 4 lakh in 2017-18. The proposed training programme will cover manpower requirements in ramping up power generation, building transmission and sub-transmission networks among other things. Ministry of Power has set a target of generating 1,75,000 MW from renewable energy sources by 2022. Of the targeted 1,75,000 MW, lion’s share of 1,00,000 MW will come from solar power, 60,000 MW from wind, 10,000 MW from biomass and the remaining 5,000 MW from small hydro projects. At present, the solar power generation capacity is at about 2,700 MW; Wind - 21,000 MW; Small Hydro - 3,800 MW and biomass - 4,100 MW. Small hydro power projects are plants with up to 25 MW generation capacity. (www.thehindubusinessline.com)

March 4, 2015. Government began the second round of coal mine auctions by putting on offer four blocks - all in Jharkhand - with firms including Adani Power, JSW Steel, SAIL and BALCO in the race. The mines on offer are Jitpur, Moitra, Brinda and Sasai. The companies vying for Jitpur mine - earmarked for the power sector - are Adani Power, Adhunik Power and Natural Resources, Jaiprakash Power Ventures and Jindal Power. The mine was earlier allocated to Jindal Steel & Power Ltd (JSPL). For Moitra mine - earmarked for the non-power sector - the companies in the race are Jayaswal Neco Industries Ltd, JSW Steel and SAIL. It was earlier alloted to Jayaswal Neco. With regard to Brinda and Sasai coal blocks, the companies found to be technically qualified are BALCO, Easternrange Coal Mining Pvt Ltd, Sesa Sterlite and Usha Martin. The two blocks were earlier alloted to Abhijeet Infrastructure Pvt Ltd. The e-auction proceeds from the first lot of mines are over ` 1 lakh crore. (www.business-standard.com)

 [INTERNATIONAL: OIL & GAS]

March 10, 2015. UK independent energy firm Premier Oil reported the start-up of gas production from the Pelikan field in the Natuna Sea Block A offshore Indonesia. Premier said that production from Pelikan began – adding to production from the Naga field (also on Natuna Sea Block A), which started in November. Pelikan and Naga is delivering additional reserves into Singapore and the domestic Indonesian market under Premier's long-term gas contracts. The firm said that production of up to 200 billion British thermal units per day will allow it to increase operational flexibility and to respond to increase Singaporean or domestic gas demand. Premier operates Natuna Sea Block A, with a 28.67-percent stake, on behalf of partners that include KUFPEC, PTT and Petronas. (www.rigzone.com)

March 10, 2015. Myanmar will shut down three of the country’s offshore gas fields for scheduled maintenance next month, the Myanma Oil and Gas Enterprise (MOGE) said. Production from the three gas fields – Yadana, Yetagun and Zawtika – will each be halted for around a week commencing in late April for annual maintenance, according to the MOGE. The Yadana gas field in Blocks M5 and M6, operated by France’s Total S.A. and which has been in commercial production since 2000, will shut down for maintenance from April 10 to April 19. Meanwhile, the planned shutdown at the Yetagun field in Blocks M12, M13 and M14 – operated by the upstream arm of Malaysia’s national oil company Petroliam Nasional Berhad (Petronas) Petronas Carigali – will take place from April 20 to April 27. (www.rigzone.com)

March 10, 2015. Cairn Energy Plc expects a slump by half in the cost of oil rigs to sustain the U.K. producer’s exploration in Senegal even after crude prices sank in previous months. Cairn and its venture partners last year found oil in two blocks off Senegal, West Africa. The company expects to generate cash in the country by 2020 or 2021, Chief Executive Officer Simon Thomson said. The oilfield-services industry is bracing for slow business this year after the value of Brent crude sank by about half in 2014. The crash in prices has forced some oil producers to delay or cancel projects, sapping demand for drilling companies and allowing their remaining customers to negotiate cheaper rates. Cairn operates three blocks off Senegal with a 40 percent working interest. ConocoPhillips has 35 percent, FAR Ltd. of Australia 15 percent and the rest is owned by Petrosen, the national oil company. (www.bloomberg.com)

March 10, 2015. China National Offshore Oil Corp. Ltd. (CNOOC) announced that its Qinhuangdao 32-6 comprehensive adjustment project in Bohai Bay offshore China has commenced production. The Qinhuangdao 32-6 oilfield is located at the central north of Bohai Bay with an average water depth of approximately 65 feet. The main production facilities of Qinhuangdao 32-6 comprehensive adjustment project include 4 platforms and 99 producing wells. This project is fully on-stream and expected to reach its overall development plan designed peak production of approximately 36,000 barrels per day in 2015. (www.rigzone.com)

March 9, 2015. BP has made a second large gas discovery off Egypt as part of a concession estimated to contain more than 5 trillion cubic feet, the energy company announced. BP Egypt's Atoll-1 is a deepwater exploration well located around 80 kilometres north of Egypt's Damietta and is the country's deepest well ever drilled, BP said. The company drilled the well at 6.4 kilometres depth and expects to go another kilometre deeper. (af.reuters.com)

March 10, 2015. Chevron Corp has seen "quite a bit of interest" among prospective buyers for its 54,000 barrel-a-day refinery in Kapolei on the Hawaiian island of Oahu, Chief Executive Officer (CEO) John Watson said. The company hired Deutsche Bank and began seeking buyers last fall for the refinery, one of the smallest in its global portfolio. (www.downstreamtoday.com)

March 10, 2015. An expansion of Bahrain's Sitra crude oil refinery is expected to cost around $5 billion and the facility is likely to be commissioned by 2019, the Energy Minister Abdul-Hussain bin Ali Mirza said. The increase in capacity according to the current plan is from 260,000 barrels per day to 360,000 and it will be commissioned by 2019. Bahrain lacks the ample crude oil and financial resources of the big Gulf energy exporters, and its state finances are under heavy pressure from the plunge of oil prices since last year. But Bahraini officials have said they will press ahead with key projects that are needed to develop the economy. Construction of a pipeline between Saudi Arabia and Bahrain, which will replace an ageing one and lift capacity to 350,000 bpd from 230,000, is expected to be finished by 2018, Mirza said. Previously, officials had estimated the pipeline would be completed by the third quarter of 2016. Mirza did not give a reason for the change. He said that this year Bahrain would ask companies to bid to explore offshore blocks for oil and gas. He did not give a specific date or say which companies would participate as a roadshow for investors has not taken place yet. (en-maktoob.news.yahoo.com)

March 6, 2015. Mexican state-owned oil company Pemex said that it had contained a fire at its Miguel Hidalgo refinery and that the facility was back to normal operations. No workers were injured, and the facility near the city of Tula in central Hidalgo state sustained only minor damages, the company said. The morning fire ignited in a leaking hydrogen compressor at the refinery's residual hydrodesulfurization plant. The refinery, Pemex's second-biggest, has a crude processing capacity of 315,000 barrels per day. (www.downstreamtoday.com)

