NEWS BRIEF

OIL & GAS

July 15, 2014. Prime Minister Narendra Modi's government will decide next month on the sale of a $3 billion stake in Oil and Natural Gas Corp (ONGC). The government will decide in August whether to sell a 5 percent stake in ONGC, the oil ministry said, in a deal that would be worth $2.9 billion at current market prices. The government was interested in selling stakes in ONGC and other state companies given their high market valuations. If completed, the sale would raise more than a quarter of the $10.5 billion target for asset sales announced by finance minister Arun Jaitley for the fiscal year to March 2015. He will need to hit or exceed that figure to cap the budget deficit at 4.1 percent of gross domestic product, a goal set by his predecessor that he has vowed to uphold. The proposal to sell a 5 percent stake follows reports that the government may sell a stake of as much as 10 percent in ONGC, which produces the equivalent of 1.2 million barrels per day, or two-thirds of India's oil and gas. The state directly owns 69 percent of ONGC, while further stakes are owned by the Life Insurance Corporation of India (LIC) (7.8 percent), Indian Oil Corp (IOC) (7.7 percent) and Gas Authority of India (GAIL) (2.4 percent). ONGC, with a market value of $57 billion, has struggled for years with stagnant production and a lack of commercially viable discoveries. It is burdened by a subsidy regime that forces it to sell oil and gas cheaply. Still, even without wholesale restructuring, some analysts back the stock on expectations that the government will replace the existing, ad hoc, regime for sharing the burden of energy subsidies with a more predictable model. (in.reuters.com)

July 14, 2014. The Government has slapped an additional penalty of $579 million on Reliance Industries Ltd (RIL) for producing less than targeted natural gas from its KG-D6 block, Oil Minister Dharmendra Pradhan said. With this, the total penalty on RIL for missing the target in four fiscal years beginning April 1, 2010 now stands at a cumulative $2.376 billion, he said. The penalty is in the form of disallowing costs incurred.

The Production Sharing Contract (PSC) allows RIL and its partners BP Plc and Niko Resources to deduct all capital and operating expenses from the sale of gas before sharing profit with the government. Disallowing costs will result in government’s profit share rising by $195 million from 2010-11 to 2013-14, he said. He said gas output from the Dhirubhai-1 and 3 gas field in the eastern offshore KG-D6 block was supposed to be 80 million standard cubic meters per day (mmscmd), but the actual production was only 35.33 mmscmd in 2011-12, 20.88 mmscmd in 2012-13 and 9.77 mmscmd in 2013-14. This year, the output has been only 8.05 mmscmd. (www.thehindubusinessline.com)

July 13, 2014. Gujarat government company Gujarat State Petroleum Corp (GSPC) has asked the government to approve a price of about USD 13 for the natural gas it plans to produce from its field in KG basin this month. GPSC is almost ready to begin production from its Deen Dayal West (DDW) gas field in Block KG-OSN-201/3 off the Andhra coast and wants a price approved immediately.

GSPC wants to price DDW gas at a rate equivalent to the price at which India imports long-term gas in its liquid form (liquefied natural gas or LNG) from Qatar. GSPC had run a price discovery process using the Qatar price formula, generating demand which was more than 12 time the available gas, and sought approvals. At USD 100 per barrel oil price, this price comes to USD 12.93 per million British thermal unit, three-times the current rate of USD 4.2 paid to domestic producers. While the previous UPA government had ignored the price discovery by GSPC and approved a formula which would have doubled the price of all domestic gas to USD 8.4, the new government has deferred its implementation till September 30 to see if users can pay this new price.

GSPC said it produce about 28 million standard cubic feet per day (0.8 mmscmd) from two development wells (DDW#D1 and DDW#D3), which will be ramped up to 55 mmscfd (1.55 mmscmd) after addition of two more development wells by February, 2015. (economictimes.indiatimes.com)

July 14, 2014. Rajasthan Chief Minister Vasundhara Raje announced renegotiate the oil refinery-cum- petrochemical complex project with HPCL started by the former government in Barmer district as the state share was just 26 per cent despite offering free infrastructure facilities.

Raje said the previous government entered into an agreement with HPCL for setting up the complex and committed to give interest free annual loan of ` 3,736 crore per annum for a period of 15 years. Raje said that the decision of the former government was not viable hence the decision to renegotiate with the HPCL was taken up. (economictimes.indiatimes.com)

July 14, 2014. Indian Oil Corp (IOC), the nation's largest oil firm, has sought shareholders' nod for fixing its borrowing limit at ` 110,000 crore as well as for raising ` 11,000 crore through a privately placed debenture issue in the current fiscal.

IOC's current borrowing limit stands at 110,000 crore and it is seeking shareholders' nod to meet the new Companies Act requirement. The company's current borrowing stands at about ` 70,000 crore. The company plans to raise ` 11,000 crore through redeemable non-convertible bonds/debentures this fiscal to meet its capital needs. (economictimes.indiatimes.com)

July 15, 2014. Public sector Gas Authority of India Limited (GAIL) has proposed to establish a gas pipeline grid in Andhra Pradesh. The proposal was highlighted by GAIL chairman and managing director BC Tripathi who called on Andhra Pradesh chief minister N Chandrababu Naidu. While the length covered by the pipeline and the capacity did not come up for discussion, GAIL, however, would take up a detailed project report soon. The earmarked gas from the pipeline would significantly boost the industrial activity and aid the state government's efforts for augmenting power supply. The development comes against the backdrop of Naidu announcing his vision to develop the state’s coastline into a logistics hub of the country’s east coast. Naidu in the meeting also raised the Cabinet’s decision to induct multinational oil major Shell with a 26 per cent equity in the proposed special purpose vehicle (SPV) for setting up a liquefied natural gas floating, storage and re-gasification unit (FSRU) at Kakinada. GAIL is a joint venture partner with the AP Gas Infrastructure Corporation in the project. (www.business-standard.com)

July 14, 2014. Rajasthan Chief Minister Vasundhara Raje announced to set up a joint venture (JV) with GAIL India Ltd for city gas (CNG) distribution in selected cities in the state. Rajasthan State Petroleum Corporation would be strengthen through the joint venture with the GAIL for supply of CNG, Raje said. In first phase for supply of CNG through GAIL, One mother station would be set up in Neemrana, and a daughter station in Jaipur, she said.

On petroleum and mineral areas, she said the state would encourage zero waste mining by reducing pollution, a new policy of mining would be prepared soon, and the Rajasthan Minor Mineral Concession Rules would be amended, she said. (economictimes.indiatimes.com)

July 14, 2014. Oil and Natural Gas Corp (ONGC) is set to skip a second naphtha export cargo for August after shutting a pipeline supplying gas to its western India plant. ONGC, which on average exports two 35,000-tonne naphtha cargoes a month from Hazira, previously cancelled a tender to sell a cargo for Aug. 9-10 loading from the western India port. The company has shut a 42-inch subsea pipeline supplying gas to the plant to carry out repairs after sand was displaced beneath the pipe by high tides. (economictimes.indiatimes.com)

July 9, 2014. India paid a second instalment of $550 million in oil dues to Iran under an interim deal that has allowed Tehran access to $4.2 billion in blocked funds globally. Asian buyers such as Japan and South Korea have already cleared some of the money they owe for imports of Iranian oil under a payment schedule approved by world powers in an interim nuclear deal with Iran last November. Iran wanted the last three payments under the joint plan of action (JPA) totalling $1.65 billion from India, but New Delhi could not clear the May and the June instalments on time as the banking mechanism to remit the funds was not in place.

