MonitorsPublished on Feb 14, 2019
Energy News Monitor | Volume XV; Issue 35


Gas News Commentary: January 2019


IOC and GAIL (India) Ltd are still evaluating plans to invest in a ₹ 60 billion LNG import terminal being developed by the Adani Group in Odisha. The plan was announced in 2016. According to a preliminary pact signed in September 2016, the Adani Group had agreed to give away half of equity stake in the LNG terminal to IOC and GAIL. The Adani Group said construction orders have been placed and the LNG terminal is on track. Adanis have roped in French energy giant Total to invest in Dhamra LNG terminal. According to the 2016 pact, the country’s top refiner IOC and top gas transporter GAIL were to hold 39% and 11% equity stakes, respectively, in the Dhamra LNG terminal. The Adani Group was to hold the remaining 50%. IOC and Adani were to give away 1% each to a financial institution at a later stage, reducing their stakes to 38% and 49%, respectively. IOC’s 5 mt a year LNG terminal at Ennore in TN is almost ready to go on stream.

IOC the nation’s biggest oil firm, said it will commission its first LNG import terminal at Ennore in Tamil Nadu this month. The ₹ 51.51 billion terminal is complete and would be commissioned after completion of dredging of the channel that will bring cryogenic ships carrying natural gas in its liquid form to the port. Once dredging is complete, IOC will bring a cargo or shipload of LNG to commission the terminal. The company holds 12.5% stake in Petronet LNG Ltd, which operates import facilities at Dahej in Gujarat and Kochi in Kerala. It has also booked capacities in upcoming terminals on both east and west coast. The dredging is being carried out by Ennore Port Trust. IOC holds 95% stake in the Ennore LNG import terminal. Tamil Nadu Industrial Development Corp has 5%.

BPCL may revive its plan to build a terminal for imported LNG amid rising domestic demand for the clean fuel. The regasification LNG terminal with a capacity of 1 to 3 mtpa was planned to be expandable to 5 mtpa later. The public sector oil marketer may consider Kakinada, Krishnapatnam, Mangalore or Gangavaram for the terminal. BPCL’s plans to have its own LNG terminal, now five years in the making, have not made much headway. In 2017-18, BPCL formed a wholly owned gas subsidiary Bharat Gas Resources Ltd with a view to focus on natural gas as a separate business. BPCL may look at booking capacity in the LNG terminals in the country. BPCL said that currently, it is not considering any such proposal. BPCL is a co-promoter of Petronet LNG Ltd, along with IOC, ONGC and GAIL.

Gujarat may offer an additional 50% stake in GSPC LNG Ltd to Adani Group, which already holds a 25% stake in the company, after IOC decided to opt out of the race. The Gujarat government, which owns 50% in GSPC LNG, had been looking to induct a third partner for the remaining 25% stake. It may allow the Adani Group to pick up the 25%, and offload up to 25% of its own stake in the company. The Gujarat government had set up GSPC LNG as a special purpose vehicle for implementing the project with a proposed capacity to re-gasify 5 mtpa. The cost of the project was estimated at ₹ 45-50 billion. The terminal’s capacity can be expanded to 10 mtpa and is designed to have a berth for receiving LNG tankers and storage tank facilities for re-gasification and gas evacuation. Four months since inauguration the terminal is yet to be commissioned as the land lease and sub-concession agreements are yet to be signed between the promoters and the Gujarat government.

A proposal by GAIL for transportation tariff for a major KG basin natural gas pipeline has faced opposition from stakeholders including GMR group, H-Energy, and Gujarat State Petronet Ltd. PNGRB is going to hold an open house to discuss the comments of all the stakeholders. PNGRB has said the then tariff order issued was without considering any extension in the life of the pipeline beyond February 2017 and the extension of economic life beyond February 2017 is still under consideration of the board. The KG-basin natural gas pipeline is a 877.86 km pipeline network with a provisional capacity to transport 15.99 mmscmd of gas, including common carrier capacity of 4 mmscmd. The regulator had determined a transportation tariff of ₹ 5.56/mmBtu for the gas pipeline on GCV basis for the period between 2008-09 and 2014-15; ₹ 5.56/mmBtu for 2015-2016 and ₹ 45.32/mmBtu for financial year 2016-2017. Subsequently PNGRB asked GAIL to make an updated tariff filing with actual data up to 2017-2018. GAIL has proposed a transportation tariff of ₹ 45.32 per mmBtu for period between 2016-17 to 2018-19 and a tariff of ₹ 47.20 per mmBtu for the period between 2019-20 up to 11 February 2027. GAIL said that the pipeline is used for transportation of gas to various customers and more than 80% of supplies cater to the needs of fertilizer plants, power plants, refineries, LPG plants, petrochemical plants and other Industrial units. GAIL said that in order to take care of the requirements of the downstream sector at least 20 days of planned maintenance may be considered while determining the tariff for natural gas pipelines and, accordingly, the number of working days in a year may be considered as 345. GAIL has offered three cargoes loading from the Sabine Pass terminal in the US in 2020. The Indian importer has 20-year deals to buy 5.8 mtpa of US LNG, split between Dominion Energy’s Cove Point plant and Cheniere Energy’s Sabine Pass site. It has offered three cargoes on a free-on-board basis from Sabine Pass for second-half January, second-half July and first-half November loading.

A commissioning cargo from the US had arrived at the Mundra LNG terminal in November last year but it had to be diverted to Hazira port as it was not allowed to discharge at Mundra. The LNG terminal project was originally conceived way back in 2008 by the Gujarat government. Back then, it was planned to come up at Hazira and GSPC was to hold a 50% stake in the project with management control, while Adani and Essar Power Ltd were to hold 25% each. Essar later backed out of the project and the site of the terminal was shifted to Mundra.

India’s domestic natural gas production increased marginally by 0.62% to 2,731.79 mmscm in November 2018, as compared to the corresponding month a year ago. This was primarily due to increase in production from oil and gas fields operated by ONGC. India’s domestic natural gas production in November 2017 stood at 2,714.86 mmscm. Cumulatively, India’s natural gas production during the April-November period of financial year 2018-2019 fell 0.69% to 21,783.74 mmscm, as compared to 21,936.16 mmscm produced in the corresponding period a year ago. The fall was due to lower natural gas production from fields operated by government-owned OIL and private operators/JVs. ONGC, India’s largest producer of crude oil and natural gas, witnessed its natural gas production increase 6.84% to 2,091.44 mmscm in November due to increase in production from its offshore and onshore fields. ONGC’s natural gas production from offshore fields increased 8.59% to 1,617.54 mmscm in November, as compared to 1,489.56 mmscm produced in the corresponding month a year ago. The company’s natural gas production from onshore fields increased marginally by 1.25% to 473.89 mmscm in November, as compared to 468.02 mmscm produced in the corresponding month a year ago. Cumulatively, ONGC’s natural gas production during the April-November period of financial year 2018-2019 increased 3.64% to 16,219.29 mmscm as compared to 15,650.38 mmscm produced in the corresponding period a year ago, because of increase in production from the company’s offshore fields. OIL’s natural gas production in November declined 3.66% to 226.88 mmscm, as compared to 235.50 mmscm produced in the corresponding month a year ago. Cumulatively, OIL’s natural gas production in the April-November period of financial year 2018-2019 declined 6.73% to 1,828.14 mmscm, as compared to 1,960.01 mmscm produced in the corresponding period a year ago. Natural gas production from fields operated by private operators as well by JVs declined 20.76% to 413.47 mmscm in November, as compared to 521.80 mmscm produced in the corresponding month a year ago. Natural gas production from fields operated by private operators/JVs in the April-November period of financial year 2018-2019 declined 13.63% to 3,736.31 mmscm, as compared to 4,325.78 mmscm produced in the corresponding period a year ago.

In Karnataka, the ratio of clean fuel to non-clean fuel usage is 55:45 and there is good scope for increasing usage of natural gas, the PNGRB said. In Bengaluru, the PNGRB held its 10th round of CGD bidding road show, to help interactions between interested stakeholders from the industry with senior State government officials. About 15 Karnataka districts are to be covered under the CGD in the 10th round of bidding which is currently under way. In the 10th round of CGD bidding, which is currently on, in Karnataka there are six GAs covering 15 districts – Kolar, Bagalkot, Koppal, Raichur, Hassan, Chikkamagaluru, Kodagu, Kalaburgi, Vijayapura, Mysuru, Mandya, Chamarajanagar, Uttar Kannada, Haveri and Shivamogga are being offered by the PNGRB. Shale gas may turn as a boon to West Bengal's investment map with a potential of ₹ 500 billion over the next several years but proper regulatory framework, environmental or social factors needs to be handled properly. GEECL and Essar Oil who are producing CBM in the Ranigunj belt had expressed interest in exploring and extracting shale gas and under the new licensing regime government has allowed shale exploration from CBM blocks. GEECL's CBM block may hold as much as 6.63 tcf of shale resources, of which about 1.7 tcf can be recovered. The Raniganj block has a shale gas potential of 7.7 tcf, Essar had said. But, several experts have flagged environmental and social concerns in shale gas exploration.

Kolkata is likely to get CNG by end of this year, which would facilitate vehicles running on greener fuel. The Central government owned GAIL was entrusted to develop CGD network in six cities - Patna, Jamshedpur, Ranchi, Bhubaneswar, Cuttack and Kolkata. However, Greater Calcutta Gas Supply Corp was earlier authorised for city gas distribution in Kolkata and surrounding areas. Subsequently, it was decided the CGD in the eastern metropolis would be developed jointly. Incidentally, the gas major has been setting up Jagdishpur-Haldia-Bokaro-Dhamra pipeline to bring natural gas to eastern India. PNGRB said CNG is 60% cheaper than petrol and 45% than diesel. Seven districts in Rajasthan has been offered under the 10th round of CGD bidding. AS a part of the wider energy security programme, the government has set a target to reduce 10% crude oil imports by 2022. In the 9th round of city gas distribution bidding, 13 districts in Rajasthan were awarded to companies for creating the infrastructure and marketing of the gas to consumers in the districts. The state is taking efforts not only to increase the use and supply of gas but also produce the green fuel. In the 10th round of biddings, the Centre is offering 50 GAs across the country.

