Power ministry releases medium-term power procurement guidelines
The Ministry of Power has released the guidelines for procurement of electricity for medium term from power stations set up on finance, own and operate basis (FOO) through the e-bidding portal DEEP. Medium term power is purchased through a power procurement agreement for a period between one and five years. Earlier this month, the government issued standard bidding documents to be adopted by distribution licensees for procurement of electricity from power producers, traders, distribution companies through competitive bidding through DEEP e-Bidding portal based on offer of lowest tariff from power generating stations constructed on FOO basis. The ministry in the guidelines said any deviation from the model bidding documents shall be made by the distribution licensees only with the prior approval of the appropriate commission. It further said the guidelines will also apply to those procuring power from thermal projects set up on design, build, finance, own and operate (DBFOO) basis after new coal block auction policy came into being. “Any project specific modifications expressly permitted in the model bidding documents shall not be construed as deviations from the model bidding documents,” the guidelines said. The ministry said any agreements signed or actions taken prior to the date will not be affected by such repeal of the sail guidelines and shall continue to be governed by the pervious guidelines. Jamie Meder Jersey
REC inks pacts with Andhra Pradesh for Rs 60,000 crore funding
State-owned Rural Electrification Corporation Ltd has inked three pacts to extend financial assistance of around Rs 60,000 crore to Andhra Pradesh. “Memorandum of Understanding (MoU) signed by REC for extending financial assistance to the tune of Rs 60,000 crore in the state of Andhra Pradesh,” Rural Electrification Corp informed BSE today. According to the statement, REC has signed three MoUs for extending financial assistance of around Rs 60,000 crore in the state for the next five years (till March 2022). The financial assistance comprises Rs 40,000 crore to Andhra Pradesh Power Generation Corp, Rs 10,000 to Transmission Corporation of Andhra Pradesh and Rs 10,000 crore to AP DISCOMSs. Apart from financial assistance, the power utilities have agreed on availing consultancy and management services from REC arms, REC Power Distribution Company and REC Transmission Projects Company, for various activities/projects for the next five years. Mike Komisarek USA Authentic Jersey
Solar parks with capacity of 7500 MW to come up in Ladakh
The Jammu and Kashmir government has signed an MoU with the Centre for the development of two mega solar parks in the rocky mountainous region of Ladakh with a total capacity of 7500 MW. Minister for Science & Technology, Sajjad Gani Lone today said the government has proposed development of one each Mega Solar Park in the districts of Leh and Kargil. “The State Government has signed MoU with the Government of India for the development of two Mega Solar Parks of 5000 MW capacity in Leh district and 2500 MW capacity in Kargil district,” Lone informed the House in reply to a Question by Congress Legislative Party Leader Nawang Rigzin Jora. However, he said the work on these projects has not been started as yet in view of non-availability of land and lack of proper infrastructure in Ladakh for transmission of power generated from the proposed parks. Matt Haack Womens Jersey
Power Ministry misses target despite rise in output for November-December
Demonetisation may have negligible impact on power sector as output grew by 8.53 per cent in November and 6.13 per cent in December year-on-year but Power Ministry could not achieve the targeted electricity generation during the respective months. There was a fear that junking high value currency notes of Rs 1,000/500 will lead to slowdown in all segments in the economy including power sector. According to the Central Electricity Authority monthly report, total power generation in the country was 95.123 billion units (BUs) in December 2016, which was 6.13 per cent higher than 89.625 BUs electricity generation in the corresponding month previous year. However, as per the report, the electricity generation target of 96.999 BUs could not be achieved in December. Similarly, the CEA report said power generation grew 8.53 per cent in November, 2016 to 93.235 BUs compared to 85.904 BUs in same month year ago. However, the target of 93.236 could not be achieved. “The generation in the month of November was almost on track as there is not much difference in the actual output and target. But power generation is 1.8 BUs short of the targetted output in December,” said an expert. According to the CEA data, the per capita consumption of electricity was 1,075 units in 2015-16 as per provisional estimates. Therefore, output of 1.8 billion units could have lit thousands of houses in the country where a large number of people either live without electricity or face outages due to shortages in supply. However, Power Ministry data indicates that distribution companies collections increased by more than Rs 3,000 crore from November 10 to December 15, 2016 compared to last year i.e. after the demonetisation move. According to the Power Ministry, this will help achieve affordable tariffs. North Bihar Power Distribution Company saw a 204 per cent increase, NESCO in Odisha 251 per cent, APDCL in Assam 97 per cent and TANGEDCO in Tamil Nadu witnessed 97 per cent rise in collections. However, the experts think that this has happened because people have parked their black money with discoms to pay their electricity due in advance for many months. They think that such practice will not continue as utilities have already stopped honouring junked high value currency notes of Rs 1,000/500. D.J. Fluker Womens Jersey