The current mechanism involving the central bank of the United Arab Emirates allows Tehran access to funds in Dirahms as a reward for cooperating in talks with world powers over its nuclear programme. India last month made the first payment to Iran under the interim deal.

The settlement of the final instalment of $550 million to Iran due on July 20 depends on Iran fulfilling all of its commitments under the joint action plan. Iran and six major powers resumed talks and negotiators continued meetings in Vienna, but there was no immediate sign of substantive progress.

Mangalore Refinery and Petrochemicals Ltd, Essar Oil, Indian Oil Corp., Hindustan Petroleum Corp and HPCL-Mittal Energy Ltd. together owed about $4.6 billion to National Iranian Oil Co as of May 31.

India, which imports a total of 4 million barrels per day of oil, has been steadily reducing its dependence on Iran, whose share in its overall oil imports has fallen by two-thirds over the last five years to 5.7 per cent in 2013/14. (economictimes.indiatimes.com)

July 15, 2014. The oil ministry has sought the law ministry's advice on payment to judges involved in the upcoming arbitration between the government and Reliance Industries Ltd (RIL) over the KG-D6 block.

The foreign arbitrator has proposed that each member of the tribunal would be paid $13,500, or ` 8.1 lakh each per hearing and another $1,350 per hour for "interlocutory matters" apart from administrative expenses.

The arbitration was initiated by RIL which has challenged the oil ministry's decision to disallow cost recovery of $2.4 billion to penalise the company for the sharp fall in gas production from the KG-D6 block. The company has attributed the decline to geological complexity and has argued that in any case its product sharing contract does not have any provision for penalty due to fall in production.

Oil minister Dharmendra Pradhan reiterated the government's position on disallowing cost. The government has so far disallowed cost recovery of $1.797 billion as on March 31 last year. Pradhan said a notice had been served to increase the amount to $2.376 billion. RIL said it hopes to resolve the matter expeditiously. (economictimes.indiatimes.com)

July 15, 2014. Price of diesel sold to bulk consumers like Railways and State Transport Corporations was today cut by ` 1.09 per litre in line with falling international rates. However, diesel sold to retail consumers like cars and trucks have not been revised. Price of bulk diesel sold in Delhi has been cut from ` 60.41 per litre to ` 59.32 per litre.

The government had decided to sell diesel to bulk consumers like State Transport Corporations, Railways and Defence while the subsidised fuel was meant only for retail users like automobiles, car owners and trucks. The price of retail diesel has not been changed. It currently costs ` 57.84 per litre in Delhi. (economictimes.indiatimes.com)

July 14, 2014. Diesel prices may be deregulated as early as December if the current trend in global prices continues, while the number of subsidised cylinders supplied to households may be cut again as the government strives to cut fuel subsidies and achieve the fiscal discipline targeted by the finance minister.

Brent crude oil, which had soared above $115 last month due to the crisis in Iraq, has fallen to $106.7 as fears of supply disruption receded. Prospects of higher supply from Libya has also dampened prices. This is expected to reduce the gap between India's diesel price and the international price. The gap had fallen to Rs 1.6 a litre but rose to ` 3.4 last month.

The finance minister Arun Jaitley said the government would deregulate diesel and reduce cooking gas subsidy though several measures such as checking diversion though direct cash transfer and reducing the number of subsidised LPG cylinders per household annually to a realistic level. Diesel is a major drag on the public exchequer as state oil firms incurred a revenue loss of ` 62,837 crore in the previous fiscal year.

The government also plans to cut cooking gas subsidies with steps such as checking its diversion and reducing the number of subsidised cylinders. On an average each household consumes 7.2 cylinder a year but they can buy 12 if they need. Subsidy on the cooking gas in 2013-14 was ` 46,458 crore. The UPA government had initially cut the supply of subsidised cylinders to six. Subsequently, this was raised to nine and then 12 just before elections. (economictimes.indiatimes.com)

July 14, 2014. Cabinet will soon take a decision on mandatory blending of 10 per cent ethanol with petroleum, Oil Minister Dharmendra Pradhan said. At present, it is compulsory to blend 5 per cent ethanol with petroleum but the oil marketing companies have achieved only 1.37 per cent.

The government is of the view that farmers can get good price for their sugarcane when there is value addition. The sugarcane farmers feel that the move will yield better income for farmers, as ethanol is a by-product of sugarcane and will generate huge revenues if it is blended with petrol.

In November, 2012, the Cabinet Committee on Economic Affairs had decided that 5 per cent mandatory ethanol blending with petrol should be implemented across the country and achieved by June, 2013.

Pradhan had earlier said that the state governments have been asked to simplify the procedure and expedite clearances to ease the availability of ethanol for blending. In the year 2008, the Government announced its National Policy on biofuels, mandating a phase-wise implementation of the programme of ethanol blending with petrol in various states. (economictimes.indiatimes.com)

July 10, 2014. The Union Budget projected petroleum sector's gross under-recoveries at ` 104,500 crore for 2014-15, with the budget providing for ` 33,200 crore in addition to the carry forward of ` 30,220 crore towards FY2013-14. The budget emphasised on reducing fuel subsidies; but remained silent on the details.

The budget proposes to build 15,000 km gas transportation pipelines to complete national gas pipeline grid under public-private partnership (PPP) model. Besides, rapidly scaling up usage of piped natural gas (PNG) in a Mission mode, since it is a cheaper and cleaner fuel. All this to reduce dependence on any single source of energy viz. crude oil. Overall, enhanced focus on gas sector is key positive of gas transportation players (like GAIL, GSPL etc) and city gas distribution (CGD) entities. (economictimes.indiatimes.com)

July 10, 2014. The government proposes to exempt natural gas supply to Pakistan from import duty, boosting GAIL India's plans to invest ` 500 crore to set up a 100-km pipeline from Jalandhar in Punjab to the Wagah border. However, the importer will have to produce a certificate from the assistant commissioner or deputy commissioner of customs that the imported liquefied natural gas (LNG) has been exported to Pakistan.

LNG imports currently attract a duty of 5%. GAIL India said that export of gas to Pakistan made business sense since that country is short of the fuel. The company has held several rounds of discussions with Indian and Pakistani government officials in this regard. (economictimes.indiatimes.com)

July 10, 2014. The government will set up 15,000 km of additional gas transport infrastructure under the public-private-partnership mode, finance minister Arun Jaitley said. India has an existing gas pipeline network of 15,000 km and there is a necessity to add an additional 15,000 km which will be developed in the PPP mode, Jaitley said.