March 5, 2015. Abu Dhabi National Oil Co (ADNOC) will export its first diesel and jet fuel cargoes from the newly expanded Ruwais refinery in March, adding to a supply glut facing Asia and the Middle East, traders said. The company has sold its first diesel cargo to be loaded from Ruwais between March 12 and March 14 and its first jet fuel cargo to be loaded between March 21 to 23, the traders said. The diesel cargo was likely sold to Brazil's Petrobras and the jet fuel cargo to French oil major Total , they said, though this could not immediately be confirmed. ADNOC is currently in talks to sell a second diesel cargo to be loaded over March 22 to 24, and is expected to slowly ramp up overall exports once production is stable, they said. ADNOC's expanded Ruwais refinery is currently running at about 50 to 60 percent of its capacity, and is expected to export its first gasoline cargo in April when it starts up a residual fluid catalytic cracking (RFCC) unit. The expansion is expected to more than double the capacity of the refinery from 415,000 barrels-per-day (bpd) and will process Abu Dhabi's Murban crude oil. Once fully commissioned, the expanded refinery is expected to produce an additional 8 million tonnes a year of diesel and about 4 million tonnes a year of jet fuel. The refinery currently produces 5 million tonnes a year of diesel and 6 million tonnes a year of jet fuel. Ruwais' expansion comes at a time when new refining capacity from the Middle East, including two new refineries in Saudi Arabia, are adding to excess supply while diesel demand from major consumers such as China and Indonesia has slowed. (www.downstreamtoday.com)

March 9, 2015. Libya is set to export more than two million barrels of crude oil this week from two ports in the east where output has topped 245,000 barrels per day. Rising exports from the ports of Hariga and Zueitina offer some hope for the OPEC member state's oil sector, which has been battered by Islamist militant attacks and fighting between rival factions. Output from four fields including Sarir, the country's largest, has reached 243,000 to 245,000 bpd, Arabian Gulf Oil Company (AGOCO) said. AGOCO restarted output at the Sarir and Messla oilfields after a pipeline blast cut off supplies to Hariga. The two fields pump around 180,000 bpd, while AGOCO also runs the Hamada and Nafoura fields. A fifth field, Bayda, has been closed to an outage, AGOCO said. A tanker has loaded 600,000 barrels of crude at Hariga while a second one will load one million this week, AGOCO said. Libya also exports some 80,000 bpd from two offshore fields, while the eastern Brega port supplies Libya's Zawiya refinery. (www.reuters.com)

March 9, 2015. Two more serious derailments and fires involving trains carrying crude oil in the past week confirm there is a serious problem with the safety culture on North American railroads. The latest fiery derailments occurred in northern Illinois involving a train operated by BNSF and northern Ontario involving a train operated by Canadian National Railway. They come just weeks after serious oil train fires in West Virginia involving a train operated by CSX and another Canadian National derailment in northern Ontario. The U.S. Department of Transportation predicts more than 200 crude and ethanol carrying trains will derail over the next 20 years, including ten in urban areas. The U.S. Department of Transportation and groups representing the industry have failed to produce timely and effective response to the spate of train fires. So it is time for Congress and the White House to step in and impose a solution to enable crude to be carried safely while protecting communities along the major oil by rail corridors. (www.reuters.com)

March 9, 2015. Traders who have been storing oil since the start of the year are selling some supplies back into the market, completing a trade-play that made oil storage profitable, and re-injecting fuel into an already oversupplied market. The selling signals a winding down of a strategy that has seen at least 50 million barrels of oil stored in tankers, equivalent to about one month's consumption in Britain, although traders said it was not clear how much oil has been sold. A steep fall in the price of crude from last June to January enabled traders to potentially make money by storing oil for delivery at a later date, as the market moved into an unusually large contango, with prices in future months well above the spot price. Traders such as Trafigura, Vitol and Gunvor, as well as energy majors like BP and Shell stored oil on land and in tankers to capitalise on the price movement. Under the strategy, a trader buys oil and sells it forward, locking in a profit as long as the price difference is higher than the cost of storage. As oil prices have recovered the contango has narrowed, making it less profitable to store oil, and prompting some selling. (uk.reuters.com)

March 9, 2015. South Korea's GS Caltex Corp has bought Mexican crude for the first time in 25 years, as the refiner takes advantage of low prices to make cheap spot purchases. The country's second-biggest refiner bought 1 million barrels of crude from Mexico's state-owned oil company Pemex, which arrived. According to shipping data and traders, the shipment is Isthmus crude, and the tanker called Maran Penelope reached the port of Yeosu, about 350 kilometres south of Seoul. GS Caltex's refinery is in Yeosu. The purchase was made to procure cheap crude on the spot market and further purchases were likely as long as cheap offers were available, the joint venture of GS Holdings and Chevron Corp said. Another one million barrels of Mexican crude on board tanker Ridgebury Lindy B, will reach the port city of Daesan, about 100 kilometres southwest of Seoul, according to data. A fall in U.S. crude futures to the lowest in nearly a year against global benchmark Brent has opened a trading window for shipments of Latin American crude and U.S. condensate to Asia, traders said. Oil from countries such as Argentina, Colombia, Ecuador, Mexico and Venezuela was starting to look cheap in Asia, according to traders. South Korea has not imported crude from Mexico since 1990, when the customs service started its reports. From America, the world's fifth-largest crude oil importer bought only 10.1 million barrels, or just over 1 percent of its total 927.5 million barrels of crude oil imports last year. Last year, GS Caltex bought the first condensate cargo shipped from the United States since the easing of a 40-year ban on U.S. oil exports, and also bought 800,000 barrels of Alaskan crude oil, the first U.S. export of Alaskan crude to South Korea in more than a decade. (www.downstreamtoday.com)

March 6, 2015. Five potential buyers have made bids to purchase Tamoil's 55,000 barrels-per-day (bpd) Collombey oil refinery in Switzerland in a government-organised attempt to keep the complex from permanently closing. The Libya-owned energy group said in January it was planning to close the refinery due to "severe market pressures," but the Canton of Valais said it had convinced Tamoil to give a sale one last chance before finalising the closure. The five bidders have already made initial presentations to Tamoil, and signed the confidentiality agreements needed to move forward, but have to submit a final offer by March 31, the Canton said. The Valais government is keen to keep the plant running, providing employment to locals, rather than see it close. The five buyers were identified and courted by the Canton itself as part of a task force launched in the autumn of 2014 that found and vetted more than 40 potential buyers. The Canton said the final decision was Tamoil's, and that the company had made it clear it had no intention of continuing to run the refinery itself. (www.downstreamtoday.com)

