Russia’s Gazprom to increase natural gas deliveries to Austria
Russian energy producer Gazprom will deliver more gas to its Austrian partner OMV , the two companies said on Monday. Deliveries to Austria will be increased by 1 billion cubic metres per year, they added. “The signing of a document on additional exports beyond the contractual amounts serves as yet another proof of the high demand for Russian gas on the part of our European consumers,” Gazprom CEO Alexei Miller was quoted as saying in the statement.
GAIL Q2 profit jumps 50% YoY to Rs 1,963 crore, beats analysts’ estimates
State-run GAIL on Monday reported a 49.89 per cent year-on-year rise in profit at Rs 1,962.96 crore for the September quarter. Analysts in an ET NOW poll had estimated the profit figure at Rs 1,473 crore. The company had posted a net profit of Rs 1,309.63 crore in the corresponding quarter last year. Total income of the company increased 54.86 per cent to Rs 19,640.96 crore in Q2FY19 over Rs 12,682.88 crore in Q2FY18.
Qatar reshuffles Cabinet, board of Qatar Petroleum
Qatar named the head of its largest bank as the new trade minister and restructured the boards of its state-run energy firm and sovereign wealth fund amongst other changes in a top-level shake-up on Sunday. It was the first government reshuffle in Qatar, the world’s top liquefied natural gas producer, since early 2016, but diplomats and analysts said the changes did not represent a significant shift in power in the world’s largest liquefied natural gas exporter. The tiny but wealthy country has been subject to a diplomatic and economic boycott by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt since June 2017. They accuse Qatar of backing terrorism and cosying up to Iran. Doha denies the charges and says the boycott aims to impinge on its sovereignty. Qatar’s ruler issued decrees outlining changes to the boards of Qatar Petroleum (QP) and Qatar Investment Authority (QIA), the world’s ninth largest sovereign wealth fund with about $300 billion in assets. A Cabinet reshuffle saw Qatar National Bank (QNB) CEO Ali Ahmed al-Kuwari appointed to a new portfolio which combined commerce and industry under one ministry. Saad al-Kaabi, the chief executive of QP, was named Minister of State for Energy Affairs and there were also changes to the justice, labour and social affairs, and municipality and environment ministries. Western diplomats and analysts did not see the shake-up as indicative of a shift in policy nearly 18 months since the start of the regional rift, which Qatar has weathered with new trade routes and amid higher oil prices that have helped it swing to a budgetary surplus this year. “The Cabinet shuffle was expected to come earlier, but was apparently on hold as the country dealt with the blockade and now as the ramifications have been successfully dealt with it was time,” said Majed al-Ansari, an analyst and professor of political sociology at Qatar University. “It does not signal a change in policy or power shift in the government,” he said. It was not clear whether Kuwari would retain his post at QNB, the Middle East’s largest lender by assets. The bank, which is 50 percent owned by the country’s sovereign wealth fund, did not immediately respond to Reuters’ request for comment. QP’s Al-Kaabi, a US-educated engineer, rose through the ranks to become chief executive in 2014 and also sits on the board of the Qatar Investment Authority. He has gained a reputation among executives of the world’s energy majors, such as Exxon, Shell and Total , as a reliable counterpart for energy projects that have made the tiny nation of 2.6 million people the biggest exporter of liquefied natural gas (LNG) on the planet. Abdulla Abdulaziz Al Subaie was appointed minister of municipality and environment, a post seen as key to preparations for the country’s 2022 World Cup. Subaie has served as managing director and CEO of Qatar Rail, which expects to launch Doha’s first metro line this year. A separate decree on Sunday appointed Mohammed Bin Hamad Al-Thani chairman of the Qatar Financial Markets Authority as part of a shuffle to its board of directors.
Hughes India bags Rs 200 crore order from oil marketing firms
Satellite-based broadband services firm Hughes India has bagged an order to the tune of Rs 200 crore for a five-year period from oil marketing firms Indian Oil (IOCL), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL) to upgrade connectivity across their 19,000 retail points, a senior official of the company said. “We have been working with OMCs, and this is the first time we have awarded order to upgrade their retail outlets. Total order size is in the range of around Rs 200 crore for a period of 5 years,” said Shivaji Chatterjee, senior vice-president and head, Hughes Communications India. Under separate contracts, IOCL, BPCL and HPCL will each use the JUPITER system to upgrade network connectivity across 19,000 locations collectively to increase speed of transactions, eliminate manual interference, and deliver accurate, real-time data across the retail operations. “The contract includes around 4,120 outlets of HPCL, 10,015 of IOCL and 5,000 retail outlets of BPCL,” Chatterjee said.
