MonitorsPublished on Dec 12, 2017
Energy News Monitor | Volume XIV; Issue 26


Oil News Commentary: November 2017


India’s crude oil production in September remained flat at 2,920,000 tonnes as compared to the corresponding month a year ago while natural gas output grew 4.74 percent to 2,723 mmscm in the same month. The country’s gross petroleum imports in value terms increased a whopping 21 percent to $7.5 billion in September as compared to the corresponding month a year ago. Cumulatively, gross petroleum import bill increased 17 percent to $43.4 billion in the first six months of 2017-18 as compared to the corresponding period last year on the back of increased international crude oil prices. Oil production dipped due to poor performance of fields under PSC data shows. The growth in natural gas production is attributed to healthy performance of acreages under government-owned ONGC, OIL and fields under PSC, data released by PPAC indicated. On a cumulative basis, the country’s crude oil production in the first six months of 2017-2018 remained almost flat at 18,025,000 tonnes decreasing 0.22 percent as compared to the corresponding period a year ago. Cumulative natural gas production during the period grew 4.38 percent to 16,413 mmscm as compared to the corresponding period a year ago. Government-owned ONGC, responsible for 63.15 percent of country’s crude oil production in September, witnessed a crude output growth of 2.25 percent to 1,844,000 mt in September. Cumulatively, the oil and gas behemoth witnessed a 2.48 percent increase in production to 11,302,000 tonnes in the first six months. The company’s natural gas production witnessed a growth of 5.20 percent to 1,938 mmscm in September as compared to the year ago period. Cumulatively, gas production increased 9.28 percent to 11,675 mmscm in the first six months.

India’s crude oil import bill jumped over 20 percent to $56.25 billion in the first seven months (April-October 2017) of the current financial year and is likely to rise up to $90 billion by March 2018 – a 29 percent increase over last fiscal. The swelling oil bill could further impact the already widening trade deficit and push up inflation. India’s trade deficit widened to its highest in nearly three years in October, government data showed. Higher crude price, coupled with a more than a quarter jump in volumes from a year ago pushed petroleum import bill to $9.2 billion in October. Any further increase in oil bill will add pressure on the country’s trade deficit which widened to $14 billion for the month of October, an increase of 26 percent as compared to the corresponding month a year ago, primarily on the back of a 28 percent increase in oil import bill. Crude oil and products were responsible for 25 percent of the country’s total import bill of $37 billion in the month of October.

Nearly 25 years after ONGC’s prime discovered oilfields were privatised, the oil ministry has identified 11 more producing oil and gas fields of the state-run firm for handing over to private firms to raise output. The ministry is approaching the Cabinet to allow private companies take 60 percent stake in producing oil and gas fields of national oil companies, ONGC and IOC with the view that they would raise production above the baseline estimate. As many as 15 fields – 11 of ONGC and four of OIL – with a cumulative in place reserve of 791.2 mt of crude oil and 333.46 billion cubic meters of gas have been identified. These include Kalok, Ankleshwar, Gandhar and Santhal – the big four oilfields of ONGC in Gujarat. All of these fields are in blocks or areas that were given to the national oil companies on nomination basis and the current policy does not allow private firms taking equity stake in a nomination block.

The oil ministry has asked geo-scientific community to reduce oil and gas import dependency by at least 10%, and ensure energy accessibility as well as affordability for entire spectrum of people. The country ranks third in energy consumption in the world and with the efforts of scientists E&P industry was growing. The sector is a priority of the government and the time was ripe for energy to synergy. Revenue collection increased from ₹1 trillion to ₹ 2 trillion.

OVL has turned its focus to buying stakes in overseas producing oil and gas assets to meet output targets after a delay by Iran in awarding development rights for a gas field. Indian firms led by OVL, the foreign investment arm of ONGC, have been negotiating with Iran for development rights of Farzad B gas field since its discovery in 2008. OVL is targeting production of 60 mt of oil and gas by 2030 from 12.80 mt in 2016/17. Africa, Central Asia and Latin America are listed as preferred regions for acquiring producing assets. India was hoping to get rights to develop Farzad B as the South Asian nation was one of the handful countries that continued to deal with Tehran despite sanctions.  India modified its bid several times to match Tehran’s expectations and terms to get the development rights. Iran has modified its petroleum contract model, ending a decades old buy-back system that barred foreign firms from booking reserves or taking equity stakes. Under new terms Iran wants India to operate the field for 20 years and commit to buy gas for 25 years at prices higher than those proposed by ONGC. Iran’s previous contracts gave investors an assured return of 18 percent. India, the world’s third biggest oil consumer, has told state oil firms to acquire assets overseas to improve energy security. India imports about 80 percent of its crude needs.

The Centre has flagged off a techno-economic feasibility study to build a mega port to cater to the $40 billion west coast refinery and petrochemicals complex being planned by three state-run oil firms. The proposed port will come up at Vijaydurg in Maharashtra’s Sindhudurg district. The proposed port will be developed through a joint venture between Mormugao Port Trust, Mumbai Port Trust and Maharashtra Maritime Board (MMB) – the state government agency tasked with developing ports in Maharashtra. IOC, HPCL and BPCL signed a joint venture in June this year to build one of the world’s largest integrated refinery and petrochemicals complex with a capacity of 60 mt a year. The refinery is expected to start operations in 2022. The proposed refinery is being developed by government oil PSUs and so, a government-run refinery with a government port will be more ideal. This port will have guaranteed cargo and require huge investments.

Indian refiners processed a record 5.2 million bpd of oil in October as the world’s third biggest oil consumer added extra capacity to meet the rising fuel demand, government data showed. The world’s third biggest oil importer sees its diesel and gasoline consumption rising by about two-thirds by 2030. The nation, which produces a fraction of its oil consumption, shipped in a record 4.83 million bpd in September ahead of processing to fuel the additional capacities. India is increasing refining capacity to keep pace with the expected growth in fuel demand as India seeks to boost the manufacturing sector. Recently the country added 170,000 bpd of capacity at the Kochi plant of Bharat Petroleum Corp and Bathinda refinery of HPCL-Mittal Energy. Kochi refinery’s oil processing rose by about 23 percent and that of Bathinda by about a quarter, data showed. Crude refining in October also jumped as several refiners resumed operations after extensive maintenance while IOC deferred a maintenance shutdown of its 300,000 bpd Paradip refinery to meet the fuel demand during festive seasons. Crude oil processing at IOC’s 300,000 bpd coastal Paradip refinery rose by a third. The refinery, commissioned in 2016, resumed full operation earlier this year. Together state-run refiners processed 6.52 percent more oil in October than a year ago, while private refiners used about 13 percent more crude, the data showed.

India’s annual diesel consumption could rise to 150 billion litres by 2030 from 90 billion litres now. Annual gasoline consumption in the world’s third-biggest oil consuming nation could rise to 50 billion litres by 2030 from 30 billion litres now. India currently imports about 80 percent of its oil needs.

IOC began trading crude oil through its Singapore unit, buying a million barrels of Nigerian oil Akpo. IOCL Singapore Pvt Ltd has bought the parcel from Total for December 8-17 loading. The company will gradually increase its workforce in line with transactions from the city state.

India’s state-run MRPL has floated its first tender to buy high-sulphur crude oil from the United States, a tender document showed. The refiner is seeking 1 million barrels of US crude for delivery between February 1-15. The tender will close on November 28 with bids valid up to November 30. Other state refiners such as IOC, HPCL and BPCL have also bought US oil in recent months.

IOC is considering buying Venezuelan crude for the first time in at least six years, in a move that could help the crisis-struck South American nation settle unpaid bills with another state-owned Indian energy firm. The OPEC-member’s economy has collapsed since crude prices plummeted in 2014, forcing it to delay payments for oil services and fuel supplies. Venezuela depends on oil for more than 90 percent of its export revenues. Venezuela’s national oil company PDVSA has missed debt payments to OVL, the foreign investment arm of Indian explorer ONGC for six month and wants to settle $449 million dues using existing and new Indian clients. IOC confirmed that it had received a letter from Venezuela seeking to sell crude. Venezuela has a supply agreement for more than 360,000 bpd with Indian companies. It is not clear, however, whether Venezuela could supply more oil to overseas customers. To meet its highly subsidized domestic needs, PDVSA is said to have been siphoning off crude from cash-paying joint ventures with foreign firms. Currently, only private refiners Reliance Industries and Essar Oil currently buy Venezuelan oil.

Ultra-clean Euro-VI grade petrol and diesel, sourced from refineries in Uttar Pradesh, Madhya Pradesh and Punjab, will be supplied in the national capital from next April in a bid to combat alarming levels of air pollution. To meet Delhi’s consumption of over 900,000 tonnes of petrol and 1,260,000 tonnes of diesel, Mathura refinery in Uttar Pradesh, Bina in Madhya Pradesh and Bhatinda in Punjab will start making Euro-VI grade fuel by mid-January so that supplies to customers start from April 1. Also, storages will have to be separated for BS-VI fuel from the present quality BS-IV fuel. India had in 2015 decided to leapfrog to Euro-VI emission norm compliant petrol and diesel from April 2020, from the Euro-IV grade at present. The deadline for the rest of the country stands. However, for Delhi, which is choking on thick toxic smog, the deadline for introduction of BS-VI – equivalent to Euro-VI grade, was preponed to April 2018. Euro-VI grade fuel contains 10 parts per million (ppm) of sulphur as against 50 ppm in Euro-IV fuels. Oil firms have been asked to examine the possibility of introduction of BS-VI auto fuels in the entire NCR, which includes adjoining cities of Ghaziabad, Noida, Gurgaon and Faridabad, from April 1, 2019. IOC the nation’s biggest oil firm, will source the BS-VI fuel to meet Delhi’s requirement from its Mathura refinery, while HPCL will do so from its joint venture refinery at Bhatinda. BPCL supply the fuel from its Bina refinery. The current BS-IV emission norm was introduced across the country from April 1, 2017. Oil refineries will need to invest ₹ 280 billion in upgrading petrol and diesel quality to meet cleaner fuel specifications by 2020. According to IOC, for petrol engines, one of the most critical specification is Research Octane No. (RON), which has improved from 88 in BS-II to 91. It is at par with regular 91 octane gasoline (petrol) required for Euro VI emission norms.