March 6, 2015. The Philippines' First Gen Corp is talking with potential partners for its proposed $1 billion LNG import terminal, the head of the energy firm said. First Gen, one of the Southeast Asian nation's biggest power producers, has been under pressure to make a quick decision on whether to build the import facility as it looks to secure long-term supplies of liquefied natural gas (LNG) for its growing portfolio of gas-fired power plants. First Gen President Francis Giles Puno declined to identify potential partners, but said First Gen was discussing "possible areas of cooperation" in natural gas with firms including Royal Dutch Shell. Shell did not immediately respond to requests for comment. First Gen expects to make a final investment decision by early next year and could open the onshore terminal around the start of the next decade, Puno said. First Gen, which operates the Santa Rita and San Lorenzo gas-fired plants in Batangas province with a combined capacity of 1,500 MW, expects to switch on its third gas-fired plant, the 97 MW Avion, by June. A fourth, the $600 million San Gabriel plant with a 414 MW capacity, will be up and running by April next year. The two new plants will also run on Malampaya natural gas supplied by Shell from its Palawan contract area in the western Philippines. The government has said that Malampaya's output may run out by 2024. Shell is looking to set up a floating LNG facility near its Tabangao refinery, also located in Batangas, near the capital Manila, ahead of the Malampaya shutdown, with First Gen as a possible customer. The Philippines is set to open its doors to imported LNG this year with the commissioning in about three months of a power plant built by Australia-listed Energy World Corp in Quezon Province. (www.rigzone.com)

March 5, 2015. Enbridge Inc, Canada's largest pipeline operator, said it plans to boost the size of two lines carrying crude from the oil sands while shaving C$400 million ($320.4 million) from their original price tag. The company said two planned regional lines, the Athabasca Twin and Wood Buffalo extension projects, will now cost a combined C$2.6 billion, down from its prior C$3 billion estimate. The pipe diameter of the Wood Buffalo Extension project, running 100 kms from its Cheecham terminal in the oil sands to its Kirby Lake terminal, will be boosted to 36 inches from a planned 30-inch diameter, while the Athabasca Twin which carries crude from Cheecham to the Hardisty, Alberta, storage center, will add pumping capacity to raise its throughput to 800,000 barrels per day from 450,000 bpd. The lines are being expanded to handle oil shipped from Suncor Energy Inc's planned Fort Hills oil sands project. The company said that the projects will be in service by the fourth quarter of 2017. (www.reuters.com)

March 5, 2015. Grupo Bolognesi is close to an agreement to import liquefied natural gas (LNG) on long-term contracts, deals that could break state-run oil company Petrobras' stranglehold on the Brazilian market for the first time in more than a decade. Bolognesi, a Brazilian construction and engineering group, won licenses last year to build and operate two gas-fired thermal power plants. It opted for LNG imports rather than Petroleo Brasileiro SA, known as Petrobras, which supplies nearly all Brazil's gas-fired plants. The proposed contracts are for 25 years, with prices based on the Henry Hub benchmark for natural gas deliveries in Louisiana, plus transport and other differentials. If successful, the strategy could be copied by others, reducing Petrobras' dominance as Brazil tries to expand power generation in the face of a supply crisis. Gas is needed to complement a hydroelectric system in need of thermal backup. Importing gas also allows Bolognesi to buy fuel at world prices rather than pay the premium Petrobras charges to restrict internal demand and preserve supplies for its own plants. While Brazil's fuels market has been open for nearly two decades, Petrobras has a de facto monopoly on imports of natural gas, crude oil, gasoline and diesel. (www.downstreamtoday.com)

March 4, 2015. Oil major BP has put up for sale its stake in one of Europe's biggest natural gas pipelines in the North Sea as part of its ongoing asset disposal programme. BP holds a 36 percent interest in the 404-kilometre subsea Central Area Transmission System (CATS) that runs through the central sector of the British North Sea. The pipeline pumps up to 1.7 billion cubic feet of gas a day from UK North Sea fields. British peer BG Group announced the sale of its 62.78 percent interest in the CATS pipeline for nearly $1 billion to the Antin Infrastructure Partners fund. The pipeline has a transportation capacity of 293,000 barrels of oil equivalent per day (boed) to a natural gas terminal at Teesside in northeast England. Average throughput in 2014 was 134,000 boed. BP has agreed the sale of around $5 billion of assets as part of a $10 billion disposal programme in 2014 and 2015. (www.downstreamtoday.com)

March 10, 2015. Staff from the Bank of Canada and Suncor Energy Inc. are among scheduled speakers at a Canadian parliamentary committee that will review the impact of falling oil prices on the country’s economy. Executives from Canada’s energy, finance and manufacturing sectors are scheduled to speak to the Standing Committee on Finance. The committee wants a closer understanding of the impact of the oil price drop by hearing from economists and business leaders ahead of the federal budget, to be released as early as next month. The Canadian Association of Petroleum Producers, Suncor Energy and Encana Corp. are among the first batch of speakers scheduled at the committee. The Bank of Canada is scheduled to testify later in the week. In its briefing, made public by the committee, the energy association said Canadian oil and gas industry revenue will drop by a third to about C$100 billion ($79 billion) this year from 2014. (www.bloomberg.com)

March 10, 2015. The world's two biggest oil firms, Exxon Mobil Corp and Royal Dutch Shell, may withstand the oil price collapse better than their rivals because they are closer to finishing expensive investment projects while others must keep spending. The near halving of oil prices since June is likely to send all the biggest listed oil companies into negative cash flow this year, and has sparked a rush to cut costs across the sector as a result. But depending on where they are in their spending cycles, some companies are finding those cuts easier to make than others. Both (Exxon and Shell) had already entered a lower spending phase, with major projects reaching completion and coming on stream over the next two years, Moody's rating company said in a report. Exxon started eight major oil and gas production projects last year in locations ranging from Papua New Guinea to the Gulf of Mexico and Abu Dhabi. Most big oil firms announced cuts of 10 to 15 percent to their 2015 budgets versus last year. Some suspended share buybacks, revived dividend payment via company stock, known as scrip shares, and maintained dividends flat in order to boost cash flows. While all companies are expected to keep paying high dividends by increasing borrowing, Anglo-Dutch Shell and Texas-based Exxon appear to be most able to cover both spending and dividend payouts if oil prices stay at their current $60 a barrel. They are also likely to be able to pick up bargain assets, while the price collapse shakes the sector out. (www.reuters.com)

March 10, 2015. The United Steelworkers (USW) strike, which has entered its second month and expanded to 12 refineries, has had a limited overall impact on refined product markets thus far but may become an issue if it is prolonged, according to Fitch Ratings. This is especially true with regard to the US gasoline market. As estimated by Fitch, the percentage of refining capacity by company that is covered by a USW contract ranges from high levels (Motiva [100%]; Tesoro [77%]; PBF [68%]) to lower exposures (Phillips 66 [12%]; Valero [22%]). Entities with middling exposure include CITGO (43%) and Marathon Petroleum Corp (45%). It is important to note that these calculations refer simply to the amount of crude distillation capacity (by refinery) that is covered by a union contract, not to whether individual refineries are experiencing or are expected to experience a strike. (www.downstreamtoday.com)

