Prices of subsidised LPG zoom 16 per cent since Modi took charge
The prices of subsidised cooking gas zoomed by 16 per cent, from Rs 414 per cylinder when the Bharatiya Janata Party (BJP) government came to power in May 2014 to Rs 479.77 in August 2017, despite global crude oil prices dipping by about 49 per cent. The Narendra Modi-led government had stormed to power in 2014 on the back of serious corruption charges against the Congress-led regime and the rise in prices of commodities like cooking gas, against which the BJP had raised its voice. Interestingly, the price of liquefied petroleum gas (LPG) was revised 22 times by oil marketing companies (OMCs) like Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL), and Hindustan Petroleum Corporation (HPCL) since May 2014, when the BJP government took charge. However, on the back of a 49 per cent drop in international crude prices, from $102.71 a barrel on May 30, 2014, to $52.16 (Brent crude) on August 3, 2017, prices of non-subsidised cylinders dipped 44 per cent, from Rs 928.50 per cylinder in May 2014 to Rs 524 in August 2017. Also, in an effort to reduce the subsidy burden or to completely do away with the subsidy, OMCs are authorised to increase prices of subsidised domestic LPG cylinders by Rs 4 per month till March 2018. “The government stands committed and will continue to provide subsidy assistance to the needy and poor households,” said an official close to the development. The subsidy amount on a 14.2-kg cylinder transferred to the accounts of Delhi consumers stands at Rs 86.54 currently, which the government wants to do away with or reduce to the range of Rs 40 per cylinder by March 2018. The current national average of LPG subsidy per cylinder comes to the tune of about Rs 58 per cylinder. This comes at a time when the Modi government is increasing the penetration of LPG through the Pradhan Mantri Ujjwala Yojana, by providing 50 million new connections to women belonging to below poverty line (BPL) families over a period of three years, starting from financial year 2016-17. So far, over 25 million connections have been given under the scheme. “With the expansion of LPG coverage, it is an imperative to rationalise the subsidy component so as to ensure that while the needy and poor are fully protected, at the same time, the affluent households should pay little more price given their rising income and higher paying ability,” the aforementioned official added. In July 2016, Delhi was declared a kerosene-free city. If you consider the prices prevailing in Kolkata, from May 2014 up till now, they have also seen a 57 per cent surge, from Rs 14.9 per litre to Rs 23.36 per litre. In the past three years, the total number of households having LPG connections has remarkably increased from 140 million in April 2014 to 210 million in July 2017. The LPG penetration has increased from 56 per cent to 76 per cent in that period. According to the BJP government, the step to decontrol prices was initiated by the Manmohan Singh government. In June 2010, an empowered group of ministers met under the chairmanship of then finance minister Pranab Mukherjee to look into the issue. “It was in this meeting that it was decided that the price of domestic LPG will be increased by Rs 35 per cylinder in Delhi, with corresponding increases in other parts of the country. Thereafter, the price would be periodically revised based on the increase in paying capacity as reflected in the rising per capita income,” said the official. Interestingly, all key Opposition leaders, including Sharad Pawar, Mamata Banerjee, Kamal Nath, Sushilkumar Shinde, Murli Deora, and M K Alagiri, were present at that meeting. In June 2010, petrol prices were deregulated and linked to international markets, which was followed by diesel prices in October 2014. However, despite these hikes, LPG prices in India remain below international standards. Earl Thomas III Jersey
It Is In Government’s Interest To Protect Air India Jobs: Arun Jaitley
Finance Minister Arun Jaitley today said a “proper decision” would be taken on Air India’s future in a competitive market and that it would be in the government’s interest to protect jobs at the airline. His remarks come at a time when a group of ministers headed by him is working on the modalities for the divestment of loss-making Air India. In a competitive market, challenges are different and a “proper decision” would be taken on what Air India has to do in such a market, Jaitley said in the Lok Sabha. “Is mein karmchariyon ke services bachee rahen, is mein hamara bhi swarth hai (It will be in the interest of the government to protect the jobs at Air India),” he said while replying to a discussion on Supplementary Demands for Grants. Noting that the airline has a debt of Rs. 50,0000-55,000 crore which is “not small”, he said, “now we have to decide what has to be done with the Air India”. He also wondered for how long can tax collected from the public be given to the public sector airline. The previous UPA government had extended bailout package worth little over Rs. 30,000 crore to the national carrier for a 10-year period starting from 2012. Air India has a share of around 15-16 per cent in the domestic market while some 84-85 per cent passengers are flying in private airlines, Jaitley said. Nathan Shepherd Jersey