The PMUY, which has provided more than 30 million LPG connections to poor households over the last one and a half years, has had a multiplier effect on the manufacturers of equipment such as cylinders, pressure regulators, stoves and tubing — most of which fall in the micro, small and medium enterprises (MSME) segment. The number of cylinder makers across the country in 2014-15 was 102, which has gone up to 146 in 2016-17 and this industry’s turnover has surged from ₹ 34.91 billion to ₹ 52.58 billion during the period. Similarly, the number of stove manufacturers has gone up from 39 to 45 and the corresponding increase in turnover has been from ₹ 22.53 billion to ₹ 27.28 billion. Overall, the total turnover of companies manufacturing cylinders, pressure regulators, stoves and connecting tubes has increased by 42% between 2014-15 and 2016-17 from ₹ 62.40 billion to ₹ 88.58 billion. For the six months between April and September, 2017, the combined turnover of these industries stood at ₹ 42.81 billion. The oil ministry launched PMUY in May 2016 to provide subsidised LPG connections to women belonging to the below-poverty-line category. The government is targeting to provide 5 billion LPG connections by May 2019 under the scheme with the ministry of finance providing a support of ₹ 80 billion. The petroleum ministry is in the process of getting Cabinet approval to add another 30 million beneficiaries at an additional cost of ₹ 48 billion. The average life of an LPG cylinder is 20 years wherein it is typically repaired once after 10 years and then five years from then. The three OMCs IOC, HPCL and BPCL, together hold an inventory of 250-300 million LPG cylinders at any point in time as many of the cylinders undergo repair at bottling plants. The increased usage of LPG has also led OMCs to plan expansion of bottling capacity.

The Madhya Pradesh government said it would decide on bringing petroleum products under the GST after considering its impact on the revenue. Finance Ministry admitted that there is a shortfall in tax collection following the introduction of the GST, but added that the situation has been improving. On October 13, the state government reduced the VAT on petrol and diesel by three and five percent, respectively. Besides, the additional cess of ₹ 1.5/litre on diesel was also withdrawn. Diesel had become cheaper in MP compared to neighbouring Rajasthan, Gujarat and Chhattisgarh.  About 34 percent of the commercial tax revenue comes from VAT and other taxes on petroleum products.

The oil ministry remained non-committal on cutting excise duty on petrol and diesel to cushion the rise in retail fuel prices that followed the rally in international oil rates. Petrol and diesel prices have risen by almost ₹ 1.5/litre in the last one month, taking away bulk of gains that accrued from a one-off cut in excise duty cut on the two fuels. The government had in October cut excise duty on petrol and diesel by ₹ 2/litre in a bid to moderate the relentless rise in fuel prices witnessed in the previous three months. After the cut, petrol price came down to ₹ 68.38/litre and diesel to ₹ 56.89/litre in Delhi on October 4. Rates have since climbed to ₹ 69.85/litre for petrol and ₹ 58.31/litre for diesel in the national capital. The excise duty cut cost the government ₹ 260 billion in annual revenue and about ₹ 13,000 billion during the remaining part of the current fiscal year that ends on March 31, 2018. The government had between November 2014 and January 2016 raised excise duty on petrol and diesel on nine occasions to take away gains arising from plummeting global oil prices. In all, duty on petrol was hiked by ₹ 11.77/litre and that on diesel by Rs 13.47/litre in those 15 months that helped government’s excise mop-up more than double to ₹ 2420 billion in 2016-17 from ₹ 990 billion in 2014-15. State-owned oil companies in June dumped the 15-year old practice of revising rates on 1st and 16th of every month and instead adopted a dynamic daily price revision to instantly reflect changes in cost. Rates during the first fortnight starting June 16 dropped but have been on the rise since July 4.

More than 2,300,000 customers have received LPG or cooking gas subsidy of ₹ 470 million in their respective Airtel Bank accounts they don’t seem to have opened, prompting the government to intervene even as the top mobile operator denied any wrongdoing. Consumers receive cooking gas subsidy in their bank accounts linked to their unique biometric identity, or Aadhaar. But after several consumers lately complained about not receiving subsidy, it emerged that their subsidy had actually been credited to their respective Airtel Bank accounts. The oil ministry has clarified that the rule is to transfer subsidy to the latest bank account of the beneficiary seeded with their Aadhaar number. Since June 9 this year, more than 2,300,000 gas consumers received over ₹ 470 million of subsidy in more than 4,100,000 transactions in their Airtel Bank accounts, according to a communication sent by a state oil company to NPCI. Of these, about 1,100,000 gas customers belong to IOC while the balance is evenly split between BPCL and HPCL. NPCI maps bank accounts with Aadhaar and oversees retail payments and settlement systems in the country.

Cooking gas or LPG price was hiked by ₹ 4.50/cylinder, the 19th increase in rates since July 2016 when the government decided to eliminate subsidy on it by raising prices every month. Also, jet fuel or ATF price was increased by 2 percent on firming international rates, the fourth straight increase in rates since August, according to price notification posted by state-owned retailers. The price of non-subsidised LPG or market priced cooking gas has been hiked by ₹ 93 to ₹ 742/bottle. At the last revision on October 1 the rate was hiked by ₹ 50 to ₹ 649/ bottle. Subsidised LPG price has been hiked by ₹ 4.50/14.2 kg cylinder to ₹ 495.69. The government last year had asked state-run oil firms to raise prices every month to eliminate all the subsidies by March next year. Since the implementation of the policy of monthly increases from July last year, subsidised LPG rates have gone up by ₹ 76.51/cylinder. A 14.2 kg LPG cylinder was priced at ₹ 419.18 in June 2016. Every household is entitled to 12 cylinders of 14.2 kg each at subsidised rates in a year. Any requirement beyond that is to be purchased at market price. ATF will now cost ₹ 54,143/kilolitre (kl) in Delhi, ₹1,098/kl more than ₹53,045 previously, oil companies said. State-owned oil firms revise rates of LPG and ATF on 1st of every month based on average oil price and foreign exchange rate in the previous month.

The IOC subsidiary in Sri Lanka has dismissed as “mischievous and factually incorrect” the allegations that it was responsible for the fuel shortage in the island nation. The Lanka IOC received flak for the fuel shortage after motorists lined up in long queues at petrol stations. The company denied any responsibility to the ongoing petroleum crisis. The Lanka IOC said it catered to only 16 percent of the Sri Lankan market, while the remaining 84 percent relied on Ceylon Petroleum Corp supplies.

Rest of the World

The global oil market could tighten towards the second half of 2018 if demand remains robust and key producers continue their current policies, IEA said amid concern that OPECs efforts to rebalance the oil market might overshoot by creating a global deficit and spurring a further price rally. The world will still have a surplus of oil by end-March next year, Saudi said, signalling a willingness to extend output cuts.

The US is expected to account for more than 80 percent of global oil production growth in the next 10 years and it will produce 30 percent more gas than Russia by that time IEA said. IEA said the US, whose upstream energy industry has seen a resurgence with the development of fracking technology, would become the “undisputed leader of oil and gas production worldwide.” On the broader market the IEA expected oil markets to rebalance in 2018 if oil demand remained “more or less” as robust as it was now and if OPEC and its allies extended output cuts. OPEC and other producers are expected to extend production cuts beyond a March deadline in a bid to cut oversupply. The Paris-based IEA cut its oil demand forecast in its latest monthly report by 100,000 bpd for this year and next, to an estimated 1.5 million bpd and 1.3 million bpd, respectively. According to OPEC’s own numbers, inventories were 154 million barrels above the five-year average in September. OPEC states have said they want to reduce stocks to their five-year average.

OPEC raised its forecast for demand for its oil in 2018 and said its deal with other producers to cut output was reducing excess oil in storage, potentially pushing the global market into a larger deficit next year. OPEC said in a monthly report it had cut its estimate of 2018 supply from non-OPEC producers and said oil use would grow faster than previously thought due to a stronger-than-expected world economy. OPEC said the world would need 33.42 million bpd of OPEC crude next year, up 360,000 bpd from its previous forecast and marking the fourth consecutive monthly increase in the projection from its first estimate made in July. The projections pointing to a growing 2018 supply deficit could influence debate on how long to maintain the curbs. The 14-country producer group said its oil output in October, as assessed by secondary sources, was below the 2018 demand forecast at 32.59 million bpd, a drop of about 150,000 bpd from September.

Saudi Arabia plans to cut crude exports by 120,000 bpd in December from November, reducing allocations to all regions. Crude exports to the US will be more than 10 percent lower than November levels. The world’s top oil exporter said it planned to ship slightly more than 7 million bpd this month, up from low levels during summer when domestic demand was at its peak. Seasonal drops in domestic crude demand free up more oil for export during the winter months. The OPEC along with other non-member oil producers led by Russia, agreed to cut output by around 1.8 million bpd from Jan. 1 this year until March 2018. Russia, Saudi Arabia, Uzbekistan and Kazakhstan are ready to do more work to reduce global oil inventories. Russia and Saudi Arabia are leading a deal between OPEC and non-OPEC producers to cut global oil production, with the aim of propping up oil prices. First oil has flowed from Brazil’s giant Libra field operated by Petrobras and a consortium that includes Total, Shell and CNPC and CNOOC, the companies said. Libra, which has recoverable volumes estimated by oil regulator ANP at between 8-12 billion barrels, is located in the high-yield region off the coast of Rio de Janeiro. Production began and the FPSO vessel Pioneer of Libra has daily capacity to process up to 50,000 barrels of oil and 4 mcm of gas, Petrobras said. French oil and gas major Total said that the production start-up will generate revenue while collecting data for subsequent development phases of the field. Total estimates the technical cost of production for the field at about $20/barrel. A final investment decision on another FPSO with a capacity of 150,000 barrels per day would be made soon, Total said. A third FPSO with the same capacity would follow soon after. Taiwanese refiner CPC Corp has bought 4 million barrels of US crude via tender for January-February delivery, skipping African oil. Occidental and Unipec sold 2 million barrels each of the WTI Midland crude to CPC. This would be CPC’s second purchase of US crude in two months and replaces Angolan crude which the refiner typically buys. The supplies are part of a large influx of US crude heading to Asia after WTI prices fell to their lowest level against Brent in years. The members of OPEC, Russia and nine other producers are curbing oil output by about 1.8 million bpd until March 2018. They are expected to extend the deal at the Vienna meeting. OPEC said the group was seeking to achieve consensus before the meeting on how long to extend the pact on curbing production.

South Africa wants the national oil companies of its BRICS partners to help build a new 400,000 bpd refinery that will be structured by senior debt and equity. The idea of building a refinery in Africa’s most industrialized economy has been under consideration for almost a decade. The cost of the new refinery was estimated at $10 billion in 2010. South Africa, a net importer of refined oil products, would consider West Africa and the Middle East, including Iran, for potential partners on a new refinery project. The cabinet expects to decide by December whether to build the refinery that has never came to fruition because of a lack of equity partners. Some refinery owners in South Africa wanted to exit the domestic market, citing the high costs of upgrading refineries to meet cleaner fuel specifications. Royal Dutch Shell, BP, Total and Sasol are among the main refinery operators in Africa’s most industrialized country.