March 10, 2015. The Organization of Petroleum Exporting Countries (OPEC) won’t change policy at its next meeting unless other producers cut first, Qatar’s former energy minister Abdullah bin Hamad al-Attiyah said. OPEC is scheduled to next meet in Vienna in June, seven months after deciding to maintain output levels and protect market share. Production by non-OPEC members such as Mexico rose in February from the month before, U.S. output is forecast to be the highest in three decades and Russian supply climbed to a post-Soviet high in January. OPEC won’t change policy at its next meeting in June unless non-OPEC producers join in a collective cut, he said. OPEC President Diezani Alison-Madueke said that she will call a meeting if prices keep declining. Saudi Arabia’s Oil Minister Ali Al-Naimi said in Germany he was unaware of any plans for OPEC to meet before June. The Energy Information Administration forecast that U.S. output will increase to 9.3 million barrels a day this year, the most since 1972. Russia produced 10.71 million barrels a day in January and Petroleos Mexicanos, Mexico’s state-controlled oil company, boosted output to 2.33 million barrels a day in February from 2.25 million barrels in January. (www.bloomberg.com)

March 10, 2015. OPEC is likely to maintain its production policy at a meeting in June, Kuwait's OPEC governor Nawal Al-Fuzaia said in the first public comment on what would be a crucial decision to determine the direction of global oil prices in the second half of the year. Many OPEC oil ministers including Saudi Arabia's Ali al-Naimi have defended the organisation's November decision not to cut production but instead defend market share and curtail the output of more expensive producers such as the United States. The accord sent oil prices below $50 per barrel, extending a sharp decline that began in June amid a global glut of crude. The Organization of the Petroleum Exporting Countries (OPEC) has said it believes the oversupply, as much as 1.5 million barrels per day, will evaporate as oil demand picks up and U.S. oil production growth slows, with companies drilling fewer wells. Fuzaia said at an energy conference in Qatar that she thought OPEC would maintain its policy at the next meeting in Vienna on June 5. Fuzaia said she did not expect oil prices to go below $40 a barrel. Brent crude is currently at about $58. She said Iraqi oil production growth was uncertain after severe fluctuations in past months, while the return of large oil volumes from Iran could take longer than expected. Analysts from the Energy Aspects think tank said that even before fresh Iranian barrels return to the market, OPEC and other oil producers will have to face lower oil prices as demand is set to weaken in April-June. Bank of America Merrill Lynch said it saw downward pressure on oil persisting throughout the third quarter of 2015 as developed nations continued to build up commercial oil stocks. (in.reuters.com)

March 10, 2015. Poland's deputy treasury minister Zdzislaw Gawlik expects the liquefied natural gas (LNG) terminal being built in the Baltic city of Swinoujscie to be up and running in June or July, nearly a year later than originally planned. The terminal is Poland's flagship project in its drive to diversify gas supplies and reduce dependence on Russia. It was approved in 2008 and building started in 2011, but the original mid-2014 launch date has been pushed back several times. The $3 billion terminal in Swinoujscie will be able to accept 5 billion cubic metres (bcm) annually, and has an option to increase capacity. Poland consumes almost 16 billion cubic metres of gas a year, most of which is imported from Russia's Gazprom. (www.downstreamtoday.com)

March 9, 2015. The Organization of the Petroleum Exporting Countries (OPEC) Secretary-General said that the group's exporters should not cut output to "subsidize" higher-cost shale, an energy source whose recent growth is blamed by OPEC for weakening oil markets. Abdullah al-Badri said that tight oil, a term he has used for shale, was "not a challenge for us" but the market should be left to decide which source of petroleum could survive at current prices. Oil prices have sunk to near six year lows in recent months as a result of a large supply glut, due mostly to a sharp rise in U.S. shale production as well as weaker global demand. The rapid decline has left several smaller oil producing countries reeling and has forced oil companies to slash budgets.

Badri said that OPEC and non-OPEC producers should work together to stabilize markets, suggesting oversupply could amount to two million barrels per day (bpd). Since 2008, supplies from non-OPEC producers had risen by almost six million bpd, he said. In contrast, OPEC production had been fairly steady at about 30 million bpd. Badri said the market's "true picture" would not be apparent until the end of June, adding he had no doubt markets would return to balance in the second half of 2015. The market was improving now, he said, and "tremendous opportunity" in oil remained despite recent market volatility and uncertainties. Energy demand would increase by 60 percent by 2040 and oil would remain a central energy source, he said. (www.reuters.com)

March 9, 2015. Goldman Sachs Group Inc. said it didn’t expect oil demand to recover so quickly and its forecast for crude at $40 a barrel may be too low. While the bank projects that oil will still reverse its recent advance, the failure of global inventories to increase amid weather-related disruptions and stronger-than-expected demand means there’s a risk prices will miss its target for the next two quarters, according to a report. Morgan Stanley said the oil market was “surprisingly healthy.” Global benchmark crude prices rose in February for the first time in eight months, rebounding from an almost 50 percent loss in 2014 as U.S. production surged to a 30-year high. Sandstorms disrupted Iraqi exports while cold weather in the U.S. and a drought in Brazil bolstered consumption, according to Goldman Sachs. West Texas Intermediate (WTI) crude, the U.S. benchmark, rose as high as $54 a barrel last month on speculation a recovery in demand was helping shrink a global glut amid a slowdown in U.S. drilling. The April contract settled at $50 a barrel on the New York Mercantile Exchange. Brent crude closed at $58.53 in London after touching $63 a barrel in February. High demand from refiners for crude and supply disruptions in Iraq and Libya meant the market was unexpectedly strong, Morgan Stanley said in a report. By the northern hemisphere summer, seasonally weak demand for oil products may prompt an increase in stockpiles and weigh on prices, it said. WTI may not reach Goldman’s forecast of $65 a barrel in 2016 as U.S. producers prepare to increase activity later this year by raising equity, reducing debt and “building an uncompleted well war chest,” according to the report. (www.bloomberg.com)

March 9, 2015. Hedge funds cut bets on rising oil prices at the fastest pace since December 2012 as U.S. inventories expanded to the highest in more than three decades. Speculators pared their net-long position in West Texas Intermediate (WTI) crude by 19 percent in the week ended March 3, U.S. Commodity Futures Trading Commission data show. Short wagers increased to a record for a second week.

