MonitorsPublished on May 29, 2017
Energy News Monitor | Volume XIII: Issue 50


Coal News Commentary: April – May 2017


According to NITI Aayog, coal will remain India’s main energy source for the next three decades although its share will gradually fall as the country pushes renewable power generation. India aims to double its output to 1.5 BT by 2020. Based on a quantitative model NITI Aayog said that by 2047, coal’s share of India’s energy mix would shrink to 42-48 percent, from about 58 percent in 2015.  India aims to cut thermal coal imports to zero by the end of this fiscal year and use its abundant domestic stockpiles to address its electricity needs. However, India will have to start importing again after its coal production peaks in 2037, according to NITI Aayog. Imports could rise to as much as 62 percent by 2047 from over 25 percent now if the country does not make its coal mining more efficient. This is not what western activists campaigning against fossil fuels in general and coal in particular would like to hear. A number of ‘not for profit’ organisations have been trying to ‘name and shame’ countries and companies that invest, produce and use coal. Few years ago the UK based not for profit organisation called ‘carbon tracker’ issued reports that India is among countries that has most of what it called ‘un-burnable carbon’.  Most recently another UK based ‘not for profit’ organisation called ‘Influence Map’ has issued a report naming the Government of India and the state owned LIC as the top two investors in coal resources.  While India has no reason to be ashamed of its natural endowment of coal or the use of it to improve the quality of life of its people as it is within its means, it is not clear if those who set up activist organisations against fossil fuels ever look within to see how much fossil fuel based energy they consume to sustain their jet-set lifestyles and to run activities against fossil fuels (using infrastructure underwritten by fossil fuels). By most account this energy alone could light up the first electric bulbs of millions in rural India!

Moving on to coal imports, state-owned power plants imported around 12 MT of coal during FY17, less than a quarter of the volume imported in the previous fiscal and far less than the anticipated 25 MT expected during the year. This year, it is expected to turn zero as these companies have decided to stop imports. According to figures compiled by the CEA, the state sector power companies imported around 7 MT during FY17 while the central sector generators imported around 5 MT. Nevertheless, the private sector power generators imported substantial volume of coal, around 54 MT during the year, of which around 9 MT by independent power producers were for blending with domestic coal, while the rest at 45 MT were by power plants built to consume imported coal. Bulk of the coal by private power companies was imported by Adani for its Mundra facilities. It imported close to 36 MT last year. Government has said it is aiming to bring down to “zero” thermal coal imports of power PSUs like NTPC in the current fiscal, a move that would reduce the country’s import bill by around  ₹ 170 billion. CIL has been looking at the South Asian region to clear surplus stock and for future contracts. CIL has conveyed to the coal ministry that it is exploring the possibilities of exporting coal to neighbouring nations, but nothing concrete has taken shape. The government had said CIL is examining opportunities to export coal with high ash content or high-grade fossil fuel to the neighbouring nations. CIL is reportedly planning to conclude an agreement with the government of Bangladesh this year to start export of coal to that country. Demand for thermal coal recently began picking up, but CIL still has a 69 MT stock as carryover from the previous year’s production. Bangladesh is an immediate consideration, as thermal power giant NTPC, the largest client of CIL, has entered the country by setting up an BIFPC. This is a 50:50 JV between NTPC and the BPDB, to construct two 660 MW coal-based units at Khulna, for an estimated cost of $2 billion. To finance this JV, India’s Exim Bank will provide a $1.6 bn loan. BHEL another Indian government-owned company, was awarded the contract to construct these power plants. With these developments, CIL seems optimistic that BIFPC will prefer Indian coal over others. Last year, CIL had sent a team to Bangladesh to check the feasibility of export. According to BPDB, the installed power capacity of Bangladesh is 12,339 MW, of which coal-based plants comprise only 250 MW or about two percent. By that country’s Power System Master Plan, 2010, the demand in 2030 will be about 30,000 MW and installed capacity is targeted to reach 40,000 MW. Of this, coal-based generation capacity is expected to be 15,000 MW. Quality is an issue that CIL has ignored until now. In this context the news that all mines of CIL have been re-graded following complaints from consumers, including power sector players, about the slippages in fuel grade is welcome development.  The re-grading of CIL mines was done this year by engaging four independent scientific bodies. Currently, third party sampling assessment is continuing. The government’s next target is to supply superior quality of coal to power producers to improve electricity generation and reduce pollution. CIL, which accounts for over 80 percent of domestic coal production, is targeting 1 BT output by 2020. The government’s next target is to supply superior quality of coal to power producers to improve electricity generation and reduce pollution. Recently, fuel quality watchdog Coal Controller had downgraded 41 percent of samples from the mines of CIL. In most cases, downgrading has been of one to two grades.

Meghalaya government said that coal mining could be legally carried out by MMDC in the state where mining of coal was banned three years ago by the National Green Tribunal. Under provisions of the Mines and Minerals (Development & Regulation) Act 1957, MMDC was eligible to apply for coal mining lease under existing laws and with the consent of the people. Once the MMDC has taken the mining lease, the mines need not be routed through auction. India is in the process of throwing open commercial coal mining to private firms for the first time in four decades, with the aim of shifting the world’s third-biggest coal importer towards energy self-sufficiency. The government is working on various auction models with regard to sale of coal blocks for commercial mining by private companies. An inter-ministerial panel under the chairmanship of coal secretary and members from ministries like power and finance would consider the auction models for commercial mining. India is in the process of throwing open commercial coal mining to private firms for the first time in four decades, with the aim of shifting the world’s third-biggest coal importer towards energy self-sufficiency. The government had said that opening up of commercial coal mining to private companies will bring in competition in the coal sector and may also reduce power tariff. The government had said it wants to convey to potential investors that sustainable and efficient mining, not revenue maximisation, is the idea behind commercial coal auction. As per the Coal Mines Special Provision Act of 2015, the government can open up commercial coal mining for private players. State-run power generating companies will now have the flexibility to swap their coal supplies and divert them to more efficient power plants. CIL signed agreements for aggregation of contracted quantity of coal with state and central power generating companies for flexible movement of coal that would help reduce the cost of power generation. The move will allow all coal linkages given to plants of state and central utilities like NTPC to be combined. That is, if a utility has many plants all over the country and has different FSA for each plant, all these linkages will be considered as one FSA. The utilities will have the option of deciding the effective way of utilising the coal, so that efficient plants are run at higher capacity to reduce costs. The Union Cabinet approved the proposal for allowing flexibility in utilisation of domestic coal amongst state-owned power generating stations. The scheme is gradually proposed to be extended to enable coal swaps between government-run and private power plants. Improvement in coal quality and efficiency in supply chain have lowered power generation cost of NTPC stations. Data shows that coal cost for generating power has declined by ₹ 0.39/kWh to less than ₹ 2/kWh in FY17. According to the data, overall cost of power production for NTPC stood at ₹ 2.01/kWh in FY15 which has declined to ₹ 1.94/kWh in April-February of FY17.

Rest of the World

China’s coal output rose 9.9 percent in April from a year earlier to 294.5 MT the National Bureau of Statistics said. It is the second straight month that output has registered a year-on-year increase as mines have scrambled to reverse the government-enforced cuts last year to take advantage of soaring prices. For the first four months of the year, coal production rose 2.5 percent to 1.11 BT data showed. China will suspend approvals for new coal-fired power plants in 29 provinces to reduce overcapacity in the sector. The NEA has put as many as 25 provinces on “red alert”, meaning that new projects would create severe overcapacity or environmental risks, while another four regions were put on “orange alert”. The NEA said that utilization rates at coal-fired power plants were falling as a result of slowing growth in power consumption, and it established the warning system to identify regions that need to curb overcapacity. The China Electricity Council said that utilization rates had dipped further in some regions in the first quarter of 2017, especially in the northeast and northwest, putting margins at power plants under further pressure. The NEA’s new warning system also takes into account the resources and pollution levels of each region, with some coal-dependent provinces facing extreme water shortages or pressure to control smog, including the capital Beijing and the surrounding province of Hebei. Of China’s 32 provinces and regions, only Tibet was not subject to a capacity warning while two were given “green” status. China’s total coal-fired power generation capacity was likely to reach 1,300 GW by the end of 2020, much higher than the 1,100 GW target in China’s 2016-2020 five-year plan. Total coal-fired capacity stood at 940 GW at the end of 2016. Chinese authorities met with the country’s leading power companies to discuss measures to curb low-quality coal imports and fight overcapacity in the world’s top coal consumer. Leading power firms including Huaneng Group and Datang Group were also invited to the meeting. The two companies mainly import Indonesia coal, considered low quality by the Chinese government because of its high sulphur and ash content and low heat value. Restrictions on low-grade coal imports could hit Chinese purchases of Indonesian coal. China’s coal imports in the first four months of the year jumped 33.2 percent to 89.49 MT, General Administration of Customs data showed as utilities and steel mills continued to buy cheaper foreign fuel as Beijing ramped up efforts to phase out overcapacity. The data did not include an April number, but it would equate to about 24.8 MT based on calculations. That would be up from 22.09 MT in March and 18.80 MT in April last year. China’s utilities are readying for a months-long buying spree to shore up thermal coal reserves ahead of the hotter summer months, in a strategy aimed at averting a supply crunch but which may drive prices higher. Top power generating companies will need to purchase more than 40 MT of thermal coal by the end of June to provide a cushion of supply during the third quarter, the second-highest demand period of the year after winter, according to internal government calculations. That is 14 percent of China’s quarterly output, or 15 days of use. The estimate is based on stocks of 90 MT at the nation’s thousands of utilities and a target to reach at least 130 MT by June. That target is equivalent to almost half of the utilities July to September consumption. The plan is to avoid a repeat of last winter’s chaos when government mining cuts tightened domestic supplies, triggering a rally in prices in the world’s top coal consumer and forcing Beijing to take emergency steps to boost supplies to avert an energy crisis.