The enhanced grid will promote usage of gas, both domestic and imported, reducing dependence on one source of energy, he said. The finance minister also said the government will accelerate exploitation from coal bed methane reserves and evaluate old and closed wells to maximise production. (economictimes.indiatimes.com)

POWER

July 14, 2014. Rajasthan Chief Minister Vasundhara Raje y said the state aims to generate capacity addition of 6,500 MW power in next five years. Three DISCOMs -- Jaipur Vidyut Vitran Nigam Ltd, Jodhpur Vidyut Vitran Nigam Ltd and Ajmer Vidyut Vitran Nigam Ltd -- were facing massive losses to the tune of ` 75,000 crore due to transmission and distribution (T&D) losses as of March 31, 2014, and these companies were paying ` 10,000 crore on loan repayment, Raje said. Due to the huge losses, the power tariff goes up every year by ` 1.80 per unit, she said. (economictimes.indiatimes.com)

July 9, 2014. Low water-level in reservoirs and technical snags in certain thermal electricity generation station have led to power crisis in Odisha. Odisha requires at least 3,000 MW of power to meet its demands while only about 2550 MW of electricity is now available, Grid Corporation of Odisha (Gridco) said. Scarcity of power has forced Gridco to regulate electricity supply in the state, Gridco said. Gridco said that while the state was availing about 1,000 MW of power from hydro-power stations in July last year, this time it has come down to about 400 MW.

This apart, five units, one of in NTPC Kaniha, two of TTPS, Kahalgam (Bihar), Pharaka (WB), which usually provides 476 MW electricity to Odisha, have remained non-functional for renovation work. The Gridco was also facing problem in purchasing electricity from outside due to high cost. (economictimes.indiatimes.com)

July 12, 2014. Power demand in Delhi again broke all records, touching an all-time high of 5810 MW, a day after registering the highest demand. The power demand soared to 5789 MW. The demand touched all time high as mercury rose to 42 degrees Celsius. The rise in electricity demand caused power cuts ranging from one to two hours. (economictimes.indiatimes.com)

July 12, 2014. The beleaguered power sector will be among the first beneficiaries of the government's proposal to develop the Ganga waterway. Experts say the ` 4,200-crore plan will help speed up transportation of coal to power plants in the north and east of the country. Coal accounts for about 55per cent of India's energy needs. Despite the country's high dependency on the fuel, problem with logistics means coal from pit heads generally lies idle for months before it can be moved to railway sidings for transportation to power plants.

Finance Minister Arun Jaitley announced the government's intent to develop the river route between Allahabad in Uttar Pradesh and Haldia in West Bengal over the next six years. The National Waterway project will entail building the river channel and river ports along the banks of the Ganga. Experts say power producers are awaiting the development of inland waterways to transport coal. National Thermal Power Corporation started transporting imported coal through the inland waterways route to its Farakka plant in West Bengal. (economictimes.indiatimes.com)

July 9, 2014. The Consumer Disputes Redressal Cell (CDRC) of Gujarat has imposed a fine of ` 50 lakh on the Torrent Power Ltd for alleged illegal recovery of a hefty amount from a user by cutting off electric supply. The CDRC quorum comprising judicial member acted upon the appeal of Torrent Power in which they challenged the Surat district Consumer Forum's judgement in which the company was asked to reimburse ` 78,000 to a consumer. (economictimes.indiatimes.com)

July 15, 2014. Signalling the government and regulators are on the same page to push growth in the sector, power minister Piyush Goyal has asked the Forum of Regulators (FOR) to form working groups suggest ways to increase generation capacity and ensure 24x7 power supply. Goyal wants FOR to submit its recommendations on energy management involving off-grid, renewable water conservation, and dip irrigation by revising the existing system of determining floor price for renewable energy certificates. According to Goyal, FOR members should first provide 24x7 quality power supply and then consider appropriate tariff revision in a calibrated manner, while keeping the sensitivities of the consumers in mind. (www.business-standard.com)

July 15, 2014. India's largest power producer National Thermal Power Corporation Limited (NTPC) will continue to pursue legal action against new tariff determination parameters in the country after the industry regulator rejected its request to reconsider the tariff regulations for 2014-19.

NTPC had approached the Central Electricity Regulatory Commission (CERC) following a direction from the Delhi High Court and it will now go back to the court. While framing the new guideline in December, CERC had altered various parameters and methods for determining power tariff, which NTPC said will impact the return on equity (RoE) of projects. Since then the firm's share price has fallen 11% to a five-year low.

NTPC, which controls over 43,000 MW of country's total power production of 2,49,500 MW, approached Delhi High Court to seek modifications in the tariff guideline for five years starting April 1. The court then directed it to go back to the regulator. (economictimes.indiatimes.com)

July 15, 2014. Power tariffs will rise at least 6-7% due to an increase in clean energy cess and rise in customs duty announced in the Union Budget, as well as the freight rate hike announced in June, forcing consumers to pay anything between 18 and 21 paise per unit of power consumed. A middle class family, for instance, which uses at least 300 units of power every month, will now have to pay at least ` 54 more. Rise in power cost also increases other costs: the cost of power paid by railways to transport coal will have a spiralling effect.

The rise in customs duty by 0.5% on imported coal will affect companies that source coal from foreign countries, including NTPC and coastal thermal power companies. This is expected to raise cost by 1% to 1.5%, depending on the volume of coal consumed. (economictimes.indiatimes.com)

July 14, 2014. Finance minister Arun Jaitley's announcement to ensure adequate coal supplies to power plants already commissioned and those due for completion by 2015 should come as a relief to the promoters of these projects.

While the private sector accounted for approximately 55 per cent of the total capacity addition in the 11^th Plan, it has contributed 68 per cent, or 30,500 MW, of the 45,516 MW capacity put up so far against the targeted 94,285 MW for the full 12^th five-year plan. (economictimes.indiatimes.com)

July 13, 2014. Seven power PSUs, including the country's largest electricity generator NTPC, have drawn up total capital expenditure plans of ` 51,425.84 crore during the current financial year 2014-15. The total capex or capital expenditure of the seven PSUs for FY2014-15 is just 3.4 per cent higher than that of ` 49,731.90 crore in 2013-14. NTPC's capex for the year will be ` 22,400 crore followed by central transmission utility Power Grid Corporation's ` 20,000 crore.

In 2013-14, NTPC, which has diversified into hydro power, power trading, coal mining etc, had planned ` 20,200 crore as capex. Power Grid's capex is same as last fiscal's. Hydro power generator NHPC will have a capital expenditure of ` 3,224.26 crore this year against ` 3,058.12 crore in 2013-14.