TANGEDCO Floats Another 500 MW Solar Tender
A 500 MW solar tender has been floated by the Tamil Nadu Generation and Distribution Corporation (TANGEDCO). A request for selection (RFS) has been issued for auction and allocation of 500 MW of solar capacity. Prospective bidders/project developers can submit their bids by February 10th, 2017. There was a tender for the same capacity which TANGEDCO had floated in October 2016 but the state state utility failed to attract enough bids. Bidders can submit a maximum tariff bid of Rs 4.5 per unit as against Rs 5.10 threshold limit set by the state utility In its October tender that had evinced bids from 117 prospective companies. If this tender process emerges successful, it will set a new record on tariff front. The tariff submitted by bidders in the Rajasthan tariff bid was Rs 4.34 a u it. With a fall in interest rates, it is expected that tariffs to be discovered through this bidding will be further lower. Red Schoendienst Jersey
Abu Dhabi’s NMDC wins $316m India port contract
Abu Dhabi’s National Marine Dredging Company said it has been awarded a $316-million engineering, procurement and construction (EPC) contract for a hitech floating LNG (liquefied natural gas) port at Jafrabad in the Indian state of Gujarat. India’s emerging energy entity, Swan LNG Private Limited (SLPL) is developing the country’s first all-weather floating storage and regasification unit (FSRU)-based LNG import terminal in Gujarat at an estimated cost of $800 million. On completion, it will have an initial capacity of 5 million metric tonnes per annum (MMTPA), expandable up to 20 MMTPA. HH Sheikh Mohammed Bin Zayed Al Nayan, Abu Dhabi Crown Prince and Deputy Supreme Commander of the UAE Armed Forces, launched the project during his recent three-day India visit. He was there as the Chief Guest for India’s 68th Republic Day Celebration at New Delhi on January 26. This project award has set a new milestone in strategic relationship between India and UAE. The Indian arm of NMDC, National Marine & Infrastructure India Private Limited (NMIIPL) has already begun construction on the project and targets to complete the project within three years, said a company spokesman. “We are proud to be a part of India’s next generation LNG import facility. We ensure that this world class infrastructure will be engineered with the highest paradigms of safety, environment, compliance, reliability and quality,” he added. Walter Payton Jersey
India-Iran energy co-op in the pipeline
Marking India’s 68th Republic Day a flag-hoisting ceremony was held at the embassy on Thursday. It was followed by a speech by Ambassador Saurabh Kumar. After the ceremonies the Indian envoy talked with the Tehran Times about India-Iran relations. Below is the text of the interview. Seven agreements, valued at over $3b, were signed on January 23 on the sidelines of the international conference on investment opportunities and sustainable development in Mokran coastal area in the Chabahar Free Trade Zone (CFTZ). Agreements were signed by Indian, Omani, Chinese and S. Korean investors. Could you please elaborate on this? Chabahar is a very important symbol of cooperation between India and Iran. It was a very important issue of connectivity between India, Iran and Afghanistan and as well as the Central Asia region. Deputy Chief of Indian Mission, Davesh Uttam, was present at this ceremony which was attended by around a dozen Indian companies. We have a few important initiatives which are presently under way. Rashtriya Chemicals and Fertilizers and Gujarat State Chemicals and Fertilizers are two important Indian companies that manufacture fertilizers and are looking to establish urea and ammonia plant in CFTZ. They are searching for a reliable partner from the Iranian side. “There is no distinction between good terrorist and bad terrorist.”Another initiative is an agreement between National Aluminium Company of India (NALCO) and Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO) for an aluminium smelter plant in CFTZ. A delegation from NALCO was here in December and held extensive discussions with IMIDRO and visited various sights in Chabahar. At present NALCO and IMIDRO are looking at an independent consulting company to prepare a feasibility report. In addition, there were other Indian fertilizer companies which held discussions with the Iranian side. If investments come about they would add significantly to the development of the Chabahar region and provide the needed traffic for the Chabahar Port. It would be hard to put a deadline into these projects because of their technical nature and commercial aspects. One of the most critical issues is establishing an understanding on the gas price and again there are a lot of technicalities involved. Expectation is that they would reach a positive conclusion and we are encouraging these activities. Minister of Transport and Urban Development Abbas Akhundi visited India last September. Both India and Iran had decided to hold an event in Chabahar in which Indian private sector and other stakeholders can be invited. “It (terrorism) is becoming highly unpredictable.”We had a high level Indian official from our foreign ministry who was in Tehran in January and he visited the Chabahar region. During those interactions, we decided that we are looking at this event on the second half of April. I emphasize the importance of this event because what Chabahar needs is investment. The private sector will be the major investor and it needs a lot more exposure to Chabahar and