Beijing will encourage coal companies to merge and restructure to increase efficiency in the industry and take measures to return thermal coal prices to a “reasonable” range, the NDRC said. The comment by the NDRC came after a meeting with coal mining firms as thermal coal prices continue to rally while utilities that consume the fuel lose money. The NDRC issued a similar release following a gathering with utilities. China is enforcing its policy against North Korean coal imports seriously, and there have been no violations, the foreign ministry said after a report that North Korean ships had entered a Chinese port where coal imports are offloaded. Following repeated North Korean missile tests that drew international criticism, China in February banned all imports of coal from its reclusive neighbour, cutting off its most important export product. Several North Korean cargo ships, most fully laden, were heading home after China’s customs department issued an official order, on April 7, telling trading companies to return their North Korean coal cargoes. The Su Pung, which also flies a North Korean flag, was shown to be at a berth at the port’s Jintang coal terminal, data showed. North Korea is a significant supplier of coal to China, especially of the type used for steel making, known as coking coal. In April last year China said it would ban North Korean coal imports in order to comply with sanctions imposed by the United Nations and aimed at starving the country of funds for its nuclear and ballistic missile programs. But it made exceptions for deliveries intended for “the people’s wellbeing” and not connected to the nuclear or missile programmes. March customs data this year showed that China did not import coal from North Korea.

Glencore and Japanese power utilities have settled annual thermal coal contract prices at $84.97/tonne, down from $94.75/tonne in October. Glencore reached the settlement with Japan’s Tohoku Electric after negotiations restarted when an initial round of talks failed to reach agreement. Australian Newcastle spot cargo prices last traded at $77.70/tonne. Glencore is the world’s biggest supplier of sea-traded thermal coal and usually sets pricing for the sector. Myanmar’s plans to grow the country’s desperately needed but polluting coal-fired power plants could kill more than a quarter of a million people in the coming decades, environmentalists said. The country’s air is among the dirtiest in the world and pollution is only expected to worsen as the economy opens up after decades of isolation under the former junta. A new study by Harvard University and Greenpeace warned that the government’s plans to expand its current network of two coal-fired plants to 10 could have a major human toll.  Six of its cities already have higher counts of dangerous microscopic particles known as PM10 than China’s famously smog-filled capital Beijing, according to 2016 data from the World Health Organization. The extra pollution would likely cause more than 7,000 premature deaths a year, totalling 280,000 over the 40-year operating life of the eight new planned plants and the two operating ones, it predicted.  Western concern that over premature death of people in developed countries supposedly on account of coal based pollution ignores death caused by other causes including abject poverty and the lack of basic amenities such as clean water and electricity. This may suggest that their real concern is coal burning and not the heath of people in developing countries. Myanmar has made coal-fired plants a cornerstone of a government plan to provide electricity to its entire population of more than 50 million people by 2030. Less than a third of people have regular access to electricity through the country’s dilapidated power grid, which frequently breaks down, and a lack of power is a major issue for attracting foreign investors.


India’s crude oil production marginally down while natural gas production grows 1.8 percent in April

May 23, 2017. India produced 2,939 thousand metric tonnes (tmt) of crude oil in April 2017 witnessing a decline of 0.62 from 2,957 tmt produced in the corresponding period a year ago, while natural gas production for the same month grew 1.80 percent to 2,533 million metric standard cubic meter (mmscm) as compared to the same month a year ago, according to the oil ministry data. Oil and Natural Gas Corp (ONGC) which accounted for 57 percent of the country’s domestic crude oil production in 2016-17 witnessed its production grow by 2.51 percent to 1,847 million tonnes (mt) in April 2017 as compared to the corresponding month a year ago. The oil and gas behemoth witnessed its natural gas production grow by 10 percent to 1,790 mmscm in April as compared to the corresponding month a year ago. Crude oil production by Oil India Ltd (OIL) also grew by 4.53 percent to 273 tmt in April 2017. However, the state-owned company missed its crude oil monthly production target by more than 4 percent primarily due to less than planned contribution from high producing areas like Greater Hapjan, Shalmari, Chandmari and Moran fields. The company’s natural gas production fell for the month of April by 3.62 percent to 241 mmscm as compared to corresponding month a year ago.

Source: The Economic Times

Oil firms may take a collective hit of Rs 250 bn as a result of GST

May 22, 2017. Oil companies will have to take a collective hit of about Rs 25,000 crore a year after the roll-out of the goods and services tax (GST) since most of their output is outside the ambit of the new system, AK Srinivasan, director (finance) at Oil and Natural Gas Corp (ONGC) said. From July 1, India will roll out GST that includes most goods and services but excludes crude oil, natural gas, petrol, diesel and jet fuel. The exclusion of these goods from GST is part of the trade-off Centre conceded to address states’ fear of losing out on revenue from taxes on oil sales, a key source of their income. Other oil products such as kerosene, liquefied petroleum gas and naphtha are included in the GST. This means oil companies will have to comply with both the old and the new tax regimes. But the tax credit can’t be transferred between the two systems. So the GST paid by an oil company on the procurement of plant, machinery and services will not be creditable against the excise duty and value added tax on the output such as crude oil, petrol and diesel not covered by GST. All downstream companies such as Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp will together have to bear an impact of about Rs 15,000 crore, he said. Analysts said higher tax burden for oil companies will have an inflationary impact on the overall economy. Under GST, 5 percent tax rate will apply to subsidised kerosene and LPG used for domestic cooking. At present, most major states have 5 percent tax on kerosene. Many states impose no tax on cooking gas while others levy up to 5 percent.

Source: The Economic Times

Saudi Aramco ‘strongly interested’ in Indian refining project: Indian Oil Minister

May 22, 2017. Saudi Aramco is “strongly interested” in a refining project with Indian state refiners, Indian Oil Minister Dharmendra Pradhan said. India, one of the world’s largest energy consumers, has sought to diversify its supply of not only crude but also gasoline and other refined products. India, which has repeatedly pressed OPEC (Organization of Petroleum Exporting Countries) members for oil price stability, has offered staff and other technical assistance to Aramco, Pradhan said. OPEC Secretary General Mohammad Barkindo, who took the top role at OPEC last year, did not directly address the potential Aramco investment in India, but said the group looks forward to rising Indian appetite for OPEC crude.

Source: Reuters

Kochi BPCL’s insulated pipeline to boost oil products’ value chain in India

May 21, 2017. As part of efforts to enhance the value chain of petroleum products and facilitate the refining of high viscous indigenous crude oil, the public sector Bharat Petroleum Corp Ltd (BPCL) is replacing the existing 30-inch crude oil pipeline with 20-inch insulated pipeline, from South Tanker Berth Jetty to Kochi Refinery. For laying pipeline in the Corp area, the Kochi Corp had given the necessary sanction and as part of the agreement Kochi Refinery has contributed Rs 5 crore to the developmental activities of the Corp.

Source: The New Indian Express

PM Modi’s oil champions, IOC, HPCL, on track to match $16 bn spending

May 20, 2017. India’s state-owned oil companies aim to sustain spending near a three-year high, encouraged by falling oil-services costs and expanding demand. The country’s largest oil refiner Indian Oil Corp (IOC) will boost domestic spending by a quarter in the year to March 31 and smaller processor Hindustan Petroleum Corp Ltd (HPCL) plans to invest about 17 percent more this year. Oil and Natural Gas Corp (ONGC) plans to invest as much as last year. The 11 state-owned companies spent more than Rs 1 trillion ($16 billion) in the year ended March 31, the highest since 2014. The Indian spending boom is being driven by the country’s growing energy appetite and the need to meet Prime Minister (PM) Narendra Modi’s goal of reducing dependence on oil imports by 10 percent by 2022. The International Energy Agency (IEA) expects India to be the fastest-growing oil consumer through 2040.

Source: The Economic Times

Global oil companies may get sops to set up production units in India

May 18, 2017. In its bid to streamline India’s energy sector, government think tank NITI Aayog is considering incentives for global oil majors to set up manufacturing and research and development facilities in the country. NITI Aayog began discussions with the petroleum and natural resources ministry on the implementation of a new blue print for the sector for the next three years to significantly enhance domestic production and exploration while simultaneously augmenting refining and distribution of oil and gas to reduce India’s dependence on imports. The Aayog, in its three-year draft action plan, has pitched for speedy roll out of other initiatives that include launch of the open acreage licencing policy and rationalisation of all discoveries made so far.

Source: The Economic Times

Maharashtra hikes petrol surcharge for 2nd time in less than a month

May 18, 2017. The slash in petrol prices did not benefit vehicle users in the state for more than 24 hours. Barely had the Union government announced a cut in prices by Rs 2.16 per litre on May 15 than the state government increased the value added tax (VAT) surcharge on the fuel by around Rs 2 from May 17, the state’s finance department and oil marketing companies said. An official notification in this regard will soon be released, but the hiked rates have already been introduced in the state’s petrol retail market. While diesel prices were also cut on May 15, the state has not increased the VAT surcharge on this fuel. On April 21 this year, the state government had increased the surcharge collected along with VAT from Rs 6 to Rs 9, making petrol prices in Mumbai and Pune among the highest in the country. With the latest hike, the surcharge has gone up to Rs 11. Finance department said the state government’s revenue loss on account of the cut in petrol and diesel prices would have been to the tune of Rs 850 crore. To make up for that, the state government immediately raised the VAT surcharge. The new rate for petrol in Pune will now be Rs 77.52 per litre as against the earlier price (after reduction) of Rs 75.19. The new rate in Mumbai will be Rs 76.76 as against the earlier Rs 74.24.

Source: The Times of India

No fuel to bikers not wearing helmets in Lucknow

May 18, 2017. In an effort to discipline two-wheeler riders, SSP Lucknow has initiated a new policy of not allowing two-wheeler riders without helmet a refill at petrol pumps. SSP Deepak Kumar met Lucknow Petrol Pump Dealers’ Association and discussed the rule which will be implemented from May 21. Kumar said there are around 180-200 pumps in the city and he has directed SOs/SHOs to sensitise filling staff for a trial-run of three days about how to behave with motorcyclists without helmets and even counsel them on the perils of not wearing one. Repeat offenders will be dealt with seriously under law and they will not be provided fuel. Earlier, states like Madhya Pradesh, Maharashtra, and West Bengal have introduced such rules but had to withdraw the order.