China has raised its 2018 crude oil import quota for “non-state trade,” generally meaning independent refiners, by 55 percent over 2017, raising the clout of the independents in the global market after a setback this year. The move took market participants by surprise after Beijing cut the quotas to independents for 2017. The annual quota setting, announced earlier than usual, is a sign the government is relaxing its policies towards the independent refiners after the cuts and after banning them from exporting fuel this year. The commerce ministry said companies can start applying for quotas for 2018 totaling 142.42 mt or about 2.85 million bpd up from 91.73 mt for 2017. The new quotas are equal to about one-third of China’s imports during the first nine months of the year. The ministry said the quotas will be issued in batches, with the first lot based on companies’ actual purchases during the January to October period this year. Companies without any import record will be banned from new quotas for 2018 and those which under-use quotas are required to return the unfinished permits.


IOC to take Rs 42 bn hit under GST regime

December 5, 2017. Indian Oil Corp (IOC) has said that the impact of the Goods and Services Tax (GST) would be nearly Rs 4,200 crore as it would not be able to claim input tax credit (ITC) for automotive fuels that fall outside GST. ITC allows an entity to reduce the tax on outputs by the same amount already paid as tax on inputs. IOC has embarked upon de-bottle necking its existing plants to enhance capacity. At both Paradip and Panipat refineries, the capacities will be increased from 15 million tonnes (mt) a year to 20 mt in each of them. At Barauni, it will increase to 9 mt from 6 mt.

Source: The Economic Times

ONGC partners in 6 pre-NELP blocks may have to share cess, royalty load

December 5, 2017. ONGC (Oil and Natural Gas Corp)’s partners in six pre-NELP (New Exploration Licensing Policy) blocks will have to share royalty, cess and other government charges with the state firm in proportion to their stakes, ending the current practice of ONGC alone bearing state levies for entire production, according to an oil ministry proposal that would soon be sent to the Cabinet. Once the proposal gets the Cabinet’s nod, Vedanta, Essar Oil, GSPC, Focus Energy, Hindustan Oil, and UK’s Hardy Oil would have to bear the burden of government charges in their respective fields where they partner with ONGC. The Directorate General of Hydrocarbons (DGH) had recently recommended ONGC exit the contract and let other partners share the government charges in proportion to their stakes in these six blocks. But the government didn’t accept the DGH proposal of removing ONGC from the blocks while taking its recommendation of allowing shared liability. These six blocks—CB/OS-2, CBON/2, CB-ON/3, CB-ON/7, CYOS90/1 (PY3), RJ-ON/6—are located mainly in Gujarat and Rajasthan. The prolific Barmer block (RJON-90/1) too had the same royalty and cess sharing rule earlier, but about six years back Vedanta, while purchasing the field from Cairn Energy, agreed to share with ONGC the liability of paying government charges. Vedanta is the operator of the field with 70% participating interest in the Barmer block. In other six pre-NELP blocks too, partners operate fields with ONGC owning only minority interest. These are called pre-NELP blocks because they were auctioned before the NELP, was launched, which mandated proportionate sharing of government charges by all contractors of a block. The oil ministry is now planning to extend the model adopted in Barmer to other six blocks.

Source: The Economic Times

Government planning to restrict petroleum coke imports: Oil Minister

December 2, 2017. Oil Minister Dharmendra Pradhan said the government is planning to curb the imports of petroleum coke, which is believed to be a major polluter. Pradhan said a policy is being framed by various stakeholder ministries to put curbs on its imports. Petroleum coke does not cause pollution if it is used as fuel in certain industries such as cement production, Pradhan said.

Source: Business Standard

State oil companies to add 5k distributors for LPG by 2019

December 2, 2017. State oil companies are aiming to augment their cooking gas distribution network by nearly a third in a little more than a year to cater to the rapidly expanding consumer base, mainly in rural areas. The past three years have witnessed a spectacular rise in access to cooking gas, putting strain on the current distribution network that hasn’t grown as fast. Between April 1, 2015, and September 30 this year, the number of active domestic cooking gas consumers has risen 44% to 21.4 crore, while the number of LPG (liquefied petroleum gas) distributors has expanded just a fifth to 19,200. The government is now pushing oil companies to accelerate the process of appointing new distributors and ensure they quickly become operational, the oil ministry said. The government has already issued 2,000 new licences. In addition, nearly 600 applicants have been selected through draw of lots in recent months while another 3,400 are slated to be picked for licences by March. After obtaining licence from an oil company, it usually takes about a year for an applicant to set up a cooking gas distribution agency, which involves obtaining many local regulatory clearances as well as readying an office and warehouse. New distributors are mainly coming up in regions that have been short on distributors or places which have seen a surge in new cooking gas consumers. States like Uttar Pradesh, Bihar, Bengal, Odisha and Maharashtra are set to have a big share of new distributors. The new LPG consumers are mostly located in remote and rural areas and from underprivileged background. Big distance to gas agencies become a deterrent for consumers to seek a refill when they run out of gas. In these regions, services by distributors are relatively weak and home delivery of cylinders mostly absent, making it difficult and expensive for consumers to use cooking gas. By staying close to consumers, state oil companies can hope to overcome these consumption hurdles and increase their sales volume.

Source: The Economic Times

Government forms panel to lay down rules for tractors to slash diesel consumption

December 1, 2017. The oil ministry has set up a high-level committee to help frame fuel economy rules for tractors to moderate their diesel consumption that constitutes nearly 7.7 percent of India’s annual diesel use. The nine-member Steering Committee, headed by an additional secretary in the oil ministry, will submit an interim report in six months and a final one on the road map for development of the norms in 15 months. Tractors are used for different applications and the average fuel consumed for each application varies. On a rotavator, they may consume 7-8 litres per house while on a trailer, they may give an efficiency of 5-7 kilometre per litre with the load. On static application like alternator or straw reaper, it could be 6-7 litres per house. Diesel is the most consumed fuel in India, accounting for over 56 percent of 82 million tonnes of petroleum products used in April-October. As much as 57 percent of diesel is used by automobiles, with trucks guzzling 28.25 percent. Tractors, agri equipment and agri pumpsets use 13 percent diesel while cars and SUVs use 13.15 percent of the fuel.

Source: Business Standard

India’s MRPL makes its first US oil purchase

December 1, 2017. India’s Mangalore Refinery and Petrochemicals Ltd (MRPL) has made its first purchase of US (United States) crude oil, buying high-sulphur grade Southern Green Canyon through a buy tender for an early February delivery, the head of its refinery M. Venkatesh said. MRPL bought a 1 million-barrel cargo for a Feb. 1-10 delivery, Venkatesh said. Other Indian refiners – Indian Oil Corp Ltd, Hindustan Petroleum Corp Ltd, Bharat Petroleum Corp Ltd and Reliance Industries Ltd – have also bought US oil in recent months. He declined to elaborate on the award of a separate MRPL buy tender for a million barrels of sour grades for January loading. MRPL bought Oman crude in the January tender. Both cargoes were sold by Royal Dutch Shell. Venkatesh said a delayed coker unit at MRPL’s 300,000 barrels per day (bpd) coastal refinery is operating at full capacity since end-November, making it possible for the plant to resume processing high sulphur crude grades.

Source: Reuters

India’s crude oil production flat in October, import bill rises 27 percent

December 1, 2017. India’s crude oil production in October remained flat at 3,038 thousand metric tonne (tmt) as compared to the corresponding month a year ago while natural gas output grew 1.95 percent to 2,755 million metric standard cubic meter (mmscm) in the same month. The country’s gross petroleum imports in value terms increased a whopping 27.5 percent to $8.8 billion in October as compared to the corresponding month a year ago. Cumulatively, gross petroleum import bill increased 19 percent to $52.3 billion in the first seven months of 2017-18 as compared to the corresponding period last year on the back of increased international crude oil prices. Oil production dipped marginally by 0.4 percent due to poor performance of fields under Production Sharing Contracts (PSC), data shows. The growth in natural gas production is attributed to healthy performance of acreages under government-owned Oil and Natural Gas Corp (ONGC), data released by Petroleum Planning and Analysis Cell (PPAC) indicated. On a cumulative basis, the country’s crude oil production in the first seven months of 2017-2018 remained almost flat at 21,063 tmt decreasing 0.24 percent as compared to the corresponding period a year ago. Cumulative natural gas production during the period grew 4 percent to 19,222 mmscm as compared to the corresponding period a year ago. Government-owned ONGC, responsible for 62 percent of country’s crude oil production in October, witnessed a crude output growth of 0.93 percent to 1,890 tmt for the month. Cumulatively, the oil and gas behemoth witnessed a 2.25 percent increase in production to 13,192 tmt in the first seven months.

Source: The Economic Times

Oil Minister inaugurates Paradip-Raipur-Ranchi petro pipeline

November 29, 2017. Oil Minister Dharmendra Pradhan dedicated 1,073 km long Paradip-Raipur-Ranchi petroleum products pipeline to the nation during an event held in Chhattisgarh’s Korba district. On the occasion, Pradhan and Chhattisgarh Chief Minister Raman Singh also dedicated the newly set-up oil terminals of Indian Oil Corp (IOC) in Korba and Raipur (Chhattisgarh), Ranchi (Jharkhand) and Jharsuguda and Jatni (Odisha) and also laid the foundation stone of a LPG bottling plant in Korba. Pradhan hailed the pipeline project, while referring to its contribution to the success of the economic development plans of Prime Minister Narendra Modi-led government. He also said the new facility will further strengthen storage and distribution of petroleum products in Chhattisgarh. The Paradip-Raipur-Ranchi petroleum products pipeline will feed five terminals at Jatni, Jharsuguda, Korba, Raipur and Ranchi, covering 57 districts across three states. The underground pipeline has been laid for the supply of petrol and diesel. The government’s priority is to ensure the availability of petroleum products to people in an easy way, he said. On the occasion, Raman Singh thanked oil ministry for its continued support in making petroleum products reach the people of the state.

Source: Business Standard


Cairn India set to increase gas production by 2019

November 30, 2017. The country’s biggest private sector oil producer, Cairn India, which is a part of Anil Agarwal’s Vedanta group, is set to considerably increase its gas production to three million standard cubic metres a day (105.9 million standard cubic feet) by June 2019. Production from its Raageshwari Deep Gas (RDG) field is expected to increase to 100 million standard cubic feet a day (mscfd) by then. The firm’s production capacity for the September quarter of FY18 stood at of 33.8 mscfd. Activity on tenders for partnership with leading service providers for integrated delivery of RDG Phase-II is underway. This is expected to increase gas production and condensate production to over 5,000 barrels of oil equivalent per day (boepd) by the first half of 2019. As on September-end, gas sales, after captive consumption, stood at 18 mscfd. Cairn’s oil and gas business Chief Executive Officer (CEO) Sudhir Mathur said the company would also be undertaking drilling in its Krishna-Godavari block in the first quarter of 2018. The average gross production of Cairn India during the September quarter was 180,955 boepd. Gross production from the Rajasthan block averaged 153,238 boepd. The current investment will cater to five blocks- the RDG project, the enhanced oil recovery (EOR) programme at Aishwariya fields, the EOR programme at Bhagyam and Barmer Hill, and the Aishwariya Barmer Hill. The company’s production sharing contract for Barmer expires in 2020 but higher cess in the extended regime could impact plans.