Damodar Valley Corporation (DVC) and North Eastern Electric Power Corporation (NEEPCO) have reduced their capex for the period to ` 2,764.99 crore from ` 3,515.97 crore and ` 1,087.98 crore from ` 1,661.77 crore in 2013-14, respectively.

While the expenditure on expansion in THDC (Tehri Hydro Development Corporation) has increased nearly 50 per cent at ` 856.68 crore from ` 331.96 crore, the one in Satluj Jal Vidyut Nigam has increased to ` 1,091.93 crore from ` 964.08 crore, last fiscal. These expenses will be incurred by the companies towards meeting their expansion plans during the period. Finance Minister Arun Jaitley announced a slew of measures for energising the country's power sector including extension of the 10-year tax holiday benefit by another three years (March 2017) to the companies. Power companies can claim tax exemption for up to 10 years within the first 15 years of a project's operations. The government extended the scheme until March 31, 2014. Association of Power Producers' has said that the extension of 10 year tax holiday will provide a significant boost in investor interest in the power sector and also benefit the end consumer. (economictimes.indiatimes.com)

July 12, 2014. The government is readying a mega ` 50,000 crore equity fund for the power sector as it looks at 24x7 electricity supply in villages in at least those states that are ruled by BJP. The initial corpus is expected to flow in from state-run banks and power sector FIs such as Rural Electrification Corporation and Power Finance Corporation. Simultaneously, the government is also working an asset reconstruction company (ARC) for the power sector, along with a separate one for roads. These ARCs will take over stalled power and road projects and help revive them to ensure that funds lent by banks don't end up as bad loans. (economictimes.indiatimes.com)

July 11, 2014. The Centre has sanctioned ` 100 crore to establish Supervisory Control and Data Acquisition (SCADA) in four towns of the state. SCADA, approved by the Union Ministry of Power, will come up in Vizag, Vijayawada, Guntur, and Nellore under the Re-structured Accelerated Power Development and Reforms Programme (R-APDRP) Scheme. Under the plan, SCADA would facilitate centralised data collection which enables to improve system stability, easy accessibility to each and every consumer, instantaneous collection of parameters like voltage, current, power. R-APDRP, a flagship programme of Government of India, paves the way to strengthen the power sector by way of taking up of IT initiatives in urban areas for enhancing customer services. (economictimes.indiatimes.com)

July 10, 2014. The NDA government allocated ` 700 crore to overcome problem of power transmission and water distribution system in Delhi. Finance Minister Arun Jaitley proposed ` 500 crore for reform in the water sector while ` 200 crore has been set aside for reform in the power sector. Separately, Delhi government was allocated ` 349 crore as central assistance for 2014-15, which is a decrease of ` 682 crore compared to last year's provision of ` 1,031 crore. (economictimes.indiatimes.com)

July 10, 2014. India's ailing power industry has welcomed Finance Minister Arun Jaitley's budget proposals, with most seeing them as a sign that the government views the sector as one of the key drivers of economic growth. Over the last few years, though the country saw 87,622 MW of capacity addition by private players, the sector has been plagued by a host of issues, including a sluggish clearance mechanism and lack of fuel and transmission network.

Piyush Goyal, minister for power, coal and renewable energy, called it a transformative budget that is focusing on policy initiatives and investment-led growth. Goyal welcomed the standardisation of custom duty on coal, which he said would help to end disputes.

Association of Power Producers, which represents project developers from the private sector, such as Tata Power, Adani Power, CLP, GMR and Lanco, welcomed the proposals. It said it is looking forward to expeditious implementation of these proposals at the earliest. The association said that the budget proposals would boost investor interest in the power sector while also benefiting the consumer. (economictimes.indiatimes.com)

July 10, 2014. With Kudankulam unit 2 likely to become operational in this financial year, the government has allocated ` 10,446 crore to the Department of Atomic Energy (DAE) for power generation and research.

For power generation, ` 1709 crore has been allocated to the department. This includes ` 30 crore for India's first Prototype Bast Breeder reactor at Kalpakkam at the Indira Gandhi Centre for Atomic Research (IGCAR).

The government also intends to invest Rs 203 crore and Rs 440 crore in NPCIL and Bhartiya Nabhikiya Vidyut Nigam Ltd, two PSUs under DAE. ` 8737 crore has been allocated for research in the field of nuclear energy. There are several research centres under the DAE, major being Bhabha Atomic Research Centre, Raja Ramanna Centre for Advanced Technology and IGCAR and Atomic Minerals Directorate for Exploration and Research (AMDER). The allocation also includes provisions for projects such as survey, prospecting, and exploration by AMDER and setting up a Centre for Global Centre for Nuclear Energy Partnership in Haryana. In last budget, the department had been allocated ` 8,449 crore for Atomic Energy Research, but it was revised to ` 6,969 crore. (economictimes.indiatimes.com)

July 9, 2014. All nuclear power plants (NPPs) in the country are safe and can withstand natural calamities like earthquakes and tsunamis, the government said. Following the March 2011 Fukushima nuclear accident in Japan, safety review of all Indian NPPs was conducted by task forces of NPCIL and the expert committee of AERB (Atomic Energy Regulatory Board), Minister of State in the PMO Jitendra Singh said. These safety reviews have confirmed that Indian NPPs plants are safe and have adequate margins and features in design to withstand extreme events like earthquakes and tsunamis, he said. He said that the designs of NPPs located in coastal areas take into account the technical parameters related to earthquake, tsunami, storm surges, floods, etc at respective sites and at all NPPs, state of art safety measures are being provided. (www.business-standard.com)

OIL & GAS

July 15, 2014. Shell announced its third major discovery in the Norphlet play in the deep waters of the Gulf of Mexico with the successful Rydberg exploration well. After more than 10 years of exploration activities in the Eastern Gulf of Mexico, Shell continues to lead industry in exploring this Jurassic play. The Rydberg well is located 75 miles (120 kilometers) offshore in the Mississippi Canyon Block 525 in 7,479 feet (2,280 meters) of water. It was drilled to a total depth of 26,371 feet (8,038 meters) and encountered more than 400 feet (122 meters) of net oil pay.

Shell is completing the full evaluation of the well results but expects the resource base to be approximately 100 million barrels of oil equivalent. Together with the Appomattox and Vicksburg discoveries, this brings the total potential Norphlet discoveries to over 700 million barrels of oil equivalent. (www.rigzone.com)

July 12, 2014. Iraq’s semi-autonomous Kurds increased their control over oil resources in the north of the country after deploying armed forces to the Kirkuk and Bai Hassan oilfields. Kurdish Peshmerga forces took control of the two sites at the country’s fourth-biggest oil field and ordered workers from Iraq’s North Oil Co. to leave, the oil ministry said. The Kurdistan Regional Government said in response that it acted to prevent the central government damaging an oil export pipeline. The oil ministry in Baghdad denied the claim. Iraq’s minority Kurds, who historically have resisted control by Arab-dominated governments in Baghdad, are charting a course to independently develop oil reserves the KRG calculates at 45 billion barrels -- equivalent to almost a third of Iraq’s total deposits according to BP Plc data. Kurdish armed forces moved outside their region in northern Iraq and occupied the long-disputed territory around Kirkuk after the Iraqi army fled from Islamist militants. (www.bloomberg.com)

July 11, 2014. Turkemistan-focused oil explorer Dragon Oil said it was on track to meet its 2015 production milestone of 100,000 barrels of oil per day (bopd), despite disappointing drilling results at some of its Turkmen fields.