OMCs to help customers in gas booking, re-filling via CSCs
In an effort to make it easier for new gas connection, re-filling and delivery of household cylinders, the Government has appointed common service centres to provide such facilities through Digital Seva Portal. Public sector oil marketing companies (OMCs) and common service centres on Saturday signed a memorandum of understanding (MoU) to facilitate these services through 0.3 million CSCs across the country. Retail marketing of petroleum products is done by OMCs which include Indian Oil Corporation (IOCL), Hindustan Petroleum Corporation (HPCL) and Bharat Petroleum Corporation (BPCL). They have agreed to provide the benefits of Ujjawla connection, re-filling of new connection and other services through CSCs – a last mile access at consumers’ doorstep. CSCs will help the beneficiary to scan/upload his/her KYC document for verification of his/her identity for new booking connection. Beneficiaries can also collect the gas cylinder from their nearby CSC. The service centres will also provide requisite information about the scheme and promote it among citizens so that maximum number of beneficiaries can avail the benefit. The Ministry of Petroleum & Natural Gas is appointing one Ujjawala Didi for every five villages whose prime responsibility is to support and give service to Ujjawala beneficiaries. “The MoU with CSC will help us in promoting a transparent and convenient option. To fulfil the last mile gap, role of CSCs can be very significant. CSC is the greatest model of the bottom of pyramid,” the Minister of Petroleum & Natural Gas and Skill Development & Entrepreneurship, Dharmendra Pradhan ,said. He said in the last four years, the government had provided 1 million additional LPG connections. “Our aim is to provide 1.3 million LPG connections in five years of our government. And today’s initiative will add the new chapter in the New India’s concept,” he said. Speaking on the occasion, the Minister of Electronics & IT, Ravi Shankar Prasad, said, “CSCs have played a significant role in promoting rural enterprise as well as digital inclusion, mainly for rural citizens. CSCs today deliver large number of services and through PMGDISHA have trained more than 10 million citizens in digital literacy.”
ADNOC announces discovery of new oil, gas resources in UAE
UAE oil company ADNOC has announced the discovery of new oil and gas resources, with an eye on full self-sufficiency as US sanctions on Iran go into effect. State-run ADNOC, based in the oil-rich capital Abu Dhabi, said on Sunday it had discovered new gas fields, totalling 15 trillion standard cubic feet, and another billion barrels of oil. The company also announced plans to boost output to four million barrels per day by 2020 and five million bpd by 2030 — a plan UAE officials said was aimed at making the country entirely self-sufficient. Abu Dhabi Crown Prince Mohammed bin Zayed also announced the Supreme Petroleum Council, the city’s main decision-making council, approved a budget of 486 billion dirhams ($132 billion) to support a five-year growth plan. This included ADNOC’s “gas strategy to become self-sufficient and a net gas exporter,” he said on Twitter. The United Arab Emirates, OPEC’s fourth largest producer, currently produces up to 3.5 million bpd. Sunday’s announcement came as the United States imposed strict sanctions against Iran. The move targets buyers of Iranian oil with the aim of throttling Tehran’s main source of income. The UAE and its main ally, Saudi Arabia, support the new sanctions. The two countries have also severed ties with Qatar — the world’s largest exporter of liquified natural gas — in a spat over Doha’s policies, primarily on Iran and radical Islamist groups. But the UAE still relies on Qatar for gas imports via the Dolphin pipeline, which Qatari officials say is still functional. Saudi Arabia is the only producer with significant spare capacity of around two million bpd that can be tapped into to compensate for the loss of Iranian supplies. But analysts doubt Riyadh can sustain high production for a prolonged period.