Oil producers are spending less, idling rigs and delaying wells to stem output that the government predicts will reach a four-decade high this year. That’s having little effect so far, with U.S. crude inventories expanding by 10.3 million barrels in the week ended Feb. 27, the most since 2001. Crude supplies nationwide reached 444.4 million barrels, the most in weekly Energy Information Administration (EIA) data going back to 1982. Inventories at Cushing, Oklahoma, the delivery point for WTI, rose to 49.2 million, the most since June 2013. Stockpiles in the Midwest advanced to a record 133.3 million, while those along the Gulf Coast surged to an all-time high of 219.9 million. U.S. crude production rose to 9.32 million barrels a day, the most in weekly estimates that started in January 1983. Output will rise 7.8 percent this year to average 9.3 million barrels a day, the EIA said in a report. (www.bloomberg.com)

March 9, 2015. Egypt has set the price of shale gas expected to be extracted from a recent concession to foreign firms at $5.45 per million British thermal units (mmBtu), the oil ministry said. Egypt signed its first contract to extract gas by hydraulic fracturing, or fracking, in a deal with Apache and Shell Egypt in December that includes investments of $30-$40 million, the oil ministry said. Under the contract, three horizontal wells as deep as 14,000 feet in Western Sahara fields will be drilled. Egypt aims to boost domestic production and foreign imports of oil and gas to help address persistent energy shortages. (www.reuters.com)

March 6, 2015. Norwegian energy firm Statoil delayed two of its key oil projects in its portfolio to develop more cost-effective solutions, it said. The firm said it has decided to postpone an investment decision for its 600-million barrel Arctic Johan Castberg project until 2017. The new schedule for the preliminary decision to implement a concept selection for its Snorre 2040 project is the fourth quarter of 2016, it said. (af.reuters.com)

March 5, 2015. Spain says that a new agreement to connect its energy networks with Portugal and France is a major step toward breaking Europe's dependence on Russian gas supplies. Spanish Energy Minister Jose Manuel Soria said that the deal to double the electricity interconnection capacity between the three countries and kick start a major gas project is "a very important political agreement."

He said the MIDCAT project linking gas infrastructure through Spain's northeast Catalonia region to southern France would help ensure that "Europe reduces its dependence on Russian gas." His comments came as European Union (EU) energy ministers gathered in Brussels to discuss increasing the interconnectivity of EU networks to 10 percent by 2020. Spain, Portugal and France sealed the agreement on boosting energy cooperation in Madrid. (www.downstreamtoday.com)

March 5, 2015. Bidding on the rights to develop Peru's biggest oil block will begin next month, and a winner will likely be announced in August, state energy agency Perupetro said. April 13 is the tentative date set for the start of bidding, but the government must first wrap up negotiations with indigenous groups over pollution, Perupetro president Luis Ortigas said. Additional talks over plans for the oil block will take place during the bidding process, he said. Oil block 1-AB, also known as 192, typically produces between 15,000 and 17,000 barrels of oil per day in Peru's northern Loreto region. (af.reuters.com)

March 4, 2015. Indonesia will need an additional 3,100 million standard cubic feet per day (mmscfd) of gas supplies within five years, to meet forecast demand from power stations and fertilizer plants, the energy ministry said. Indonesia plans to build 13,400 MW of gas-fired power stations by 2020, which will require 1,100 mmscfd of gas.

Southeast Asia's largest economy will also need 2,000 mmscfd to feed fertilizer plants, up from around 900 mmscfd. Indonesia is also in the process of forming a "gas aggregator" institution to manage domestic gas demand and supply and to manage consumer gas prices. (uk.reuters.com)

 [INTERNATIONAL: POWER]

March 10, 2015. FirstEnergy Nuclear Operating (FENOC) has begun planned refueling and maintenance outage of the 1,268 MW Perry nuclear power plant in Ohio, US. The power plant features single unit boiling water reactor that can produce electricity required to power more than one million homes. FirstEnergy will deploy a new transformer, which is one of two circuits that provide power from the off-site transmission network to the plant's on-site electrical systems. Perry plant underwent its last refueling in May 2013, and generated more than 18.6 million megawatt hours of electricity since then. (www.energy-business-review.com)

March 10, 2015. Marubeni and Alstom have been awarded an EPC contract for a new ultra-supercritical coal-fired power plant unit in Thailand. Marubeni Corporation, in partnership with Alstom, has jointly signed a contract with the Electricity Generating Authority of Thailand (EGAT) for the construction of a new unit for the Mae Moh lignite coal-fired power plant. The new unit will replace the existing Units 4-7 and produce about 600 MW of electricity, having an engineering, procurement, construction, and commissioning (EPC) contract value of over $1 billion (equivalent to over 120 billion yen).

The new unit will produce electricity from local lignite mined from a neighboring coal mine. Use of ultra-supercritical technology for the boiler will significantly reduce its environmental footprint and allow the plant to meet strict environmental standards. In the recent decade, Marubeni has consecutively executed the Chana Combined Cycle Power Plant Units 1 and 2, Bang Pakong Combined Cycle Power Plant Unit 5 and Wang Noi Combined Cycle Power Plant Unit 4 for EGAT. With this Mae Moh Replacement Project, the total installed capacity of projects delivered by Marubeni in Thailand over the past 50 years will surpass 10,300 MW. (www.pennenergy.com)

March 10 2015. Japanese trading house Marubeni Corp said it has signed a deal with the Electricity Generating Authority of Thailand (Egat) to build a 600 MW coal-fired power generator to replace a dirty power plant at the heart of a recently ended court case in Lampang province. The joint project with French power company Alstom Power Systems SA, and its local unit Alstom (Thailand) Ltd, will be worth more than US$1 billion. Under the deal signed with the Egat, Marubeni and its French partner will replace four existing power generators at the country's Mae Moh lignite-fired power plant in Lampang with the new generator. (www.bangkokpost.com)

March 9, 2015. Siemens, along with Cengiz Enerji Sanayi ve Ticaret, has completed the construction of a combined cycle power plant in Turkey, two months ahead of the schedule. Siemens has installed a SGT5-8000H gas turbine, SST5-5000 model steam turbine, SGen5-3000W generator, the electrical system and the SPPA-T3000 I&C system. Designed for 200 starts annually, the plant has the capacity to power up to full load in less than 30 minutes, after a down-time of six hours. It can also adapt its output by more than 35 MW per minute to meet the changing power requirements. (www.energy-business-review.com)

March 8, 2015. In a historic agreement signed, Bahria Town and K-Electric have agreed to set up a power plant in Karachi. Bahria Town chief Malik Riaz Hussain said that the motive behind the agreement was to improve mutual cooperation for the well being of Karachi residents. He said that these agreements will ensure uninterrupted power supply to Karachi. Bahria Town chief informed that the plant, based on coal and LNG, will be completed within three to four years. He also iterated his resolve for progress of Karachi. (dunyanews.tv)