The explorer also said it would reach a 2014 output level of 87,000-90,000 bopd. The company decided to suspend a new appraisal well at its Dzhygalybeg (Zhdanov) field in Turkmenistan after disappointing results. (www.rigzone.com)

July 10, 2014. The oil industry’s largest lobbying group began a new effort to ease public fears about hydraulic fracturing after a legal setback in New York state and a voter push in Colorado to ban the drilling practice. The American Petroleum Institute (API), a Washington-based group that includes Exxon Mobil Corp. and Chevron Corp., released guidelines for improving community relations as “fracking” extends to more towns, raising concerns about pollution risks.

Fracking has helped set records for natural gas production and turned the U.S. into the world’s largest oil producer. The technique, which shoots a watery mix of sand and chemicals underground to release gas and oil trapped in shale rock, has raised concerns about pollution of drinking water sources. API released its guidelines after New York’s highest court let cities and towns block hydraulic fracturing within their borders. (www.bloomberg.com)

July 15, 2014. French oil company Total, Europe's biggest refiner, said refining margins in the region rose to a one-year high in the second quarter of 2014, ticking up slightly after hitting a four-year low in the previous three months.

Total's European refining margins indicator rose to $10.9 per tonne in the second quarter from $6.6 in the previous quarter. That was the highest since the second quarter of 2013, but still less than half the levels seen in the first half of last year. The economic slowdown has hit European oil demand in the past few years, leaving European refineries operating at overcapacity and margins shrinking. (www.downstreamtoday.com)

July 11, 2014. Petrofac, the international oil and gas services provider, has been awarded a contract for the construct an oil gathering center for Kuwait Oil Company (KOC).

The project is one of three gathering facilities being built to support KOC's plans, next five years, to increase as well as maintain oil production. Each facility will have the capacity to produce about 100,000 barrels of oil per day along with associated water and gas. (www.energy-business-review.com)

July 14, 2014. Russian state oil group NK Rosneft' AOA signed an agreement with Brazil's Petroleo Brasileiro SA to seek ways to sell natural gas trapped in Brazil's remote Amazon jungle, the companies said. Rosneft owns 51 percent of HRT O&G, a Brazilian company that owns three giant oil and gas exploration blocks in the Solimoes Basin, west of Manaus, a city of about 1.8 million that is the capital of Amazonas state.

They contain an estimated 542 million barrels contingent oil and equivalent natural gas resources, 83 percent of it gas, according to HRT Participacoes em Petroleo, a Rio de Janeiro-based company that is Rosneft's 49 percent partner in the Solimoes blocks. (www.downstreamtoday.com)

July 14, 2014. Rebels in Libya’s east committed to keeping open the country’s largest oil port, Es Sider, and dissociated themselves from a protest that shut a smaller crude export terminal. Brent traded near the lowest in three months. Es Sider and Ras Lanuf, Libya’s third-largest oil port, have a combined daily loading capacity of 560,000 barrels. Brega, which was reported July 12 to have been shut by guards seeking better pay, can export 60,000 barrels a day, according to the oil ministry.

The Executive Office for Barqa seeks self-rule for the eastern region also known as Cyrenaica. It took control of four oil ports about a year ago, handing back two of them to the government in April and the remaining two this month. Although located in eastern Libya, Brega was not among the four ports that fell under the rebel group’s control, and it continued to supply a refinery controlled by the government in the nation’s western region. (www.bloomberg.com)

July 13, 2014. PetroChina Co. is committed to completing its C$1.32 billion ($1.23 billion) purchase of the stake it doesn’t own in the Dover oil-sands project in Canada soon, according to the Beijing-based company’s parent. PetroChina, China’s biggest oil and natural gas producer, is working with Calgary-based Athabasca Oil Corp. to close the purchase of Athabasca’s 40 percent stake in Dover. The two energy producers formed a joint venture in 2010 to develop Dover. (www.bloomberg.com)

July 12, 2014. New U.S. pipelines and a revival in Libyan supply are increasing the likelihood that oil prices will slump through year-end after climbing in the first six months. Brent is poised to decline in part on increased output in Libya as key export terminals were reopened. In the U.S., traders are focused on supplies at Cushing, Oklahoma, the delivery point for the West Texas Intermediate (WTI) futures contract. Tallgrass Energy Partners LP plans to complete the conversion of the Pony Express pipeline to carry crude to Cushing from Wyoming. Enbridge Inc.’s Flanagan South will connect to the hub from Illinois. Cushing supplies began falling two years ago when the direction of the Seaway pipeline was reversed to move oil away from the hub. Enbridge and Enterprise Products Partners LP said that they completed a 512-mile (833-kilometer) loop that’s expected to boost Seaway’s capacity to 850,000 barrels a day from 400,000. (www.bloomberg.com)

July 11, 2014. Thailand is cutting natural gas imports after consumption growth in Asia's fourth-largest user of the fuel has sagged to two-decade lows, threatening to idle costly fuel import facilities and force suppliers to turn to rival buyers such as China. Growth in gas use has stalled as the economy has taken a hit from political turmoil, putting in doubt long-term plans to boost imports of liquefied natural gas (LNG) and buy more piped gas from neighbouring Myanmar as domestic output wanes.

PTT PCL, Thailand's biggest energy conglomerate and sole gas supplier, has cut estimates for LNG imports and gas sales for this year. That comes as slowing consumption for power and petrochemicals is reducing gas demand in Southeast Asia's second-biggest economy. State-controlled PTT has also cut its gas imports from Myanmar, which is now looking to China to take up some of the slack, Myanmar government said. (af.reuters.com)

July 11, 2014. For more than 30 years, the Louisiana Offshore Oil Port LLC (LOOP) has been a symbol of U.S. dependence on foreign oil, pumping Nigerian and Saudi Arabian crude from the world’s biggest supertankers into underground storage caverns beneath the marshes of southern Louisiana.

To be an outbound hub, the port needs financial commitments from shippers to build needed infrastructure, and even under the most optimistic scenario, it will be a year before it loads the first tanker, LOOP said. Still, the fact that LOOP is considering the project underscores how shale drilling and oil-sands mining have altered energy flows in North America. (www.bloomberg.com)

July 9, 2014. Energy trading on futures exchanges is slumping as increased oversight from regulators hinders transactions, according to Platts, a company publishing prices for physical commodities including oil.

The amount of light, sweet crude futures handled by CME Group Inc., the world’s largest derivatives exchange, slumped 22 percent to an average of 489,658 contracts a day in May from a year earlier, the bourse’s data show. Natural gas trades fell the same amount. Brent crude transactions on Intercontinental Exchange Inc. were 9 percent fewer in the first six months than the same period in 2013.