Opposition parties in Tripura, mainly the Communist Party of India-Marxist (CPI-M) and Congress, strongly opposed the Centre’s decision allowing Vedanta Ltd to explore gas in the state along with government-owned ONGC. The Union government has signed 55 revenue-sharing contracts with companies which were awarded petroleum exploration blocks. These blocks were cleared under the Hydrocarbon Exploration and Licensing Policy and Open Acreage Licensing Policy for exploration and production of crude oil and natural gas. The Petroleum and Natural Gas Ministry has asked the Tripura government to facilitate speedy permission for smooth flow of investment and works in the exploration project. ONGC had so far drilled 225 wells in Tripura, finding huge reserves in over 116 wells. ONGC has, since 1962, established around 41 bcm of recoverable gas reserves in Tripura's eleven gas fields, including the Tichna field in southern Tripura adjoining Bangladesh.

Rest of the World

President Vladimir Putin opened Russia’s first LNG FSRU. The Marshal Vasilevskiy FSRU has been set up in Kaliningrad, wedged between EU members Poland and Lithuania, by Russian energy giant Gazprom to bypass pipeline gas deliveries via Lithuania in case transit is disrupted. Moscow’s decision to set up the FSRU was in part to reduce gas transit risks to Kaliningrad, home to a Baltic Fleet base, as the EU steps up efforts to reduce its dependency on Russia.

Gazprom Neft, the oil arm of Russian gas giant Gazprom, is studying the possibility of its own LNG production in the Arctic as it tries to monetize its vast natural gas reserves. Russia has only two large LNG plants in operation - Yamal LNG with capacity of 16.5 mtpa and Sakhalin Energy, at more than 10 mt on the eastern island of Sakhalin. Gazprom Neft announced a tender late last year for a study on how best to use its gas reserves in the Yamal region. The company is seeking an analysis of oil and gas markets and ways to process its gas including in LNG form. The company is considering whether to build a gas pipeline on the Arctic seabed that would connect its Novoport field to the existing Gazprom network.

Russia and Ukraine will meet for further gas talks in May after an EU (mediated discussion in Brussels yielded no concrete results. The talks have focused on Russian gas transit via Ukraine to Europe, the source of up to 3% of Ukrainian gross domestic product. With Russia embroiled in conflict with Kiev over breakaway regions in Ukraine’s east and the European Union reliant on Russian gas to fuel its industries, the future of gas transit - seen by Kiev as a crucial guarantor of its independence from Moscow - is the subject of intricate diplomacy. Moscow is ready to keep its transit of gas to Europe through Ukraine once the current deal with Kiev expires on 31 December 2019 if supplies are economically viable.

Novatek, Russia’s largest non-state gas producer, will increase gas output in 2019 by 10% and liquid hydrocarbons production by 2%. Novatek has signed contracts for a quarter of the investment needed in its Arctic LNG-2 project. France’s Total may take part in a project to build an LNG terminal in Murmansk. Novatek increased its natural gas output to 68.81 bcm in 2018.

Tellurian Inc’s proposed Driftwood LNG project in Louisiana took a major step forward as the US federal energy regulator issued a final environmental report clearing the way for the company to seek a permit to build the export terminal. The company said it needs an order from the FERC allowing the construction and operation of the 27.6 mtpa liquefaction plant aimed at meeting growing global demand for the supercooled fuel. US LNG exports have quadrupled in the last two years and are expected to top 10.3 bcfd by the end of 2020, making the country one of the world’s largest LNG exporters. One bcf of gas is enough to fuel about 5 million US homes for a day. In addition to the LNG terminal, Tellurian is developing pipelines to transport gas from shale formations in Texas and Louisiana to LNG terminals and other Gulf Coast customers.

Venture Global LNG Inc urged US FERC to approve construction of its planned Calcasieu Pass LNG export terminal in Louisiana by 22 January. The Calcasieu Pass facility is designed to produce about 10 mtpa of LNG, or about 1.3 bcfd of natural gas. One billion cubic feet is enough gas to fuel about 5 million US homes for a day. Calcasieu Pass, which is expected to cost an estimated $4.5 billion to build, is one of dozens of LNG export terminals that companies are seeking to build in the US, Canada and Mexico over the next decade to meet growing global demand for the fuel. The US, which was a net importer of LNG before shipping its first cargo from the lower 48 states in February 2016, is expected to become the third biggest exporter of the super-cooled fuel by capacity by the end of 2019, behind Australia and Qatar. Looking at only the plants currently under construction, US LNG export capacity is expected to rise to 8.9 bcfd by the end of 2019 and 10.3 bcfd in 2020 from 5.1 bcfd. World LNG trade totaled about 42 bcfd in 2018. Venture Global, which is also developing the 10 mtpa Plaquemines LNG export facility in Louisiana, said it expects Calcasieu Pass to enter service in 2022 and Plaquemines in 2023.

Top Chinese oil and gas producer PetroChina pumped 4.27 bcm of shale gas in the southwestern province of Sichuan in 2018, up 40% from 2017, CNPC said PetroChina’s shale gas output compared to around 6 bcm pumped by domestic rival Sinopec Corp last year. Sinopec is the country’s leading shale gas player developing its flagship Fuling field in southwest China’s Chongqing region, also in the Sichuan basin. PetroChina racked up record daily sales of natural gas, including mostly conventional gas supplies, at 703 mcm on 29 December last year, when residential heating demand surged amid massive temperature drops during winter, CNPC said. Gas supplies out of PetroChina’s storage hit a record 78.07 mcm on the same day

China’s top oil and gas company PetroChina is selling spot LNG cargoes on the European market from Russia’s Yamal plant, adding to a flood of volumes to the continent amid subdued Asian demand. PetroChina’s increased presence in Europe is an example of how Asian energy companies are expanding their role as LNG traders, engaging in LNG transactions globally. The early start-up of Yamal LNG’s second and third trains, or production lines, in 2018 raised spot volumes from Russia and helped PetroChina boost its European market presence, selling LNG from its 20% share of the project’s spot volumes. PetroChina has offered cargoes mainly to northwest Europe this winter, with buyers that include trading houses Vitol and Trafigura, as well as UK oil major BP. Regular volumes from Yamal ensure a more stable presence in Europe for PetroChina, the publicly traded arm of China National Petroleum Corp. Last winter, PetroChina traded some spot volumes from Yamal LNG Train 1. However, a spike in Yamal LNG production at the end of 2018 to 16.5 mtpa has allowed PetroChina to compete for high-profile buyers with another Yamal LNG shareholder, Novatek, and US producers. This winter has seen Europe become a prime destination for spot LNG cargoes, amid weak Asian demand and increased shipping costs to transport LNG between the Atlantic and Pacific basins.

China’s natural gas imports in December hit a monthly record at around 9.2 mt calculations based on Chinese customs data showed. For all of 2018, China’s natural gas imports surged 31.9% over 2017 to 90.39 mt according to calculations. The December gas imports came in at 9.15 mt according to calculations, a record high. China’s crude oil imports in 2018 rose 10.1% on a year earlier to a record 462 mt according to calculations. December crude oil imports were 43.89 mt according to calculations.

CNPC said that it will build 23 more gas storage facilities and expand 10 existing ones by 2030. The state energy group will build six regional gas storage centres across China, where the facilities will be located, in the next 12 years, according to the company. The plan was part of China’s efforts to secure supplies of natural gas during peak demand season over winter. Gas producers and local authorities have been boosting investment and adding new storage following a harsh winter that saw a severe supply squeeze, partly due to storage shortfalls.

French LNG imports soared last year as Australia, the US and Russia brought more LNG to world markets, French gas network operator GRTgaz said. GRTgaz said that new LNG gasification plants in Australia and the US - as well as shipments from Russia’s Yamal plant - had reduced the price difference between LNG in Europe and Asia, as well as between LNG and pipeline gas. GRTgaz said the cross-Pyrenees flow of gas was mostly from north to south and that in the south-north direction the pipelines were not saturated. French gas consumption fell 5% to 442 terawatt hour in 2018 compared with the previous year due to high temperatures and less use of gas-fired power generators. Industrial gas demand rose for the fifth year in a row as more industries switched from oil and coal power generation to gas, GRTgaz said.

Norwegian oil and gas firm Equinor has restarted operations at its Melkoeya LNG plant after an outage ten days ago, the company said. The plant, which liquefies natural gas from the Arctic Snoehvit gas field for transportation by tankers, has been shut since 4 January due to a compressor failure.

A record amount of LNG production is expected to get the green light in 2019 amid strong global demand, especially from China, analysts said. A final investment decision could be taken on more than 60 mtpa of LNG capacity this year, well above the previous record of about 45 mt in 2005 and triple last year’s 21 mt, Woodmac said. The new capacity would bulk out the pipeline of gas set to come on stream in coming years, adding to the more than 320 mt of LNG shipped globally in 2018, according to shipping data in Refinitiv’s Eikon. Frontrunners this year include the $27 billion Arctic LNG 2 project by Russia’s Novatek, at least one project in Mozambique and three in the United States, Woodmac said. Canada’s Woodfibre LNG project, developed by Singapore-based Pacific Oil and Gas, may get the go-ahead in 2019, WoodMac said. New projects typically take several years to develop, with many of those under consideration likely to be ready to ship gas in the early 2020s if approved. Other projects awaiting FID include train 7 of Nigeria LNG, and a three-train expansion in Papua New Guinea, although some projects are widely expected to be pushed into the 2020s. Huge increases in China’s demand growth as part of a programme to shift households and factories from coal to gas, increased LNG import dependency in Europe, and a backlash against dirtier coal is driving optimism in the industry.

Algeria will struggle to keep gas exports at 50 bcm/year in the medium term unless it curbs rising domestic gas consumption. Domestic consumption is expected to rise by 4.7% per year to 67 bcm by 2028, according to a document from the Algerian Electricity and Gas Regulation Commission (CREG). In 2018, domestic consumption was 45.1 billion, it said. The OPEC oil producer has been talking to foreign oil majors regarding exploration of shale gas in southern Algeria. Sonatrach wants to speed up exploration this year. But it needs to ensure that international companies do not face protests from local communities like those which forced Sonatrach to temporarily halt shale exploration testing near the In Salah gas field in 2015.

Saudi Aramco, the world’s top oil producer, is looking to acquire natural gas assets in the US and is willing to spend “billions of dollars” there as it aims to become a global gas player. It already owns Motiva, the biggest US oil refinery. Aramco’s gas expansion strategy needs $150 billion of investment over the next decade as the company plans to increase output and later become a gas exporter. Aramco is pushing ahead with its conventional and unconventional gas exploration and production program to feed its fast-growing industries, freeing up more crude oil to export or turn into chemicals. Investing in the US gas and petrochemical sector has become “very lucrative” due to the large availability of ethane resources. Aramco is a major gas player but much of its production is used domestically.