the facilities there. India will invest $85m in equipment for phase one of Chabahar Port and the process is underway which would short list the Indian companies that would provide the needed equipment. As far as the $150m in line of credit is concerned we are waiting for the Iranian side to submit the projects for which the finances would be utilized. In your previous interview with the Tehran Times you said “we are trying to put in place three important agreements”, namely Preferential Trade Agreement (PTA), double taxation avoidance and bilateral investment agreement (BIT). Any progress in this goal? This is something that foreign ministries of both countries are monitoring. We had received a proposal from the Iranian side. Indian Ministry of Commerce and Industry has examined these proposals and given its comments to the Iranian side. On double taxation avoidance agreement we had a few suggestions from Iran. On BIT we have agreed on some dates to hold meeting in this regards. However, no documents have been finalized at this stage.” Is the idea of transferring of Iranian gas to India through seabed still under consideration There is a working group relating to this matter. As far as our cooperation for the hydrocarbon sector, which includes transfer of gas to India, both sides are considering all possibilities, including pipelines and LNG. We are looking for a techno-commercial feasible option to utilize. Turning to political issues, how can Iran and India cooperate on containing the spread of terrorism, especially in Central Asia? Terrorism is a major concern. It is becoming highly unpredictable. This is an issue on which both Iran and India have expressed serious concerns. We have mechanisms through which we exchange views. Very important dialogue has been held between Supreme National Security Council and the National Security Council Secretariat of India. Can you elaborate on the steps needed for regional security, especially as Iran and India are very concerned about the scourge of terrorism. All the countries have to be sincere in the fight against terrorism. India has always maintained that there is no distinction between good terrorist and bad terrorist. We have to target all terrorists. All means that sustain terrorism have to be attacked, including financing and material support. Most importantly India has put on the table at the UN a comprehensive convention on terrorism. However, the progress on this issue has not been to our satisfaction. We look forward to cooperation with our partner countries so that this initiative reaches its logical conclusion. Hanley Ramirez Womens Jersey
GLOBAL LNG-Oversupplied Japanese players to sell off excess volumes
Asian spot LNG prices extended losses this week as oversupplied Japanese utilities sought to offload cargoes and as key European gas benchmarks softened. Asian prices for LNG delivery in March fell 25 cents to about $7.75 per million British thermal units (mmBtu), traders said, ranging from $8/mmBtu to about $7.60/mmBtu. Prices tailed off even more sharply into April, currently trading at around the $7/mmBtu mark, they said. One trader said utilities in Japan “have overbought due to warmer than average temperatures at the end of 2016 and the current cold spell doesn’t look like it will last,” leaving them stuck with larger inventories. “This will put massive pressure on the market as I don’t think the demand is there for March,” to absorb the excess supply, the trader said. Kansai Electric, Osaka Gas and LNG importing giant JERA are expected to unload at least one cargo apiece for March delivery, he said, though it was unclear if Kansai was trying to arrange a time-swap as opposed to a straightforward sale. A second trader said JERA was already marketing two shipments from Indonesia’s Donggi-Senoro LNG export facility and that it has likely sold one of those cargoes. Further weighing on Asia’s March LNG contract was an 8 percent slide in Europe’s equivalent benchmark, at Britain’s National Balancing Point trading hub, which settled at $6.40 per mmBtu on Friday. China’s Sinopec put up for tender several cargoes for February and March delivery from Australia’s AP LNG project, where it is a stakeholder with long-term supply rights. Exxon Mobil’s Papua New Guinea (PNG) export plant sold off one cargo for March and one for April loading, via a tender process, at a price above $8/mmBtu, traders said. “I think PNG went above 8 – but – they are big and rich and several people still have a lot of in-the-money contracts in the Far East where you would pay a big premium to take in a cargo of that quality,” one said. hailand’s PTT was seeking a March shipment via tender. Angola, which has launched a fresh sale tender, this week sold a cargo to Spain’s Union Fenosa at a price-tag above $9/mmBtu. The status of Gail India’s buy tender, which closed on Jan. 24, could not be immediately verified. Attracted by an upsurge in gas prices in France and Spain, U.S. exporters are shifting their focus away from Asia as problems with Algerian gas supply have driven southern Europe’s gas prices higher. Algeria’s Skikda LNG facility will fully resume at the end of the month after a maintenance, but state energy firm Sonatrach has fulfilled its gas delivery commitments, the Sonatrach CEO said on Thursday. Argentina state-run energy firm Enarsa has launched a tender, which closes on Feb. 7, seeking 16 LNG cargoes for delivery between April and August. Chad Williams Authentic Jersey
AG&P Signs MoU with Hindustan LNG to Build a Terminal in Andhra Pradesh