Banks including Barclays Plc, JPMorgan Chase & Co. and Morgan Stanley reduced their commodity businesses over the past several years as returns declined and regulatory scrutiny intensified. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 restricted banks from trading for their own account, under the Volcker Rule, and expanded oversight of commodities derivatives. (www.bloomberg.com)

July 9, 2014. Japan's Mitsui OSK Lines Ltd (MOL) said that it will start transporting liquefied natural gas (LNG) through the Arctic Ocean in 2018 using icebreaker LNG tankers. MOL, with its joint venture partner China Shipping, has ordered three icebreaker LNG carriers from South Korea's Daewoo Shipbuilding & Marine Engineering Co Ltd.

The new tankers will deliver LNG to Europe and Asia from a gas plant to be built on the Yamal Peninsula in northern Russia by Russia's second-largest gas producer Novatek, France's Total and China National Petroleum Corporation. (www.downstreamtoday.com)

July 15, 2014. Spanish oil company Repsol could begin prospecting for its $7-billion oil exploration project off the Canary Islands in October, Industry Minister Jose Manuel Soria said.

Spain's Supreme Court rejected environmental appeals against 2012 government permits granted for oil exploration off the coasts of the islands of Fuerteventura and Lanzarote. (www.rigzone.com)

July 15, 2014. Chile's state oil company ENAP said it would start using U.S. shale gas during the first half of 2016 via an ongoing supply contract with Britain's BG Group Plc. Energy Minister Maximo Pacheco said that ENAP had signed a long-term deal with Centrica-owned British Gas, Britain's largest energy supplier, to import shale gas from the United States at the end of next year.

The company said a potential future arrival of U.S. shale gas could diversify Chile's liquefied natural gas supplies and added that it can be imported without tariffs, thanks to the free trade agreement between the two countries.

BG Group has long-running LNG contracts with the Andean country's Endesa Chile, local natural gas distributor Metrogas and ENAP. (www.downstreamtoday.com)

July 11, 2014.  Russian President Vladimir Putin said he was hopeful Russian oil company Rosneft and Cuban state oil company Cupet could begin jointly exploring Cuba's potential offshore oil reserves "in the very near future." Rosneft and fellow state oil company Zarubezhneft agreed to help Cupet explore offshore in Cuba, which has limited onshore production and depends on Venezuela for oil imports. Putin also said a number of Russian companies were interested in doing business in Cuba's new special economic zone at the port of Mariel near Havana. (www.rigzone.com)

July 10, 2014. OPEC predicted that demand for its crude will decline in 2015 to the lowest in six years as supplies from other producers, led by the U.S., are more than enough to cover the increase in global consumption.

The need for crude from the Organization of Petroleum Exporting Countries (OPEC) will slide to 29.4 million barrels a day next year even as growth in world oil consumption accelerates, the group said in its first assessment of 2015. That’s 300,000 a day less than OPEC’s 12 members pumped in June. It would be the third consecutive annual drop in demand for OPEC crude and the lowest since 2009. The U.S. will provide about two-thirds of next year’s supply growth, OPEC said.

The U.S. has overtaken Saudi Arabia and Russia as the world’s biggest oil producer as it taps shale formations in Texas and North Dakota by splitting apart rocks with high-pressure liquid, a process known as known as hydraulic fracturing, or fracking.

Oil prices have remained supported by threats to supplies in OPEC members such as Iraq and Libya, with the Brent benchmark’s loss this year limited to 2.3 percent. (www.bloomberg.com)

July 10, 2014. A subsidiary of Chinese state oil giant China National Offshore Oil Corporation (CNOOC) has signed an around $1.6 billion deal to build equipment for a liquefied natural gas project in Siberia, the company said.

Under the agreement, CNOOC's Offshore Oil Engineering Co will build "core modules" for the liquefication process on the project in Yamal in the Russian Arctic. Novatek, Russia's second-largest gas producer, is developing the $27 billion Yamal LNG project with France's Total and China's top energy group, China National Petroleum Corporation (CNPC). The first production unit, with annual capacity of 5.5 million tonnes, is due to be launched in 2017. In May, CNPC signed a deal to buy 3 million tonnes of LNG per year from the Yamal project, as did Russia's Gazprom. CNPC also agreed in May to buy 38 billion cubic meters of gas per year from Russia's Gazprom, in a deal unofficially valued at $400 billion. (www.downstreamtoday.com)

POWER

July 15, 2014. Indonesia’s biggest cement producer, Semen Indonesia, is partnering with Japan’s JFE Engineering Corp to build a waste-to-heat power generator in East Java, with a planned investment of around 638 billion rupiah ($54.4 million). The 30.6 MW plant, which is expected to start operations by end-2016, is aimed at cutting annual electricity costs by around $10 million for Semen Indonesia, a heavy energy user.

State-owned electricity company Perusahaan Listrik Negara said it planned to increase power tariffs for industrial users by up to 38 percent this year as Southeast Asia’s largest economy seeks to alleviate its bloated energy subsidies. (www.thejakartaglobe.com)

July 15, 2014. The Quang Tri Province People's Committee and the Thai-based power firm Egat International (Egati) signed a memorandum of understanding (MoU) on the construction of a 1,200 MW thermal power project in the province. Invested in by Egati, the thermal power plant, the first of its kind in the province, will cost US$2.26 billion and will be built in Hai Lang District.

Under the MoU, the two sides will carry out necessary steps to build the project.  As planned, all work related to land clearance, compensation and financial procedures will be completed, and construction on the project will start in 2018. The project will have two turbines, with the first turbine scheduled to be put into operation in 2021. The project initiated under the BOT (Build, Operate, Transfer) plan, will supply more electricity to the locality as well as connect the country’s power transmission systems in the central region and in Southeast Asia in the future. (www.nationmultimedia.com)

July 14, 2014. Russia's Inter RAO is planning to support turnkey hydropower plants construction in Argentina. The company is prepared to help construction of the turnkey Chihuido-1 and Chihuido-2 hydropower plants in Argentina's Neuquen Province.

The first plant will cost $2 bn and would have capacity of 637 MW while the second will have 296 MW. (hydro.energy-business-review.com)

July 14, 2014. Trans-Asia Oil and Energy Development (TAPGC), a wholly-owned subsidiary of Trans-Asia Oil and Energy Development, of the Phinma Group, has been awarded three new service contracts to develop three hydropower plants with a combined capacity of 320 MW across the Philippines.

The Philippines Department of Energy has awarded service contracts to the company for a 300 MW project in Pililia, Rizal, a 10 MW project in Ilagen, Isabela, and a further 10 MW scheme in Buguias, Benguet. (hydro.energy-business-review.com)

July 11, 2014. Marubeni has begun construction of a small hydro power plant in Shimogo Town, Minami Aizu County, Fukushima Prefecture, Japan. Being developed jointly with Mibugawa Power, a wholly-owned subsidiary of Marubeni, the project is scheduled to begin commercial operation from April 2015 and be managed by Mibugawa.