AAI land monetisation plan on hold
The Centre has put on hold a plan to amend the law to enable monetisation of land assets owned by the Airports Authority of India (AAI) announced in the Union Budget 2017-18 by Finance Minister Arun Jaitley. In his Budget speech, the Finance Minister had said that money raised through monetisation of land assets will be utilised for airport upgradation. The Centre had initiated a proposal for amending the Airports Authority of India (AAI) Act, 1994 for liberalising land use at airports owned by AAI as mentioned in the National Civil Aviation Policy (NCAP) 2016, Minister of State Civil Aviation Jayant Sinha said in a written reply in Rajya Sabha on Tuesday. However, the GMR-led Delhi International Airports Ltd. had challenged the provision in the NCAP 2016 in Delhi High Court which declared it as “ultra-vires.” “Thus, the proposal of amendment in the AAI Act has been kept in abeyance. Ministry of Civil Aviation has approached the Supreme Court against the decision of Delhi High Court and the matter is presently sub-judice,” Mr. Sinha added. William Jackson Authentic Jersey
Air India’s current business ‘not sustainable’: Government tells Parliamentary panel
Air India’s current business is “not sustainable” as it is neither able to generate enough cash flow nor start repaying even the principal amount on its debt, the government has told a Parliamentary panel. With the Cabinet giving “in-principle” approval for selling stake in the loss-making Air India, a ministerial panel is working on the final contours of the proposed disinvestment. Against this backdrop, a parliamentary panel has sought details on the Air India disinvestment decision. Sources said the civil aviation ministry has provided a brief overview about the factors that led to the decision to sell Air India stake to the panel. In the current scenario, Air India is not in a position to generate enough cash flow, to be in a position to start repaying principal amounts on its debt, the ministry has told the panel, according to sources. Doug Middleton Authentic Jersey
DGCA starts safety audit of country’s airlines
As an audit of India’s aviation sector by the International Civil Aviation Organisation (ICAO) nears, the local regulator has launched an evaluation of the country’s airlines for their compliance with safety standards. The Directorate General of Civil Aviation (DGCA) audit is seen as part of the local body’s preparation for the international audit, which comes in the backdrop of increased instances of safety violation in Indian skies. Adverse findings during the evaluation by ICAO, a UN watchdog, could result in foreign aviation regulators imposing sanctions on India. “The airline audit will check them (carriers) on almost all parameters,” said an official in the know, who did not want to be named. Airlines confirmed the development. “These audits by DGCA cannot be surprise audits and they need to inform us and seek dates for the audit,” said an executive at an airline. “Our audit is likely to happen in September.” The number of safety violations reported in Indian skies increased by more than half in 2016 compared with the previous year. According to DGCA data, it took 422 enforcement actions last year, compared with 275 in 2015. And, this at a time when India has become the fastest growing aviation market, registering more than 20% growth in passenger traffic and capacity in each of the past two years. After an audit in 2012, the UN watchdog had placed India on its list of 13 worst-performing nations in terms of air safety, triggering a downgrade of Indian aviation by the US Federal Aviation Authority two years later. The ratings were finally restored in 2015. Such downgrades could hamper Indian airlines’ services to foreign destinations as well as their ability to form codeshare tie-ups. ICAO wanted to conduct the audit in March this year, but agreed to a request from the aviation ministry that it do so later as March also marked the end of financial year in the country. It conducts audit in areas related to legislation, organisation, licensing, operation, airworthiness, accident investigation, air navigation and aerodromes. DGCA officials said the regulator was prepared for the international audit. “One of the concerns was of strengthening regional offices and stationing flight operations inspectors at regional offices. We have almost completed that and we have already placed people at regional offices in Mumbai and Bengaluru,” said a senior DGCA official, who also spoke on the condition of anonymity. The aviation regulator has every requirement in place and will comfortably clear the ICAO audit, he added. Manti Te’o Womens Jersey
