Puma Energy seeks license for retail fuel sales in India
Global trader Trafigura has applied for a license for its downstream arm Puma Energy to start retail sales of gasoline and gasoil in India, an oil ministry spokesman and Trafigura said on Tuesday. Global oil majors including BP, Total and Saudi Aramco want to enter India’s fuel retail market, attracted by growing demand for gasoil and gasoline in the world’s fastest growing major economy. “A license has been applied for on behalf of Puma Energy, a downstream distribution company in which Trafigura is the largest shareholder, and that application is still pending,” Trafigura said in an email. Puma Energy, in which Trafigura has a 49.6 percent stake, operates in 49 countries. Last year it expanded into Pakistan by buying a stake in a fuel retail network. According to Indian rules, a company can get marketing rights for transport fuels if it has invested or proposes to invest 20 billion rupees ($272 million) in the country’s oil and gas sector over a 10 year period. Last year, a consortium led by Russia’s state-controlled Rosneft and including Trafigura and Russian fund UCP paid about $13 billion to buy 98.26 percent of India’s Essar Oil, now known as Nayara Energy Ltd. Nayara operates a 400,000 barrels per day oil refinery at Vadinar in western Gujarat state and controls 4,756 fuel stations in India. Trafigura, which has about a 24.5 percent stake in Nayara, applied for a fuel retail license for Puma Energy about two months ago, an oil ministry source said. The payment made by Trafigura for the Essar Oil stake cannot be considered an investment in India’s oil and gas sector, this source said. An Indian oil ministry spokesman said the government was examining Trafigura’s request for a retail sales license. “It is being examined and some information has been sought on their investment plans in the country’s oil and gas sector. Once they reply, it will be looked into,” the spokesman said.
Cairn India to invest $4 bn in Rajasthan’s Barmer oil block
Cairn Oil and Gas, a unit of Vedanta Ltd, will invest $4 billion in its flagship Barmer oil block in Rajasthan, Cairn said on Tuesday. The Delhi high court on Monday allowed a 10-year extension to the block on the condition that it pays a higher share of profit to the government. The extension results in an overall increase of oil and gas reserves of 400 billion barrels and a production of 125,000 barrels, said Sudhir Mathur, chief executive officer of Cairn India. “The extension also increases our reserves by 250 million barrels. That is quite a big booster to our overall reserve position,” said Mathur. “Cairn has driven up its share of India’s oil output by 3.5 times in the last nine years, significantly from the Rajasthan block and the extension is a great acknowledgement of our performance.” The extension also paves the way for further investments. “We are spending $4 billion, out of which we have already signed contracts worth $2.3 billion and the work has started in a big way. There are already 13 rigs operating in the Rajasthan block,” said the CEO. State-run Oil and Natural Gas Corp. (ONGC) is a 30% partner in the Barmer oil block. “The government of India, acting through the directorate general of hydrocarbons, ministry of petroleum and natural gas, has granted its approval for a 10-year extension of the PSC for the Rajasthan Block, RJ-ON-90/1,” Vedanta Ltd said in an exchange filing on Monday. The 25-year contract for exploration and production of oil and gas from Barmer block RJ-ON-90/1 was due for renewal on 14 May 2020. In April 2017, the government had approved a new policy for extension of PSCs, which would provide for a contract extension only if companies operating the fields agree to increase the state’s share of profit by 10%. However, Vedanta felt that the May 1995 PSC for the block provided for an automatic 10-year extension on same commercial terms if there are hydrocarbons left to be produced. Vedanta thus challenged the April 2017 policy and the matter is sub judice. “The applicability of the pre-NELP Extension Policy to the Rajasthan Block PSC is currently sub judice,” Vedanta said in the filing. Its partner ONGC was also of the opinion that PSC provides for an extension on same terms. “Let the legal process take its own course. Whatever the verdict of the court, we will accept that,” Anil Agarwal, chairman of Vedanta Resources, had said earlier this month.
Petronas supplies first LNG cargo to marine-fuel vessel ahead of IMO 2020
Malaysia’s state energy firm Petronas said on Thursday it has supplied its first liquefied natural gas (LNG) cargo to a marine-fuel vessel ahead of a new mandate for ships to switch to cleaner fuels in 2020. Its subsidiary, Petronas LNG, loaded the first such LNG cargo onto the world’s largest LNG bunker vessel Kairos at the Regasification Terminal Pengerang (RGTP) located in southeastern Johor, the company said in a statement. “We believe that small-scale LNG opportunities will increase from the utilization of alternative cleaner fuel such as LNG,” Petronas LNG Chief Executive Officer Ezhar Yazid Jaafar said. “The new regulation of 0.5 percent global sulphur cap to be imposed by the International Maritime Organisation (IMO) in January 2020 will make LNG the alternative fuel of choice for the shipping industry.” Kairos has a capacity of 7,500 cubic metres, and it stopped in Malaysia to refuel while making its way from South Korea’s Hyundai Mipo Dockyard in Ulsan to Europe, Petronas said.