Source: The Times of India

Drinking water supply stopped in Agartala after ONGC waste leaks

May 18, 2017. Drinking water supply to lakhs of people in Tripura was stopped after Oil and Natural Gas Corp (ONGC) drilling waste spilled over into a key river, Water and Sanitation Department Chief Engineer Bishu Debbarma said. Debbarma said that the engineers of the Water Supply Department and West district administration officials are testing the water at a regular interval and working round-the-clock to stop the spillover. The four major water treatment plants, that draw in supply from the Howrah river, cater drinking water to at least six lakh people in Agartala Municipal Corp, adjoining Ranirbazar Municipal Council and Jirania Nagar Panchayat Areas. Water Resources and Sanitation Minister Ratan Bhowmik, District Magistrate Milind Ramteke, engineers of various departments camping the affected areas and supervising the remedial works. ONGC said that the company finished their drilling works at Mandai in Baramura Hill Ranges around a week ago and maintaining the standard scientific practice, did “effluent treatment” by finally covering the waste by high quality plastic sheets.

Source: The Economic Times

Iraq replaces Saudi as top oil supplier to India in April

May 17, 2017. Iraq replaced Saudi Arabia as top crude supplier to India in April as refiners moved to boost their processing margins by purchasing the cheaper Basra Heavy oil grade, ship tracking and trade flow data showed. India’s April imports from Iraq topped 1 million barrels per day (bpd) for the first time, up by about a third from March and 8 percent from a year ago, according to ship tracking data. Indian refiners in recent years have invested heavily in modernising plants to more efficiently process low-grade crudes into diesel and gasoline, helping to boost operating margins and giving greater flexibility in the oil grades they can buy. India’s crude mix is highly diverse as a result, with just over 15 percent of its flows stemming from Africa in April, nearly 13 percent from Latin America, and most of the rest coming from the Middle East. Saudi Arabia, usually India’s main supplier, shipped about 750,000 bpd to the South Asian nation in April, a decline of about 5 percent from the previous month and 8 percent from a year ago, the data showed.

Source: Reuters

MRPL to shut 96k bpd crude unit for 25 days in September-October

May 17, 2017. Mangalore Refinery and Petrochemicals Ltd (MRPL) plans to shut a 96,000 barrels per day (bpd) crude unit in September-October for 25 days. MRPL is also planning to shut its hydrocracker for 30 days in Sept-Oct for catalyst change. MRPL, which hopes to earn higher profits in 2017-18, said it aims to expand refinery capacity to 500,000 barrels per day (bpd) from 300,000 bpd. Separately, the company said net profit for the quarter ended March 31 rose 42 percent to Rs 19.4 billion ($302.70 million).

Source: Reuters


GAIL draws up Rs 300 bn capex plan for expansion

May 23, 2017. GAIL (India) Ltd said it has drawn up investment plans of Rs 30,000 crore for expansion. GAIL is currently executing gas pipelines worth Rs 20,000 crore and another Rs 10,000 crore worth of lines are under various stages of evaluation. The pipelines under execution include Jagdishpur-Haldia line that will take the environment friendly fuel to the east. Current projects will be completed by 2019-20, taking GAILs pipeline network to 15,000 km from the current 11,000 km. The company has already spent capex of Rs 2,180 crore in FY17 and plans to spend Rs 4,261 crore in FY18 and Rs 7,704 crore in FY19 towards setting up of pipelines, petrochemical and process plants. GAIL will get charge of the LNG block, while state-owned power producer NTPC would be the largest shareholder in the power block. The company reported 69 percent drop in fourth quarter net profit of Rs 260.16 crore as it wrote down the value of its investment in Dabhol power plant. The company has taken up synchronised development of seven city gas distribution network projects at Varanasi, Patna, Jamshedpur, Kolkata, Ranchi, Bhubaneswar and Cuttack. For long term energy security, the first LNG terminal at the east coast is also coming up in Dhamra in Odisha under a joint venture of public and private sector companies.

Source: India Today

Continuing gas price cuts to deter fresh exploration capex: Ind-Ra

May 22, 2017. The ongoing rupee surge coupled with continuing price reductions of gas will push fuel cost down by around 5 percent, which in turn will lower the gross margins of upstream oil and gas players and deter fresh investment into the sector, India Ratings and Research (Ind-Ra) said. For the fifth consecutive time since implementation of the domestic gas pricing formula in November 2014, the government in March lowered domestic gas prices by 0.8 percent to $2.48 per million metric British thermal units (mmBtu). The price will be in force from April 1 to September 30, 2017. The price ceiling for gas produced from discoveries in deep-water, ultra-deep water and high pressure-high temperature areas for the period April-September 2017 is $ 5.56 per mmBtu on gross calorific value basis, while the domestic prices has been lowered to $2.48 per mmBtu on gross calorific value basis for this period. However, it will marginally benefit the midstream entities like GAIL (India) Ltd, which will see its trading revenue fall by Rs 250 crore from domestic sales during in 1H of FY18. But since GAIL sells its domestic gases on a cost-plus basis, its gross margins will be protected. The report also warned that petroleum crack spreads and gross refining margins (GRMs) will drop in FY18 in the absence of inventory gains, while crack spreads will have a downward bias. The products crack spread, which is the difference between wholesale petroleum product prices and crude prices, is estimated to remain under pressure in FY18, on the back of the fragile global demand growth amid net capacity additions as Chinese and the United States (US) export volumes are likely to remain high helping maintain utilisation levels. The agency expects the rally in crude prices to fade and price to remain in a narrow range in FY18.

Source: The Economic Times

GAIL to open new energy route for India with US shale gas

May 22, 2017. GAIL (India) Ltd will open a new energy route for India early next year by beginning regular imports of shale gas from the United States (US), adding to New Delhi’s bargaining power with its predominantly West Asian suppliers. GAIL will begin importing gas in ships under a long-term contract from Dominion Cove Point LNG (liquefied natural gas) project from March 2018 and has floated tender for chartering ships for transportation. The company has also made a time-swap deal for a million tonne of US gas for 2018-19 in an attempt to recast its supply portfolio in line with domestic demand. GAIL had in 2013 tied up 2.3 million tonne LNG supplies for 20 years from Cove Point. It signed another contract for 3.5 million tonne of LNG with Cheniere Energy Inc’s Sabine Pass project in Louisiana, the supplies from which will begin in December 2018. In The company also holds a 20% stake in Eagle Ford Shale of Carrizo Oil & Gas. The contracts with Cheniere and Dominion make GAIL one of the largest holders of LNG portfolio linked to Henry Hub — the US gas price benchmark — and will allow it to market six million tonne of US gas. Both Cheniere and Dominion projects have US energy department’s permission to export gas to countries such as India that do not have free trade agreement with Washington. Regular gas supply from the US at an affordable rate will underline the impact of a rebound in the US fracking industry on global energy trade and widens options for India, giving it leverage against West Asian suppliers.

Source: The Times of India

CNG costlier by 35 paisa, PNG by 81 paisa in Delhi

May 17, 2017. CNG (compressed natural gas) price was hiked by 35 paisa per kg in the national capital following increase in labour cost because of rise in minimum wages notified by the Delhi government. Announcing the revision in price, Indraprastha Gas Ltd (IGL) said the consumer price of CNG in Delhi will be increased by 35 paisa per kg and by 40 paisa per kg in Noida, Greater Noida and Ghaziabad. IGL said it will continue to offer a discount of Rs 1.50 per kg on the selling prices of CNG for filling between 12.30 am to 5.30 am at select outlets. Also, the rates of cooking gas piped to kitchens was hiked by 81 paisa per cubic meters. IGL said that the increase in retail prices of CNG and PNG (piped natural gas) has been effected due to increase in operational expenses as a result of hike in minimum wages notified by the Delhi government recently.

Source: Hindustan Times


Coal Minister launches SEVA app on coal dispatch

May 23, 2017. Coal Minister Piyush Goyal launched the Saral Eindhan Vitaran Application (SEVA) for power sector consumers which aims at increasing consumer connect, transparency and accountability in coal dispatch. The SEVA dashboard provides summary of quantity of coal dispatched along with grades for the given day, month, and the latest yearly updates as well. Further, the app has a dedicated backend team to monitor the status of specific grievances from consumers and take action on the feedback received on the app. While much of the information on the SEVA dashboard is available in open access, consumer specific data would be password protected. Goyal said by using this app the common man would be able to hold the government accountable for the coal linkage allocations and would be able to check any pilferage or inefficiencies in coal consumption for power generation. This would, in turn, lead to rationalization of coal linkages and finally reduction in the power prices in the country. In near future, non-power sector mines would also be added in this mobile application, Goyal said. The SEVA app helps in currently tracking of coal dispatch to 118 power plants through fuel supply agreement (FSA) of around 500 million tonnes besides, dispatch through special forward e-auction and bridge linkage from more than 200 dispatch points spread over eight states of the country. Daily quantity involved is to the tune of 1.25 million tonnes involving the daily movement of around 195 coal trains besides dispatch through other captive modes of transport like MGR, road, belt, ropeways etc.

Source: The Economic Times

Delhi court summons Jindal in another coal allocation scam case

May 23, 2017. A Delhi court summoned industrialist Naveen Jindal and four executives of Jindal Steel and Power Ltd (JSPL) in a case of allocation of a coal block to the company in an illegal manner. The court summoned the company to be represented by an authorised representative. They were summoned for alleged charges of cheating and criminal conspiracy in the allocation of Urtan North Coal block to JSPL in Madhya Pradesh. CBI (Central Bureau of Investigation) filed the chargesheet against the accused persons alleging irregularities in the allocation of the coal bloc to JSPL. It is the second charge-sheet against Jindal. The probe agency charged that during investigation it was revealed that JSPL and its office-bearers misrepresented facts to the Screening Committee pertaining to land acquired for its Patratu project in Jharkhand and orders placed for equipment for its Angul project in Odisha and obtained the coal block. JSPL has misrepresented facts and made false claims that it had already acquired 964 acres of land for its Patratu project and placed orders for equipment for its Angul project, the charge-sheet said. The accused persons cheated the coal ministry and got a “wrongful gain and pecuniary advantage,” the probe agency further alleged. Jindal is also facing prosecution in another coal bock allocation case which pertains to the allotment of Amarkonda Murgadangal coal block in Jharkhand.