Bahrain’s first LNG floating unit arrived in the Gulf as the country gets ready for its maiden imports of the super-chilled fuel this year, data from Refinitiv Eikon showed. The FSU is on a 20-year charter to Bahrain LNG, who is the developer of a wider receiving and regasification terminal within the Khalifa bin Salman Port facility, in Hidd, Bahrain, according to Bahrain LNG. The LNG import terminal, which is expected to start commercial operations early this year, will allow Bahrain to import the super-chilled fuel for the small Arab state’s growing demand for natural gas to fuel large industrial projects, generate power and water and for enhanced oil recovery. The project will have a capacity of 800 million cubic feet per day. LNG will be delivered to the import terminal by LNG carrier ships, where it will be stored in the FSU, according to Bahrain LNG. The LNG will be turned back into natural gas using sea water to warm the LNG and the natural gas will then be transferred in a buried pipeline to shore where it will supply the existing natural gas pipeline network operated by national oil company Bahrain Petroleum Company.

Angry Dutch citizens will ask their country’s highest court to put an immediate end to gas production in the Groningen region due to the risk of life-endangering earthquakes. Decades of extraction from what once was Europe’s largest natural gas field have led to dozens of minor tremors every year, damaging thousands of homes and sparking unrest among locals. An unusually severe, magnitude 3.4 quake prompted the Dutch government last year to decide to end production by 2030 and to lower it as quickly as possible in coming years. Gas production at Groningen is run by NAM, a 50-50 joint venture between Royal Dutch Shell and Exxon Mobil. Output is set to drop to 19.4 bcm in the year that began in October, down 65% from its 2013 peak, and will be cut by another 75% in the next five years, the government said. The petitioners demand drilling be stopped immediately, or at least capped at 12 bcm per year, a level the Dutch gas regulator last year said would limit risks. A sudden halt to output would put the Netherlands in a tight spot, as the country still depends on Groningen gas for a significant part of its energy supply and export obligations. The High Court in 2017 said certainty of supply should play a role in decisions on the production level, but should not outweigh safety concerns.

Thailand’s state energy firm PTT is planning to start a LNG desk in Singapore to expand its trading activities of the super-chilled fuel. PTT is planning to set up the desk by hiring at least one LNG trader and an operations staff. The company has hired Daisuke Matsuoka to join its Singapore office. Matsuoka was most recently an LNG trader with Japanese trading firm Itochu Petroleum and with Royal Dutch Shell Plc and BG Group before that. Thailand’s LNG imports are expected to more than double over the next five years from about 5 mtpa currently, driven by rising import dependency amidst declining domestic gas production. PTT is currently the country’s sole gas supplier and its only LNG importer, but state-run Electricity Generating Authority of Thailand is expected to start imports this year. PTT’s Singapore office has more than 60 staff and trade in oil and other commodities.

Bangladesh’s second LNG terminal is expected to start operations in mid-March though domestic pipeline constraints means it will be unable to fully supply gas demand to the country’s capital Dhaka. Summit Corp, a subsidiary of Bangladesh’s Summit Holdings, and partner Mitsubishi Corp are expected to start operations at their FSRU off the country’s coast by the middle of March and ahead of schedule. However, construction delays on a pipeline that will carry regasifed gas from the coastal city of Chattogram, near where the FSRU will be anchored, to Dhaka means that the vessel will not be fully utilised. Until the pipeline is fully connected, the FSRU will handle about 300 mmcfd of gas which will be supplied to the Chattogram area. The ship can regasify up to 500 mmcfd of LNG, according to Summit. Once the pipeline is completed, state-owned energy company Petrobangla will be able to send up to 1,000 mmcfd from both the Summit FSRU and a vessel operated by US company Excelerate that started up in August. Bangladesh has scrapped plans to build additional floating LNG terminals in favour of land-based stations after the start-up of Excelerate’s vessel was delayed by several months due to technical problems and bad weather.

Pakistan will seek a credit facility for LNG payments from Qatar as part of efforts to ease its severe balance of payments crisis. Pakistan faces a severe strain on its balance of payments, with a current account deficit of around 5.9% of gross domestic product and foreign exchange reserves sufficient only to cover around two months’ of import payments. The government has been talking to the International Monetary Fund about a possible bailout and has stepped up efforts to raise funds from friendly Arab nations as well as China. At the same time, Pakistan is facing a serious energy crisis with repeated blackouts and gas supply outages that led to the sacking of the heads of two of the country’s main gas distribution utilities. If agreed, an LNG credit facility with Qatar would follow similar agreements enabling deferred payments on oil supplies from Saudi Arabia and the United Arab Emirates, which have both agreed $3 billion facilities with Pakistan.

Eastern Mediterranean countries meeting in Cairo agreed to set up a forum to create a regional gas market, cut infrastructure costs and offer competitive prices, Egypt’s petroleum ministry said. The Eastern Mediterranean Gas Forum will be based in Cairo and will be open to monitoring by international and regional organizations. In September, Israel and Egypt bought a 39% stake in the EMG pipeline, paving the way for a landmark $15 billion natural gas export deal to begin this year. Cyprus is in talks with Egypt to construct a pipeline connecting Cyprus’ Aphrodite gas field to Egypt’s LNG facilities. Egypt has rapidly increased its production of natural gas and hopes to become a hub for exporting to Europe after making a series of big discoveries in recent years, including the largest gas field in the Mediterranean, Zohr.

Zimbabwe has more than doubled the price of gasoline, hoping the increase will end severe shortages that are fueling public anger even as he departs on a foreign trip to Russia and other countries in search of investment. The increase in the state-controlled price of fuel should ease the shortages that have gripped the country in recent weeks. The gas shortages highlight that this southern African country is battling its worst economic crisis in a decade due to a severe shortage of foreign currency.

Energy Ministers from Peru and Bolivia agreed to discuss building a pipeline that would transport natural gas and LNG from Bolivia to its neighbour. The pipeline would provide crucial access to the Pacific Ocean for land-locked Bolivia, running to Peru’s southern port of Ilo. Bolivia had wanted to build a pipeline through Chile to reach the ocean and expand its gas exports, but the International Court of Justice ruled against Bolivia’s demand that Chile negotiate granting it sovereign access to the sea in October. Bolivia is South America’s top natural gas exporter, but it is a net importer of oil, as is neighbouring Peru. Bolivia told Peru it would also like to build an oil pipeline to Peru and import gasoline, diesel and crude through Ilo. Talks between Peru and Bolivia also include the creation of a joint venture between Bolivian state energy company YPFB and its Peruvian counterpart, Petroperu, to commercialize LNG in border regions, Bolivia said.

The TAP has completed its €3.9 billion ($4.5 billion) project financing, paving the way for construction to be completed for start-up in 2020. TAP, the final leg of a $40 billion project called the Southern Gas Corridor to transport gas from Central Asia to Western Europe, is a cornerstone of the European Union’s energy security policy to wean the bloc off Russian gas supplies. With the first delivery of gas to Europe expected in 2020, TAP will be the first non-Russian gas pipeline to supply Europe since the Medgaz link, which started deliveries from Algeria to Spain in 2011. TAP will transport up to 10 bcm of natural gas per year from the Shah Deniz II field in Azerbaijan to Italy.

IOC: Indian Oil Corp, LNG: liquefied natural gas,  mt: million tonnes, BPCL: Bharat Petroleum Corp Ltd, mtpa: million tonnes per annum, ONGC: Oil and Natural Gas Corp, GSPC: Gujarat State Petroleum Corp, KG: Krishna-Godavari, PNGRB: Petroleum and Natural Gas Regulatory Board, km: kilometre, mmscmd: million metric standard cubic meter per day, mmBtu: million metric British thermal units, GCV: gross calorific value, US: United States, OIL: Oil India Ltd, JVs: joint ventures, CGD: city gas distribution, GEECL: Great Eastern Energy Corp Ltd, CBM: coal-bed methane, tcf: trillion cubic feet, CNG: compressed natural gas, GAs: geographical areas, bcm: billion cubic meters, FSRU: floating storage and regasification unit, EU: European Union, FERC: Federal Energy Regulatory Commission, bcfd: billion cubic feet per day, CNPC: China National Petroleum Corp, mcm: million cubic meters, UK: United Kingdom, OPEC: Organization of the Petroleum Exporting Countries, mmcfd: million cubic feet per day,   FSU: floating storage unit, TAP: Trans Adriatic Pipeline


India becomes world’s second largest LPG consumer after Ujjwala push

5 February. The government's push to provide clean cooking fuel to every household has turned India into the world’s second largest LPG (liquefied petroleum gas) consumer whose demand is projected to rise 34 percent by 2025, Oil Secretary M M Kutty said. He said active LPG consumers have grown at a compounded annual growth rate (CAGR) of 15 percent - from 148 mn in 2014-15 to 224 mn in 2017-18. Under Pradhan Mantri Ujjwala Yojana (PMUY) of providing free cooking gas or LPG connection to poor, over 63.1 mn connections have been provided since the launch of the scheme on 1 May 2016. Oil Minister Dharmendra Pradhan said the PMUY was launched in May 2016 with the objective of providing free LPG connections to 50 mn women belonging to poor households over a period of three years. LPG is supposed to replace traditional cooking fuels in rural kitchens such as firewood and cow dung which not only contribute to environmental degradation but also have serious health implications on users. Also, the government has started transferring the LPG subsidy directly into bank accounts of the beneficiaries, thereby eliminating duplication and fake users. Under the Direct Benefit Transfer, rather than supplying LPG cylinders at subsidised rates, the government now supplies cylinders at market prices and transfers the subsidy amount into bank accounts.

Source: The Economic Times

India’s oil trade with Venezuela has gone down since sanctions: Ambassador

5 February. India's oil trade with Venezuela has gone down since sanctions were imposed on the Latin American country, its Ambassador to India Augusto Montiel said. Montiel said the country is currently selling 400,000 barrels of oil per day to India. Venezuela has been battling hyperinflation, power cuts and severe shortages of basic items such as food and medicine. To a question on the mechanism of payment with India, Montiel said it is in Indian rupees.