Source: Business Standard


Post wage hike, government now asks CIL to ramp up production

December 3, 2017. The government has asked Coal India Ltd (CIL) to focus on production enhancement, saying it cannot let the “profitability tumble” as the recent wage hike will have an estimated impact of nearly Rs 6,000 crore annually. CIL had in October signed a wage agreement with workers’ unions proposing 20 percent hike in salaries for a period of five years, which will have an estimated impact of Rs 5,667 crore per year to the world’s largest coal miner. The public sector firm had signed the agreement at 20 percent hike in salaries against workers’ demand for a 50 percent raise. In 2017-18, CIL has been pegged production target at 600 million tonnes (mt) with an annualised growth of about 8.3 percent over the last year. In 2018-19, the envisaged coal production projection is 773.70 mt with a growth of about 28.95 percent.

Source: Business Standard

MPT coal handling facility was cleared by Congress government: Goa CM

November 30, 2017. Goa Chief Minister (CM) Manohar Parrikar has said the coal handling project at the Mormugao Port Trust (MPT) was cleared by the previous Congress-led government at the Centre and that he would provide details about it in the next session of the state Assembly. The Congress Legislature Party (CLP) in Goa recently resolved against the coal handling facility at the MPT, which is facing opposition from some quarters for causing pollution. The CLP also resolved against the nationalisation of rivers. The opposition party has been accusing the government of shielding the coal handling facility at MPT, which is leased out to Adani Murmugao Port Terminal Private Ltd and South West Port Ltd. Parrikar said that the permission for handling the coal at MPT was granted in January 2014 when the Congress was in power at the Centre. The MPT is governed by the Central government. The government has opposed the expansion of the coal project and has written to the Union environment ministry about it, Parrikar said. Parrikar said his government has already written to the Central government to stop any expansion of the coal handling facility and also taken steps to reduce the current pollution.

Source: Business Standard


BBMB commissions units of Ganguwal and Kotla power houses

December 5, 2017. BBMB (Bhakra Beas Management Board) has successfully commissioned unit 2 of Ganguwal powerhouse and unit 3 of Kotla powerhouse on 23.11.2017 and 4.12.2017 respectively, after replacement of damaged runner with a new one having modified and modernised design. BHEL is the supplier and designer of new units installed capacity of each unit is 24.2 MW. These units were under shut-down due to damage of their Runner Blades w.e.f. 16.9.2013 and 2.8.2013 respectively. Delay in the commissioning of these units was being envisaged due to problems in engaging sub-contractor by BHEL. These powerhouses were commissioned in the year 1955-56. Each powerhouse is having 3 No. units and the installed capacity of Ganguwal Power House is 76.39 MW and that of Kotla Power House is 77.34 MW.

Source: The Economic Times

UPPCL camps for new power connections from second week of December

December 3, 2017. Camps to give power connections under the Saubhagya-Pradhan Mantri Sahaj Bijli Har Ghar Yojana will be held from the second week of December, the Uttar Pradesh (UP) power department said. UP Power Corp Ltd (UPPCL) plans to hold mega camps at 2,300 power houses in the state. Under the scheme, as many as 1.54 crore rural and three lakh urban households across the state will get electricity. The “electricity for all” scheme aims at providing power to each and every household, and the state government has set December 2018 as its target for achieving the feat. The camps to give power connections will be set up by the second week of December, the power department said. Under the scheme, subsidy would be given on transformers, meters and wires so that electricity can be made available to the poor for free. For the implementation of the scheme, 60% of the amount will be given by the central government while state government will incur 10% of the cost and the rest 30% will be taken from bank in the form of loan. For rural households, one village per power house will be selected and the entire village will be fed through the same power house. Mega camps will also be set at one power house under one village. The scheme, which aims at benefiting more than two crore people, has a total budget of Rs 16,320 crore.

Source: The Times of India

Government plans to allow consumers to switch power service cos

December 3, 2017. Consumers will be able to change their power suppliers just like telecom services, after proposed amendment to the existing Electricity Act is approved, Power and Renewable Energy Minister R K Singh said. The power ministry will push Electricity Amendment Bill in forthcoming Budget session, which provides for segregating the distribution network business and the electricity supply business. The separation will pave the way for introducing a new system where consumers will have option to choose from multiple electricity service providers in their areas, similar to that of telecom services. He said that the amendments would also provide for stricter enforcement of Renewable Purchase Obligation (RPO). Besides, the bill will also provide for making tariff policy mandatory to keep cross subsidy below 20 percent. It means that difference between highest and lowest tariff rates should not be more than 20 percent. He said that it will help to make industrial tariff reasonable which is unsustainable at present. The bill would also provide direct benefit transfer of subsidy to farmers to improve efficiency in power consumption. It also seeks service obligation on part discoms (distribution companies) to ensure reliable power supply service by March, 2019. The minister was of the view that per capital consumption in the country will also increase in future. It is 1,075 units in India as against 5,000-6,000 units in Europe and around 1,1000 units in the United States. On village electrification, he said that it is snowing in some areas in Jammu & Kashmir, so the work in those areas will start in March or April. And in Arunachal Pradesh, it will be completed by January or February next year, excluding areas affected due to snow fall. The power ministry has identified some states where leakages or losses are more than 21 percent and written a letter to them for reduction of these losses. Aggregate technical and commercial (AT&C) loses should not be more than 5 to 7 percent otherwise it can be construed that there is theft of power, Singh said. In order to deal with this issue, the government is promoting pre-paid and smart meters. He said that the power ministry has asked the states to reduce their AT&C losses below 15 percent by 2019.

Source: Business Standard

JSW Energy bags power purchase pacts aggregating to 208 MW

December 3, 2017. JSW Energy said it has secured power purchase pacts aggregating to 208 MW, taking the long-term power purchase agreement (PPA) proportion of the company on a consolidated basis to 69.3 percent from 64.6 percent. The pacts include a 176 MW PPA with Haryana Power Purchase Centre to be supplied from Karcham Wangtoo Hydro Electric Project of Himachal Baspa Power Company Ltd, a 100 percent subsidiary of the company, and 32 MW under group captive scheme to be supplied from the Ratnagiri plant of the company, it said. According to the company, JSW Energy operates 4,531 MW of power generation capacity with the vision to achieve 10,000 MW by 2020.

Source: The Economic Times

Government may allow power plants to pass on gear expenses to consumers

December 2, 2017. The government may allow power plants to pass on their investments in equipment to meet stringent environmental norms to consumers, and such costs will not be included during preparation of dispatch order to ensure these plants remain competitive. The government is expected to soon issue an advisory in consultation with the Central Electricity Regulatory Commission towards this. Power producers had sought a clarification from the ministry and the regulator to incur the costs for meeting the environment norms. The projects would require an estimated Rs 70 lakh to Rs 1 crore per megawatt capital expenditure to meet the norms and the clarification was required to comfort lenders, the producers had told the ministry. The capital expenditure is estimated to raise the tariff by about 20-30 paise per unit.

Source: The Economic Times

Reliance Power signs pacts for Bangladesh project

December 1, 2017. Reliance Power said it has has completed signing of agreements to execute first phase of its $1 billion (Rs 6,500 crore) power project in Bangladesh. It said the integrated project entails an investment outlay of over $1 billion, which represents the largest foreign direct investment (FDI) in Bangladesh and the largest investment in Bangladesh’s energy sector. Reliance Power will relocate one module of world-class equipment procured from internationally reputed original equipment manufacturers for its 2,250 MW combined cycle power project at Samalkot in Andhra Pradesh for the Phase-1 project in Bangladesh.

Source: The Hindu Business Line

Gujarat lost Rs 260 bn in power purchase scam, alleges Congress

December 1, 2017. The Congress party has alleged the Bharatiya Janata Party (BJP)-led Gujarat government “squandered Rs 26,000 crore of the public exchequer” by purchasing electricity from four private companies at “unimaginably high rates”. The companies in question, according to party spokesperson Randeep Surjewala, are Adani, Essar, Tata and China Light & Power. None of the companies responded to the allegations, made in Ahmedabad. The reported payments are Rs 10,896 crore to Adani, Rs 4,282 crore to Essar, Rs 8,491 crore to Tata and Rs 1,966 crore to China Light, over 2013-16. Surjewala said state-owned power plants had a capacity to generate 8,641 MW but were operated at a mere 33-38 percent capacity in those three years. He said power was bought from these private companies at Rs 24.67 a unit, many times more than what was charged by the government-owned NTPC.

Source: Business Standard

Goa electricity department bill arrears touch Rs 2 bn

December 1, 2017. The Goa electricity department is sitting on arrears of Rs 200 crore which is yet to be recovered from various government departments and bodies, State Power Minister Pandurang Madkaikar said. He said that the electricity department is facing financial issues due to the piling up of these arrears and that bills were not being paid despite repeated reminders. He said that the intervention of Chief Minister Manohar Parrikar has been sought to solve the issue.

Source: Business Standard

Adani Group denies selling power to Gujarat at exorbitant rate

December 1, 2017. The Adani Group dismissed Congress’ allegation of charging exorbitant electricity tariff in Gujarat, saying it sold power to the state at a “very attractive” price of Rs 2.65 per unit over the last four years. Adani Power Ltd sells electricity to Gujarat under long-term power purchase agreements, entered through competitive bidding and duly approved by Regulatory Commission. Adani Power offers one of the cheapest power supplies, and went on to list the price charged in last four years — Rs 2.71 per unit in 2013-14, Rs 2.64 in 2014-15, Rs 2.57 in 2015-16 and Rs 2.67 a unit in 2016-17.

Source: Business Standard

UPERC adopts Rs 7.02 per unit solar tariff for nine bidders for 12 yrs

November 30, 2017. The Uttar Pradesh Electricity Regulatory Commission (UPERC) has adopted Rs 7.02 per unit as the solar tariff for the year 2015-16 for nine bidding companies who have already commissioned their projects for 12 years. For the remaining six bidders, whose projects have not been commissioned, and which the UPPCL wants to terminate, the commission said that since these companies had filed petitions against the pre-termination notices and the matter is under its consideration, it will pass necessary orders on them separately. Of the nine companies who have commissioned their projects, Essel Infraprojects is set to gain as it was the lowest bidder at Rs 7.02 per unit, while Adani Green Energy was among the highest at Rs 8.44.