Source: The Hindu

Adani defers Australian coal project investment decision

May 22, 2017. India’s Adani Enterprises deferred a final investment decision on its long-delayed Australian Carmichael coal project as the Queensland state government has yet to sign off on a royalty deal for the mine. The company had been planning to make a final investment decision on the 25 million tonnes a year coal mine and rail project by the end of May. Queensland Premier Anastasia Palazsczuk said that the issue had not been discussed by cabinet, but said that any change in the state’s royalty regime would not just be for Adani but would be for a range of new mines and gas developments. Adani has battled green groups over the past six years looking to block what would be Australia’s biggest coal mine. Opponents have argued the coal exports would stoke global warming and that the project would require a port expansion that could damage the Great Barrier Reef. The port expansion is no longer needed as the company has shrunk the first phase of the mine to 25 million tonnes from 40 million tonnes a year, as it looks to make the mine and rail project more affordable at around $4 billion, instead of more than $10 billion.

Source: Reuters

GST will light up homes of poor: Coal Minister

May 20, 2017. The goods and services tax (GST) regime will have no impact on cost of power and the lower tax on coal under the new dispensation will help discoms supply electricity at affordable rates, Coal Minister Piyush Goyal said. The tax slabs announced by the GST Council had brought coal in the 5% bracket against 11.39% at present. Solar power tariff had dropped to all-time low of Rs 2.44 per unit, which is lower than the price of power from coal-fired units.

Source: The Times of India

Cabinet approves new coal supply policy for power plants

May 17, 2017. The Union Cabinet chaired by Prime Minister Narendra Modi approved a new coal supply policy for providing the fuel from Coal India Ltd (CIL) to power plants. The proposed policy has been long pending and was deferred last time by the Cabinet. In July last year, the Cabinet Committee on Economic Affairs (CCEA) had deferred a decision on the policy for award of CIL contracts to power firms. Coal and Power Minister Piyush Goyal said coal contracts from CIL will be auctioned to companies that have power purchase agreements on the basis of discount in power that plants can offer. Separate forward auction based on premium on coal price will be conducted for plants that do not have power purchase agreements. New coal contracts will be given to states that will auction them on the lines of ultra mega power plants. The central and state- run power plants will be offered coal on nomination basis. Goyal said of the 108,000 MW capacity of letters of assurance promised in 2013 by the UPA government, 78,000 MW have been converted into fuel supply agreements (FSAs) while additional 28,000 MW will be done by 2021-22. The new coal supply policy for unregulated sectors like steel and cement has already been approved by the Cabinet. According to that policy, private steel and cement firms will have to indicate their coal requirement and end-use projects to the coal ministry before bidding for supply from CIL.

Source: The Economic Times


Discoms in BJP-ruled states may profit next year: Power Minister

May 22, 2017. Power Minister Piyush Goyal said that distribution companies (discoms) in Bharatiya Janata Party (BJP)-ruled states like Rajasthan and Uttar Pradesh are likely to become profitable by next year. He said that in Rajasthan when Vasundhara Raje government took charge the state discom had losses of Rs 15,000 crore. The losses have been reduced to half and by next year the discom would be in profit, he said. In Haryana, one discom is already in profit and another would be in profit next year, he said further. In Tamil Nadu where discom had losses of around Rs 13,000 crore that has been reduced to Rs 3,000-4000 crore last year and this year it may break even.

To benefit industry, UP power body plans to reduce tariff for higher usage

May 22, 2017. As Uttar Pradesh Electricity Regulatory Commission (UPERC) contemplates reducing tariff for industrial units consuming power above a set limit, the industrial sector may be at an advantage. Presently, the commission adopts a ‘telescopic’ tariff structure wherein more power consumption invites higher charges. As in the case of all consumers, electricity tariff for industries too increases from Rs 7 per unit to Rs 7.60 per unit when usage increases. Under the proposed changes in the tariff structure, expected to be introduced in the next couple of months, a unit consuming power more than a certain quantum would see tariff rates coming down. UPERC said the move would not only stop industries from moving out of the state but also help attract higher investment and encourage operating units to go in for expansion. UPERC plans to provide 20% rebate on tariff to industrial units which operate between 10pm and 6 am. So far, the provision was applicable only to steel industries. The electricity regulatory also plans to waiveoff the system loading charges levied on industries. Power tariff for industries in UP is among the highest, ranging from Rs 7 to Rs 7.60 per unit. In comparison, industrial power tariff in Gujarat and Maharashtra ranges from Rs 4.5 to Rs 6 per unit. UPERC records also show industries account for 22.02% of the total consumption in UP. In comparison, industries in Gujarat consume 51.95% of the total electricity supplied in the state grid. UPERC said less consumption by industries creates imbalance in the over usage pattern.

Source: The Times of India

Tata Power’s generation crosses 52k mn units in FY17

May 22, 2017. Tata Power said total generation from all its power plants crossed 52,000 million units last fiscal. Its consolidated generation through all subsidiaries stood at 52,512 million units in 2016-17 as compared to 47,347 million units in the previous fiscal. The company reported capacity increase by 16 percent in the financial year 2016-17 as compared to 2015-16 fiscal. The company aims to pursue a well charted growth strategy by demonstrating a high level of commitment towards cleaner sources of generation thus increasing the share of non-fossil fuel based generation output to 35-40 percent by 2025. Tata Power continues to be on the lookout for feasible organic and inorganic projects, both greenfield and brownfield, in India and abroad.

Source: Business Standard

Work begins on India’s first green energy corridor project

May 22, 2017. India conducted the ground-breaking ceremony for its first green energy corridor project with an ultra high voltage direct current (UHVDC) link over 1,800 km with the aim to bring power to 80 million people. The project by Power Grid Corp of India Ltd (PGCIL) is being executed by ABB Group in partnership with Bharat Heavy Electricals Ltd (BHEL). The mega project is worth over Rs 4,350 crore. The Raigarh-Pugalur 800 kilovolt (kV) ultrahigh-voltage direct current (UHVDC) system aims to connect Raigarh in Central India to Pugalur in the southern state of Tamil Nadu.

Source: The Economic Times


Compensation for grid curtailment to benefit renewable sector: Ind-Ra

May 23, 2017. The Centre’s proposed compensation mechanism for existing renewable energy projects will protect the cash flows to an extent from grid curtailments and will also ensure a favourable operational environment for renewables sector, India Ratings and Research (Ind-Ra) said. Historically, power purchase agreements (PPAs) signed for renewable energy projects have failed to address the grid issues and lacked a mechanism to compensate for energy loss. According to Ind-Ra, the annual debt service coverage ratio slips by 0.12 times for 10 percent of energy curtailment and the 50 percent proposed compensation at PPA tariff will restrict the fall by half at 0.06 percent. The compensation will also incentivise grid operators and distribution utilities to reduce curtailments and benefit renewable energy developers in scheduling and forecasting and enable integration of increasing renewable energy capacity. In FY17, grid curtailment was prevalent for wind projects in Rajasthan (up to even 45 percent energy curtailed compared to 90 percent of plant load factor) and solar projects in Tamil Nadu.

Source: Outlook India

Government sets ball rolling for Parwan Dam project

May 23, 2017. Held up for nearly a decade with several glitches, the ball has set rolling for the Parwan Dam project in Baran district. The dam once constructed is likely to benefit the people of Baran, Jhalawar and the entire Kota division with drinking water for over 820 villages and irrigation water for over a lakh hectare agricultural land. It was in 2013 that Rahul Gandhi, the then Congress vice-president, presided over the foundation stone laying ceremony for the Parwan river dam project that later got embroiled in several controversies regarding displacement of tribals, the forests land getting submerged and most important the project being brought in only to benefit two thermal power projects. Work on a mega drinking and irrigation project, held up for a decade for want of integration of various design and contractual obligations, is likely to be completed in 48 months, the company said. The dam to be built 120 km from Kota town in Akawad village of Jhalawar district was likely to submerge 10,000 hectares (ha), including more than 1,600 ha of forestland. The Union Ministry of Environment and Forests granted environmental clearance to the project in November, 2011. The clearance letter states the dam will completely submerge 17 villages and partially inundate 30 villages, affecting over 3,000 families including 461 tribal families.

Source: The Times of India

Wind power has seen steady growth in India: MNRE Secretary

May 23, 2017. Obscured somewhat by developments in the solar space, wind energy in India has experienced steady development in the last 7-8 years as the government plans a major ‘green corridor’ project to transport surplus renewable energy to deficient states, Ministry of New and Renewable Energy (MNRE) Secretary Rajeev Kapoor said. Kapoor said that his ministry had last year held a successful tender for 1 GW of wind power for inter-state sale. Kapoor said the three main challenges in wind energy were forecasting, transmission and the competitive bidding framework for trade.

Source: The Economic Times

BHEL commissions third unit of 1.9 GW Prayagraj super thermal power project in UP

May 23, 2017. Bharat Heavy Electricals Ltd (BHEL) said it has commissioned the third unit of the 1,980 MW Prayagraj super thermal power project in Uttar Pradesh (UP). With the commissioning of the third unit, BHEL has successfully executed the 1,980 MW coal-based supercritical thermal power project in UP, the company said. The first two units of the project (3×660 MW), commissioned earlier by BHEL, are already under commercial operation.

Source: The Hindu Business Line

‘India must learn from Bhutan’s sustainable tourism model’

May 23, 2017. India has much to learn about sustainable tourism from Bhutan, Amita Prasad, additional secretary, ministry of environment, forest and climate, said. The system of being accompanied by a guide can be replicated in India too, especially at environmentally vulnerable areas that are tourist attractions. Principal secretary department of environment and forests Ranbir Singh said that 115 biodiversity management committees have been set up in the state of which 13 have already prepared their biodiversity registers.

Source: The Times of India

Government hospital, mini secretariat to switch to solar energy soon in Gurugram

May 23, 2017. Mini secretariat and general hospital in Civil Lines, Gurugram, will soon be equipped with energy efficient electrical devices. The shift will help in conserving electricity. An energy audit is being conducted by the state government at the two buildings, following which the changes will be implemented. Haryana Renewable Energy Department (HAREDA) and Electrical Wing of Public Works Department (PWD) are conducting a joint survey at the two buildings. Mini secretariat is a six-storey building which has offices of district administration, while General Hospital has three floors. During the audit, the team will inspect the energy consumption of each room and office in the buildings and will compile a detailed report. The report will also have a detailed analyses of how power consumption can be brought down. Following this, a proposal will be prepared and the same will be sent to the state government for the budget sanction. This report will be instrumental in changing the electrical appliances to the energy efficient ones.