Source: Business Standard

SC asks Centre to consider plea to check cheating at petrol pumps

2 February. The Supreme Court (SC) asked the Centre to consider a petition seeking direction for the government to ensure transparency and fairness at petrol pumps across the country. A Bench headed by Justice Sikri directed the Centre and petroleum ministry to consider as representation, a petition by advocate Amit Sahni to check cheating at petrol pumps. The plea filed in public interest has alleged that petrol pumps cheat customers by dispensing lesser fuel by installing a "microchip" to speed up the pulse meter or by any other method. The plea claimed that as per news reports Delhi ranked third in petrol pumps frauds, with Maharashtra topping the list followed by Uttar Pradesh. Sahni suggested replacing the black hose pipes used for fuel vending at petrol pumps with a transparent pipe so that the consumers can see the passage of fuel onto their vehicles.

Source: Business Standard

Budget 2019: Government must allocate up to Rs 500 bn for petroleum subsidy

1 February. The government’s petroleum subsidy allocation for the next financial year must be between Rs 370 bn and Rs 500 bn taking into account expected levels of average crude oil prices and the exchange rate, experts said. The government had budgeted for an overall petroleum subsidy of Rs 249.33 bn for financial year 2018-2019, a mere 1.93 percent increase over Revised Estimate of Rs 244.60 bn allocated for 2017-2018. The oil ministry expects under-recoveries of oil firms for the current fiscal to reach Rs 457.81 bn. A different estimate shows the petroleum subsidy for this fiscal may shoot up to Rs 340 bn as global crude oil prices are easing in the second half of the year after the spike witnessed in the first half. The government’s expenditure on petroleum subsidy in the first six months of the current financial year has already crossed 83 percent of the budgeted allocation of Rs 249.33 bn.

Source: The Economic Times

Subsidised LPG price cut by Rs 1.46, non-subsidised rate reduced by Rs 30 a cylinder

31 January. Domestic cooking gas or liquefied petroleum gas (LPG) price was cut by Rs 1.46 per cylinder, the third straight reduction in a month's time due to tax impact on reduced market rate of the fuel. A 14.2 kg (kilogram) subsidised LPG cylinder will now cost Rs 493.53 in the national capital as against Rs 494.99 currently, Indian Oil Corp (IOC), the country's largest fuel retailer, said. This is the third straight monthly reduction in LPG rate. On 1 December, subsidised LPG price was cut by Rs 6.52 per bottle and by Rs 5.91 on 1 January. IOC said non-subsidised or market priced LPG rates have been cut by a Rs 30 per cylinder "due to fall in price of LPG in international market and strengthening of US dollar-rupee exchange rate". It will cost Rs 659 per 14.2 kg cylinder in Delhi. The reduction comes on the back of a steep Rs 120.50 cut on 1 January and Rs 133 on 1 December. All LPG consumers buy the fuel at market price. The government, however, subsidises 12 cylinders of 14.2 kg each per households in a year by providing the subsidy amount directly in bank accounts of users. This subsidy amount varies from month to month depending on the changes in the average international benchmark LPG rate and foreign exchange rate. When international rates move up, the government provides a higher subsidy. And when they come down, subsidy is cut. As per tax rules, GST (Goods and Services Tax) on LPG has to be calculated at the market rate of the fuel. The government may choose to subsidise a part of the price but tax will have to be paid at market rates. So, with the fall in market price or non-subsidised LPG price, the tax incidence on subsidised cooking fuel has also come down, leading to the current price reduction. Subsidised cooking gas consumers will get Rs 165.47 per cylinder subsidy in their bank accounts for the month of February, down from Rs 194.01 in January. The subsidy transfer in the customer's bank account has been reduced from Rs 433.66 in November and Rs 308.60 in December.

Source: Business Standard

Vedanta, ONGC, 37 others put in 145 bids in oilfield auction

30 January. As many as 39 firms, including six foreign players, put in 145 bids for 24 out of the 25 oil and gas fields on offer in the second round of bidding for discovered small fields in India, with mining giant Vedanta placing offer for the maximum 21 fields. At the close of bidding for the second round of Discovered Small Fields (DSF), Oil and Natural Gas Corp (ONGC) and Oil India Ltd (OIL) placed bids for 10 fields each while Indian Oil Corp (IOC) bid for 3, according to upstream regulator DGH (Directorate General of Hydrocarbons). British company Soco International made its foray into India, bidding for one field while little known Arch Softwares put in bids for 15 fields. Vedanta, which had walked away with 41 exploration blocks of the 55 on offer in a separate open acreage licensing round last year, bid for 21 fields in DSF-II. It was the sole bidder in one field. The 25 contract areas on offer covered 59 discovered oil and gas fields, spread over 3,000 square kilometres with a prospective resource base of over 190 million tonnes (mt) of oil and oil equivalent gas, DGH said. Out of the total 145 e-bids received, 103 were received for onland contract areas and 42 for offshore contract areas. All the 15 onland contract areas received bids while 9 out of 10 offshore contract areas have received bids. The fields would be awarded by end of February 2019, so as to expedite the monetisation of the hydrocarbon production from these fields, it said. Oil Minister Dharmendra Pradhan had said that ONGC had spent Rs 128.26 bn and OIL another Rs 2.24 bn on the 115 oil and gas discoveries that were taken away from them by the government for auctioning to private companies under DSF bid rounds.

Source: Business Standard

IOC looking for annual deal to buy US oil

30 January. Indian Oil Corp (IOC) is looking for an annual deal to buy US (United States) crude as it seeks to broaden its oil purchasing options, its Chairman Sanjiv Singh said, amid uncertainties over imports from Iran. Washington in November granted a six-month waiver to New Delhi from sanctions against Tehran and restricted India’s monthly intake of Iranian oil to 1.25 million tonnes or 300,000 barrels per day. He said IOC has not yet finalised from which company it would buy US oil. IOC had previously purchased US oil from spot markets and signed a mini-term deal in August to buy 6 million barrels of US oil between November to January. IOC is the top Indian buyer of Iranian oil with an annual

contract for 180,000 bpd in the fiscal year ending March 2019. He said his firm buys Iranian oil because of competitive prices and attractive terms and conditions. Iran offers extended credit periods and almost free shipping on oil sales to India.

Source: Reuters


GAIL Q3 net profit up 33 percent

5 February. Natural gas processing and distribution company GAIL (India) Ltd reported a 33 percent rise in net profit for the third quarter (Q3) of 2018-19. According to the company, the net profit during the quarter under review rose to Rs 16.81 bn from Rs 12.62 bn reported for the corresponding quarter of the last financial year. According to GAIL CMD (Chairman and Managing Director) B C Tripathi, the company is expected to achieve a capital expenditure outlay of around Rs 70 bn during 2018-19, which would be an increase of more than 70 percent over the last year's.

Source: Business Standard

IOC seeks commissioning cargo for new Ennore LNG terminal

30 January. Indian Oil Corp (IOC) is seeking a commissioning cargo for its new Ennore liquefied natural gas (LNG) terminal in south India. The company is seeking a partial cargo for delivery on 25 February, with offers due by 11 February. IOC Chairman Sanjiv Singh had said that the 5 million tonnes per year Ennore terminal will likely be commissioned by January, but the tender suggests there will likely be a delay.

Source: Reuters


Government allows women to work in underground coal mines

4 February. The Central government decided to allow women to work in underground coal mines and also do night shifts in open cast or over ground mines, in a bid to bring about greater gender equality and generate more employment opportunities for women. The government in a notification said it had decided to exempt the women employed in any mine above and mine below ground from the provisions of section 46 of the Mines Act, 1952, which restricts the women from working in mines. Following the request from women employees and mining companies, the ministry has also decided to extend the timing of women workers in coal mines initially and it would be extended in other such mining sectors on the basis of the initiative. However, the deployment of women has been subjected to certain rules, which includes providing adequate facilities and safety to them. The labour ministry has ordered that the deployment of women should be in a group of not less than three in a shift. Earlier, the Mines Act had restricted the employment of women in underground mines, and also in opencast or above ground workings of the mine during night hours between 7 pm and 6 am.

Source: NDTV

India ramps up spending on coal exploration as it slashes funds for mine safety

1 February. The Indian government will increase spending on exploration of coal and lignite by 20 percent in the coming financial year but will slash funding for coal mine safety and conservation, according to the budget document. India is one of the world’s largest consumers of coal and rising imports of the fuel are adding to a burgeoning trade deficit, prompting the government to invest in developing more domestic resources. In the 2019/20 financial year that begins in April, the government aims to spend Rs 6 billion ($84 million) on exploration of coal and lignite, the document for the 2019/20 budget showed. At the same time, it will cut spending on conservation, safety and related infrastructure development by about a third from last year to Rs1.35 billion, according to the document. India is one of the most dangerous countries in the world to be a coal miner, with one miner dying every six days on average in 2017, according to government data, but this will be the second straight year that the government has cut spending on safety. The coal ministry said that coal companies had their own safety budgets. Coal India Ltd (CIL) has a near monopoly, producing over four-fifths of the country’s coal output. It allocated 8.6 billion rupees for safety-related expenditure for the year ending March 2019, up from Rs 8 billion a year earlier, the ministry said. India scrapped a separate excise duty levied on coal companies, which was used by the federal coal ministry to shore up funds for enhancing safety, after it reformed tax policies in 2017. The coal ministry said it had increased spending for exploration in 2019/20 to develop more coal blocks to increase domestic coal production and minimize imports.

Source: Reuters


CERC pushes for 100 percent power sale in spot market

5 February. India proposes to move to the global practice of selling entire power generation through spot market to lower tariffs, promote efficient plants and withstand periodical aberrations that benefit a few plants. It is also expected to ensure that power plants with low tariffs do not get into ‘stressed assets‘ category in future even without power purchase contracts with states. However, Association of Power Producers director general Ashok Khurana said the operational and settlement issues have to be looked into for implementation. The proposal put forth by sectoral regulator and followed in Europe and many parts of the United States is expected to result in savings of crores of rupees to the state-owned electricity distribution companies. An exercise by the Central Electricity Regulatory Commission (CERC) showed that the mechanism could have last year resulted in savings of nearly Rs 60 bn to distribution companies of five states. If implemented, pan-India the savings are expected to be higher. CERC has begun consultations on the proposal on market-based economic dispatch of electricity.