Source: The Financial Express

UP energy watchdog spares industry from tariff shock

November 30, 2017. Uttar Pradesh (UP) energy watchdog has spared the industrial sector from power tariff hike for 2017-18 even as it announced a 12 percent increase in the average tariff payable by the sector across board. The exemption in power tariff not only provides relief to the industrial sector, but it also places Chief Minister Yogi Adityanath government on a better footing right ahead of the global investors’ meet that is slated to take place on February 21 and 22 in 2018. The two-day mega event is expected to attract investments into the state. However, the recent average hike has been the steepest over the past three years. In the preceding financial years- FY16 and FY17- the average increase stood at 5.47 percent and 3.18 percent respectively. The UP Electricity Regulatory Commission (UPERC) has also approved a power tariff hike of 63 percent and 67 percent for the unmetered rural domestic and commercial consumers. The move is expected to encourage customers to migrate to the metered segment, offering a lower tariff hike of 57 percent and 43 percent respectively. The ‘Power for All’ pact signed between the Adityanath-led state government and the Centre aims at providing power supply to every household in UP. This seems to be a mammoth of a challenge, given the total number of power consumers in the state is estimated to burgeon from existing 18 million to 40 million by 2019-20. Meanwhile, urban consumers would bear a power tariff hike of 8.49 percent (domestic) and 9.89 percent (commercial). Likewise, the Commission has also increased the fixed charges on power connection to partially remunerate the beleaguered discoms (distribution companies) in UP. Giving relief to the social sector, the energy watchdog has exempted shelter homes, orphanages, old age homes and similar institutions from commercial tariffs- a move that would effectively reduce their power bills. The new tariffs would be effective after seven days of issuing a public notice on the matter by the UP Power Corp Ltd (UPPCL). At present, the UPERC approves new power tariffs based on the aggregate revenue requirement (ARR) filed by power utilities that has details on estimated income, expenditure, power demand and supply, among other relevant data.

Source: Business Standard

Power Minister meets banks on stressed power assets, NTPC floats tender

November 29, 2017. As part of the ongoing process to deal with the issue of massive stressed assets in the sector, Power Minister R K Singh met bankers. Singh said that NTPC Ltd has floated a tender to acquire commissioned stressed coal-fired thermal power plants. Of the 40 GW stressed thermal power generation capacity, around 12 GW capacity worth around Rs 50,000 crore commissioned after April 1, 2014 is eligible under this tender. NTPC will shortlist the suitable operational domestic power assets located for possible acquisition. As per the tender, each plant size should be at least 500 MW. The power sector accounts for a substantial chunk of the non-performing assets, or bad loans, in the Indian banking sector, which have reached a staggering level of over Rs 8 lakh crore.

Source: Business Standard


Units 1 and 2 of KKNPP generates full capacity of 2 GW

December 5, 2017. Power generation at units 1 and 2 of the Kundankulam Nuclear Power Plant (KKNPP) touched the maximum level of 2000 MW, KKNPP Site Director SV Jinnah. He said though the maximum capacity of each unit was 1000 MW, they had reached the full capacity. He said the first Unit had so far generated 16,079 million units while the second unit had generated 4,784 units, since its commission.

Source: Business Standard

Kolkata airport to go green with 15 MW solar power plant

December 5, 2017. The Kolkata airport is all set to start using clean and green energy for its day to day operations, as its ground mounted grid connected solar plant is ready for commissioning. The 15 MW plant, capacity wise the largest one among all the AAI (Airports Authority of India) airports across the country, is slated to be inaugurated by Union Minister for Civil Aviation Ashok Gajapathi Raju. The Netaji Subhas Chandra Bose International (NSCBI) airport Director Atul Dixit said the solar panels have been installed across 67.5 acre land in the operational area of the airport. The plant will generate 1.35 million units per month and this will reduce the AAI’s power bill by around 1.20 crore per month, Dixit said. Only two other AAI airports have the ground mounted grid connected solar plant – Chandigarh (3 MW) and Jaipur (1.8 MW).

Source: The Economic Times

India’s largest floating solar power plant commissioned in Kerala

December 5, 2017. Power Minister M M Mani commissioned the largest floating solar power plant in the country set up on the Banasura Sagar reservoir at Padinjarethara in Wayanad. The 500 kWp (kilowatt peak) solar plant of the Kerala State Electricity Board (KSEB) floats on 1.25 acres of water surface of the reservoir. The solar plant has 1,938 solar panels which have been installed on 18 ferro cement floaters with hollow insides. The plant has been set up by KSEB at a cost of Rs 9.25 crore. The project has used high- efficiency solar panels and a floating substation have been set up on the reservoir itself to convert the output into 11 kilovolt (kV), considering economic and safety aspects. A 500 KVA kilo volt ampere transformer, 17 inverters, a supervisory control and data acquisition (SCADA) system to control and monitor power generation and an anchoring system are part of the floating solar project. The power generated by the plant will be transmitted to the KSEB’s Padinjarathara substation. Floating solar plants had higher efficiency compared to ground-mounted installations due to the moderating effect of water bodies on panel temperature. Mani said that it has become imperative for the state to explore all avenues of renewable energy as it was currently producing just 30 % of its power requirement.

Source: The Economic Times

Baba Ramdev’s Patanjali to diversify into solar power business

December 4, 2017. Yoga guru Baba Ramdev’s Patanjali Ayurved Ltd, the consumer goods products upstart, is poised to diversify into solar power equipment manufacturing. This will be the company’s first exposure to the infrastructure sector and comes after its runaway success in consumer products. Just like it identified the opportunity to compete with established multinational packaged consumer goods companies, Patanjali is seeing a opening for itself in solar equipment manufacturing. The government is considering a 30% capital subsidy as part of a new solar manufacturing policy. India is working to improve its per capita power consumption of around 1,200 kilowatt hours (kWh), among the lowest in the world. Alongside, it is also proposing a “rent a roof” policy to support its ambitious plan of generating 40 GW of solar power by 2022. For China’s solar panel manufacturing industry, with an estimated capacity of around 70 GW per year, the US and India are major markets. Patanjali acquired Advance Navigation and Solar Technologies Pvt Ltd, a manufacturer of navigation aid equipment, earlier this year. Currently, the facility has a manufacturing capacity of 120 MW. Patanjali plans to invest around Rs100 crore in solar equipment manufacturing and its factory in Greater Noida is expected to be fully operational within the next couple of months. With the average efficiency of a solar panel usually at just 16-22%, sub-standard quality will impact generation. India proposes to award 100 GW of solar and wind contracts by March 2020. This includes a plan to invite bids for setting up 20 GW solar power capacity—the world’s largest solar tender—at one go, to spur domestic manufacturing of solar power equipment.

Source: Livemint

Bridge to India cuts rooftop solar forecast to 10.8 GW by 2021

December 4, 2017. Renewable energy consultancy firm Bridge to India said it has lowered projections for rooftop solar capacity addition to 10.8 GW, as against 13.2 GW, by 2021. Bridge to India, a knowledge services provider in the Indian renewable space, has released the latest edition of its info-graphic report, ‘India Solar Rooftop Map’. As per the report, India added new rooftop solar capacity of 840 MW in the 12 months ending September 2017, at an annual growth of 82 percent and total installed capacity as of September 2017 stood at 1,861 MW. The report said that Maharashtra has taken over Tamil Nadu to become the biggest solar rooftop state, as per the latest edition of ‘India Solar Rooftop Map’ by Bridge to India.

Source: Business Standard

AP to set up solar-wind hybrid project with battery back-up

December 4, 2017. Andhra Pradesh (AP) is planning to develop a 160 MW solar-wind hybrid project with battery back-up facility. Significantly, this is the first such project to be developed in the country. Recently, Tesla announced the commissioning of a 100 MW power pack system, the world’s largest, in Jamestown, Australia. The project, to come up in a strong wind zone of Ramagiri in Anantapur, will have 120 MW of solar, 40 MW of wind and a battery back-up facility of 40 MW. While the solar and wind energy projects would be offered for development through the competitive biding process, the battery back-up will be funded by a soft loan from the World Bank, G Adiseshu, Managing Director of AP Solar Power Corp said. The project, to be developed on a 750-800 acre site, is expected to be tendered out by the Solar Energy Corp of India. Solar-wind energy hybrid projects are relatively new for India, and projects of this nature are expected to set the tone for future projects. The overall cost of a battery-backed renewable energy project would be known once such projects get implemented, he said. The southern States of Andhra Pradesh and Telangana have been very aggressively promoting renewable energy projects. The former, due to its location advantage, has also seen big capacity addition in the wind sector.

Source: The Hindu Business Line

Government mulls longer fixed cost recovery period for hydro power

December 4, 2017. The government is looking at extending fixed cost recovery period of hydro projects to 30- 35 years, from 12 years at present, to bring the tariff down to as low as Rs 2 per unit, Power and Renewable Energy Minister R K Singh has said. The ministry is working on the hydro power policy to provide Rs 16,000 crore assistance to projects to promote the clean source of energy and it is expected to be tabled before the Union Cabinet for approval this month. He said it happens with a lot of hydro power plants that the tariff remains high at Rs 6 per unit during the recovery period and after realisation of fixed cost, it comes down to 80 paisa per unit. India, he said, has realised about 45 GW, out of 145 GW hydro power potential in the country. Singh also talked about boosting domestic manufacturing capacity of solar equipment saying that the new tenders would provide for setting up production capacities here by bidders. Only those bidder would be able to bid who would set up manufacturing capacities here in India from polysilicon onwards, Singh said. He said that the government would buy equipment to aid generation of 20 GW but the bidders would set up manufacturing capacity in stages. On the finalisation of Ultra Mega Power Projects (UMPP) bidding document, Singh said the future in thermal is for pit head UMPPs, otherwise it would not be competitive.

Source: Business Standard

World’s largest panel maker Trina Solar shelves plan to set up plant in India

December 4, 2017. China-based Trina Solar, the world’s biggest solar panel maker, has put on hold its make-in-India plan to set up a 1,000 MW manufacturing unit in India because of low prices and absence of supportive policies but it will invest up to $500 million if it gets the right incentives. Gaurav Mathur, India sales head of Trina Solar, said international players like Trina will be interested in incentives to set up manufacturing in India, and the government’s domestic manufacturing policy for solar, which is in the works, may provide some clarity on the plans.

Source: The Economic Times

AP Cabinet approves Polavaram Hydro project

December 2, 2017. The Andhra Pradesh (AP) Cabinet has approved the Polavaram Hydro project in a meeting chaired by Chief Minister Chandrababu Naidu. The Cabinet, besides approving the project, also discussed about future course of action to be taken regarding Polavaram project.

Source: Business Standard

REC trading at IEX hits all-time high in November at 18.9

December 2, 2017. Trading of renewable energy certificates (REC) at the Indian Energy Exchange (IEX) touched an all-time high in the November session, with 18.9 lakh RECs being traded under the non-solar category. The number represents a 452% rise month-on-month and more than 12 times the volume traded in November, 2016. One REC, priced at Rs 1,500, is treated as equivalent to 1,000 units of green electricity. REC trade is a market based instrument designed to facilitate compliance with renewable purchase obligations (RPO). It aims to address the mismatch between availability of renewable energy resources in the states and the requirement of the obligated entities to meet their RPOs. Power distribution companies (discoms) were the major buyers to purchase REC in the November trade session. According to sources, Bihar, Uttarakhand, Maharashtra and Delhi discoms purchased the largest number of RECs.

