bangalore Exxon, BHP to develop Australian natural gas project
Exxon Mobil and the world’s top miner BHP Billiton said on Thursday they approved development of the West Barracouta gas field in the Gippsland Basin in Australia, to bring fresh gas to Australian domestic markets. Exxon said the project, located off the shore of the state of Victoria, is part of its continuing investment in the Gippsland Basin, an area rich in oil and gas. BHP will invest about A$200 million ($144.36 million) in the gas field, the miner said in a separate statement. Rising natural gas prices has become a political issue in Australia as households and manufacturers complain of higher costs, especially in the country’s more populous east coast. The Gippsland Basin joint venture continues to supply about 40 percent of east coast Australian domestic gas demand, Exxon said, adding that front-end engineering design work for the project was completed and key contracts awarded. “The West Barracouta project is an important investment, underpinned by strong economics and rates of return, that will unlock a high quality, new gas resource and will help offset Bass Strait production decline at a vital time for the east coast market,” said Graham Salmond, General Manager of BHP Petroleum Australia. “BHP is actively engaging with a diverse range of customers for future Bass Strait gas supply,” he said. The West Barracouta development is expected to achieve first gas from 2021. Exxon’s unit Esso Australia Pty operates the Gippsland joint venture on behalf of a 50-50 joint venture with BHP Billiton Petroleum (Bass Strait) Pty.
Despite rising oil imports, energy security plan on track: Dharmendra Pradhan
Oil minister Dharmendra Pradhan has said the increasing dependency on imported fuel should not be seen as a challenge to the energy security programme that the country is building on. Pradhan said government has taken many initiatives to increase the capacities of alternative sources of energy like solar, wind, biogas, among others. The country imports more than 82 per cent of its daily oil demand, making crude imports the biggest drain on the nation’s foreign exchange, as domestic production has either been stagnant or even declining for long but demand has been on a steady rise, clipping at 4-6 per cent per annum. “The rise in oil imports and the dependency on the imported fuel are not going to be hurdles in our energy security programme. Even large economies like Japan and Korea are also net importers of oil. On the contrary, because of our energy diplomacy, we have been able to, for the first time, get a say in oil production in the GCC,” he said. Addressing an economic summit organised by the Times group, Pradhan said government has taken initiatives to create a gas-based economy considering the easy and cheaper availability of natural gas. “To increase domestic gas production, we have undertaken many reforms and made a lot of amendments in ease of doing business in the oil sector. Besides, we have also increased our ethanol production and now we are experimenting with converting coal into synthetic gas,” he said. Reiterating his call to oil producers to take into consideration the interest of their large consumers like India, Pradhan said that “we have been stressing that our consuming capacity should be recognised by the oil cartel Opec. They cannot continue to determine both the quantity and price and that there has to be space for consumers as well.” He also claimed that because of the efforts taken by New Delhi, other large Asian oil importers like China, Japan and Korea will also be beneficiaries. “Why should Europe get oil at a lower rate while we we pay higher prices to the same quality crude?. This is what we have been telling the Opec and finally they are now revisiting their strategies,” he added.
CNOOC gas supply hits new record as northern China shivers
CNOOC Gas & Power, a unit of China National Offshore Oil Corp , said on Wednesday its daily supply of natural gas had surpassed 200 million cubic meters for the first time as temperatures in northern China plummet. * CNOOC sent 205 million cubic meters of gas to the Chinese market on Dec. 10, 18.5 percent more than the daily high of 173 million cubic meters recorded in 2017, CNOOC Gas & Power says on its website. * CNOOC plans to supply 48 billion cubic meters (bcm) of gas this year, including 46.5 bcm of base supply and 1.5 bcm of incremental supply, the statement says. * State-run news agency Xinhua reported last month that CNOOC would raise gas supply by 20 percent during the winter heating season. * Temperatures in northern China have dropped since Dec. 4 and various regions have seen an increase in demand, CNOOC Gas & Power says. * China Meteorological Association data put temperatures in Beijing as low as -8 degrees Celsius on Wednesday.
Auction of 25 oil and gas fields deferred by a month, says DGH
The government has deferred the auction of 25 oil and gas fields by one month that hold resources worth an estimated Rs 1 lakh crore, upstream regulator Directorate General of Hydrocarbons (DGH) said. The second round of Discovered Small Fields (DSF) auction opened in August and December 18 was the last date for submission of bids. “Due to consistent demand of investors, the last date for submission of bids for India DSF Bid Round-II is now extended till 1200 hrs January 18, 2019,” the DGH said in a tweet. Bids will be opened on the same day, it added. In 2016, the government brought in a new DSF policy wherein ‘idle’ small discovered fields of state-owned Oil and Natural Gas Corp (ONGC) and Oil India Ltd (OIL) were taken away from the companies and auctioned to private players on liberalised terms including marketing and pricing freedom and lower taxes. ONGC and OIL say they have not been able to develop the fields due to their small size and current capped prices making their development unviable. Private companies will, however, get full pricing and marketing freedom. When the DSF-II bid round was launched in August this year, Oil Minister Dharmendra Pradhan said the fields hold resources worth Rs 1 lakh crore. Some of these resources would translate into higher revenue for the government by way of increased royalty paid on production, taxes and profit petroleum. Pradhan had said that the government is expecting as much as Rs 45,000 crore in royalty, taxes and profit petroleum over the life of the fields. In DSF-II, 59 discoveries have been clubbed into 25 contract areas spread over 3,042 square km and eight sedimentary basins. In the DSF-I round, Rs 34,600 crore of resources were bid out. A total of 134 bids were received for 34 blocks out of 46 on offer. The government is expecting a revenue of Rs 9,000 crore from fields bid out in DSF-I, with first oil expected in 2020. The government had planned to offer 60 discoveries clubbed into 26 contract areas spread over 3,100 sq km in DSF-II but curtailed the offer to 25 areas comprising 59 discoveries due to some unexplained technical difficulty. The fields are being offered in Rajasthan, Gujarat, Kutch & Cambay shallow waters, Mumbai offshore, Assam and Tripura, Mahanadi shallow water, Andhra Pradesh onland and KG offshore. DGH officials said the main features of DSF-II include a single licence for exploitation of both conventional and unconventional hydrocarbon, prior technical experience not a pre-qualification criterion, no upfront signature bonus and full pricing and marketing freedom. Royalty rates have been reduced to 7.5 per cent from 10 per cent for offshore blocks. In DSF-II, the fields on offer hold 190 million tonne or 1.39 billion barrels of oil and oil equivalent in place gas reserves. On offer are 15 onland fields and 10 shallow water areas. Of the 60 fields that were identified for DSF-II, 22 belong to ONGC, five to OIL and 12 are relinquished discovered fields from the New Exploration and Licensing Policy (NELP) blocks. In DSF-I, 46 contract areas consisting of 67 discovered fields spread across nine sedimentary basins were put on auction.