Source: The Economic Times

NTPC threatens to cut supply to Andhra Pradesh, Karnataka and Telangana

5 February. With outstanding dues spiralling to nearly Rs 60 bn, NTPC Ltd has threatened to cut supplies to the electricity distribution companies (discoms) of Andhra Pradesh, Karnataka and Telangana if the bills are not cleared soon. The cumulative dues, pending for more than 60 days, stood at Rs 41.38 bn as on 30 January. If immediate arrangements are not made, the three states could lose 3,470 MW of power supply from NTPC’s Ramagundam, Simhadri, Talcher and Kudgi power plants. As per the regulation notice sent to the discoms from NTPC, some of the bills for which payments have not been made were raised as early as March 2018. NTPC’s outsanding receivable from states (more than 60 days) are pegged at Rs 7,020 crore at the end of December 31, 2018. According to sources, dues are also rising significantly from the discoms of Uttar Pradesh and Jammu and Kashmir. The dues have been pending in spite of “repeated follow ups at various levels in person as well as through letters”.

Source: The Financial Express

January spot power price rises 4 percent to Rs 3.33 per unit

4 February. Average spot power price at Indian Energy Exchange (IEX) rose slightly by 4 percent at Rs 3.33 per unit in January compared to same month year ago mainly due to subdued demand. According to the day-ahead-market data at IEX, with trade of 3,281 million units, the volume in the day-ahead-market saw an increase of 7 percent on month-on-month basis and decline of 3 percent year-on-year basis. On a daily average basis about 106 million units were traded. IEX said the market clearing price and volume in January 2019 remained almost same as that in December 2018, mainly on account of winter and subdued demand for power, especially in the northern states. IEX said that 'One Nation, One Price' was realised for 18 days during the month. The day-ahead-market experienced transmission congestion of 1.6 percent mainly in the import towards southern region. On daily average basis, 686 participants traded in the market during the month. As per the NLDC (national local dispatch centre) statistics, the all India peak demand touched 162 GW on 18th January, registering a 4 percent increase over peak demand registered in January 2018. On all India basis, the energy supplied in January 2019 at 103 billion units registered marginal increase of 3 percent from 100.7 billion units compared to last year.

Source: Business Standard

Central Railway saved 16.5 percent power in December 2018

4 February. A series of green initiatives have helped Nagpur division of Central Railway to reduce power consumption by 16.46% in December last year. Nagpur Central Railway pays an annual electricity bill of Rs 200 mn, which comes to Rs 16.6 mn per month. Recently, the division launched a mobile app called VISHNUP for quick redressal of power complaints. It also conveys a message to the employees after solving of problems. The division has also replaced all conventional lights with 20,000 nine-watt LED (light emitting diode) bulbs in staff quarters. Work to replace 20,000 more LED tube lights of 20 watts is in progress at all railway quarters.

Source: The Economic Times

Greater Noida villagers protest 10-day power cut

4 February. Residents of a Dankaur-based village in Greater Noida protested against the electricity department for allegedly discontinuing the power supply for the past 10 days. The residents alleged that they face severe power cuts which can last up to days since the officials don’t address their complaints on time. The residents of Derin Khuban village raised slogans against the department. Shiv Kumar, the sub-divisional officer at Dankaur substation, said that there has been a fault in a 150 metre underground wire which goes through the Peripheral Expressway.

Source: The Economic Times

UP government extends date for electricity bills scheme for farmers to 15 February

3 February. The Uttar Pradesh (UP) government has extended the registration date to avail the one time settlement (OTS) scheme from 31 January to 15 February. The BJP (Bharatiya Janata Party) government had launched the special OTS scheme in January this year in which 100% farmers who could not pay their electricity bill on time will get a waiver of 100% surcharge on their bill. The OTS scheme, which came into effect from 1 January 2019, requires farmers to pay 30% of their pending dues to get registered and get the surcharge (fine imposed on delay in payment of an electricity bill) waived. The scheme will also cover residential and commercial consumers having a sanctioned load of up to 2 kW (kilowatt) and will take into account pending dues till 31 December 2018.

Source: The Economic Times

Government sets up committee to explore prepaid payments by discoms to generator firms

1 February. The government has constituted a committee under the Central Electricity Authority (CEA) to explore prepaid payments by state electricity distribution companies (discoms) to power plants. With this the government has deferred a decision on a recommendation made by Cabinet Secretary P K Sinha led panel to put in place a bill discounting mechanism ahead of elections. The committee, constituting Chairmen of discoms of Tamil Nadu and Maharashtra, representatives from Union power ministry and power associations, will look into problems of delayed payments from distribution companies to power generators. The power ministry has already issued an advisory to states to shift to prepaid smart metering for all consumers in the next three years. The CEA–led committee has been asked to submit its recommendations to the power ministry in one month. The committee will study working capital cycles of power distribution companies and generation companies and identify gaps contributing to stress in the sector. Power generators pay in advance to coal companies while delayed receivables from discoms mounted Rs 300 bn this year.

Source: The Economic Times

Government to auction PPAs to revive 10 GW of stressed power plants

1 February. The government expects to put 10,000 MW of stressed power assets on track through auctions, starting with 5,000 MW of power purchase contracts to be offered in the next 15 days. Tenders for procurement of 2,500 MW agreements for three years were issued. The auctions kick-started will be in a reverse e-bid format under which the power producers will have to lower tariffs in the online process. The tariffs will be linked to inflation, unlike the last round where these were fixed for three years. The reverse e-bid auction for PPAs (power purchase agreements) is in a different format than the previous auctions conducted by the power ministry in April last year. In the previous tenders, the bidders had to match the lowest quoted price to bag contracts. Also, the bidders will quote capacity charges this time and the scheme assures minimum offtake of 85% of contracted capacity to the power plants. In the last round, the fixed cost was kept at 1 paisa per unit with minimum offtake guarantee of 55%. PFC Consulting Ltd has been appointed as the nodal agency for the bidding, while PTC India Ltd will act as the aggregator. PTC India will sign a three-year agreement for procurement of power with successful bidders and power supply agreement with state distribution companies. Recent tenders by discoms (distribution companies) seeking short-term power supply have received high bids as generators expect coal shortage, higher demand for electricity from states during summer and the election. Bids floated by state utilities of Chhattisgarh and Uttar Pradesh for supply in May-–June received bids as high as Rs 5-6.5 per unit. The government had in April last year kicked off a pilot scheme for procurement of aggregate power of 2,500 MW on competitive basis for three years from commissioned projects without PPAs. Seven plants won 1,900 MW power contracts in the pilot round. These include RKM Powergen, Jhabua Power Ltd, MB Power Ltd, SKS Power, Jindal India Thermal Power Ltd, IL&FS Energy and JP Nigrie.

Source: The Economic Times

Karnataka need not fret over power outage this summer

31 January. The city’s technology and manufacturing hubs as well as shopping malls are unlikely to face any power shortage in the summer with the energy department taking steps to conserve hydel and coal resources right away. The electricity demand will increase from February onwards. Karnataka Chief Minister HD Kumaraswamy reviewed the power supply situation in Bengaluru and summer preparedness. In Udupi Power station too, KPTCL (Karnataka Power Transmission Corp Ltd) is drawing power from only one unit, and other thermal stations are operating far below their load factor in preparation for the summer demand.

Source: The Economic Times

India to have world’s only completely-electrified large railway network

30 January. India is targeting complete electrification of its railway network over the next four-five years, which will make it the only such large rail network, Union Railway Minister Piyush Goyal said. He said that over 4,000 km (kilometre) of railway tracks were electrified last year, which would increase to 6,000 km this year.

Source: Business Standard


PM Modi holds talks with Monaco’s Prince Albert II, discusses combating climate change

5 February. Prime Minister (PM) Narendra Modi held wide-ranging talks with Monaco’s reigning monarch Prince Albert II and discussed stepping up cooperation, especially in the renewable energy sector and in combating climate change. Prince Albert, who arrived on a week-long India visit, met the PM at Hyderabad House. There was a good exchange of views on enhancing cooperation, especially in environment and climate change and renewable energy, through sharing best practices, Ministry of External Affairs Spokesperson Raveesh Kumar said. India and Monaco established diplomatic relations in 2007, though their friendship goes back much further in time, Kumar said. Earlier in the day, External Affairs Minister Sushma Swaraj called on Prince Albert and discussed opportunities for cooperation in the areas of environment, specially renewable energy, investment into India, smart cities, marine ecosystems, tourism and people-to-people contacts, Kumar said.

Source: The Economic Times

Tamil Nadu solar policy eyes 9 GW by 2023

4 February. The Tamil Nadu government has announced its Solar Energy Policy 2019 with the objective of achieving an installed capacity of 9,000 MW by 2023. Its earlier policy, which was unveiled in 2012, had set a target of 3,000 MW of installed capacity by 2015. But the State managed to achieve a little over 2,000 MW as of 31 March 2018. This capacity was about 10 percent of the country’s installed capacity in the solar sector. The new policy, which was released by Chief Minister Edappadi K Palaniswami, comes at a time when Tamil Nadu has lost its leadership position in rooftop solar capacity. With an installed capacity of 473 MW (as on 30 September 2018) in rooftop solar segment, Maharashtra has emerged the leader in this segment, pushing Tamil Nadu to the second position with an installed capacity of 312 MW, according to Bridge to India, a solar energy consulting firm. The policy hopes to create a framework that will help accelerate development of solar installations in the State, promoting both utility category and consumer category solar energy generation through various enabling mechanisms. About 40 percent of the target (9,000 MW) will be earmarked for consumer category solar energy systems, the policy document said. Tamil Nadu has been a pioneer in harnessing energy from renewable energy sources and it has highest installed capacity of more than 11,000 MW in the renewable energy sector with wind energy, where it leads the country, accounting for more than 8,200 MW. The State has huge potential for solar energy with around 300 clear sunny days in a year.

Source: The Hindu Business L ine

Budget 2019: Allocation for solar power development seen flat at Rs 30 bn

4 February. The interim budget has allocated Rs 30 bn for development of solar power projects next financial year (2019-20) including both grid-interactive and off-grid and decentralized categories. This is a mere 1 percent increase over the likely expenditure of Rs 29.69 bn for solar projects this fiscal. Under grid-interactive schemes, the budgeted allocation for solar is seen rising 15 percent to Rs 24.79 bn in 2019-20 as compared to the current fiscal’s Revised Estimate of Rs 21.57 bn, a review of budget documents tabled in Parliament show. The allocation for solar projects under off-grid and decentralized renewable power is seen declining 35 percent to Rs 5.25 bn for the next financial year from Rs 8.12 bn based on the revised estimate for 2018-19. Overall, the budget has allocated Rs 49.60 bn for both grid-interactive and off-grid or decentralized renewable power for 2019-20. This is a marginal 1 percent increase over the allocation of Rs 49 bn based on the Revised Estimate for current fiscal. Apart from solar, the budget has allocated a bulk of the funds under two other heads -- wind power and green energy corridors. Both of them fall in the grid-interactive category.