March 5, 2015. APR Energy, the global leader in large scale, fast-track power solutions, announces that it has agreed to extend 75MW of power generation projects in Argentina. Two of the projects, representing 50MW, have extended through late 2016, while a third, representing 25MW will continue through late 2017. APR Energy has operated in Argentina, one of South America's largest markets for distributed power, since 2008. APR Energy's distributed solution provides a total of 93MW of electricity capacity, dispersed across five rural sites. The plants employ a workforce comprising almost entirely Argentine nationals and provide critically needed electricity directly into regional grids, helping to ensure reliable power and voltage regulation for local communities. (www.prnewswire.com)

March 10, 2015. South Africa’s power grid is strained and the chance of blackouts is “very high,” the state-owned utility that provides about 95 percent of the country’s electricity said. Eskom is struggling to meet demand after the country failed to invest adequately in generation in the 20 years after the first democratic elections in 1994, even as the government expanded supply to millions of households. This year, the company has rationed power for 18 days as part of plans to prevent a total collapse of the grid serving the continent’s second-biggest economy. The cuts have curbed production and forced businesses to shut doors at peak times.

On average about 14,000 MW, or one-third of Eskom’s generating capacity, is offline and 57 percent of that is due to plant breakdowns, Ompi Aphane, a deputy director-general in the Department of Energy, said in a presentation to lawmakers in Cape Town. He warned that power shortages may persist for the next three years, unless urgent action is taken. The government’s plans to alleviate the power crisis includes buying 2,500 MW of coal-fired power from independent producers. Bids for the contracts must be submitted by June 8, the winners will be announced in August and first output is expected by early 2019, Aphane said. With about 30 percent of South Africa’s energy going to waste, there is also a focus on improving the efficiency of the power grid and reducing demand, he said. (www.bloomberg.com)

March 9, 2015. Europe's energy boss has urged Germany to overcome a political gridlock over disputed plans to build new power transmission lines between the windy north and the industrial south. The power lines are seen as crucial to Germany's shift towards renewable sources of energy and away from nuclear and fossil fuels, known as the "Energiewende". But a decision on whether to build the power lines has been delayed until the end of June amid divisions over the plan within the governing coalition. (in.reuters.com)

March 4, 2015. The power situation in Mindanao is expected to improve following the completion of the ground works of the last component of the Mindanao transmission backbone project which will energize the 230-kiloVolt (kV) Abaga-Kirahon Line, officials of the National Grid Corporation of the Philippines (NGCP) said. Spanning 122 kilometers (km), the completed project is a line that crosses the provinces of Lanao del Norte, Misamis Oriental and Bukidnon, including the major cities of Iligan and Cagayan de Oro.

According to NGCP, the country’s sole transmission service provider, the energization of the line will strengthen the existing transmission backbone of the island, particularly reinforcing the link between the transmission lines and the power plant, Agus Hydro Complex, a major part of the source of the Mindanao grid. Prior to the Abaga-Kirahon line completion, two sections of the transmission line project were already completed, the last of which was the Kirahon-Maramag 230-kV line. (www.mb.com.ph)

March 10, 2015. China has given the go-ahead for the launch of a major domestic nuclear power project, marking the first such approval since a temporary freeze on new construction following Japan's Fukushima disaster. China General Nuclear Power Group has received state approval to build two one-gigawatt (GW) reactors in the second phase of a project called Hongyanhe in the northeastern province of Liaoning.

The project will use what the company calls home-grown "third-generation" reactor technology, dubbed ACPR1000. China froze new construction and implemented a year-long safety review after the Fukushima disaster in 2011. While it lifted the construction ban at the end 2012, China has been slow to approve new nuclear projects. Beijing has promised to stick to the highest safety standards, using third generation reactors.

In an estimated $100 billion expansion programme, China aims to raise its domestic nuclear power capacity to 58 GWs by 2020 from 20.3 GW at the end of 2014. Nuclear capacity would still only meet 3 percent of China's total electricity needs by 2020. China is also seeking to export its home-grown third-generation reactors, such as Hualong 1 and CAP1400, to an overseas market potentially worth hundreds of billions of dollars. (www.reuters.com)

March 10, 2015. The Slovak Government is seeking compensation between €280mn and €320mn ($304 mn to $347 mn) from Italian power company Enel after a local court invalidated the lease contract of the 720 MW Gabcikovo hydropower plant. A court in Bratislava court has ruled that Enel's contract to operate the plant was invalid. The Slovak Government and Enel have been at dispute over the maintenance and costs of the facility. Enel's subsidiary Slovenske Elektrarne owns a 66% stake in the hydropower plant while the government owns the remaining. The government will take over Enel's stake and the operations of the plant. The government estimates that up to €40mn has been generated annually by the Gabcikovo plant in eight years. (www.energy-business-review.com)

March 10, 2015. The Nuclear Regulatory Commission has renewed the operating license for Ameren's Callaway nuclear power plant through 2044. But ongoing litigation could quash that renewal. The Missouri Coalition for the Environment and others filed suit against the NRC, alleging its licensing process doesn't take into account the impacts of storing nuclear waste long-term. Ameren's Callaway reactor is the only commercial nuclear power plant in Missouri. If Callaway's license renewal is later set aside by the courts, the mid-Missouri power plant would revert to its original license, which is still valid until Oct. 2024. The Missouri Coalition for the Environment's Ed Smith called the NRC's renewal premature and unnecessary. Smith expects the court to reach a decision in the case by late summer. (news.stlpublicradio.org)

March 9, 2015. The gloom pervading the coal industry is set to deepen with the Chinese government outlining plans to further wind back the use of coal as it seeks to boost the use of non-fossil fuel energy and tackle the country's chronic air pollution. The new program comes as China's coal imports slumped in January with the introduction of tighter environmental controls, which have already resulted in imports being blocked. A new mid-term energy policy was released at the latest national people's congress in Beijing aimed at taking the mounting sting out of rising domestic criticism over poor air quality in China's larger cities. Reflecting political sensitivities, an online video highlighting the issue was blocked after being seen an estimated 300 million times. According to the new energy policy, China is to lift to 15 percent of the total its use of non-fossil fuels, such as renewable  and nuclear energy sources, by 2020. If achieved, this could slice coal use by an estimated 160 million tonnes a year by 2020, which is equal to around 40 percent of present import volumes. The impact on coal exporters to China is expected to be muted due to anticipated growth in demand from other Asian markets such as India, traders said. But compared with China's annual coal consumption of an estimated 3.4 billion tonnes of coal, the prospective decline in use is small. The new policy came as China's coal imports in January fell more than 50 percent year on year, declining by another 33 percent in February, according to customs data. These falls came in the wake of a 2.9 percent decline in coal usage in 2014. (www.smh.com.au)

March 5, 2015. The price of electricity in Vietnam will go up by 7.5 percent on March 16 at the suggestion of the state-run Vietnam Electricity (EVN). The increase was approved by Prime Minister Nguyen Tan Dung, who chaired a meeting in Hanoi with representatives of the Ministry of Industry and Trade and EVN to consider the proposal. The average price of electricity in Vietnam will be VND1,622 per kWh as of March 16.