Source: The Times of India

UP government setting up 750 MW solar plant at Badhla

May 22, 2017. With solar energy rates crashing below that of the coal-fired thermal power, states even with land constraints and lower irradiance are now warming up to the renewable energy. In a first in the country, the Uttar Pradesh (UP) government is setting up 750 MW solar plant at Badhla, near Jodhpur and draw the power in their state from the transmission network of Power Grid Corp of India. In a meeting in New Delhi, top officials from the ministry of new and renewable energy, Solar Energy Corp of India (SECI), representatives from UP and Rajasthan government, laid out a roadmap to carry out the reverse auction and award the project by August 31 with a target to start generation from October 2018. The Centre mandates the states to mix certain portion renewable energy to their total consumption energy under renewable purchase obligation (RPO) but its implementation has been patchy. Solar requires lot of land and many states do not have large tracts of infertile land. Secondly, the number of sunny days and irradiance are also factors as the volume of power generation depends on them. While experts in the sector feel that the current lower tariffs are not sustainable, there seems no lack of appetite from investors.

Source: The Economic Times

Vardhan assumes additional charge of environment ministry

May 22, 2017. Union Science Minister Harsh Vardhan took charge of the environment ministry — an additional portfolio allotted to him following the sudden demise of previous incumbent Anil Madhav Dave. Vardhan is the third Environment Minister in the BJP-led NDA government after Prakash Javadekar and Dave. Reviewing the work and tasks at hand, the Minister acknowledged that there were many immediate and complex issues that needed to be tackled. He marked pollution as his immediate priority. He said it was important for the Ministry to quickly adopt the latest technologies, re-engineer clearance processes and develop policy initiatives to further enhance transparency, accountability and timely delivery. Vardhan stressed upon a collective effort to address climate change. Dave passed away on May 18 at the age of 60, following cardiac arrest. He was appointed Environment Minister in 2016, following a reshuffle of the Narendra Modi cabinet. He emphasised that the ministry would always keep in mind the last wish of Dave to protect the environment by planting, protecting and nurturing trees and by cleaning of rivers and ponds.

Source: Business Standard

Second unit of KNPP restarts generation

May 21, 2017. The second unit of the Kudankulam Nuclear Power Project (KNPP) was reconnected to the southern power grid. The unit was shut down due to water and steam leakage. KNPP said that the second unit was reconnected to the grid and touched a level of 500 MW during the course of the day. India’s atomic power plant operator, the Nuclear Power Corpof India Ltd (NPCIL) has two 1,000 MW nuclear power plants at KNPP built with Russian equipment. The first unit was shut down on April 13, for annual maintenance and refuelling, a process that would take around two months. Every year, one third of the reactor’s 163 fuel assemblies, or 54 assemblies, will be replaced.

Source: The Economic Times

Solar water heater makers warm up to subsidies, eye rooftop systems

May 20, 2017. With solar rooftop power plant installations gaining momentum following financial assistance from Central and state governments, a growing number solar water heater makers are now venturing into the business of solar photovoltaic rooftop systems. Apart from growing emphasis on solar rooftop projects by the state and Union government, the stagnancy in the solar water heaters market is also driving these manufacturers to get into the solar rooftop systems business. The central government offers a subsidy of 30% in capital cost (which is Rs 20,700 per kilowatt) for solar rooftop projects, while the state offers additional assistance of Rs 10,000 per kilowatt. The estimated cost of grid connected 1 kilowatt solar rooftop system is Rs 69,000. STFI (Solar Thermal Federation of India) feels solar water heaters lack encouragement from the government, which should come up with policies to provide level-playing to solar waters as well.

Source: The Times of India

Work on WTE project to begin in Kochi

May 19, 2017. The construction of the controversial waste-to-energy (WTE) plant at Brahmapuram would begin by the end of May despite the project not clearing crucial hurdles including the environmental clearance from pollution control board (PCB) and fixation of tariff for purchase of powering power. The Kochi Corp has signed an agreement with GJ Eco Power Pvt Ltd for construction and operation of the WTE plant. The greens are of the opinion that the project can be started only after getting environmental clearance.

Source: The Times of India

India to build 10 heavy water reactors to boost nuclear power

May 17, 2017. In a major decision to fast-track India’s domestic nuclear power programme, the union cabinet approved construction of 10 units of indigenous Pressurized Heavy Water Reactors (PHWRs). Power, Coal, New and Renewable Energy and Mines Minister Piyush Goyal said the decision will result in significant augmentation of the country’s nuclear power generation capacity. He said India’s installed nuclear power capacity is 6,780 MW from 22 operational plants, and another 6,700 MW is expected to be generated by 2021-22 through projects under construction. The government had in July 2014 set a target of taking nuclear power capacity to over 14,000 MW by 2024. The decision on construction 10 PHWRs comes days before the Modi government completes three years in office. Goyal said the move will give manufacturing orders to domestic industry to the tune of nearly Rs 70,000 crore and is expected to generate more than 33,400 jobs in direct and indirect employment. He said it would be one of the flagship “Make in India” projects in the nuclear power sector. He also linked the decision to the government’s clean energy goals and low-carbon growth strategy.

Source: Hindustan Times

ISRO to help Adani Group hike solar power produce

May 17, 2017. In a first, the Space Application Center (SAC) of Indian Space Research Organisation (ISRO) has signed an agreement with a subsidiary of the Adani Group to provide solar insolation data from its satellites. As per the agreement signed between SAC-ISRO and Adani Green Energy Ltd, the former will provide information about daily solar radiation — including the quality and quantity of radiation — that is required for solar power generators to determine level of production. Adani Green Energy Ltd currently operates 760 MW solar power plants spread across three locations in the country. The company intends to expand the same to 2000 MW.

Source: Ahmedabad Mirror

India ranks second in EY renewables list

May 17, 2017. India has been placed in the second spot in the renewable energy country attractiveness index by EY. The United Kingdom (UK) accountancy firm noted the fast pace of growth in Indian renewable energy in the past three years. Over 10 GW of solar power was added between 2015 and 2017 and wind energy capacity grew to 5.4 GW in 2017-18. EY said falling bids tracked lower technology costs and cheaper capital, allowing developers to maintain margins. But those margins were already squeezed by competition. In an auction for a 500 MW solar power park in Rajasthan, bids spiralled down to Rs 2.62 per unit. Also, in the first-ever auction of a wind power project, the tariff fell to Rs 3.46 per unit. In the medium term, as renewable energy penetration increases, the government will also have to ensure the grid can manage intermittent renewable energy. EY said the cost and availability of energy storage technology could dictate how close India would get to its renewables targets.

Source: Business Standard

IIEST creates India’s first smart grid project generating power from renewables

May 17, 2017. The Indian Institute of Engineering Science and Technology (IIEST), Shibpur, has successfully created the country’s first smart grid project, which will generate power from renewable sources of energy. The project will soon be inaugurated by President Pranab Mukherjee, IIEST Director Prof Ajoy Kumar Roy said. Roy said that the world will be faced with serious situation with the depletion of hydrocarbon source.

Source: The Economic Times


US lawmakers gear up to block Trump plan to slash oil stockpile

May 23, 2017. A Trump administration plan to sell off half the United States (US) emergency crude oil stockpile to help balance the budget faces opposition in Congress, with lawmakers from both parties worried the proposal would undermine the drilling industry and make the country vulnerable to supply shocks. The White House’s 2018 budget proposal, sent to Congress, proposes raising nearly $16.6 billion by 2027 by gradually selling millions of barrels from the reserve, which now holds about 688 million barrels of oil in underground caverns in Texas and Louisiana. News of the proposal had briefly sent oil prices tumbling on concern it would oversupply the market, but prices recovered and finished slightly higher on hopes that OPEC (Organization of the Petroleum Exporting Countries) and other countries would extend supply cuts. US oil imports from the producer group OPEC have fallen to less than 3.2 million bpd in 2016 from more than 5.4 million barrels per day in 2008, according to the US Energy Information Administration (EIA).

Source: Reuters

OPEC still debating duration of cuts extension: UAE

May 23, 2017. OPEC (Organization of the Petroleum Exporting Countries) is still debating whether to extend oil output cuts by six or nine months, UAE (United Arab Emirates) Energy Minister Suhail bin Mohammed al-Mazroui said. The OPEC meets in Vienna to decide on output policy after June.

Source: Reuters

Saudi Aramco plans up to $30 bn investment in Motiva by 2023

May 23, 2017. Saudi Aramco plans an investment of up to $30 billion in its US (United States) subsidiary Motiva Enterprsies LLC, the company said. The company said that $12 billion would be the initial investment in a project to expand refining capacity at Motiva’s Port Arthur, Texas, refinery, already the largest in the US, and to extend Motiva’s operations in the petrochemical value chain, according to a statement about the investment. A likely additional investment of $18 billion is expected in Motiva by 2023, it said. Since the completion of an expansion of the Port Arthur refinery in 2012, which more than doubled its capacity to refine crude oil to 603,000 barrels per day (bpd), Motiva has weighed plans for further expansion of the plant. Saudi Aramco has also looked at acquiring at least one additional Gulf Coast refinery and visited chemical plants up for sale.

Source: Reuters

To slash tariffs on used oil equipment: Argentina

May 23, 2017. Argentina will slash the tariff it puts on the import of used oil exploration and drilling equipment to 7-8 percent from the current 27 percent in the coming days, Energy Minister Juan Jose Aranguren said The move is part of Argentina’s push for investment in its vast but largely untapped Vaca Muerta shale formation in Patagonia. Lowering operation costs in the remote area has been a major focus of the government. The government expects investment in Vaca Muerta to reach $15 to $20 billion annually from 2019 through 2014-25. The Belgium-sized formation is key to the country’s effort at regaining energy self sufficiency after becoming a net oil importer in 2010.