Power workmen threaten stir in Chandigarh
The Electrical Workmen Union on Wednesday set a deadline of August 17 for the authorities to meet their long-pending demands. If the authorities fail to comply, the union will stage protests from August 18. The decision was taken in the meeting of the union, which was chaired by its president Kishori Lal. In the first phase of the agitation, effigy burning processions will be organised and then relay hunger strikes. The demands include categorisation of technicians as per orders of the administration, implementation of old pension scheme in regards to the workers regularized after 2004, implementation of labour laws in respect of contractual employees, filling up of 40 vacant posts and special allowance to workers at par with Punjab. UT Powermen Union is also at loggerheads with the administration for non-fulfilment of their long pending demands. Anthony Hitchens Womens Jersey
CAG audit report on MRPL’s Planning and Implementation, laid in Parliament
The Comptroller and Auditor General has reported deficiencies in planning and execution of capital projects, operation of processing units, and operation of support facilities, leading to cost and time overruns at Mangalore Refinery and Petrochemicals Ltd. These discrepancies have been highlighted in the performance audit report on the Planning and Implementation of Phase III Expansion Project of Mangalore Refinery and Petrochemicals Ltd, tabled in Parliament on Wednesday. CAG notes that the initial project cost to increase the refinery capacity from 11.82 mmtpa to 15 mmtpa was estimated at Rs 79.43 billion in 2006. The estimates of cost underwent changes from time to time due to change in capacity and the addition and deletion of various units. As of October 2015, the total adjusted estimated cost of the project worked out to Rs 163.23 billion. Against this, the company had incurred an expenditure of Rs 148.32 billion by March 2016. The project, which was initially proposed to be completed in June 2010, was actually completed in June 2015. Chidobe Awuzie Jersey
South Asia becomes global LNG hotspot as Bangladesh enters market
South Asia, long a backwater for energy markets, is emerging a hotspot for liquefied natural gas (LNG), with Pakistan and Bangladesh set to join India as major consumers, helping to ease global oversupply that has dogged this market for years. Only India and Pakistan currently import LNG in South Asia, taking in a combined 25 million tonnes, or 8 per cent of global demand last year. With a fast growing population, strong economic growth and soaring energy demand, Pakistan and Bangladesh are leading the way by developing more import projects. “Both countries already have extensive gas infrastructure due to legacy production from domestic gas fields,” said Chong Zhi Xin, principal Asia LNG analyst at energy consultancy Wood Mackenzie. “As domestic production has failed to keep up with demand, both markets are a natural fit for LNG imports,” he noted. Pakistan started importing LNG only in 2015, and surprised some in the industry by developing its first terminal within schedule and budget. A second is about to become operational and a third is expected to be completed next year. With Bangladesh set to join the club of importers next year, the region could import 80–100 million tonnes a year by the mid 2020s, analysts said. This makes South Asia the world’s second biggest import region, ahead of Europe. Bangladesh boom Bangladesh, a country of over 160 million people, could import as much as 2,500 million cubic feet per day (mmcfd) of LNG, equivalent to around 17.5 million tons per year, by 2025, said Nasrul Hamid, Bangladesh’s state minister for energy and power. With its own gas reserves depleting and seeking to almost double power capacity to 24,000 megawatt (MW) by 2021, Bangladesh is tapping cheap and plentiful supplies on world markets and investing heavily in LNG. Several floating storage and regassification units (FSRU), the first developed by private U.S. company Excelerate Energy, are due to begin importing cargoes starting 2018. “We are working on two FSRU’s from which gas will start flowing (by) next July,” Hamid told Reuters. Both FSRUs will be deployed off Moheshkhali Island in the Bay of Bengal, in the southeast of the country. They will have a combined capacity of 7.5 million tonnes a year. Two more FSRUs are planned, though no exact dates have been finalised. In addition, state-run Petrobangla signed a preliminary deal with India’s Petronet in December to set up an onshore terminal to regasify a further 7.5 million tonnes a year of LNG on Kutubdia Island, just to the north of Moheshkhali, at a