The adjustment of the electricity price is targeted at helping EVN cut losses from previous years, ensuring Gross Domestic Product (GDP) growth at 6.2 percent this year, and keeping the inflation rate at five percent. It is estimated that EVN would suffer a loss of VND12 trillion (US$577 million) in 2015 if the electricity price were to remain unchanged. At the meeting, Prime Minister Dung also instructed EVN to improve its grid to lower the loss of electricity rate to eight percent this year. (tuoitrenews.vn)

March 4, 2015. Brazil's mines and energy minister Eduardo Braga acknowledged the serious, drought-triggered crisis affecting the nation's electricity generation system, but he said the risk of rationing is minimal. Eduardo Braga appeared before Brazil's lower house of Congress to discuss the national electrical system in the wake of several recent blackouts, a situation that experts say could worsen in the short-term due to scant rainfall during the Southern Hemisphere summer, which ends on March 21. Brazil has boosted its overall generating capacity over the last decade and since 2010 has strived to diversify its energy matrix and reduce its dependence on hydropower, the minister said. A total of 19 new hydroelectric projects are being developed, but 34 natural-gas fired plants, 420 wind farms and 31 solar parks also are in the works, Braga said. (www.laprensasa.com)

 [RENEWABLE ENERGY / CLIMATE CHANGE TRENDS]

March 10, 2015. US-based solar power projects developer, First Solar, is planning to set up dedicated solar power plants in India for industries and commercial outfits, which would like to meet part of their electricity requirement through renewable energy sources. India has lots of companies like Microsoft and Cisco, which globally do procure renewable power. Several Indian IT and pharmaceutical companies also want to source a part of their energy requirements through solar power, First Solar country head, Sujoy Ghosh said explaining the potential for dedicated solar power plants. According to Ghosh, industries which have opted for express feeders can have such dedicated solar power plants to secure uninterrupted power supply. The advantage of utilising solar power is that the tariff rates can be fixed for a long-term. Stating that First Solar would set up 5,000 MW of green energy projects in India by 2019, he said it was currently establishing 200 MW of solar power projects in Andhra Pradesh and Telangana. Two solar power plants of 20 MW and 25 MW capacity, being set up at Marikel and Polepally in Mahabubnagar district,would be operational by June this year. The average investment for setting up solar power plants would be ` 6.5 crore per MW. At present, Ghosh said, First Solar had a 20 percent share in solar power market in India. The combined capacity of all solar power plants in the country stands at around 3,000 MW. (www.business-standard.com)

March 9, 2015. With limited funds at disposal and price of solar panels going down, the government has proposed to reduce the subsidy on rooftop projects by half, Parliament was informed. Power Minister Piyush Goyal, who also holds charge of Coal and New and Renewable Energy ministries said, the government has set a large target for rooftop solar power plants in the country. The minister said that there are provisions of concessional import duty or excise duty exemption, accelerated depreciation and tax holiday for setting up grid connected rooftop power plants. Finance Minister Arun Jaitley, in his Budget speech announced a massive renewable power production target of 1,75,000 MW in the next seven years. Of the total 1,75,000 MW proposed to be tapped by 2022, solar power will have a lion's share of 1,00,000 MW followed by 60,000 MW from wind energy, 10,000 MW biomass energy and 5,000 MW of small hydro projects. As for the status of clean energy projects in the country, the solar power generation capacity is at about 2,700 MW; Wind - 21,000 MW; Small Hydro - 3,800 MW and biomass - 4,100 MW. (www.deccanherald.com)

March 6, 2015. India will achieve energy independence by 2050 if most households go for rooftop solar power generation under a new official policy, a leading expert has said. According to solar scientist Shantipada Gon Chaudhuri, the ministry of new and renewable energy (MNRE) is in the process of framing an ambitious policy to generate adequate electricity from non-conventional energy sources. Gon Chaudhuri is involved in drafting the rooftop solar power generation policy, which he said would be ready within a year. Saying work was already on in Tamil Nadu, Rajasthan, Gujarat, West Bengal, Karnataka and Delhi, he observed that the proposed policy would help India to achieve the goal of energy independence. The MNRE has revised its target of renewable energy capacity to 175,000 MW by 2022, comprising 100,000 MW solar, 60,000 MW wind, 10,000 MW biomass and 5,000 MW small hydro. Gon Chaudhuri has developed India's first floating solar power plant installed on a water body near Eco Park in New Town, near Kolkata. The one MW capacity floating solar power project, financed by MNRE, was inaugurated on January 5. India's first public solar power operated irrigation pump was inaugurated by then Planning Commission head Manmohan Singh -- later prime minister -- in Herma tribal village in western Tripura in 1981. India's total installed capacity of electricity (from coal, gas, nuclear, hydro and renewable) is 260,000 MW, including 31,700 MW from non-conventional sources. The government has accorded in-principle approval for setting up Solar Parks in Gujarat, Andhra Pradesh, Uttar Pradesh, Meghalaya, Rajasthan, Madhya Pradesh, Tamil Nadu, Karnataka, Punjab and Telangana. (www.business-standard.com)

March 4, 2015. The Telangana government is in the process of inviting bids for setting up 1,000 MW of solar photo-voltaic (PV) power generation farms through a reverse bidding process. Reverse auction is a type of auction in which sellers bid for the prices at which they are willing to sell their goods and services. However, in a regular auction, a seller puts up an item and buyers place bids till the close of the auction. At the end, the item goes to the highest bidder. The Telangana government had set a target to develop 5,000 MW of solar energy projects in the next five years. (www.business-standard.com)

March 4, 2015. ABB India, a leader in power and automation technologies, became the first company to reach sales of a cumulative capacity of 1 GW solar inverters, the company said. This milestone was marked with the rollout of an order for Tata Power Solar’s project for Kiran Energy Solar Power.

ABB India commenced local manufacturing of solar inverters in 2012 and has since grown in partnership with key industry customers. Technology leadership complemented with competent indigenisation and reliable service, helped ABB India to quickly achieve and maintain pole position in the market over the last three years. The cumulative installed base for central inverters in India reached 3 GW in 2014. Changes were made in ABB’s product design keeping in mind the local requirements like demanding environments of high temperatures, dust and humidity.