Source: Reuters

Nigeria activist group calls for progress on small-scale oil refineries

May 23, 2017. An activist group in Nigeria’s oil-rich Delta region has called for the government to advance plans to allow illicit bush refineries to be converted into legal operations. Nigeria is pushing to legalize such refineries in an attempt to soothe tensions in the Delta states, where an uneasy peace is now being kept as the government holds talks with local communities, including militants whose attacks cut oil production by as much as a third last year. Nigeria’s government depends on oil sales for around two-thirds of its revenue. The Pan Niger Delta Youth Leadership Forum (PANDLEAF) said the government should “make bold its promises by relaxing all the bottle necks associated with licensing and other regulatory process” to allow illicit refineries to be converted into modular refineries. The group also condemned the government’s move to concession large refineries in the cities of Port Harcourt and Warri to Italian oil major Eni and Nigeria’s MRS Oil without benefit for the people of the Delta. PANDLEAF also raised concerns about the lack of environmental clean-up in the wake of damage caused by oil pollution. International oil companies should also relocate their Nigeria headquarters to the Delta, the group said.

Source: Reuters

Mexico’s oil regulator approves new Gulf area for Pemex

May 23, 2017. Mexico’s oil regulator approved a promising new deep water block to state oil company Pemex, but conditioned the allotment on the firm developing the area with a partner that would eventually operate it. The new Chachiquin area, adjacent to Pemex’s Nobilis-Maximino block, could produce 80,000 barrels per day of oil once it reaches peak output, according to the regulator’s estimates. Development of the area is not expected to begin until 2024 at the earliest.

Source: Reuters

Agreement on oil output cuts must satisfy all parties: Kuwait

May 23, 2017. Oil producers agree they need to do whatever is necessary to restore balance to the crude market but any decision on output cuts must satisfy all parties, Kuwait’s Oil Minister Essam al-Marzouq said. But it must be an agreement that meets the satisfaction of everybody, and if necessary, it may be possible to increase the quantity that is cut, but it is too early to wade into this subject.

Source: Reuters

China April diesel exports ease from record high

May 22, 2017. China’s April diesel exports fell 1.1 percent from a year earlier to 1.23 million tonnes, while gasoline exports rose 28.7 percent to 910,000 tonnes, data from the General Administration of Customs showed. Diesel exports eased from a record high of 1.91 million tonnes in March, as some large refineries began the heavy maintenance season and refinery throughput eased to a seven-month low. China’s gasoline and diesel output fell in April to its lowest since September, data showed. China’s imports of liquefied natural gas (LNG) remained robust in April, with total shipments standing at 2.17 million tonnes, up 15.6 percent on a year ago, customs said.

Source: Reuters

Iraqi Oil Minister agrees with Saudi call to extend OPEC cuts for 9 months

May 22, 2017. Iraqi Oil Minister Jabar Ali al-Luaibi said he agreed with Saudi Arabia on the need for extending OPEC (Organization of the Petroleum Exporting Countries) crude output cuts for a further nine months. Saudi Energy Minister Khalid al-Falih said the Iraqi Prime Minister also agreed on the need to extend OPEC cuts for a nine-month period. Existing output curbs by OPEC and non-OPEC producers were due to last for the first six months of 2017. A meeting this week of the OPEC will discuss whether the cuts are extended.

Source: Reuters

New BP oil project breathes new life into North Sea

May 22, 2017. BP has started production at an oilfield in the North Sea after a $5.7 billion redevelopment, one of the largest such projects there in recent years that will breathe new life into the aging offshore basin. The Quad 204 project in the western Shetland region, also knows as Schiehallion, is expected to ramp up production throughout 2017 to reach a level of 130,000 barrels per day, BP said. The Schiehallion field was first developed in the mid-1990s. The 4.4 billion pound project, which was sanctioned in 2011, will unlock an estimated 450 million barrels of oil and gas, extending its life into 2035. The field is operated by BP, which holds a 36 percent interest in it, while Royal Dutch Shell has a 55 percent interest and private equity-backed Siccar Point owns the remaining 10 percent. For BP, the project is the third of seven projects it plans to launch this year as it seeks to increase its production by around 800,000 barrels of oil equivalent per day (boed) by the end of the decade.

Source: Reuters

Russian Economy Minister sees lower inflation if oil cut deal extended

May 22, 2017. Russia will see lower inflation and a smaller budget deficit if OPEC and non-OPEC oil producers agree to extend a production cut deal, Economy Minister Maxim Oreshkin said. Inflation may slow below the year-end forecast of 3.8 percent, while the deficit could shrink to below 2 percent of gross domestic product from the initially targeted 3.2 percent, Oreshkin said. The rouble could end the year at 62-63 versus the dollar, Oreshkin said. Previously, he said the rouble rate could average 67.5 versus the dollar this year.

Source: Reuters

China’s CNPC receives first crude through Myanmar-China pipeline

May 20, 2017. China’s state-owned refiner China National Petroleum Corp (CNPC) has started receiving crude oil through its Myanmar-to-China pipeline. The pipeline starts at Kyauk Phyu in Myanmar’s west and enters China at the border city Ruili and is a joint investment by CNPC and the Myanmar Oil and Gas Enterprise. The oil will supply the new Anning refinery in the Yunnan province. The refinery was built with the capacity to process 13 million tonnes a year (260,000 barrels per day) of crude.

Source: Reuters

Azerbaijan believes global oil cut deal should be scrapped sooner than planned

May 19, 2017. A global oil production cut deal should be scrapped sooner than planned, Azerbaijan’s energy ministry said. Azeri Energy Minister Natig Aliyev met US (United States) ambassador to Baku, Robert Cekuta, and both officials agreed that it was “more expedient” to keep the global oil output cut deal in place only until the end of 2017, not March 2018. Saudi Arabia and Russia, the world’s top two oil producers, agreed on the need to extend output cuts for a further nine months until March 2018 to rein in a global crude glut, pushing up prices.

Source: Reuters

Indonesia offers 15 oil blocks amid thin industry interest

May 19, 2017. Indonesia is offering 15 conventional and unconventional oil and gas blocks to potential bidders, the government said, hoping more flexible terms will help reverse flagging interest in the sector after lackluster performance in 2016. This year the government is applying new production sharing rules and will revise rules on recoverable costs and cut import duties on exploration equipment where possible, Deputy Energy Minister Arcandra Tahar said.

Source: Reuters

US gasoline demand weak but expected to strengthen this summer

May 19, 2017. US (United States) gasoline demand has been weaker than expected this year, but a growing economy and relatively cheap pump prices have the energy industry expecting record demand again this summer driving season, which should help drain the global oil glut. Gasoline demand in the first two months of 2017 was down 2.1 percent from a year ago, according to the US Energy Information Administration. The US gasoline market accounts for roughly 10 percent of global oil consumption, so American motorists have outsized influence over the global petroleum supply. Some analysts believe weak gasoline demand and a recent dip in auto sales will keep the global oil glut swollen. Analysts said weak demand may be temporary, due to the weather and other unusual factors. But oil refiners doubt that summer demand will be strong enough to boost their profit margins. Last year, US gasoline demand hit a record 9.33 million barrels per day.

Source: Reuters

Rosneft working to be ready for competition post-oil output cuts: Sechin

May 18, 2017. Russia’s Rosneft, the world’s top listed oil company by output, is working to be ready to compete on global oil markets after the deal with OPEC (Organization of the Petroleum Exporting Countries) on oil curbs expires, Chief Executive Officer  Igor Sechin said. Rosneft is key for Russia’s efforts to meet obligations under the deal with the OPEC, under which Moscow has promised to cut production by 300,000 barrels per day. Russia, which delivered the cut in full last month, and Saudi Arabia agreed on the need to extend the global deal until March 2018. Sechin said Rosneft will plan its work this year so as to be competitive on the global oil market when the agreement expires.

Source: Reuters

Canada oil industry get $172.7 mn loan to clean up abandoned wells

May 18, 2017. The oil industry in Canada’s resource-rich Alberta will be on the hook for a C$235 million ($172.7 million) government loan to clean up a rising number of oil wells abandoned by owners who have gone bankrupt. The loan, repayable over 10 years, will go to the government-run, industry-funded Orphan Well Association (OWA), which cleans up wells for which no party is legally responsible, Alberta Premier Rachel Notley said. The number of so-called orphan wells in Canada spiked after the 2014 oil price crash as layoffs swept the oil patch and companies went bankrupt. Alberta, which produces about 80 percent of Canada’s crude, had more than 1,500 orphan wells in February, up from 26 in 2012. The loan is lower than the C$500 million an industry group asked for in 2016. The OWA will double indefinitely its levies charged to all petroleum producers to a total of C$60 million a year, starting in 2019, Notley said.

Source: Reuters


China’s CNPC to invest $2 bn in Peru oil, gas block: Perupetro

May 23, 2017. China National Petroleum Corp (CNPC) plans to invest $2 billion in an oil and natural gas block in southern Peru in coming years, Rafael Zoeger, the head of Peru’s state energy agency Perupetro said. CNPC’s block 58 has some 3.9 trillion cubic feet of natural gas reserves, according to government data, enough to increase Peru’s total gas reserves by 27.7 percent. Zoeger said CNPC had presented its development plan and would carry out the investments between 2017 and 2023. It plans to start drilling 60 wells this year, he said. Block 58 is located in the Cusco region near Peru’s largest gas block of Camisea, from which gas is exported to Mexico. Zoeger said Chilean oil and gas producer GeoPark Ltd would also likely present a plan to develop block 64 in northern Peru in coming weeks. He said to encourage more investment in exploration, Perupetro would present the finance and energy ministries with a new royalty scheme for contracts based on productivity of wells and oil prices.

Source: Reuters

Woodside aims to decide on Browse gas development in 2019

May 23, 2017. Woodside Petroleum plans to make a final investment decision on its Browse gas development off Australia’s west coast in 2019, Chief Executive Peter Coleman said. Australia’s biggest independent gas producer is now looking to use gas from the offshore Browse field to supply the North West Shelf liquefied natural gas (LNG) plant from 2025, rather than developing it as a brand new LNG project.