The 175kW power plant would produce approximately 1 million kWh per annum, which is enough to power 300 ordinary houses annually, while the generated power will be sold under Japan's feed-in-tariff scheme for over 20 years. (hydro.energy-business-review.com)

July 11, 2014. Ofgem, the U.K. energy regulator, approved SSE Plc’s 1.2 billion pound ($2 billion) project to install a new link in the north of Scotland that will increase renewable energy flow to Britain’s networks.

The link between Caithness and Moray will be built by SSE unit Scottish Hydro Electricity Transmission and is expected to be operational by 2018, SSE said. It will enable the connection of 1.2 GW of new renewable electricity generation. (www.bloomberg.com)

July 12, 2014. President Vladimir V. Putin of Russia and his Argentine counterpart signed deals on nuclear energy and other projects in an effort to expand his country’s influence in Latin America.

Russia will help build the third reactor of a nuclear power plant in Argentina. Both leaders said the nuclear projects would be for peaceful purposes. (www.nytimes.com)

July 11, 2014. First NatGas Power Corporation (FNPC), a subsidiary of Lopez-led First Gen Corporation (First Gen), has obtained a $265-million export credit facility to partly finance its 414 MW natural gas-fired power project in San Gabriel, Batangas City. The loan was inked with KfW IPEX-Bank of Germany (KfW) with a tenor of 13.7 years.

Proceeds of the loan will be used primarily to finance the eligible German and non-German goods and services under the equipment supply contract of the San Gabriel power plant with Siemens AG, the equipment supplier.

Siemens had informed First Gen that by the time the San Gabriel plant turns commercial in March 2016, it will be the most efficient gas-fired power plant in Southeast Asia, with an efficiency of more than 60%. San Gabriel project is one of 3 power facilities that First Gen is developing in Batangas City totaling 1,350 MW. (www.rappler.com)

July 11, 2014. South Korea has resumed operations of at its nuclear reactor following a month-long closure. Korea Hydro and Nuclear Power said that the nuclear reactor was closed by due to a control rod problem. South Korea's nuclear watchdog said the thorough checks have been carried out at the 950-MW Hanul No.1 reactor in Uljin County, over 300km southeast of Seoul and that the facility was safe. The restart comes at the peak time for electricity demand in the nation.

The government said it would provide stable power this summer using new generating capacity and fewer closed nuclear power plants. The country faced nuclear safety scandal that prompted the closure of some reactors in 2012. (nuclear.energy-business-review.com)

July 15, 2014. Sunil Hitech Engineers (SHEL) said it has bagged a contract from Solar Energy Corporation of India (SECI) for setting up a 5 MW solar plant in Maharashtra. SECI, which is developing a 375 MW project in the state under the phase II of the Jawaharlal Nehru National Solar Mission, has sub-contracted the construction work for 5 MW to SHEL. SHEL will set up the project, generate power and supply to SECI at ` 5.45 per unit, which is fixed for the entire term of 25 years with effect from the scheduled date of commissioning, it said. The company is in final stages of financial closure for the project, which is expected to be completed by April next year.

The cost of the 5 MW project is estimated at ` 42.5 crore which has received a variable grant funding of ` 6.75 crore from the government. The company is expecting to bag contract for another 15 MW. (economictimes.indiatimes.com)

July 15, 2014. Alstom and NASL have bagged a contract worth 13 million euro (` 107.4 crore) from NTPC for renovation and modernisation of the firm's Odisha thermal power plant. NASL is a joint venture company between NTPC and Alstom.

The upgrade will reduce particulate emissions from the plant which is scheduled to be commissioned in 2018. Alstom and NASL had earlier executed similar contracts for NTPC's Tanda 4x110 MW plant (Uttar Pradesh) as well.

Electrostatic precipitators have been used widely to control particulate emissions and are often the most cost- effective solution due to high removal efficiencies and low maintenance costs. (www.business-standard.com)

July 14, 2014. The Gujarat government will soon introduce a pilot project to run 'electric-buses' for public transport between state capital Gandhinagar and Ahmedabad. The Gujarat Power Corporation Limited (GPCL) has invited expression of interest from the potential companies interested in the project which has been flashed on its official website.

As per GPCL, the 'Electric Vehicles and Solar Based Electric Charging System' pilot project has been inspired by former Chief Minister and now Prime Minister Narendra Modi's vision towards environment-friendly initiatives coupled with innovative ideas.

Modi had first introduced a 'climate change department' amongst the states in the country. In the first phase, electric-buses will be running from Gandhinagar to Ahmedabad and if the project meets with success, it can be implemented in other parts of the state.

This project includes purchase of 15-40 seater mini- buses same as the city-buses used in capital Gandhinagar. The project also includes setting up of solar-power based electric charging stations at regular distances on the over 35 km long stretch between Ahmedabad and Gandhinagar.

The bidders' profile will be scrutinised thoroughly considering their capabilities and strength to proceed with the project. However, the state government is claiming to launch the project by end of the year, though the time is not yet set for the opening phase.

The 'green- project' of the state government will also involve deploying, commissioning, supervision and monitoring the electric vehicles transport system based on solar powered energy for six months from the date of commissioning. (www.business-standard.com)

July 10, 2014. There is a great potential to work with the Rajasthan government in renewable energy, especially solar energy, urban development and tourism sectors, France's Special Representative for Economic Relations with India, Paul Hermelin said.

France's companies should fully use Rajasthan's infrastructures and grow their business, Hermelin said during a high level meeting with state Chief Minister Vasundhara Raje.

After exploring and working out business potential in Karnataka, France would be interested in working in Rajasthan viewing investment possibilities, Hermelin said. Raje said Rajasthan is taking concrete steps to strengthen its infrastructure.

Rajasthan has fixed a target of setting up 25,000 MW solar energy production in next five years, and Bikaner, Jaisalmer, and Jodhpur were best suited for this power generation, Raje said. (economictimes.indiatimes.com)

July 10, 2014. The power industry welcomed the Budget's emphasis on renewable energy and coal-based project, saying it will give an impetus to the sector which is reeling under a crisis. Finance Minister Arun Jaitley announced allocation of ` 1,000 crore for the solar power sector.

The government has set aside ` 500 crore for new and renewable energy, ` 400 crore for launching a scheme for solar power-driven agricultural pump sets and water pumping stations for energising one lakh pumps, and ` 100 crore for the development of one-MW solar parks on the banks of canals.

The industry experts said the focus on the solar energy sector will give a deserving boost to solar companies to increase generation capacity which is currently a mere one per cent of the country's total energy production.