Source: The Financial Express

India to start building ultra supercritical thermal plant in 2019

December 2, 2017. India will begin construction of an 800 MW advanced ultra supercritical thermal power plant in 2019, which will run on an indigenous technology that is developed to reduce carbon emissions, AK Bhaduri, director of Indira Gandhi Centre for Atomic Research, Kalpakkam, said. The project is being executed by a consortium of three government entities, Bharat Heavy Electrical Ltd, Indira Gandhi Centre of Atomic Research and National Thermal Power Corp. It will involve Indian industries in the design, manufacture and commissioning of the plant. Bhaduri said the prototype fast breeder reactor, which is built in Kalpakkam, will achieve criticality in another two months and is expected to generate full power of 500 MW by next year.

Source: The Economic Times

NIT-K mechanical department’s new rooftop dedicated for solar research

December 1, 2017. The rooftop of the mechanical engineering department of National Institute of Technology-Karnataka (NIT-K), Surathkal, which got a vertical extension, will be dedicated for solar research. The power generated will be utilized for running few electronic gadgets in the building. The department said that rooftop of the newly constructed building will be turned into a research lab on solar energy.

Source: The Times of India

India closer to signing nuclear pact with Russia, Bangladesh

December 1, 2017. India has moved closer to signing its tripartite Inter Governmental Agreement (IGA) involving Russia and Bangladesh for Rooppur Nuclear Power plant near Dhaka — Delhi’s first such civil nuclear document — amid foundation stone laying for the project that would power South Asia’s second fastest growing economy. Bangladesh saw the first concrete pouring into the reactor building foundation of its first Rooppur Nuclear Power Plant, which will mark the construction of Bangladesh’s first nuclear reactor and make it the third country in South Asia after India and Pakistan to have a civil nuclear project. While India has been working with major powers (USA, Russia and Japan) across various sectors as well as firming up joint ventures in third countries in Africa, SE Asia and Central Asia, it would be the first occasion where Delhi will conclude a tripartite civil nuclear project marking India’s global entry into a strategic sector. In fact, India for the first time ever is playing a substantive role in building a nuclear power plant on foreign soil with the proposed supply of equipment and material for the power station being built by Bangladesh with Russian assistance. Bangladeshi nuclear scientists and technicians are undergoing training at the Kudankulam Nuclear Power Plant which is also built with Russian assistance and uses Russian nuclear technology. It will also boost the Make in India initiative amid a proposal by Delhi to Moscow for manufacturing of some nuclear power reactor equipment in India. The Rooppur plant involves two units, each with a capacity of 1200 MW and is situated on the bank of Padma river. Rooppur Nuclear Power Plant’s generation units will be based on VVER-1200 reactors of the 3+ generation technology. VVER-1200 technology is also likely to be offered to India for the second set of six Russian built nuclear reactors. This technology uses “post-Fukushima” safety standards for a nuclear power plant.

Source: The Economic Times

India targets $3.1 tn climate investment opportunities by 2030

November 30, 2017. India’s ambitious plans to meet its climate targets under the Paris Agreement represent about $3.1 trillion worth of investment opportunities by 2030 in sectors including renewable energy, green buildings, transport infrastructure, electric vehicles, and climate-smart agriculture, IFC report said. The report, which examined the climate-investment opportunities in  Bangladesh, Bhutan, India, Maldives, Nepal and Sri Lanka, found that these countries together represent 7.38 percent of global carbon dioxide emissions. It also identified $172 billion of climate-smart investment opportunities in Bangladesh, $42 billion in Bhutan, $2 billion in the Maldives, $46 billion in Nepal, and $18 billion in Sri Lanka. With a population of 1.3 billion, India is the world’s third-largest economy according to purchasing power parity, and with a young, large, and growing labour force, the country is a significant market for the private sector.

Source: Zee News

Cabinet nod soon for hydropower policy: Power and Renewable Energy Minister

November 29, 2017. Power and Renewable Energy Minister R K Singh said the hydropower policy is in the final leg and will soon be sent for the Cabinet approval. The Minister also assured the industry representatives that he would look into their demands for restructuring debt over stranded hydro projects as well as their refinancing by Power Finance Corp and Indian Renewable Energy Development Agency (IREDA). As per the draft hydropower policy, it will aim to provide Rs 16,709 crore support for 40 stalled hydel projects with 11,639 MW capacity, and to classify all such ventures as renewable energy. Once it is approved, the distinction between large and small hydro plants will go, which would help India to achieve clean power capacity of 225 GW by 2022. At present, a hydropower project of up to 25 MW is classified under renewable energy and is entitled to various incentives provided by the government. Projects beyond this capacity are not in this category and hence not entitled to the benefits. India has set an ambitious target of adding 175 GW of renewable energy capacity by 2022, which includes 100 GW of solar, 60 GW from wind, 10 GW from bio-power and 5 GW from small hydropower (up to 25 MW capacity each). Under the policy, the government will provide interest subvention of 4 percent during construction for up to 7 years and for 3 years after the start of commercial operation to all hydro power projects above 25 MW.

Source: The Times of India


UAE lowers November oil output to better comply with pact

December 5, 2017. The United Arab Emirates’ crude oil output in November fell to around 2.9 million barrels per day (bpd), as the Gulf OPEC (Organization of the Petroleum Exporting Countries) member looks to increase its compliance with a global pact to curb production. The United Arab Emirates (UAE) reported output of 2.950 million bpd in October. OPEC and non-OPEC producers led by Russia have agreed to extend oil output cuts until the end of 2018 to help lower global inventories and support prices. Compliance by participating producers has topped 100 percent in the past couple of months, however, the UAE’s compliance has been lower because it is using a higher baseline for its cut than the one stipulated in the agreement. But the UAE, which will hold OPEC’s presidency next year, has been slashing oil exports in a bid to demonstrate its commitment.

Source: Reuters

Bangladesh plans to lower sulfur content of gasoil imports from 2018

December 5, 2017. Bangladesh plans to lower the sulfur content of its gasoil imports to 10 parts per million (ppm) sulfur from the current 500ppm from mid-2018. Bangladesh imports around 3.5 million tonnes of gasoil a year to meet domestic demand, while the country’s sole Eastern Refinery produces about 350,000 tonnes. If Bangladesh decides to go ahead with the plan of importing cleaner diesel, its import costs are likely to go up, traders said, though they could not provide estimates as this will depend on the price spread between the two grades next year.

Source: Reuters

Malaysia’s Petronas forecasts oil prices to hold in $50s, $60s

December 4, 2017. Malaysia’s state energy company Petroliam Nasional Berhad (Petronas), forecast oil prices to hold in the $50s and $60s in its 2018-2020 Activity Outlook report. Sustained healthy global demand growth will help speed a drawdown in crude and fuel inventories, and hasten rebalancing in the oil markets, Petronas said. Nearly 60 percent of the growth will be contributed from the Asia Pacific region, mainly by China and India, it said. Petronas last forecast that oil prices at $50 a barrel should be taken as the new norm, but it also said in its recent earnings announcement that it expects its overall year-end performance to be better than last year, indicating an improved view of the energy market. Petronas’ oil output has been stagnant for years. The company is increasingly focusing on downstream projects like its Refinery and Petrochemical Integrated Development project in the southern state of Johor, which from 2019 onwards will refine crude oil into fuel and petrochemical products.

Source: Reuters

Saudi Arabia and Russia reach compromise on oil pact

December 2, 2017. Ministers from OPEC (Organization of the Petroleum Exporting Countries) and their allies have agreed to extend their production pact all the way to the end of 2018 but with a review in June that will take into account market conditions and progress toward rebalancing. The outcome represents a successful compromise between de facto OPEC leader Saudi Arabia (which wanted to announce an extension throughout 2018) and non-OPEC heavyweight Russia (which wanted to avoid giving such a long commitment). Saudi Arabia’s Oil Minister Khalid Al-Falih said the excess of OECD (Organization for Economic Cooperation and Development) oil stocks over the five-year average had already shrunk from 280 million barrels in May to just 140 million in October.

Source: Reuters

CNPC reports new oil field discovery in western China

December 1, 2017. China National Petroleum Corp (CNPC) discovered a new oil field with about 520 million tonnes of crude reserves in place. The discovery sits in the Juggar Basin of the Xinjiang region in western China. Oil majors such as PetroChina and China National Offshore Oil Corp (CNOOC) are ramping up their upstream exploration efforts as domestic production from aging wells continues to fall. PetroChina said it also increased production capacity at its Xinjiang oilfield by 1.38 million tonnes this year, or about 27,000 barrels per day.

Source: Reuters

Chevron, Total, PetroChina may develop Iraq’s Majnoon oilfield

November 30, 2017. Chevron, Total and PetroChina may form a consortium to develop Iraq’s Majnoon oilfield which Royal Dutch Shell wants to exit, Oil Minister Jabar al-Luaibi said. Shell plans to exit Majnoon and hand over its operation to Basra Oil Company by the end of June 2018. Iraq is developing the Majnoon field, which currently produces around 235,000 barrels of oil per day, by itself until it can find a foreign partner. Luaibi said that Iraq might offer Chevron and Total terms to develop the Majnoon oilfield that were different to those given to Shell, which has said it wants to leave because of unfavourable changes to fiscal terms. Iraq expects its refining capacity to increase by 100,000 barrels per day (bpd) by mid-2018 with the rehabilitation of two refineries retaken from the Islamic State. The rehabilitation of Kisik refinery, near Mosul, should add 30,000 bpd in processing capacity before the end of the year, and Salahuddin 70,000 bpd within six months, he said.

Source: Reuters

Nigeria’s NNPC targets up to $5 bn oil prepayment

November 29, 2017. Nigeria’s state oil firm Nigerian National Petroleum Corp (NNPC) is looking to set up a $3.5-$5 billion cash-for-crude prepayment with some of the world’s top commodity traders to fund oil and gas upstream projects as well as related infrastructure. Africa’s biggest oil producer and OPEC (Organization of the Petroleum Exporting Countries) member was hit hard by the sharp drop in global oil prices in 2014 that pushed it into its first recession in 25 years. The country returned to growth-mode in the second quarter. Oil Minister Emmanuel Ibe Kachikwu reached a deal last year with its major foreign oil-producers to repay $5.1 billion over five years, interest free. NNPC has already leveraged over 300,000 barrels per day of crude to cover current fuel imports via a crude-for-product swap scheme as well as debts to traders dating back nearly a decade.