Oil price rise: Making India’s voice count
The steep rise in international oil prices over the last few months is pinching the government and the people alike. This has not only affected the finances of people and the government, it has also affected the exchange rate of the rupee against international currencies. The current geopolitical landscape continues to pose a challenge in keeping prices within an affordable range. We have come across statements of global leaders appealing to oil-producing countries to reduce oil prices for long-term benefits that will accrue to the global economy. That hasn’t helped. While OPEC countries remain the main balancer of prices, there are several other factors that affect global crude rates. We have been raising the issue of the Asian premium, loud and clear, at every relevant international forum. At the ministerial meeting of the International Energy Forum on April 11, PM Narendra Modi had said, “We need to move to responsible pricing, which balances the interests of both the producer and consumer.” In a recent meeting with global oil experts and CEOs, which was also attended by the oil ministers of Saudi Arabia and the UAE, Modi noted that the oil market was producer-driven and oil-producing countries determined both the quantity and prices. Over the last many years, OPEC has played a key role in India’s quest for secure sources of supplies as the overall trade with OPEC nations is more than 80% in crude and 75% in gas of total import. Our companies pay huge sums on this account each year. To diversify our crude sourcing and get a better price for crude oil, we started importing from the US since last year. Now, it has become a regular feature for our PSUs to import from the US. In view of India’s high import dependence for oil and gas, in the first phase of the Strategic Petroleum Reserve (SPR) programme, the government has built SPR facilities with a capacity of 5.3 million metric tonnes. The total reserve of SPR has an estimated capacity of 9.5 days of India’s crude oil requirement. Under the second phase, we will build two more facilities. A refiners’ forum of private and public sector refineries in India has been formed to negotiate and strengthen as a block for better bargaining with producer countries. Recently, the International Energy Agency acknowledged that India will be the fastest growing energy consumer – and market – till 2040. The forecast also holds a promise for renewable energy, as fast-declining costs turn solar and wind energy into the main drivers of growth in the power sector. Reducing dependence on fossil fuel is one of the prime focus of our government’s policies and initiatives. Another interesting aspect in pricing of petrol and diesel in India that is less known is that international prices of petrol and diesel (not the price of crude oil) determine the price of petrol and diesel for Indian consumers. Many times, we have come across situations when the price of crude oil remains at a modest range while the cost of petrol or diesel is at a higher range pushing up the retail price in India. India remains the loudest and most reasonable voice representing the consuming nations. We have championed the cause of reasonable price of crude oil as something, which is in the long-term interest of the oil-producing countries. The PM has led this debate in his dialogue with the global community. There has been consensus that rise in oil prices was not a byproduct of shortages in supply of oil or demand supply imbalance. Rather, a more plausible argument is that it is a balanced market but the sentiments are imbalanced. In simple terms, geopolitical uncertainties and speculation about the macro-economic situation in large economies are having a crucial influence on prices rather than the actual production of crude oil. Our views arguing for long-term stability of oil industry by keeping oil prices at reasonable level has gained acceptance by major players in the international oil circuit. We are optimistic their future decisions will factor in concerns of consuming countries as championed by us.
Oil and Gas May be One Reason Why India Looks the Other Way on Myanmar
While the West moves to re-isolate Myanmar after a short period of re-engagement, neighboring India is taking a more realpolitik approach to reports of massive rights abuses by the nation’s security forces. Indeed, India is doing its utmost to improve relations while the United States and European Union impose new sanctions aimed specifically at Myanmar’s military, including top soldiers involved in the abuses. It is by now evident that Myanmar’s treatment of its Muslim Rohingya population and crackdown on the media — major concerns in the West — will be subordinated to New Delhi’s broader policy aims for Myanmar and the wider region. There are several intertwined reasons for India’s pragmatic approach. First, India’s eastern neighbor is a vital link in its commercially driven “Act East” policy, a gambit aimed at expanding trade and investment through better linkages with Southeast Asia’s booming economies. India’s fast-expanding economy needs fuel to grow, and New Delhi has shown strong interest in importing oil and gas from Myanmar. Meanwhile, long-decrepit roads to the Myanmar border are being upgraded to facilitate faster bilateral trade. An agreement signed in May paved the way for entry-exit points at the border towns of Moreh in India and Tamu in Myanmar, as well as at the Rihkhawdar-Zowkhawtar at the border between India’s Mizoram and Myanmar’s Chin state. Second, India has stayed fully engaged with Naypyidaw to prevent China from stealing a march in yet another neighboring country after Beijing has made strong advances in Pakistan, Nepal, Sri Lanka and Maldives, including through its global infrastructure-building program. Just as significantly, New Delhi’s security planners want to ensure that Assamese, Naga and Manipuri ethnic insurgents based in remote areas of northwestern Myanmar are deprived of their sanctuaries. Insurgents often launch lethal raids into India’s northeast from those camps and then retreat across the border into Myanmar, beyond the reach of the Indian army. In June 2015, India’s security authorities ran out of patience and sent commandos across the border to attack rebel camps. Myanmar authorities denied any such attack took place and have always claimed their are no rebel bases on their territory. Still, the