Further, the implementation of the Green Energy Corridor Project will be a great move to integrate channels for evacuation of solar power - a formidable challenge for generating companies at the moment, they said. (economictimes.indiatimes.com)

July 9, 2014. Shriram Group's renewable energy firm Orient Green Power has decided to take an enabling resolution from the shareholders in its upcoming annual general meeting to issue and allot securities to qualified institutional buyers worth upto ` 400 crore. This is an enabling resolution to get approval of the shareholders for a future fund raising, since the market is looking up, according to Orient Green Power. The proposed fund raising would be to bring up additional capacity in the renewable sector, considering the opportunities for the sector is expected to go up. The sector hopes to grow better as the new government's communications are in direction to giving more focus to the sector, though there is no actual policy or action towards this direction so far. (www.business-standard.com)

July 9, 2014. Two of the country's largest power producers Tata Power and Reliance Power are betting big on renewable energy and will spend about ` 1,500 crore each on clean energy projects this fiscal. While Reliance Power has big plans in the renewable energy segment with a special focus on solar, Tata Power said that all the new capacity that it is planning to add over the next two years, close to 800 MW, comprises clean energy projects in the wind, hydro, solar and waste-gasses space.

Tata Power said that it's the only private utility to voluntarily declare that 20-25 per cent of its total installed capacity will be in the green energy space.

Reliance on the other hand said that it has already finalised renewable energy projects of about 200 MW for the current fiscal and is keenly looking at upcoming opportunities to enlarge its renewable portfolio. This comes at a time when the ministry of new and renewable energy (MNRE) plans to set up giant solar projects in Rajasthan, Gujarat, Ladakh and Kargil. This is a part of the government's target of achieving 20,000 MW of solar capacity by 2020. (economictimes.indiatimes.com)

July 15, 2014. Itochu Corp., Kyudenko Corp. and Mitsui Engineering & Shipbuilding Co. will build a 45 MW solar power station in Oita prefecture in southwestern Japan. Construction will start in August and the plant will start operating in March 2016, Tokyo-based Itochu said. Itochu has a 50 percent stake in the venture, while Kyudenko holds 30 percent and Mitsui Engineering the rest, according to the statement. The venture signed a loan agreement with a group of lenders led by Mizuho Bank Ltd., Itochu said. The project will cost about 15 billion yen ($148 million). (www.bloomberg.com)

July 15, 2014. Ocean Power Technologies Inc. (OPTT) is canceling plans to build a renewable-energy project off the coast of Australia that’s not “commercially viable.” The company said its Australian unit, Victorian Wave Partners, is stopping all work on the project. Ocean Power will repay what it has received of an A$66.5 million ($62.5 million) grant from the Australian government, which was to support the A$232 million project. Ocean Power, based in Pennington, New Jersey, makes PowerBuoys that produce electricity from the motion of waves. (www.bloomberg.com)

July 15, 2014. The U.K. will fail to meet its carbon target without taking new emissions-reduction steps, the government’s climate change adviser said. Britain has a self-imposed goal to lower carbon-dioxide output in half from 1990 to 2025. That entails a 31 percent cut from today’s levels, and the nation is on course only to slash CO₂ by 21 percent to 23 percent, the Committee on Climate Change said. Taking additional measures to accelerate carbon cuts is important because the committee has identified the 2025 target as the cheapest pathway for the U.K. to bring down emissions. Britain has enshrined in law a requirement to reduce carbon by 80 percent from 1990 to 2050. The panel recommended the government improve and expand on policies to cut emissions by promoting energy efficiency in homes and factories, increasing the use of renewable-heat technologies such as heat pumps, extending support for renewables beyond 2020, accelerating the development of carbon capture and storage, and supporting longer-term European Union targets for emissions from new vehicles.

The government’s carbon targets are laid out in five-year budgets. The fourth budget runs 2023 through 2027 and caps U.K. emissions at 1,950 million metric tons of carbon dioxide over the period. That’s 390 million tons a year, or half the 1990 level of 780 million tons. (www.bloomberg.com)

July 14, 2014. Sumitomo Corp., a Japanese trading company, will build a 75 MW biomass power station in Aichi prefecture in central Japan. Construction will begin around August and the station will start running by March 2017, Sumitomo and its power generation and retail unit, Summit Energy Corp., said. The 20 billion yen ($197 million) project will be the second biomass power plant for Summit Energy. The two companies are considering another biomass plant in eastern Japan. Biomass fuel will be procured through Sumitomo, which has expertise in handling wood chips and palm kernel shells. (www.bloomberg.com)

July 11, 2014. First Solar Inc. won’t be building the world’s largest solar plant in China after more than four years of negotiations on pricing failed to produce an agreement. First Solar had planned to build the 2,000 MW Ordos project in Inner Mongolia and sell the output to China’s power grid. Terms for selling the power were never agreed to, Arizona-based First Solar said. Ordos was First Solar’s first foray into China, the world’s largest producer of both solar panels and greenhouse gases. First Solar agreed to build the project and consider opening a manufacturing plant in the region in a memorandum of understanding with Chinese officials on Sept. 8, 2009. (www.bloomberg.com)

July 10, 2014. China will waive a 10 percent purchase tax on electric cars as part of expanded measures to combat pollution and cut energy dependence. New-energy autos -- China’s term for electric cars, plug-in hybrids and fuel-cell vehicles -- will be excluded from the levy from Sept. 1 to the end of 2017.

Electric carmaker BYD Co. climbed as much as 4.5 percent in Hong Kong trading. The tax break is China’s latest attempt to spur demand for electric vehicles, whose sales have lagged behind a government target, as state subsidies failed to overcome consumer concerns over price, convenience and reliability. China has identified EVs as a strategic industry that can help it gain global leadership, reduce energy dependence and cut emissions that have contributed to worsening air pollution. (www.bloomberg.com)

July 9, 2014. The US, EU and 12 other governments in the WTO have opened negotiations on a trade deal aimed at ending tariffs on environmental goods such as wind turbines and solar panels.

The WTO members participating in the talks announced in Geneva account for 86 percent of global trade in the products, the Office of the US Trade Representative (USTR) said. The US exported US$106 billion in goods such as turbines, solar panels and filters to treat wastewater last year, the USTR said.

US President Barack Obama’s administration is beginning initiatives to damp the effects of climate change and getting started on the accord is part of that effort, the USTR said. The administration proposed standards to cut greenhouse gas emissions from existing power plants, a step that rankled members of the nation’s Republican Party and utility companies that use coal-fired generators that release carbon dioxide to make electricity. The agreement may also help US exporters gain from the burgeoning international market for clean-energy goods. The US, Taiwan, China and the 28-nation EU are among participants in the talks that have been ensnared in trade disputes over solar-energy equipment in recent years.

According to the US trade office, tariffs on environmental goods can be as high as 35 percent of the value of the products. The nations that participate in Asia-Pacific Economic Cooperation meetings have agreed to cut tariffs on 54 environmental products by 5 percent by the end of next year. (www.taipeitimes.com)

• Energy
• India
• budget
• Energy News Monitor
• MONITORS
• solar
• Village Electrification

The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.