Source: The Economic Times

EDF Renewables and SITAC Group sign pact for 300 MW wind energy project in India

4 February. North America headquartered EDF Renewables announced its Indian arm has signed a long-term agreement to develop 300 MW of wind project in partnership with the UK-based SITAC Group. This agreement was the outcome of a competitive tender process launched by the Indian government under the fifth tender process of Solar Energy Corp of India (SECI). The award was granted in September 2018. EDF Renewables has a gross installed renewable energy capacity of 12.7 GW globally. Its development is mainly focused on wind and solar photovoltaic power and the company operates mainly in Europe and North America but is currently moving into emerging markets like Brazil, China, India, South Africa and the Middle East.

Source: The Economic Times

Chandigarh seeks status report on solar power project from CREST

3 February. The UT (Union Territory) administration has sought status report on the solar city project from the Chandigarh Renewal Energy, Science and Technology Promotion Society (CREST), the nodal agency for installation of solar plants in Chandigarh. CREST is making efforts to achieve the target of 69 MW set by the ministry of new and renewable energy, which is to be achieved by 2022. UT administration had already approved the detailed project report (DPR) of installation of 800 kW (kilowatt) solar power plants worth Rs 45 mn at the parking area of the new lake at Sector 42. Out of 800 kW, 90 kW solar energy would be reserved for charging e-vehicles. CREST also planned to install a 3 MW solar plant on the N-choe, a seasonal rivulet that passes through Garden of Springs, Sector 53, at the southern end of Chandigarh. It would be first of its kind solar plant on the N-choe. To encourage residents for installation of solar plants, the Chandigarh administration has already started transferring subsidy for installing solar plants on their rooftops, to residents, online. Earlier, the administration used to give cheques to residents. CREST provides 30% subsidy to residents for installing solar panels.

Source: The Economic Times

Gujarat electricity regulator approves solar power supply by salt pan workers

3 February. Gujarat Electricity Regulatory Commission (GERC) has permitted Gujarat Urja Vikas Nigam Ltd (GUVNL) to procure 2.7 MW solar power generated by salt pan workers of Self Employed Women Association (SEWA) during off-season period in salt pan work. As many as 3,000 salt pan workers in the Kutch desert use solar-powered pumps to draw saline water for salt production. These salt pan workers use solar panels- with an aggregate capacity to produce 2.7 MW power- for six months (October to April) for salt production at a remote location. The panels remain idle in warehouses during the remaining off-season period of six months. SEWA had requested Gujarat government to devise a suitable mechanism for purchase of power generated from these solar panels during the off-season period to optimally utilise the panels for socio-economic upliftment of salt pan workers. Subsequently, Grassroot Trading Network for Women (GTNfW), a SEWA entity, also received a go-ahead from the government to set up a solar power project of the same capacity. GUVNL approached GERC for the latter’s approval to procure solar power from salt pan workers during off-season period. The state regulator recently approved GUVNL’s petition as a special case considering the socio-economic upliftment of salt pan workers.

Source: The Economic Times

India’s solar generation capacity grew over 10 times: Goyal

1 February. Finance Minister Piyush Goyal said India’s installed solar generation capacity has grown over 10 times in the last five years and so has the usage of green technologies, including e-vehicles. But climate activists said the budget has nothing for cleaning the air and polluted rivers as well as the pollution in cities. Based on implemented policies, India's greenhouse gas (GHG) emissions were expected to increase to a level of 4,469 to 4,570 MtCO2e (metric tonnes of carbon dioxide equivalent) by 2030, excluding forestry. This emission pathway was not compatible with a 2 degrees Celsius scenario. According to the India Cooling Action Plan draft, there is a plan to cut cooling demand by 20 to 25 percent by 2037, thus curbing a source of huge growth in electricity demand. The total renewable energy installations in India reached 75 GW by September 2018, representing 21 percent of total installed capacity and generating a record high of 11.9 percent of all electricity in the September 2018 quarter.

Source: Business Standard

BHEL bags 2 orders worth Rs 970 mn from NPCIL

31 January. BHEL (Bharat Heavy Electricals Ltd) said it has bagged two orders worth Rs 970 mn from Nuclear Power Corp of India Ltd (NPCIL) to manufacture and supply primary side heat exchangers. The heat exchangers will be manufactured at BHEL’s Bhopal plant, BHEL said. The company has been a pioneer in the design and development of primary side products such as nuclear steam generators for NPCIL, and has, so far, supplied 40 steam generators for various nuclear power installations in the country.

Source: Business Standard

Solar scheme only for those with direct discom connection in Gurugram

31 January. Around 3,150 residents of Sushant Lok 2 Extension and Sushant Lok 3 can’t avail the grid-connected solar rooftop scheme because they are not direct DHBVN (Dakshin Haryana Bijli Vitran Nigam) consumers. Launched in 2014, the scheme makes it mandatory for residents living in an area of up to 500 square yards or more to install solar power plant on their rooftop. Residents can use the power generated while exporting the surplus units to the discom (distribution company), which in return will provide a rebate to them. The solar panels, when purchased from empanelled vendors of Haryana Renewable Energy Department (HAREDA), come with generous subsidies. But according to Haryana Electricity Regulatory Commission (HERC) guidelines, only direct consumers of DHBVN can avail it. Sushant Lok 2 Extension and Sushant Lok 3 get power from a single point connection (SPC) which the discom extends to the developer who then divides it into as many connections as number of consumers in the township. The scheme was supposed to encourage consumers to opt for alternative power sources. Gurugram has potential for generating solar power of 200 MW but only 27 MW is currently being generated.

Source: The Economic Times

PM Modi launches solar power plants in Gujarat

31 January. Prime Minister (PM) Narendra Modi inaugurated multiple solar power plants with a combined capacity of 1 MW for Surat Municipal Corp in Gujarat. The solar projects are located at multiple locations in the city for powering three water distribution plants and 18 municipal schools.

Source: The Economic Times

Surat first in the country to use solar energy for water distribution

31 January. Surat has become the first city in the country where water supply management by Surat Municipal Corp (SMC) is being carried out using solar energy. Out of the total 6 MW of solar power plants, 4 MW is dedicated for water supply management. 5 MW of solar power plants are already installed and a 1 MW solar power plant will be commissioned on 30 January by Prime Minister Narendra Modi. Out of the 6 MW solar power plants, 4 MW is dedicated for Sarthana waterworks, Katargam waterworks, Rander waterworks, Varachha waterworks, Udhana water distribution station, Magob water distribution station and Simada water distribution station. The total solar energy generation out of 4 MW solar power plants meant for water supply is about 53 lakh units per annum.

Source: The Economic Times

NCAP can allow Delhi, UP residents to live 3 yrs longer: AQLI

30 January. If India reduces particulate pollution by 25 percent, under the National Clean Air Programme (NCAP) goal, residents of Delhi and Uttar Pradesh could live almost three years longer, according to a recent report from the Air Quality Life Index (AQLI). An average Indian could live 1.3 years longer. NCAP aims to reduce particulate pollution by 20-30 percent nationally, will be implemented over the next five years. The report said that the residents living in the 102 cities, singled out by the NCAP for having higher pollution levels than the national average, would gain 1.4 years onto their lives. In Delhi, people would live 2.8 years longer. Those in Kanpur would live 2.4 years longer. And, in Kolkata, people would live 1.1 years longer, the report said. It said that bringing the entire country into compliance with India’s standards or the WHO (World Health Organization) guideline would increase the average Indian’s life expectancy by 1.8 years and 4.3 years, respectively.

Source: The Economic Times

Samsung R&D Centre in Bengaluru switches to solar energy

30 January. Samsung’s R&D centre in Bengaluru has switched to solar power for its campus which houses over 3000 R&D employees, the company said. The campus will draw 88% of its power requirement from a solar farm in Kalburgi district in Karnataka, around 500 kilometres away from Bengaluru. In December 2018, Samsung’s Bengaluru R&D Institute, which is the company’s largest R&D centre outside Korea, adopted the green energy solution through a method called ‘energy wheeling’. The solar farm by Bagmane Green Power LLP based in Kalburgi would power the R&D centre through energy wheeling. The farm adds the required power to the state electricity grid and the centre in turn, receives an equal amount of power from the local electricity grid. This method makes it more energy efficient.

Source: The Economic Times


Kuwait sees risk of oil supply shortage in 2019 due to Venezuela

5 February. Kuwait Petroleum Corp head Hashem Hashem said that global oil supply could be hit this year by big reductions in exports from Venezuela. The Trump administration has imposed sweeping sanctions on Venezuelan oil firm PDVSA, aimed at severely curbing the OPEC (Organization of the Petroleum Exporting Countries) member’s crude exports to the United States (US) and at pressuring socialist President Nicolas Maduro to step down. Hashem said that the threat of a US-China trade war and mixed messages from the United States on whether it would raise interest rates is causing volatility in the global equity markets and could increase oil price volatility this year. OPEC, Russia and other non-OPEC producers - an alliance known as OPEC+ - agreed in December to reduce supply by 1.2 million barrels per day (bpd) from 1 January. OPEC’s share of the cut is 800,000 bpd, to be delivered by 11 members - all except Iran, Libya and Venezuela. Hashem said OPEC+ actions should help re-balance the oil markets this year but he also warned of the impact of underinvestment in the oil industry which could cause a supply crunch by 2025.

Source: Reuters

Russia’s Rosneft sees different scenarios for global oil deal

5 February. Russian oil producer Rosneft said it saw different possible scenarios for the global oil output deal between OPEC (Organization of the Petroleum Exporting Countries) and non-OPEC allies in the future and that it was unclear what chances the deal had of being extended. Rosneft will expect something in return from the Russian government if the company has to keep limiting output.

Source: Reuters

US oil prices edge up on tightening global supply

5 February. US (United States) oil prices inched up, buoyed by expectations of tightening global supply amid US sanctions on Venezuela and production cuts led by OPEC (Organization of the Petroleum Exporting Countries). Analysts said that US sanctions on Venezuela had focused market attention on tighter global supplies. The sanctions will sharply limit oil transactions between Venezuela and other countries and are similar to but slightly less extensive than those imposed on Iran last year, experts said. Oil supply from the OPEC fell in January by the largest amount in two years, a survey found, as Saudi Arabia and its Gulf allies over-delivered on the group’s supply-cutting pact while Iran, Libya and Venezuela registered involuntary declines. Russia has been in full compliance with its pledge to gradually cut its oil production, Russian Energy Minister Alexander Novak said.