Source: Reuters

China’s Sinopec starts building nation’s largest gas storage site

May 23, 2017. Sinopec said it has started building China’s largest natural gas storage and logistics center with the capacity to store up to 10 billion cubic meters (bcm) of gas in Henan province in the central part of the country. The world’s second-largest economy is investing in infrastructure from pipelines to storage tanks as Beijing prepares to switch from coal-fired boilers and heating systems across 28 of its smoggiest cities to natural gas or electricity by October. The storage facility is expected to open in May 2018. The storage facility will be connected to pipelines and supply gas to central China, Beijing and Tianjin.

Source: Reuters

Malaysia’s Sarawak state government seeks 10 percent stake in LNG train

May 22, 2017. Malaysia’s Sarawak state government said it is negotiating with Petroliam Nasional Berhad to acquire a 10 percent equity stake in a liquefied natural gas (LNG) production facility at Petronas’ LNG complex in Bintulu, Sarawak. The government is looking to buy a stake in the LNG Train 9 facility, the site’s ninth liquefaction unit, which can produce 3.6 million tonnes of LNG per year. It began its commercial operations in January, boosting production capacity at the Petronas LNG complex to 30 million tonnes per year.

Source: Reuters

Netherlands to receive first LNG cargo from Cheniere’s US plant

May 22, 2017. The Netherlands is set to receive its first liquefied natural gas (LNG) delivery from Cheniere Energy’s Sabine Pass export plant in the United States (US), according to shipping data. The Arctic Discoverer vessel, with a carrying capacity of 133,500 cubic metres of LNG, departed the facility on the Gulf Coast and is listed as heading for Rotterdam, data shows. Cheniere is currently the only company able to export large cargoes of LNG from the continental US but very few have so far landed on European shores despite analyst expectations of a surge in supply. According to US Department of Energy data, the biggest beneficiary of Sabine Pass volumes has so far been Mexico, followed by Chile, China, Japan, Jordan, India and Turkey. Currently Spain, Portugal, Italy and Malta are the only European countries to have received deliveries. Analysts and some LNG traders expect European imports to improve from this summer due to increased LNG production capacity as markets in Asia and elsewhere struggle to absorb the growing pool of supply. In February Britain received its first ever LNG delivery from Peru aboard the Gallina tanker. Royal Dutch Shell exports LNG from Peru, mostly to Mexico, but due to contractual issues with Mexico’s CFE the oil major had opted instead to divert some cargoes into alternate markets, traders said.

Source: Reuters

Chile to export gas to Argentina to cover winter demand

May 19, 2017. Chile will send some 276 million cubic meters of gas from June to Argentina to help its neighbour cope with demand in the southern hemisphere winter, Chile’s state-run oil and gas distributor ENAP said. Last year, Chile began sending liquefied natural gas to Argentina for the first time. Although energy investment in Argentina is increasing, it is still a long way from regaining the self-sufficiency it lost in 2010. Before the mid-2000s, it was an important supplier to Chile. The agreement would allow for the equivalent of around 3 million cubic meters to be piped daily from June 1 to August 31, ENAP said. Chile does not have significant gas production of its own but is selling surplus LNG imported via its Pacific-facing ports. Argentina obtains most of its gas needs from Bolivia, which are cheaper, but insufficient to meet its demand.

Source: Reuters

CLP Holdings faces $718 mn claim in Australia over gas plant sale

May 19, 2017. A unit of Hong Kong’s CLP Holdings Ltd is being sued by one of Australia’s largest fund managers for up to A$967 million ($718 million) in damages over the sale of a gas storage facility. Lochard Energy, owned by a consortium led by Queensland Investment Corp (QIC), is seeking damages of A$967 million or A$780 million, alleging that CLP unit EnergyAustralia misled bidders about the maximum rates at which gas could be delivered from the Iona storage site. Lochard bought the Iona facility in the state of Victoria for A$1.78 billion in December 2015. The plant is the only major gas storage facility in southeastern Australia, a region facing soaring gas prices and a potential supply shortfall within the next 18 months that has alarmed the federal government. EnergyAustralia said it has worked closely with Lochard Energy ever since the plant was sold and would continue to do so, despite the court case, to ensure reliable and affordable supplies of gas.

Source: Reuters


China’s imports from North Korea sink below $100 mn in April as coal ban bites

May 23, 2017. China’s total imports of North Korean goods in April fell below $100 million to a multi-year low, accelerating a months-long decline after China halted coal shipments from its isolated neighbour, data showed. The world’s second-largest economy bought goods worth $99.3 million in April from North Korea, the lowest monthly tally since at least June 2014. That compares with $114.6 million in March and $167.7 million a year earlier. The value of imports has fallen month-on-month since December, General Administration of Customs data showed. China’s exports to North Korea eased to $288.2 million in April, down 12 percent from March. Exports for the first four months of the year were up 32 percent at $1 billion. Analysts and traders expect data due out later to show China did not take any North Korean coal in April for a second straight month, after Beijing’s ban of such imports following repeated missile tests by Pyongyang. China imported 1.53 million tonnes of coal worth $72.3 million from North Korea in April 2016.

Source: Reuters

Japan’s JFE aims to widen coking coal sources after Australian cyclone

May 17, 2017. JFE Holdings Inc, Japan’s second-biggest steelmaker, aims to buy more coking coal outside of Australia to offset price risks for the steel ingredient that were made evident by a big cyclone in March, its president Eiji Hayashida said. The price of coking coal has been volatile for more than a year, nearly quadrupling between March and late November 2016, and then halving over the next four months to end-March 2017. Japanese steelmakers, which bought 71 percent of the 59.9 million tonnes of coking coal they consumed in 2016 from Australia, were forced to scramble to get material from the United States, Canada and China to replace supply lost or delayed due to the cyclone.

Source: Reuters


Ranhill to raise power generation capacity to 1 GW

May 23, 2017. Ranhill Holdings Bhd, which is involved in water supply services and power sector, aims to increase its power generation capacity to 1,000 MW by 2020 from 380 MW currently. Currently, the company operates two combined cycle gas turbine power plants in Kota Kinabalu, Sabah, with a capacity of 190 MW each. President and chief executive officer Tan Sri Hamdan Mohamad said the Energy Commission had awarded the company a 300 MW combined cycle gas turbine power plant in Sandakan, Sabah, and the tariff from the power plant is currently being sorted out. He said by increasing the generation capacity, the company was also aiming to balance its business portfolio between water supply services and power sector to 60:40 by 2020 from 70:30 currently.

Source: The Star Online

SNOC, SEWA sign deal for power generation

May 20, 2017. Sharjah National Oil Corp (SNOC) and the Sharjah Electricity and Water Authority (SEWA) have signed a full gas sales agreement targeting the supply of natural gas for power generation in Sharjah. SNOC will organise the importation of liquefied natural gas into the Port of Hamriyah in Sharjah and supply natural gas to the three power stations operated by the Sewa.

Source: Khaleej Times

PGE agrees to buy EDF’s Polish power plants for $1.2 bn

May 19, 2017. Poland’s biggest power producer PGE has agreed to buy French group EDF’s local power and heating plants for 4.51 billion zlotys ($1.2 billion) including debt, in a move to increase market share and give the state more control over the country’s energy assets. The deal to buy EDF’s plants, which include eight combined heat and power plants and a 1.8 GW coal-fired power plant at Rybnik, in the south of the country, is expected to be concluded by January 2, 2018, PGE said.

Source: Reuters


Climate-threatened Bangladesh to impose carbon tax in June

May 23, 2017. Bangladesh is set to impose its own carbon tax on fuel next month – despite the hugely climate-vulnerable country producing relatively tiny per capita emissions. The tax is expected to be put in place on June 1 as part of the country’s annual budget and will be part of a larger bundle of “green” measures, the National Board of Revenue, said. Many businesses and environmental groups have welcomed the plan, saying that Bangladesh – one of the countries considered most threatened by climate change impacts – needs to make a strong statement as governments like that in the United States pull back from action on climate change. The new tax may not make any significant contribution to achieving the Paris Agreement’s goal of keeping average global temperature increases below 2 degrees Celsius above pre-industrial levels, they said. Bangladesh produces about 0.44 tonnes of carbon dioxide per person, much lower than the United States’ 16.4 tonnes, Australia’s 16.3 tonnes and Qatar’s whopping 40.5 tonnes, according to World Bank figures. Carbon taxes – which raise the cost of using fossil fuels by creating a charge for the climate damage they do – are one of the simplest, most market-friendly ways of driving climate action, experts said.

Source: Reuters

Shell shareholders reject emissions target proposal

May 23, 2017. Royal Dutch Shell shareholders widely rejected a proposal by an environmental group calling for the oil company to set and publish annual targets to reduce carbon emissions. The vote is a setback for climate activists who are increasing pressure on global oil companies, including United States firms Exxon Mobil and Chevron, to become more ambitious in helping combat climate change. Around 94 percent of Shell shareholders who cast a vote decided against resolution 21, according to final results reported following the company’s annual general meeting in The Hague. Roughly 5 percent of voters abstained. Shell said binding emissions reduction targets would mean “tying its hands” and weakening the company because it would be forced to reduce production and sales. Growing investor sensitivity to climate change risks have already led Shell to invest in renewable energy projects such as offshore wind farms. Shareholders overwhelmingly approved the company’s new remuneration policy which for the first time ties 10 percent of executives bonuses to cutting greenhouse gas emissions.

Source: Reuters

Tunisia launches tender for 210 MW of renewable capacities

May 22, 2017. Tunisia has opened a tender for developing 210 MW of renewable projects worth TND 400 mn (US$165 mn) with bids due to be submitted by 15 November 2017. The tender will include 10 MW projects, 30 MW projects around TND 60 mn, solar micro-projects up to 1 MW and 5 MW wind projects, which will have to meet the requirements of the 12/2015 act to promote Tunisian developers. Selected projects will sell their power generation to national power utility STEG, including 60 MW from solar plants, 10 MW from micro-projects and 70 MW from wind power plants. Tunisia aims to reach 30% of solar in its energy mix by 2030.

Source: Enerdata

Veolia to develop waste to energy facility in Mexico

May 22, 2017. Veolia has secured a contract to construct and operate a waste to energy facility in Mexico. Through its subsidiary Proactiva Medio Ambiente Mexico, Veolia won the public call for tenders published by the government of Mexico City. The new waste to energy facility will hold capacity to treat about 1.6 million metric tons of household waste per annum. Under 30-year operation and maintenance contract, the new facility is expected to add an estimated cumulative revenue of around €886 mn for Veolia. Veolia, along with global and Mexican companies, will construct and operate the first waste to energy plant in Latin America. The 965,000 MWh of electricity generated from the new facility will be supplied to the Mexico City Subway Metro. Expected to begin operations in 2020, the construction on the facility is expected to start in this year.