insurgent issue created new headlines in the Indian media when Myanmar’s Deputy Home Minister Major General Aung Thu met with India’s Home Secretary Rajiv Gauba in New Delhi in late October. Reports said the two senior officials held talks on a range of issues, with the local The Sentinel newspaper proclaiming in a headline that “India, Myanmar to jointly strike against Northeast rebels.” The Business Standard, meanwhile, announced that “India, Myanmar agree to act against insurgent groups operating within their territories.” LiveMint, an Indian news website, reported that India and Myanmar are going to “draw up [a] counter-insurgency cooperation plan.” If all true, the bilateral meeting would have represented a major breakthrough in security cooperation between India and Myanmar. Ethnic insurgents opposed to New Delhi’s rule have maintained cross-border sanctuaries in Myanmar since the late 1960s, and India has tried as long to persuade the Myanmar army to take action against them – preferably through the kind of joint operations that The Sentinel mentioned in its commentary. Despite the sensational headlines, nothing of the sort was agreed upon during Aung Thu’s visit. Myanmar and India only agreed to work together to prevent smuggling of wildlife and narcotics, and vaguely increase “security cooperation” along their common border, which is nothing new. Indeed, any joint counterinsurgency operation by Indian and Myanmar militaries would be impossible under Myanmar’s 2008 constitution, which clearly states that “no foreign troops shall be permitted to be deployed in the territory of the Union.” It is widely known that the main bases of India’s northeastern rebels are located in and around Taga north of Singkaling Hkamti — miles away from the Indian border and at least a week’s trek over mountainous terrain — where they appear to have a cozy relationship with nearby Myanmar army camps. Naga rebel leaders from the Indian side are known to have invested in gold mining and other lucrative business ventures in Myanmar’s upper Sagaing Region, where they are based. Assamese and Manipuri rebels are able to move more or less freely from the Taga camps across northern Myanmar to Ruili in China’s southern Yunnan province, where they buy military supplies and other necessities. The strategic reality is that Myanmar’s army is now fully occupied with fighting its own domestic insurgencies in Kachin and Shan states and cannot be bothered with the presence of rebel groups from India’s northeast who are actually good for the region’s local economies. It is also now apparent that India’s “Act East” policy, previously known as “Look East” until rechristened and ramped up in 2014 under Prime Minister Narendra Modi, is focused in part on stabilizing its long volatile eastern border. Still, India is lagging far behind China in terms of accessing Myanmar’s markets and resources. Bilateral trade between China and Myanmar amounted to nearly US$6 billion in fiscal 2016-2017 and US$7.42 billion in the first eight months of 2017-2018. China has built new dual-carriage motorways connecting Kunming, the provincial capital of Yunnan, with Ruili and other towns on the Myanmar border. China has also agreed to build a railway from Muse to Mandalay on the Myanmar side, which eventually will link up with a proposed railroad down to Myanmar’s port town of Kyaukpyu on the Bay of Bengal, giving China strategic access to the Indian Ocean. China’s fast-growing trade with Myanmar is also spilling over to northeastern India. Chinese-produced electronics, clothes, bags, household utensils and other cheap manufactures are transported across Myanmar and can be found in abundance in northeast Indian market places. By comparison, annual trade between India and Myanmar is only around US$2 billion, and the roads from the Indian side to the Myanmar border are still rough and nowhere near of the standard and quality of the infrastructure in China’s southern Yunnan province that borders on Myanmar. But Modi wants to change all that. In September 2017, he visited
Petronet LNG & ONGC Videsh eye LNG stake in US
Petronet LNG and ONGC Videsh are jointly in talks to buy a stake in Tellurian Inc’s proposed Driftwood project in Louisiana, Petronet’s managing director has said. “We have moved slightly forward (from the preliminary discussion stage)… we are evaluating it seriously and we are in serious discussion with them,” Prabhat Singh told Reuters in a phone interview on Friday. Tellurian is a natural gas company based in Houston, Texas. To be built in four phases, the Driftwood project will have a production capacity of 27.6 million tonnes per annum. India is expanding its pipeline network and building new liquefied natural gas (LNG) import terminals to boost use of the cleaner fuel in the country. Prime Minister Narendra Modi has set a target to raise the share of natural gas in India’s overall energy mix to 15 per cent in the next few years from about 6.5 per cent at present. Petronet is India’s top gas importer with no experience of the upstream business, which is why it is tying up with ONGC Videsh, the overseas investment arm of oil producer Oil and Natural Gas Corporation. “We want confirmation and confidence of upstream … we want to mitigate geological risk,” Singh said. ONGC Videsh’s managing director N. K. Verma declined to comment when asked by Reuters. Tellurian is offering a 60 to 75 per cent equity interest in Driftwood Holdings, which comprises Tellurian’s upstream company, its pipeline and the upcoming terminal that will be able to export 27.6 million tons a year of LNG, its co-founder Martin Houston told Reuters last year. Singh, however, said that Petronet was also in talks with several other players about buying a stake in assets spanning from drilling to dispensing, saying it was a bold step for the firm. “But this will deliver gas at cheap prices to India on a longer-term basis. It has merit in this, let us see how things shape up,” he said. A $500-million investment in Driftwood would give the stakeholder rights over a one million tonne/year of LNG over the life of the project, according to a presentation by Tellurian posted on the US company’s website. On a free-on-board basis gas will cost $4.5 per million British thermal units. Tellurian hopes to deliver the first LNG to partners in 2024, the presentation said. “We are negotiating on the contours offered by them (Tellurian),” Singh said.