AG&P (Atlantic, Gulf and Pacific Company), the leading global integrator of LNG infrastructure solutions including LNG terminals and the supply chains that emanate from them, and Hindustan LNG (HLNG), a Hyderabad-based LNG import terminal development company, have signed a Memorandum of Understanding (MoU) to supply tolled gas to power stations in the East Godavari region of Andhra Pradesh, India. Under the agreement, AG&P will provide an integrated solution to deliver regasified LNG through a new LNG import terminal that AG&P will also design and build at the port in Andhra Pradesh. The MoU was signed at the Partnership Summit 2017 organized by Confederation of Indian Industry (CII), and the signing was graced by Chief Minister N. Chandrababu Naidu. The MoU has launched a fully integrated solution for delivering tolled gas in India, including design, construction, financing, operations and maintenance of the new terminal, which will ensure a reliable and low-cost supply to power producers, fertilizer plants, cold storage and other industries in Andhra Pradesh and other markets along the east coast. Speaking at the signing ceremony in Andhra Pradesh on 28th January, 2017, Dr. C.R. Prasad, Chairman of HLNG said: “Andhra Pradesh is the ideal place for developing an LNG import facility to serve the growing energy demands of the east coast of India where existing gas-fired power projects urgently need a reliable supply of LNG. The partnership with AG&P will provide a strong platform to develop a fast-track and low-cost LNG import solution that enables the region to continue on its growth trajectory.” AG&P will be responsible for designing and building all the required facilities for the import terminal, including a floating storage and mooring system, regasification terminal, related utilities and the provision of tolled gas to power plants and other users. AG&P will also carry out any necessary conversion works and, upon commissioning, ongoing operations and maintenance activities. “It is a great privilege for AG&P to help implement India’s vision for clean, low-cost, flexible and reliable power. Andhra Pradesh is playing a critical role in manufacturing and trade. The state and its people are on a strong, upward trajectory. We see the provision of tolled gas to supply power and fuel to factories, homes and even transport in an environmentally clean way as crucial elements of Andhra Pradesh’s future. We are honoured to be a part of this exciting phase of the state’s development,” said Dr. Jose P. Leviste, Jr., Chairman of AG&P. Brett Favre Womens Jersey
Budget wish list: Oil & Gas sector hoping for reduction in cess rate, 100% depreciation allowance
he oil and gas sector is hoping for couple of announcements related to reduction in cess rate, 100 per cent depreciation allowance for projects undertaken for upgradation of fuel quality and exemption on 15 per cent service tax on LNG Sea transportation and regasification from the government in the upcoming Union Budget scheduled on February 1. Experts also believe that the industry is further expecting to get infrastructure status from the government. According to ICICIDirect.com, the change in Oil Industry Development (OID) cess duty would be positive for upstream oil companies as it would reduce costs by $5-6 per barrel at current crude oil prices. The elimination of import duty on LNG will also boost LNG demand and lower costs. It will prove to be positive for gas utility companies. At present, only the power sector is exempted from paying import duty on spot LNG. In the past one year, crude oil prices have surged nearly 64 per cent to $55.52 per barrel till January 27, from $33.89 per barrel on January 28, 2016. IndiaNivesh Securities says upstream companies like ONGC and Oil India are seeking a reduction in cess rate applied on crude producers. It was linked to crude prices in last budget at the rate of 20 per cent ad-valorem from earlier being linked to volume at Rs 4500 per mt. The recent rise in crude oil prices is impacting the profitability of these companies. The brokerage house further said that there is very low probability that the sector will get infrastructure status from the government in the upcoming Union Budget. However, if it happens, the move will be positive for upstream companies like ONGC and Reliance Industries. At present, 15 per cent tax is levied on sea transportation of LNG from a place outside India to the first customs station of landing in India. According to market experts, the industry has also demanded inclusion of LNG facility at port location in the definition of “industrial infrastructure” in section 80-1A of Income Tax Act. Federation of Indian Petroleum Industry seeks clarity on the definition of the term “Mineral Oil” by including both crude oil and natural gas under it for the purpose of section 80 IB (9) retrospectively irrespective of NELP rounds. The industry also flags concerns about the implementation of BS-VI emission norms by April, 2020 and the need to incentivise the shift for downstream companies. Hence, the industry body has suggested that 100 per cent depreciation allowance be provided for projects undertaken for up-gradation of fuel quality. Brokerage houses believe that the move will be positive for OMCs and upstream companies both. In the past one year, the BSE Oil & Gas outperformed benchmark equity indices and surged 45 per cent till January 27, whereas BSE Sensex gained 13.84 per cent during the same period. During the period, oil marketing companies such as HPCL, BPCL and IOC surged 101 per cent, 93.54 per cent and 62 per cent, respectively. On the other hand, other oil and gas majors such as Reliance Industries, ONGC and Oil India gained 2.58 per cent, 40.49 per cent and 30 per cent, respectively. Gail (India) gained 35 per cent in the past one year. Jonathan Marchessault Jersey