Source: Energy Business Review

Germany approves 807 MW of capacity at onshore wind parks

May 19, 2017. Germany approved 807 MW of capacity at onshore wind parks, saying the price at which it awarded the projects came below expectations in a sign that competition in the industry will lead to lower prices for consumers. Wind energy accounts for over half of Germany’s renewable production in its long-term shift away from reliance on fossil fuels, that it wants to have largely in place by mid-century.

Source: Reuters

Researchers warn against betting on deployment of carbon removal technologies

May 19, 2017. Two researchers from the Stanford University warned against betting the future of the planet on massive-scale deployment of carbon removal technologies. Field and Katharine Mach, senior research scientists at the Stanford’s School of Earth, Energy and Environmental Sciences, wrote in journal Science about the potential solution being widely discussed for removing carbon dioxide from the atmosphere, also known as “negative emissions”. With the current pace of renewable energy deployment and emissions reductions efforts, the world is unlikely to achieve the Paris Climate Agreement’s goal of limiting global warming to two degrees Celsius above pre-industrial levels. This trend puts in doubt efforts to keep climate change damages from sea level rise, heat waves, drought and flooding in check. The researchers support a balanced approach that includes research and development of carbon removal technologies but also makes use of available means to limit and reduce carbon emissions, such as investing in renewable energy sources.

Source: Business Standard

Greenpeace asks Alberta regulator to halt Kinder Morgan Canada IPO

May 18, 2017. Environmental group Greenpeace asked the Alberta securities regulator to halt Kinder Morgan’s initial public offering (IPO) of its Canadian business until the company disclosed climate-related risks to potential investors. Energy infrastructure company Kinder Morgan is seeking to raise up to C$1.75 billion ($1.29 billion) in an IPO to help fund the expansion of its Trans Mountain pipeline project, which runs from Alberta’s oil sands to the British Columbia coast. The project received approval from the Canadian government last year but is facing fierce environmental opposition from campaigners worried about high greenhouse gas emissions from the oil sands. Greenpeace’s submission to the Alberta Securities Commission argues the IPO prospectus’ analysis of climate change risks is incomplete and uses oil demand forecasts that are too bullish.

Source: Reuters

Daimler, Vivint Solar in exclusive deal on US home batteries

May 18, 2017. German automaker Daimler AG will enter the nascent US (United States) market for home batteries through a collaboration with residential rooftop solar installer Vivint Solar Inc, the two companies said. The exclusive partnership, Vivint’s first foray into energy storage, will allow the companies to compete against similar offerings from automaker Tesla Inc, solar installer Sunrun Inc, battery maker LG Chem Ltd and others. Daimler will sell the batteries through its Mercedes-Benz Energy subsidiary established last year, bringing its aspirational car brand to the home energy market in much the same way Tesla has with its Powerwall batteries. Vivint Chief Executive Officer David Bywater said solar customers are increasingly demanding an energy “ecosystem” that includes home energy management, storage and electric vehicle charging. The energy storage systems will be made up of 2.5 kWh modular batteries that can be combined to create a system as large as 20 kWh. The largest size would cost about $13,000 fully installed, Bywater said.

Source: Reuters

Spain awards 3 GW at clean power auction

May 17, 2017. Spain’s government has picked suppliers for 3 GW of renewable power in an auction. The successful bidders will obtain regulated revenues in exchange for producing clean energy. Spanish wind energy producer Forestalia has obtained 1.2 GW, while Gas Natural has won 600 MW, Endesa’s Enel Green Power 500 MW and Gamesa around 300 MW. Spanish solar power lobby UNEF said it would ask European antitrust authorities to cancel the sale, saying its design benefited wind energy suppliers and so was discriminatory.

Source: Reuters

Jordan’s Azraq becomes world first clean energy refugee camp

May 17, 2017. Thousands of Syrian refugees will be able to light their homes, charge their phones and chill their food by solar power as Jordan’s Azraq camp became the world’s first refugee camp to be powered by renewable energy, the United Nations (UN) refugee agency said. Each family in almost 5,000 shelters in the desert camp will be able to use electricity generated by a solar plant. The Azraq camp, in northern Jordan, is home to 36,000 Syrians refugees who will all be able to rely on solar power by 2018, UNHCR (United Nations High Commissioner for Refugees) said. The switch to solar power will save the agency $1.5 million per year and function even if funding dries out, UNHCR said. The solar plant – which cost almost €9 million ($10 million) – was funded by the IKEA Foundation, which donated € 1 to UNHCR for each lightbulb sold in the furniture chain’s stores. The plant will be connected to the national grid and any surplus electricity generated will be sent back for free.

Source: Reuters

Swiss to vote on law to help renewables, ban new nuclear power plants

May 17, 2017. Swiss voters will determine the fate of a law proposing billions of dollars in subsidies for renewable energy, a ban on new nuclear plants and a partial utilities bailout. Polling so far suggests the law will be approved in the binding referendum, but support has slipped. A survey this month by research institute gfs.bern for state broadcaster SRG showed 56 percent of voters backed the law, down from 61 percent. The Swiss initiative mirrors efforts elsewhere in Europe to reduce dependence on nuclear power, partly sparked by Japan’s Fukushima disaster in 2011. Neighbouring Germany aims to phase out nuclear power by 2022. Nearby Austria banned it decades ago. Debate on Switzerland’s “Energy Strategy 2050” has focused on what customers and taxpayers will pay for the measures and whether a four-fold rise in solar and wind power by 2035, as envisaged in the law, can deliver reliable supplies. Energy Minister Doris Leuthard, whose government proposed the law, dismisses opposition estimates as highly inflated. She said the package would cost the average family 40 francs more a year, based on a higher grid surcharge to fund renewable subsidies. The law will ban building new nuclear plants. Switzerland has five plants, with the first slated to close in 2019. Voters have not set a firm deadline for the rest, allowing them run as long as they meet safety standards.

Source: Reuters

Iowa senator slams energy chief for grid study undermining wind energy

May 17, 2017. Iowa’s Republican senator raised concerns that US (United States) Energy Secretary Rick Perry has commissioned a “hastily developed” study of the reliability of the electric grid that appears “geared to undermine” the wind energy industry. In a letter sent to Perry, Senator Chuck Grassley asked a series of questions about the 60-day study he commissioned. Grassley said the results were pre-determined and would show that intermittent energy sources like wind make the grid unstable. Perry ordered the grid study and said Obama-era policies offering incentives for the deployment of renewable energy had come at the expense of energy sources like coal and nuclear. Grassley said Iowa gets 36 percent of its electricity from wind and that its largest utility, MidAmerican Energy Co, is on track to generate 90 percent of its electricity from wind in a few years. Grassley said MidAmerican has the ninth lowest electricity rates in the country. Grassley has been a leading proponent in Congress for the continuation of a wind energy production tax credit. The current credit is due to phase out over the next few years before ending in 2020.

Source: Reuters

Ash from Rampal will destroy Sundarbans: Activists

May 17, 2017. Environmental activists and researchers claimed that the ash which will be produced as a by-product of the Rampal power plant will destroy the ecology of the Sundarbans mangrove forest. According to their statistics, the proposed coal-fired power plant at Rampal will produce more than 38 million tonnes of ash during 60 years of operation at 90% electric load generation capacity. Based on projected ash recycling plans, only a portion of coal ash would be used in domestic concrete or brick industries. Even if half of all ash produced is recycled into these industries, the ash disposal pond would still be full in 12 years with 20 million tonnes of ash left over, US Forest Service researcher Dennis Lemly said. Furthermore, Lemly said that sufficiently strong storms and high water levels may breach the ash pond and lead to an environmental catastrophe by covering the entire region in toxic heavy metal waste. The activists hence suggested that the government shift the location of the power plant to the banks of the Burishowr River, at the coastal district of Barguna, to minimise the impact on the Sundarbans. With the aim of keeping up with the country’s growing energy needs, Bangladesh plans to establish a 1320 MW coal-fired power plant at Rampal with the support of India. The plant is to be located adjacent to the Sundarbans, the world’s single largest mangrove forest.

Source: Dhaka Tribune

Georgia Power to construct 139 MW solar facility at Robins AFB

May 17, 2017. Georgia Power has unveiled plans to construct a new 139 MW solar facility adjacent to Robins Air Force Base (AFB) in Warner Robins, Georgia, just south of Macon. The project was approved by the Georgia Public Service Commission (PSC) and will be the sixth large-scale solar project to be developed by Georgia Power working with the United States military and the Georgia PSC. The Warner Robins facility will be the largest single solar project to date to be constructed by Georgia Power. The new solar facility will be located on approximately 870 acres of land reserved to prevent encroachment near the base, and is expected to include more than 500,000 solar panels. The solar project at Robins AFB is estimated to represent a more than $200 million investment and will help to enable the base to meet critical energy security and energy resiliency goals.

Source: Energy Business Review


Scenario of Clean Environment Cess in India

Rs in Crore


Clean Environment Cess (CEC) or

Coal Cess

CEC transferred to National Clean Energy &

Environment Fund (NCEEF)

2010-2011 1,066.46 0
2011-2012 2,579.55 1,066.46
2012-2013 3053.19 1,500.00
2013-2014 3,471.98 1,650.00
2014-2015 5393.46 4,700.00
2015-16 (RE) 12,623.33 4,700.00
2016-17 (BE) 26,148.20 8,447.00
Total 54336.17 22063.46

Trends in Clean Environment Cess Collection under Indirect Tax

Rs in Crore

2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-16 2016-17 (till June)
Customs NA NA NA 135.41 451.09 1172.27 321.49
Central Excise 1066.46 2579.55 3053.19 3081.72 5393.46 12675.6 5307.34

Source: Compiled from Ministry of Finance & Lok Sabha Starred Question No. 375

Publisher: Baljit Kapoor
Editorial advisor: Lydia Powell
Editor: Akhilesh Sati
Content development: Vinod Kumar Tomar

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