Source: Reuters

Schlumberger still seeking drilling opportunities in Russia

5 February. US (United States) oilfield services giant Schlumberger said it will continue looking for alternative ways to work in Russia’s onshore drilling market despite its bid for Eurasia Drilling Company (EDC) falling apart. Russia’s Federal Anti-monopoly Service said that Schlumberger has withdrawn its bid for a stake in EDC, one of the largest private drilling companies in the country.

Source: Reuters

Aker BP finds up to 153 mn barrels of oil equivalents in North Sea

4 February. Aker BP has discovered an oil and gas reservoir while drilling near its Alvheim field in the North Sea, the Norwegian firm said. Known as Froskelaar (Frog’s Leg) Main, the reservoir is estimated to hold between 45 million and 153 million barrels of oil equivalents, and may straddle Norway’s maritime border with Britain, the company said. When reserves are found to stretch across the British-Norwegian offshore border, the two nations share the revenue from production based on estimates of how much oil and gas is located on each side. Aker BP is operator of the license with a 60 percent stake, while Sweden’s Lund Petroleum and Eni’s Vaar Energi each hold 20 percent.

Source: Reuters

Russia complying with global deal to cut oil output: Energy Minister

4 February. Russia is complying fully with its pledge to cut oil production gradually, Energy Minister Alexander Novak said. He said Russian oil production decreased by 47,000 barrels per day (bpd) in January from October, the baseline for the global deal aimed at reducing oil supply. The pace of Russia’s output cuts has drawn criticism from Saudi Arabia, de facto leader of the Organization of the Petroleum Exporting Countries. According to energy ministry data, Russia cut its output in January by around 35,000 bpd from October to 11.38 million bpd. The ministry has not revealed its calculations in barrels. Novak earlier said Russian oil production reached 11.41 million bpd in October 2018. OPEC and other global oil producers agreed in December to cut their combined output by 1.2 million bpd in order to support oil prices and try to balance the market. Of that, Russia pledged to cut its production by around 230,000 bpd in the first quarter.

Source: Reuters

Magellan cancels plan for short-haul oil pipeline in West Texas

1 February. Magellan Midstream Partners LP has canceled plans to develop a stand-alone crude pipeline West Texas, the area of the nation’s top oil field as it considers a lower-cost project for the same region. The Tulsa, Oklahoma-based pipeline operator had said in 2017 it would build a 60 mile pipeline from Wink to Crane, Texas to supply crude to its large, 275,000 barrel per day Longhorn crude pipeline.

Source: Reuters

US cracks down on foreigners dealing in Venezuela oil

1 February. US (United States) sanctions will sharply limit oil transactions between Venezuela and other countries and are similar to but slightly less extensive than those imposed on Iran last year, experts said after looking at details posted by the Treasury Department. Treasury’s notice makes more explicit that the sanctions restrict foreign entities from doing business with Venezuela using the US financial system or US brokers after April. With most oil transactions conducted in dollars, that is expected to sharply curtail off Venezuela’s efforts to seek buyers around the world. Venezuela sells oil to buyers around the world, including India and Europe, and the country has been seeking buyers elsewhere to replace the roughly 500,000 barrels a day it sells to the US. Few alternative buyers are available for the heavy Venezuelan crude oil that is currently shipped to the US, Ed Morse, global head of commodity research at Citi Group, said.

Source: Reuters

Iraq state oil company to drill 40 wells in Majnoon field

31 January. Iraq’s Basra Oil Co has agreed a deal with Iraq Drilling Co to drill 40 new oil wells in the giant southern Majnoon field, the oil ministry said. The deal will help boost output from the Majnoon oilfield to 450,000 barrels per day (bpd) in 2021, the ministry said. Majnoon is producing around 240,000 bpd. The new wells are in addition to the 40 that Iraq and US company Schlumberger Ltd agreed on 19 December  to drill in Majnoon.  Royal Dutch Shell exited Majnoon last year, handing operations to Basra Oil. Iraq, the second-largest producer in the Organization of the Petroleum Exporting Countries (OPEC), is pumping below its maximum capacity of nearly 5 million bpd in line with an agreement among OPEC and other exporters to curtail global supply.

Source: Reuters

Canadian province of Alberta lowers oil curtailments as glut eases

31 January. The Canadian province of Alberta will ease oil curtailments in February and March, earlier than expected, saying that its rare step to limit production had eased a glut of crude. Alberta’s move to scale back its curtailments came at the end of a volatile month, in which Canadian prices improved dramatically but producers were affected disproportionately. US (United States) refiners are also scrambling to find a replacement for Venezuelan heavy crude - similar to what Alberta produces - because of US sanctions on that country’s oil company. Prices for Alberta oil fell in October to record lows compared with US futures prices because of congested pipelines that backed up crude in storage tanks and prompted the curtailments. The province said it would set production for February and March at 3.63 million barrels per day (bpd), up by 75,000 bpd from January.

Source: Reuters


Centrica, Tokyo Gas sign deal to purchase Mozambique LNG

5 February. British energy supplier Centrica and Tokyo Gas Co. have agreed to jointly purchase 2.6 million tonnes (mt) of liquefied natural gas (LNG) a year from Mozambique LNG Company Pte Ltd, the firms said. Centrica LNG Company Ltd, a subsidiary of Centrica, and the Japanese energy company said the LNG will be delivered ex-ship from Mozambique LNG from the start-up of production until the early 2040s. Mozambique LNG1 is owned by US oil and gas producer Anadarko Petroleum Corporation and partners in a consortium which is developing the project aimed at serving both the Asia-Pacific and European markets. It will consist of two liquefaction trains with the capacity to produce 12.88 mt per year in its initial phase and is expected to be completed by 2023-2024. A final investment decision is expected this year. Separately, Anadarko said Mozambique LNG1 Company has signed an agreement with Shell International Trading Middle East Ltd for 2 mt of LNG a year for 13 years.

Source: Reuters

Qatar Petroleum, Exxon invest in $10 bn Texas LNG project

5 February. Qatar Petroleum and Exxon Mobil Corp said they are investing in a $10 billion project to expand a liquefied natural gas (LNG) export plant in Texas, as companies race to meet global demand for the fuel. Construction of the Golden Pass LNG project in Sabine Pass, Texas, is expected to begin early this year. The project will add production capacity of around 16 million tonnes of LNG per year after it starts up in 2024. The Trump administration has promoted gas drilling and LNG exports in part to offer European customers alternatives to piped natural gas from Russia, while slashing Obama-era environmental regulations on energy operations. Worldwide consumption of LNG is expected to more than double to 550 million tonnes a year by 2030, triggering a race among oil and gas companies eager to dominate the market. Exxon has a 30 percent stake in Golden Pass and Qatar Petroleum holds 70 percent. The two have been strengthening a global alliance across LNG projects from the United States (US) to Mozambique. Exxon has signed an agreement to buy a 12.4 percent interest in the existing terminal and a pipeline from ConocoPhillips, and the purchase is subject to regulatory approvals, both companies said. The expansion is part of Qatar Petroleum’s plans to invest about $20 billion in the US as the company seeks to increase its overseas oil and gas business. Qatar, a tiny but wealthy country, is one of the most influential players in the LNG market with annual production of 77 million tonnes. It plans to boost capacity 43 percent by 2023-24.

Source: Reuters

China’s LNG imports reach another record amid high stocks

4 February. China’s imports of liquefied natural gas (LNG) rose to another monthly record in January, even as the country grapples with high gas inventories amid a warmer-than-usual winter, according to Refinitiv Eikon shipping data. The world’s second-largest LNG importer took 6.55 million tonnes of LNG in January, beating the previous record hit in December by nearly 2 percent, according to data. China’s imports last year surged 41 percent from 2017 after gas shortages the previous winter prompted Chinese companies to stock up on supplies and pre-order cargoes, with Beijing continuing to push millions of households to switch to gas from coal for heating. China National Offshore Oil Corp (CNOOC) resold at least one LNG cargo in January and possibly another, an unusual move during what is typically a peak demand period and highlighting this year’s warmer weather. Chinese traders are offering LNG cargoes to international buyers or selling into their domestic market at lower-than-expected prices. Wholesale LNG from small, land-based liquefaction plants fell to 3,500-3,950 yuan ($519-$586) a tonne on 2 February, less than half levels of last year, according to Chinese gas-price monitoring agency

Source: Reuters

SoCalGas urges natural gas conservation during California cold snap

4 February. Southern California Gas (SoCalGas) urged customers to use less natural gas until further notice to avoid straining its system as colder weather covers its service area. Gas supplies have been tight in Southern California this winter because of limitations on several SoCalGas pipelines and reduced availability of the utility’s biggest storage field at Aliso Canyon in Los Angeles, following a massive leak between October 2015 and February 2016. After the leak, the state mandated Aliso can be used only to maintain system reliability after all other storage facilities and pipelines have been exhausted. SoCalGas has been pulling gas out of Aliso since the start of the year to avoid curtailing supplies to some non-core customers like electric generators and large industrial businesses. Consumer gas demand is expected to peak near 3.9 billion cubic feet per day (bcfd), up from 3.5 bcfd, according to SoCalGas. In total, SoCalGas has about 56.0 billion cubic feet (bcf) of gas left in its four storage facilities, including Aliso. That compares with 58.8 bcf at this time last year and a five-year (2013-2017) of 60.3 bcf. If needed, Aliso can deliver around 1.0 bcfd. But like all storage facilities, the amount of gas it can provide will decline rapidly as pressure in the cavern decreases when the utility pulls fuel out.

Source: Reuters

Pennsylvania governor seeks natural gas tax to raise $4.5 bn

1 February. Pennsylvania governor Tom Wolf proposed a tax on extracting natural gas to pay for his plan to spend $4.5 billion over the next four years to improve the state’s infrastructure. The state legislature, however, has refused to approve the tax over the past couple of years. Wolf said Pennsylvania is the only state in the country without a severance tax on extracting natural gas. Pennsylvania is the second biggest gas-producing state behind Texas. The state produces about 18 billion cubic feet per day (bcfd) from the Marcellus and Utica shale basins, which is a little over 20 percent of nation’s total gas production. The state’s gas industry, however, said the tax is not necessary since the state already has a per well impact fee. The proposed tax would increase if the price of gas rises and would start 1 March 2020.