cost of $950 million. “By 2025, depending on our national demand, we will import anywhere from 2,000 to 2,500 mmcfd gas,” Hamid said. Those imports would add to plans from India and Pakistan to buy 50 million and 30 million tonnes of LNG per year, respectively, by the mid-2020s. “LNG imports in South Asia are expected to rise four-fold from 22 million tonnes per year in 2016 to over 80 million tonnes per year by 2030,” said Mangesh Patankar, head of Asia/Pacific business development at energy consultancy Galway Group. Should all plans in the region go ahead and Sri Lanka also starts LNG imports, this figure could rise to 100 million tonnes, industry project data shows. That would push South Asia’s demand ahead of Europe as the world’s second biggest LNG import region by 2020, though it would still lag North Asia’s 150 million tonnes of annual imports. The boom in demand will help ease oversupply in LNG markets, which have resulted in a more than 70 per cent price fall from their 2014 peaks to $5.75 per million British thermal units. Supply talks “We are looking for a mixture of both long-term contracts and the spot market,” Hamid said. HE added that the nation was in talks with Qatar’s RasGas and Indonesia’s Pertamina for long-term deals, while it also planned to import significant amounts of its future demand via the freely traded spot market. Rupantarita Prakritik Gas, part of Petrobangla, in June posted a notice looking for LNG suppliers for spot cargoes from 2018. However, not everyone believes Bangladesh and Pakistan will achieve their LNG ambitions. “It is likely to be an overly ambitious target… China took more than 10 years to reach 20 million tonnes of LNG imports. In India, it took 13 years to reach the same amount,” said Chong Zhi Xin. He also noted that the low domestic gas prices also required LNG imports to be subsidised in Bangladesh and Pakistan. Thus, “As LNG imports increase, so does the subsidy bill. Without pricing reforms, it would be a challenge for Pakistan and Bangladesh to fulfil their LNG import ambitions.” Hamid, however, is confident. In order to meet surging demand, he said LNG was part of an even bigger plan. “The solutions are FSRU, land-based LNG, deep sea exploration in the Bay of Bengal, and transnational (gas) grids ,” he said. Kevin Faulk Womens Jersey
ONGC finds gas, oil offshore West and East India
ONGC has three new offshore discoveries, the company revealed in its latest results statement. In the SWMH ML lease in the Mumbai Offshore basin, the company drilled exploratory well WO-24-3 (WO-24-C) to a depth of 2,360 m (7,743 ft). The well tested intervals in the Basal Clastics, Mukta and Panvel formations. All flowed gas and condensate. In the KG Offshore basin offshore eastern India, well GD-10-1(AA) in the KG-OS-DW-III PEL block was drilled to a depth of 2,829 m (9,281 ft), with two hydrocarbon zones tested in the Godavari clay formation. Both flowed gas. Finally, well GS-29#11 (GS-29-AL) in the GS-29 Extn. PML concession in the same basin was drilled to a depth of 2,718 m (8,917 ft). A sand objective in a Pliocene interval test-flowed oil and gas, boosting the company’s reserves at the Pliocene level in the GS-29 area and potentially improving prospects for a development. Danny Shelton Jersey
Indian Oil Corporation aims to source a tenth of oil needs from own assets
IOC aims to raise its refining capacity by about 89 percent to 3 million barrels per day (bpd) by 2030 by setting up new plants and expanding some existing ones, it said. India, the world’s third biggest oil consumer, imports about 80 percent of its oil requirements as its local production has not increased for decades. But the country wants to create integrated oil companies with activities both in oil production and refining by combining state-run oil firms. In its quest to become an integrated oil firm, IOC wants to expand its current portfolio of its oil and gas blocks. The refiner has a stake in eight domestic and nine overseas oil and gas blocks in Libya, Gabon, Nigeria, Yemen, Venezuela, Russia, Canada and USA, it said in the annual report. IOC, the country’s largest fuel retailer, controls 50 percent of the downstream marketing infrastructure and is beefing up its sales network to cater to rising fuel demand in India, the world’s third biggest oil importer. The refiner owns the largest crude oil and product pipelines network of about 12,848 kilometers and aims to add 8,000 kilometers by 2021. IOC also wants to tap refining and fuel retail opportunities in emerging markets in Southeast Asia and Africa. It is opening offices in Singapore, Malaysia and Bangladesh. IOC currently operates fuel retail and terminal operation in Sri Lanka and Mauritius. To tap India’s growing demand for gas, IOC plans to commission its 5 million tonnes a year LNG terminal in southern Indian in 2018-19, the annual report said. Kevin Huber Authentic Jersey