Solar power has great potential to lead the charge of renewables and is rapidly approaching grid parity in many countries. It is emerging to be a key contributor in the energy mix and the government’s drive to provide access to electricity for all. This positions ABB India well in an industry that is set for 10 percent plus annual growth in the country. (www.projectsmonitor.com)

March 10, 2015. US electric generating companies expect to add more than 20 GW of utility-scale generating capacity to the power grid this year with nearly 50% being delivered from wind turbines. New analysis published by the US Energy Information Administration found 9.8 GW of the new, additional capacity will be delivered by wind, natural gas will be responsible for 6.3 GW, and solar 2.2 GW, which combine to make up 91% of total additions. Nearly 16 GW of generating capacity is expected to retire in 2015, 81% of which (12.9 GW) is coal-fired generation. (www.clickgreen.org.uk)

March 9, 2015. European Union (EU) member states meet to hold their first talks on a compromise proposal for carbon-market reform. Representatives of the EU’s 28 nations gather at 10 a.m. in Brussels to discuss the presidency’s plan to begin operating in 2019 a reserve to curb a surplus of emission rights, according to the Council of the EU meeting agenda. The U.K. and Germany want a 2017 start while an alliance headed by Poland is pushing for 2021, as first proposed by the European Commission.

The planned reserve would ease a glut of permits that has pushed emission prices down about 75 percent since 2008 to levels that fail to deter industry from burning coal, the most-polluting fossil fuel. Carbon permits have fallen 8.2 percent this year, touching a three-month low on the ICE Futures Europe exchange. The draft law needs qualified-majority support from national governments and majority support by the European Parliament to be approved or amended. The position to be agreed on by member states will define their stance in negotiations with the bloc’s assembly. Both supporters and opponents of an early start in the Council have enough votes to form a blocking minority and stop each other’s proposals.

The role of the presidency, currently held by Latvia, is to help broker a compromise. The proposed reserve would automatically absorb carbon allowances if the surplus exceeds a fixed limit and release them to the market in the event of a shortage. The surplus of allowances is above 2 billion, according to EU estimates. Under the Latvian proposal, the amount corresponding to 12 percent of allowances in circulation the previous year would be deducted from auctions each year until the accumulated surplus falls below 833 million. If the excess drops below 400 million, the EU will return 100 million allowances. One permit gives the right to emit one metric ton of carbon dioxide. Latvia also proposed leaving the door open for the Commission to propose further changes to the parameters of the reserve under a periodic analysis of the market balance, the range triggering supply controls. (www.bloomberg.com)

March 9, 2015. A Chubu Electric Power Co. unit will build a biomass power station in central Japan. The plant, in Mie prefecture, will start running in June 2016, Chubu Plant Service Co. said. The station will have about 7 MW of capacity and will use woody biomass as fuel. (www.bloomberg.com)

March 6, 2015. The European Union (EU) agreed to submit the goal of cutting greenhouse gases by at least 40 percent from 1990 levels by 2030 to a global climate conference in a bid to retain its leading role in the battle against global warming. The contribution, agreed on by ministers from the 28-nation bloc at a meeting in Brussels, will be the second sent to the United Nations climate body after Switzerland. Envoys from more than 190 countries aim to reach an accord in December that would for the first time impose pollution limits on both developed and developing countries. The contribution is ready for submission, the Latvian presidency of the EU said. Nations agreed last December that those countries “ready to do so” should deliver to the UN by the end of March details on how much they intend to cut emissions, adapt to warming weather and rising seas as well as assist developing countries. The EU reduction target is to be met through measures carried out within the bloc, according to a statement on the European Commission’s website. It can be deepened if countries reach an ambitious deal in Paris, and could include the enabling of imports of carbon offsets in developing countries, German Environment Minister Barbara Hendricks said. (www.bloomberg.com)

March 6, 2015. Egypt launched a new power plant generated by solar energy in Siwa, west of the country, the Electricity Minister Mohamed Shaker announced. Shaker said the new plant would generate 10 MW to compliment the diesel units in the city. Shaker said that the plant would help establish a number of projects in the city and provide job opportunities there. Establishing the power plant costs $25 million, Shaker reportedly said. He said that the costs were provided by an Emirati grant signed last year worth $140 million. South Sinai Governor Khaled Fouda announced the intention to use solar energy for all lighting in the resort city of Sharm el-Sheikh, which currently relies on solar energy for 70 percent of its lighting. The governor said the shift will be completed within three months. The shift towards solar energy comes in line with government policies to diversify sources of energy, amid an energy crisis Egypt has been facing for years. Egypt aims to build solar power plants and wind energy facilities within the next three years, with a total capacity of 4,300 MW. It is also seeking to generate electricity using nuclear power and has signed an agreement with Russia to assist with building a nuclear facility. (egyptianstreets.com)

February 5, 2015. Geodynamics has received environmental approvals for the exploration phase of the Takara Geothermal Power Project. Following the submission of the Environmental and Social Impact Assessment in September last year, the Acting Director of the Department of Environmental Protection and Conservation approved Geodynamics application for the drilling of two geothermal exploration wells at Takara, on the condition that the Environmental Management and Monitoring Plan is implemented and complied with. The approval grants the Project all required environmental permissions to conduct the activities necessary for an exploration drilling campaign. The approval by the Department is an important step in advancing the Project.

The receipt of this approval is confirmation of the low environmental impact of the geothermal activities and the positive benefits that geothermal power development can have for Vanuatu. The use of geothermal power replacing imported diesel generation will improve energy security, reduce imports, increase energy self sufficiency, reduce emissions, reduce life cycle cost and provide long term stability in pricing. (www.energy-business-review.com)

March 4, 2015. Italian renewable energy company Enel Green Power SpA) said it has connected to the grid the 102 MW Sureste I-Phase II wind farm in Mexico's southern Oaxaca state. The company installed 34 turbines of 3 MW each, able to produce 390 GWh a year. It has a 20-year power purchase agreement for the wind farm from a public tender held by state-owned utility Comision Federal de Electricidad (CFE).

The investment stood at nearly USD 160 million, part of which was financed with a loan from local banking group BBVA Bancomer. With the new plant, Enel Green Power's installed capacity in Mexico rose to 399 MW, including wind power and 53 MW of hydro plants. In October 2014, the company connected to the grid its 100 MW Dominica I wind farm in the state of San Luis Potosi. (renewables.seenews.com)

March 4, 2015. China, the world’s biggest carbon emitter, is in discussions to determine a top negotiator for climate talks in Paris at the end of this year. China has yet to make a decision, said Xie Zhenhua, former vice chairman of the National Development and Reform Commission, who led the nation’s climate negotiations in Lima, Peru last year.

That meeting ended with a plan for nations to commit to cut emissions as a prelude to a wider climate change accord to be finalized in Paris in December. Xie may attend the Paris talks if required, he said. Xie is now vice chairman of the CPPCC’s National Committee of Population, Resources and Environment. China plans to cap carbon emissions by 2030 under an agreement reached between U.S. President Barack Obama and Chinese President Xi Jinping in November. (www.bloomberg.com)

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