Source: Reuters

Total-invested China gas field pumps record 2.24 bcm in 2018

1 February. A north China natural gas field, invested by French oil firm Total, pumped a record 2.24 billion cubic meters (bcm) of gas in 2018, 11 percent more than a year earlier, according to CNPC (China National Petroleum Corp) that operates the field. Total and CNPC signed a deal to jointly develop the Sulige South field in north China’s Ordos basin in 2011 and production had started in 2012. This is one of the handful foreign-invested gas projects in onshore China. The joint venture currently operates 594 gas wells with a daily output of 6.5 million cubic metres, CNPC said. China’s national oil companies are stepping up domestic drilling for oil and gas in a response to a government call to boost national energy security. China’s gas output rose 7.5 percent last year to record 161 bcm. Apart from Total, Shell and Chevron are also producing gas in China in joint operations with CNPC.

Source: Reuters

Leviathan gas rig reaches Israel

31 January. Israeli Prime Minister Benjamin Netanyahu inaugurated the foundation of the Leviathan natural gas rig, effectively stomping out protests from residents and environmentalists who say it is too close to shore. Leviathan, discovered in 2010, is one of the world’s largest gas discoveries of the past decade. The rig’s foundation, known as a platform jacket, arrived on a barge that sailed from Texas. Its topside is expected in several months. It is expected to be completed by the end of this year.

Source: Reuters

Bangladesh seeks developers for its first onshore LNG terminal

30 January. Bangladesh is seeking expressions of interest to build the country’s first onshore liquefied natural gas (LNG) import terminal. The South Asian country, which has a population of more than 160 million, is turning to land-based LNG terminals as its first imports of the super-chilled fuel through a floating platform were delayed due to the weather and technical issues. Rupantarita Prakritik Gas Co, part of Petrobangla, which oversees LNG supplies, has requested interest from potential terminal developers for a land-based LNG regasification terminal at Matarbari in the Cox’s Bazar district of southern Bangladesh. The expression of interest is for the design, engineering, procurement, construction and commissioning of a land-based terminal that can handle 7.5 million tonnes per annum (mtpa) of LNG, including receiving, unloading, storage and re-gasification facilities. The project is on a build-own-operate basis for 20 years, with ownership then transferred to the Bangladeshi government or a company nominated by the government at no cost. The onshore terminal, which can be expanded to 15 million mtpa in the future, is part of Bangladesh’s strategy to develop its gas sector with private companies. The developer will receive the LNG from the LNG ship as part of an agreement between Bangladesh and the LNG supplier, unload and store it, re-gasify it and supply the gas to the transmission pipeline. The terminal is set to be completed by June 2023. Companies should submit their expressions of interest by 20 March, with the official documents expected to be issued to shortlisted applicants by 29 August. Bangladesh began importing LNG from Qatar on a regular basis in last year through the country’s first floating storage and regasification unit (FSRU). It has scrapped plans to build additional floating LNG import terminals after its second FSRU comes on line.

Source: Reuters


Germany’s Merkel signals support for 2038 coal exit deadline

5 February. German Chancellor Angela Merkel said that her country would withdraw from coal-fired power production by 2038, showing her support for the deadline recommended by a government-appointed commission. The so-called coal commission said that Germany should shut down all of its coal-fired power plants by 2038 at the latest and proposed at least €40 billion ($45.7 billion) in aid to coal-mining states affected by the phase-out. The proposals highlight Germany’s shift to renewables, which made up more than 40 percent of its energy mix last year, surpassing coal for the first time.

Source: Reuters

Chinese coking coal soars to 17 month peak on supply concerns

31 January. China’s coking coal futures jumped nearly 5 percent to a near 17 month high, spurred by concerns over tight supply amid expectation of import restrictions on the commodity. Some ports in northeastern China have stopped customs clearings on imported coking coal. Coal imports in China were curbed in December last year as the government aimed to cap the full-year shipments at the 2017 level. Traders also expected coal arrivals to remain low in January as Beijing may continue to limit imports to boost domestic coal prices. China brought in 64.9 million tonnes of coking coal in 2018, down 6.4 percent from the previous year.

Source: Reuters

Botswana’s first private coal mine to produce saleable coal in March

31 January. Botswana’s first privately owned coal mine will produce its first saleable coal in March. The Masama Coal Mine aims to produce 1.2 million tonnes (mt) per annum of coal and will target the South African market as well as other countries in the region, Minergy CEO (Chief Executive Officer) Andre Boje said. The open cast mine and associated coal wash plant is located 60 kilometre (37 miles) northwest of Botswana’s capital Gaborone and is being developed at a cost of 400 million pula ($39 million). The Masama mine is estimated to hold 390 mt of coal reserves.

Source: Reuters

South African coal miner Exxaro aims to double coal exports through Richard’s Bay by 2023

31 January. South African coal miner Exxaro aims to double its coal exports through the Richard’s Bay export terminal by 2023, from 8 million tonnes a year at present, Nombasa Tsengwa, executive head of Exxaro’s coal operations, said.

Source: Reuters


South African unions oppose potential split of power firm Eskom

5 February. South African trade union federation COSATU said that it opposed a proposal to split up Eskom into three different entities, adding that it would not solve the struggling utility’s governance and debt problems. The proposal to split Eskom into three separate firms was made by a task team appointed by President Cyril Ramaphosa at a meeting with members of the ruling African National Congress, COSATU Deputy General Secretary Solly Phetoe said.

Source: Reuters

Britain’s Ofgem appoints Utilita Energy to take on Our Power customers

30 January. British energy regulator Ofgem said it had appointed independent power supplier Utilita Energy to take on the customers of Our Power which ceased trading. Our Power is the tenth small British energy suppler to cease trading in the past twelve months leading to questions over the viability of some of Britain’s 50 or so smaller energy suppliers which have taken market share from the “big six” suppliers over the past few years. Ofgem said any outstanding credit balances of Our Power’s 31,000 customers would be honoured and the switch of supplier would take place on 31 January. Utilita Energy is an independent energy supplier with around 600,000 customers.

Source: Reuters

'California power market not impacted by PG&E bankruptcy'

30 January. California’s power grid operator said the bankruptcy filing by PG&E Corp and its Pacific Gas and Electric Co utility, the biggest US (United States) power company, has not had any effect on the state’s power grid and energy markets. The California Independent System Operator (ISO) said it is continuing normal day-to-day operations with the utility and has not detected any material change in market trends that could be attributed to PG&E since the utility announced its intention to file for bankruptcy protection. PG&E provides electricity and natural gas to 16 million customers in northern and central California and employs 24,000 people.

Source: Reuters


Biofuels group Growth Energy sues US EPA over small refinery exemptions

5 February. Biofuels group Growth Energy filed a federal lawsuit against the US (United States) Environmental Protection Agency (EPA), challenging the agency’s renewable fuel mandate for 2019 as failing to address rising waived biofuel volumes. Under the US Renewable Fuel Standard (RFS), oil refiners must blend increasing amounts of biofuels into their fuel each year or purchase blending credits from those that do, a policy that has helped farmers by boosting the market for ethanol and other biofuels.

Source: Reuters

German grid firms see extra costs to meet renewable power target

4 February. Boosting renewables to 65 percent of Germany’s power mix by 2030 could cost €20 billion more than previously planned, which will mean higher consumer energy bills, TSOs (transmission system operators) — EnBW’s TransnetBW, 50Hertz, TenneT, and Amprion said. Germany raised its target for the contribution of renewables to 65 percent by 2030 from 50 percent in a bid to reduce CO2 (carbon dioxide) emissions by 55 percent over 1990 levels. It is set to miss a 2020 target aimed at cutting emissions by 40 percent.

Source: Reuters

Colombia gets bids from 27 companies in renewable energy tender: Energy Minister

2 February. Colombia has received bids from more than two dozen companies that want to participate in the country’s first-ever tender of renewable energy projects, Mines and Energy Minister Maria Fernanda Suarez said. Some 70 percent of Colombia’s electricity is generated with hydropower. Bidding for 22 different solar, wind and biomass projects will take place on 26 February. Twenty-seven local and multinational companies are set to participate, the Minister said. The projects are expected to begin electricity production in 2021.

Source: Reuters

BP to expand emissions disclosure on oil investments

1 February. BP has agreed to broaden its disclosure on greenhouse gas emissions to show how it thinks future investments in oil and gas align with UN (United Nations)-backed climate goals, it said. Following talks with a large group of investors, BP also agreed to back a shareholder resolution on the measures at its annual general meeting (AGM), further evidence of the way the energy industry and investors are engaging on climate issues. The agreement with a group of investors with $32 trillion under management, known as Climate Action 100+, comes weeks after rival Royal Dutch Shell agreed to introduce broad carbon emissions targets linked to executive pay. BP said it would link carbon targets to the remuneration of 36,000 of its employees, including executive directors. If the resolution is approved at the AGM, BP will introduce these changes into its reporting for 2019 onwards. BP Chief Executive Officer Bob Dudley has repeatedly said that while the oil and gas sector needs to play a role in the transition to low carbon energy, it still needs to meet growing demand for fossil fuels, particularly in emerging economies.

Source: Reuters

EU carbon market emissions fell 3 percent in 2018

30 January. Emissions from power stations and factories regulated under Europe’s carbon market fell by 3 percent in 2018 as coal-fired power generation dipped. Verified emissions figures are published each year by the European Commission in April, and can affect carbon prices in the EU (European Union)’s Emissions Trading System (ETS). EU ETS emissions fell to 1.7 billion tonnes of carbon dioxide in 2018 from 1.754 billion tonnes, the report by green lobby group Sandbag and German think tank Agora Energiewende estimated.

Source: Reuters


Coal Sector in India: Production and Imports

Company Coal Production (Million Tonnes)
ECL 28.4
BCCL 18.9
CCL 34.9
NCL 65.6
WCL 26.5
SECL 98.2
MCL 85.3
NEC 0.3
Total CIL 358.3
SCCL 39.5
Others 36.1
Total Coal Production 2018-19 (Apr-Nov) 433.9

Trends in Coal Import Dependency

P: Provisional
Source: Compiled from Ministry of Commerce & Industry & Various Parliamentary Ques.

This is a weekly publication of the Observer Research Foundation (ORF). It covers current national and international information on energy categorised systematically to add value. The year 2018 is the fifteenth continuous year of publication of the newsletter. The newsletter is registered with the Registrar of News Paper for India under No. DELENG / 2004 / 13485.

Publisher: Baljit Kapoor

Editorial Adviser: Lydia Powell

Editor: Akhilesh Sati

Content Development: Vinod Kumar

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