Source: Reuters

Iraq aims to up Rumaila oilfield output to 1.5 mn bpd in 2018

November 29, 2017. Iraq is planning to increase production from the giant Rumaila oilfield to around 1.5 million barrels per day (bpd) in 2018, the head of Rumaila operations Mohammed Hassan said. Rumaila oilfield, which is developed by Britain’s BP and its Chinese partner CNPC, is currently producing around 1.45 million bpd, Mohammed Hassan said.

Source: Reuters

Mexico’s Pemex declares force majeure on Isthmus crude oil

November 29, 2017. Mexico’s national oil company Pemex has declared force majeure on the loading of Isthmus crude. The producer informed buyers late the force majeure would affect cargoes loading in early December. Pemex has offered to replace Isthmus supplies with another Mexican crude grade, Maya. Force majeure on Mexican crude loadings routinely happens during winter due to poor weather conditions, usually lasting a few days. Four oil tankers are waiting off Dos Bocas port to load Isthmus crude, shipping data shows.

Source: Reuters


Russia starts up second LNG plant in remote Arctic

December 5, 2017. Russia started production at its second liquefied natural gas (LNG) plant, Yamal LNG, with the aim of shipping the first cargo on December 8 from the remote Arctic port of Sabetta. Russia’s No.2 gas producer Novatek owns a 50.1 percent stake in Yamal LNG. France’s Total and China National Petroleum Corp each control 20 percent, while China’s Silk Road Fund owns 9.9 percent. Russia, seeking to produce more than 70 million tonnes of LNG per year in its remote Arctic regions, for now has just one operational LNG facility, run by Gazprom and co-owned with Shell on the Pacific island of Sakhalin. Novatek said the first train was for 5.5 million tonnes of fuel to be delivered year round to Asian and European markets via the Arctic Ocean with ice-class tankers used. The overall capacity is set to reach 17.5 million tonnes with the last train of the project starting operation by the end of 2019.

Source: Reuters

Greece, Italy, Israel and Cyprus back natural gas pipeline to Europe

December 5, 2017. Italy, Greece, Cyprus and Israel agreed to back the construction of a natural gas pipeline from newly discovered fields in the eastern Mediterranean to Europe. The project, known as East Med, involves a 2,000 kilometre long pipeline to channel offshore reserves in the Levantine Basin in the far east corner of the Mediterranean to Greece and Italy, at a cost of up to €6 billion. The eastern Mediterranean has produced some of the world’s biggest gas finds in the past decade, and much of it is still thought to be untapped at a time Europe is looking to diversify its gas resources for reasons of energy security. Israel has discovered more than 900 billion cubic metres (bcm) of gas offshore. Cyprus’ Aphrodite gas field holds an additional 128 bcm and Cypriot waters are expected to hold more reserves. It is estimated the pipeline could transport up to 16 bcm of gas per year. The project owners are IGI Poseidon, a joint venture between Greece’s natural gas firm DEPA and Italian energy group Edison.

Source: Reuters

Philippines aims to issue permit for $2 bn LNG facility in 2018

December 5, 2017. The Philippines is aiming to next year award the permit to build and operate the country’s first facility for receiving and distributing liquefied natural gas, its Energy Secretary Alfonso Cusi said. The project, estimated to cost $2 billion, comes as the Southeast Asian nation seeks to replace depleting local gas reserves that now produce around a fifth of its power. Dozens of domestic and foreign companies are looking to get a stake in the project, including investors from China, Japan, South Korea and Russia, Cusi said. Cusi said the government intended to initially allow only one such LNG facility, with state-owned Philippine National Oil Company (PNOC) holding a minimum stake of 10 percent. Construction of the project, which includes a 5 million tonnes-per-annum storage facility, will take about 30 months to complete, Cusi said. The country’s key Malampaya gas field is expected to be depleted in seven years. Operated by a unit of Royal Dutch Shell Plc, it fuels utilities producing about 40 percent of power supply for the main Luzon island, home to the capital Manila.

Source: Reuters

Tokyo Gas signs LOI with Alaska Gasline on LNG purchase

December 5, 2017. Tokyo Gas Co Ltd said it signed a letter of intent (LOI) with Alaska Gasline Development Corp (AGDC) regarding the sale and purchase of liquefied natural gas (LNG). The move follows China’s biggest state oil company Sinopec, one of the country’s top banks and its sovereign wealth fund agreeing to develop the $43 billion natural gas project in Alaska, as the cash-poor US state seeks to revive its dwindling energy industry. Alaska LNG is designed to carry natural gas from fields in the North Slope through an 800 mile (1,287 km) pipeline to south central Alaska for in-state use and to a liquefaction plant to produce up to 20 million tonnes of LNG per year for export. Tokyo Gas, which purchases about 14 million tonnes of LNG a year, plans to talk with AGDC on details of the possible purchase of LNG, including volume and length, a company spokesman said, adding such an action reflects its efforts to widen its supply sources. Alaska created AGDC in 2010 to build the project to tap the North Slope gas reserves, where production is expected to average about 3.5 billion cubic feet per day, according to Alaska LNG.

Source: Reuters

Arrow Energy signs gas supply deal for Shell’s QCLNG project

December 4, 2017. Arrow Energy has signed a long-term agreement for gas supply to Shell’s Queensland Curtis Liquefied Natural Gas (QCLNG) project. Under the 27 year gas sales agreement signed with Shell-operated QCLNG joint venture, Arrow Energy will annually supply gas from its reserves in Surat Basin in Queensland. Arrow Energy, which is equally owned by Shell and PetroChina, is developing coal seam gas reserves in the Surat Basin in Southern Queensland, and the Bowen Basin in Central Queensland. Arrow said that the agreement will commercialize the majority of its reserves in the Surat Basin. It has gas reserves of approximately 5 trillion cubic feet in Surat Basin.

Source: Energy Business Review

DUC partners to invest $3.36 bn for Tyra gas field redevelopment in Danish North Sea

December 4, 2017. The Danish Underground Consortium (DUC), which is led by Maersk Oil, has approved DKK21 bn ($3.36 bn) investment for the full redevelopment of the Tyra gas field located in the Danish North Sea. The redevelopment work is aimed at ensuring continued production from the Tyra field, which is said to be the Denmark’s largest gas field. It is located in Blocks 5504/11 and 12, 225 km west of Esbjerg, Denmark. Maersk Oil said that the investment will allow Tyra field to operate for at least another 25 years as well as protect and rejuvenate Danish North Sea infrastructure. DUC plans to close the Tyra field for the redevelopment in November 2019 and resume production in July 2022.

Source: Energy Business Review

Beijing orders regions to ‘regulate’ gas market as prices soar

December 4, 2017. China’s state planner, the National Development and Reform Commission(NDRC), has ordered eight regions to meet with natural gas producers, liquefied natural gas (LNG) terminal operators and traders to “regulate” the market as prices of the clean fuel soar due to winter heating demand.  The meetings highlight Beijing’s concerns about rising gas prices amid its policy to shift millions of homes to gas heating from coal for the winter along with thousands of factories and businesses to combat air pollution. The industrial provinces of Hebei and Shandong warned of gas shortages and ordered cuts to some industrial and commercial users. The eight regions include top natural gas producing regions Shaanxi, Inner Mongolia, Xinjiang and Sichuan and major gas consuming regions such as Hebei, Jiangsu, Liaoning and Beijing, he said.

Source: Reuters

Pakistan in LNG talks with France, Italy and Spain

November 30, 2017. Pakistan is in liquefied natural gas (LNG) supply talks with France, Italy and Spain. Intergovernmental agreements (IGAs) could help Pakistan speed up its ambitious plans to bolster LNG imports as it aims to end the country’s chronic energy shortages. Pakistan opened its second LNG import terminal in Karachi and Prime Minister Shahid Khaqan Abbasi said up to five more terminals are in the works. Islamabad aims to source about 3 million tonnes of LNG per year for the new terminal through intergovernmental deals, or about four cargoes per month. Abbasi said he expects Pakistan’s demand to grow to 30 million tonnes in three years, which would make it a major LNG buyer. It is already one of the fastest-growing LNG markets, attracting interest from producers such as Shell and ExxonMobil and from traders such as Trafigura and Gunvor. Pakistan last year agreed a deal with Qatar to supply 3.75 million tonnes per year for its first LNG terminal and this year in an open tender it awarded Eni a 15-year supply contract. Russia, Malaysia, Turkey and Azerbaijan have all signed IGAs with Pakistan and their companies have begun commercial negotiations. Pakistan expects to sign deals with Indonesia and Oman soon.

Source: Reuters


China coal cities secure $310 mn ADB loan to revitalize economies

December 5, 2017. Four cities in northeast China have secured a loan of $310 million from the Asian Development Bank (ADB) to revitalize their economies, the bank said, two years after mass layoffs at local coal mines triggered unrest in the region. The cities of Hegang, Jixi, Qitaihe and Shuangyashan – in northeast China’s Heilongjiang province – were the major casualties of a 2015 decision by state-owned Longmay Group to slash coal production, close depleted mines and lay off as many as 100,000 local workers, part of nationwide efforts to tackle overcapacity and shore up prices in the sector. The ADB loan to the four cities will be used in a project worth a total $1 billion that is designed to support the development of small- to medium-sized enterprises and help tackle environmental damage caused by decades of coal mining, the bank said.

Source: Reuters

Colombia’s coal output down 8.1 percent in third quarter

December 5, 2017. Colombia’s coal output fell 8.1 percent to 21.5 million tonnes (mt) in the third quarter from a year earlier. The Andean nation, the world’s fifth-largest coal exporter, produced 23.4 mt in the third quarter of 2016. So far this year, the sector has produced 65.1 mt of coal, 4.4 percent lower than for the same period a year ago.

Source: Reuters

Greece finalises deal with lenders over coal-fired plants: Energy Minister

December 2, 2017. Greece has finalised a deal with its official creditors on the coal-fired plants the country will sell to comply with an EU (European Union) court ruling, Greek Energy Minister George Stathakis said. The issue was at the top of the agenda of talks between Greece and its EU and International creditors, who are reviewing the country’s bailout progress on energy and labor market reforms, on fiscal targets and privatisations.

Source: Reuters

China underscores push towards longer term coal contracts

November 29, 2017. China has again urged coal suppliers and buyers to sign more medium- and long-term contracts, amid robust demand for the fuel during the peak winter-heating season. The National Development and Reform Commission (NDRC) said that medium- to long-term contracts should make up 75 percent of supply deals signed by government and municipal authorities as well as power firms. It said that railways, ports and shipping firms should make handling such contract business a priority. Contracts should run for at least a year. The NDRC had already ordered coal companies and utilities in April to fix 75 percent of their total coal purchases through long-term contracts. But Chinese thermal coal futures have still surged this year, recently rallying about 7 percent since early November to 655.6 yuan ($99.29) per tonne.

Source: Reuters


Emera seeks Presidential Permit for 1 GW Atlantic Link subsea transmission project

December 5, 2017. Emera subsidiary Clean Power Northeast Development is seeking Presidential Permit from the United States (US) Department of Energy for the development of 1 GW Atlantic Link subsea electric transmission project. The proposed Atlantic high-voltage direct current (HVDC) transmission interconnection will be designed to deliver wind and hydro power from Atlantic Canada directly to Massachusetts, US. Emera said that the Presidential Permit is required to allow the construction, connection, operation and maintenance of the 375 mile transmission line between the US and Canada. Scheduled to be commissioned is late 2022, the subsea cable would run from Coleson Cove, New Brunswick in Canada to Plymouth, Massachusetts.

Source: Energy Business Review

FirstEnergy plans to invest $450 mn to upgrade electric system in Ohio

December 4, 2017. FirstEnergy is planning to redesign and modernize the electric system as well as prepare for smart technologies with an investment of $450 mn in Ohio, US. As part of this effort, the FirstEnergy has filed the three-year investment plan with the Public Utilities Commission of Ohio to reduce the frequency and duration of power outages. The proposed projects are expected to help restore power faster, boost the system against adverse weather conditions, and enhance system performance. FirstEnergy will also invest in projects include reclosers, which allow grid operators to isolate an outage to the immediate area where damage occurs as well as data acquisition systems which allows grid operators to remotely monitor and react to power grid conditions to help restore power faster. The firm said that the investment will be used to create a stronger distribution system serving customers in Ohio Edison, Cleveland Electric Illuminating and Toledo Edison.

Source: Energy Business Review

Tanzania restores power in parts of country after nationwide outage

December 1, 2017. Tanzania’s power utility said it had started to restore electricity to parts of the country after the East African nation was hit by a country-wide blackout. Tanzania Electric Supply Company (TANESCO) apologised for the power outage, but did not explain what caused a “technical glitch” in the national power grid that left the region’s No. 3 economy in a blackout that lasted more than 12 hours. TANESCO said it had also restored electricity in the administrative capital Dodoma, as well as Iringa region in the centre and Tanga in the northeast. Tanzania’s energy infrastructure has suffered from decades of underinvestment, neglect and corruption allegations, and investors have long complained the lack of reliable power hurts business there. Tanzania aims to boost power generation capacity to 10,000 MW over the next decade by also using some of its vast natural gas and coal reserves.

Source: Reuters

Brazil struggles to help state dependent on Venezuela for power

November 29, 2017. The Brazilian government is looking at all options, including large batteries, to help northern Roraima state with power supplies after a series of blackouts in recent months largely related to its dependency on cash-strapped neighbour Venezuela. Roraima is the only Brazilian state not connected to the national power grid. Its capital, Boa Vista, and most other cities in the state are supplied by power produced in Venezuela and transmitted through a line that was opened in 2001. Documents produced by a Brazilian government committee monitoring the power sector show the state suffered 17 large-scale power outages since August. The documents said only one instance was not related to Venezuela. The situation underscores how Venezuela’s economic collapse is affecting its neighbours The government plans to award a new license early next year for the construction of a power line to connect Roraima to the grid.

Source: Reuters


US confirms duties on Argentine, Indonesian biofuel

December 5, 2017. The United States (US) International Trade Commission (ITC) made a final finding that biodiesel imports from Argentina and Indonesia harm US producers, ensuring that anti-dumping and anti-subsidy duties remain in effect for at least five years. The US Commerce Department set steep trade barriers that brought to a halt shipments of soyoil-based biodiesel from Argentina and palm oil-based supplies from Indonesia.

Source: Reuters

France to reduce share of nuclear in power mix ‘as soon as possible’: Poirson

December 5, 2017. France will reduce the share of nuclear energy in its electricity mix “as soon as possible”, French Junior Environment Minister Brune Poirson said. The French government dropped a legal target set by the previous government to reduce the share of nuclear to 50 percent by 2025, from 75 percent.

Source: Reuters

French utility Engie plans to go green via biogas and renewable hydrogen

December 4, 2017. French utility Engie plans to switch all of its gas operations to biogas and renewable hydrogen by 2050, making it 100 percent green, its Chief Executive Officer (CEO) Isabelle Kocher said. Kocher said the world was focused on decarbonising electricity via renewable energy, but that electricity only accounts for a minor part of total energy demand.

Source: Reuters

Afghan girls win European prize for solar-powered farming robot

November 30, 2017. An Afghan girls’ robotics team, which was temporarily denied entry to the United States earlier this year, has won an award at a prestigious competition in Europe. The team’s winning entry was a solar-powered robot that would help small farmers carry out tasks including seeding and cutting crops like wheat, Afghanistan’s embassy said.

Source: Reuters

South Korea’s nuclear reactor surge to hamper Moon’s renewable push

November 30, 2017. South Korean President Moon Jae-in has vowed to lead his country to a “nuclear-free era”, but in an ironic twist, nuclear capacity is on track to hit a record during his five-year term. The rise reflects the lag time for change, but also a surprise defeat on shuttering two partially built reactors that could hamper Moon’s efforts to slash reliance on both nuclear and coal and boost renewable energy. The government will release its mid- and long-term energy blue-print next month, and analysts say it faces a tough task to boost renewable energy to 20 percent of the power mix by 2030 and increase gas usage given a rise in both nuclear and coal capacity. Nuclear contributes about 30 percent of South Korea’s electricity, but Moon’s push for change resonated with public concerns over nuclear safety. The decision means South Korea’s installed nuclear capacity is expected to reach to 28.9 GW by 2022, up 28 percent from the current 22.5 GW, according to the country’s nuclear exit plan.

Source: Reuters

US EPA ups biofuel targets slightly, draws scorn from refiners

November 30, 2017. The United States (US) Environmental Protection Agency (EPA) said it will require fuel companies to blend slightly more biofuels into the nation’s gasoline and diesel next year, angering oil refiners who view them as a competitive threat. The announcement follows weeks of lobbying by Midwestern lawmakers and representatives of the corn industry who wanted the agency to reject recent proposals from the oil industry to water down the US biofuels mandates. The US Renewable Fuels Standard requires refiners to blend increasing amounts of biofuels into the nation’s fuel supply every year as a way to boost US agriculture, slash energy imports and cut emissions. The law, introduced more than a decade ago by then-President George W. Bush, has been a boon to the corn belt but has upset the oil industry, which sees biofuels as competition and which has been burdened with the costly responsibility of blending. The 2018 targets require fuel companies to blend 19.29 billion gallons of renewable fuels into the nation’s fuel supply, up slightly from the 19.28 billion gallons required for 2017. That will include 15 billion gallons of conventional biofuels like corn-based ethanol, in line with 2017, and 4.29 billion gallons of so-called advanced biofuels, up from 4.28 billion in 2017, the EPA said. For 2019, the EPA set a target for biodiesel at 2.1 billion gallons, unchanged from 2018. The targets adhere to the EPA’s proposal made in July for both conventional biofuels and biodiesel, but reverses a proposal by the agency to slightly reduce total advanced volumes to 4.24 billion gallons in 2018.

Source: Reuters

Brazil lower house passes bill aimed at boosting biofuels use

November 29, 2017. Brazil’s lower house of Congress approved a bill to set up a program to boost the use of biofuels, a move that could sharply change the way fuel distributors operate in the country. The program, called RenovaBio, will give fuel distributors in Brazil targets to cut carbon emissions, which they will meet by selling increasing volumes of ethanol and biodiesel over the coming years. The bill has yet to be approved by the Senate before it could be signed into law by President Michel Temer. RenovaBio could be a lifeline to Brazilian ethanol producers struggling in recent years to compete with gasoline. It could also bolster sugar prices by encouraging mills to produce more ethanol and less sweetener. Sugar and ethanol consultancy Datagro estimates the new policy could result in domestic demand for as much as 40 billion liters of ethanol by 2030, up sharply from just over 26 billion liters in 2016. The program will force fuel distributors to show they are cutting carbon emissions based on certificates issued by biofuel producers. The certificates will estimate the emissions cut compared with equivalent petroleum products. The program would allow distributors to buy and sell the certificates on a secondary market to meet emissions targets that will grow stricter, tracking Brazil’s commitments within the Paris climate agreement.

Source: Reuters

PJB, Masdar to develop 200 MW floating solar plant in Indonesia

November 29, 2017. Pembangkitan Jawa-Bali (PJB) and Abu Dhabi-based energy company Abu Dhabi Future Energy Company (Masdar) have signed a project development agreement for a 200MW floating solar photovoltaic (PV) power plant in Indonesia. The floating solar plant will span across an area of 225 hectares on the top of the Cirata Reservoir in the West Java province. According to Masdar, one of the benefits of opting for floating solar power in tropical countries such as Indonesia is that it facilitates renewable energy development in forested regions that are otherwise not suitable for conventional solar power.

Source: Energy Business Review

Japan’s Kyushu Electric likely to delay nuclear plant restart due to Kobe Steel checks

November 29, 2017. Japan’s Kyushu Electric Power Co will likely delay the restart of a nuclear plant by several months as it makes checks related to the data-fabrication scandal that has engulfed Kobe Steel Ltd. A delay would be a further hitch in the protracted reboot of Japan’s nuclear sector, which was shut down in the wake of the Fukushima disaster in 2011. The government and industry want reactors restarted to cut electricity bills, but swathes of the public oppose returning to atomic energy. Four reactors are operating out of 42 commercially viable units, and Kyushu Electric has been planning to restart two of its reactors at its Genkai plant in southern Japan by next March.

Source: Reuters


Cost of Electricity Procured by Indian Railways from Key Power Companies

Year Name of Power Supply Company Quantum of Power (in MW) Cost of Power (in Rs/kWh)
2012 NTPC 100 7.35
DVC 50 4.05
TATA 100 5.96
2013 NTPC 100 6.75
DVC 50 4.11
TATA 100 6.67
2014 NTPC 100 5.90
DVC 50 4.11
TATA 100 7.68
2015 NTPC 100 4.68
DVC 50 4.52
TATA 100 7.25
APL 50 3.96
RGPPL 300 4.75
2016 NTPC 100 4.66
DVC 50 4.32
TATA 100 4.46
APL 50 4.16
RGPPL 500 4.65
JIPTL 18.4 3.52

Source: Central Electricity Authority & Rajya Sabha Questions

NTPC: National Thermal Power Corp; DVC: Damodar Valley Corp; TATA: TATA Group; APL: Adani Power Ltd; RGPPL: Ratnagiri Gas and Power Pvt Ltd; JIPTL: Jindal India Thermal Power Ltd

Publisher: Baljit Kapoor

Editorial Adviser: Lydia Powell

Editor: Akhilesh Sati

Content Development: Vinod Kumar Tomar

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