Platts adds Rotterdam-priced crude oil cargoes to dated Brent
Oil pricing agency S&P Global Platts plans to adjust the way it calculates the price of North Sea dated Brent by reflecting cargo offers on a delivered basis, its latest move to ensure enough supply underpins the global price benchmark. A steady decline in crude production from the North Sea has led to concern that output could become too low and hence could be accumulated by just a few players, making the benchmark vulnerable to manipulation. Platts said on Monday that it plans to reflect offers of BFOE cargoes made on a cost, insurance and freight (CIF) basis in the dated Brent price benchmark as of Oct 1 2019. “Allowing offers for these crudes on a CIF basis in Northwest Europe will enable the inclusion of a greater amount of market data in the North Sea’s light sweet crude oil benchmark,” Platts said in a statement. Dated Brent is based on five British and Norwegian North Sea crudes – Brent itself, Forties, Oseberg, Ekofisk and Troll, or BFOE as they are known. The price – used in oil deals around the world – is set by the cheapest grade.
MOL inks LNG bunker vessel charter with Pavilion Gas
Mitsui O.S.K. Lines (MOL) has signed a long-term charter contract to operate a 12,000-cbm liquefied natural gas bunkering vessel in Singapore with Pavilion Gas, a Pavilion Energy company. Demand for LNG as bunker fuel is expected to grow on a global scale as stricter SOx regulations take effect in January 2020. Singapore’s Maritime and Port Authority (MPA) is focusing on the development of an LNG fuel supply infrastructure and implementing policies aimed at creating the world’s largest LNG fuel supply port, MOL said in its statement. The Japanese government also concluded a Memorandum of understanding in relation to the cooperation on the development of LNG as a marine fuel with seven other countries, including Singapore. Since then the Japanese government has worked with Singapore to promote the use of LNG fuel and develop a supply framework, the statement reads. MOL has already teamed with Sembcorp Marine Specialised Shipbuilding, a unit of Singapore-based Sembcorp Marine Group, for construction of the vessels, and Sinanju Tankers, a bunker barge company, as a ship management partner. The new ship will be the second LNG bunkering vessel in Singapore, and Asia’s largest, according to MOL. It is slated to start services after its delivery to PGPL in early 2021. MOL reminded that after establishing its Bunker Business division in April 2017, it secured a number of contracts including a long-term charter deal with Total Marine Fuels Global Solutions, a Total unit, for an 18,600-cbm bunker vessel in February last year.
Saudi Aramco to deliver 500,000 barrels per month of crude to Egypt
Saudi Aramco has agreed to deliver more than 500,000 barrels of crude oil every month to Egyptian refineries starting in January, Egyptian Petroleum Minister Tarek El Molla said on Tuesday. The minister told Reuters that the agreement would be effective for a period of six months.
Govt reappoints A K Sharma as IOC Director-Finance ahead of elections
The government has reappointed A K Sharma as the Director (Finance) of Indian Oil Corp (IOC) – a first under Prime Minister Narendra Modi when a PSU director has been reemployed in the same position after retirement. Sharma, who superannuated as Director (Finance) of IOC on January 31, has been appointed for three months in the same position, IOC said in a regulatory filing. The reappointment is with effect from February 18, the company said without giving reasons for the reemployment. Officials said Sharma, who as the finance head of IOC was also in charge of pricing of petrol, diesel and other fuels, has been reemployed keeping in mind the impending general elections. The government, they said, does not want to take chances with retail prices and has preferred an old and experienced hand to handle it. Sources said a proposal was moved to reemploy Sharma for six months but Oil Minister Dharmendra Pradhan curtailed it to three months before forwarding it to the Appointments Committee of Cabinet(ACC). The ACC approved his reemployment for three months. This is the first time that a PSU director has been reemployed in the same position after attainment of superannuation age of 60 years. The government has also not given any PSU director an extension after 60 years in the last few years. Last time, such a phenomenon happened on December 31, 2013, when B Prasada Rao was given a two-year extension as Chairman and MD of state-owned power equipment maker BHEL on the day he attained the superannuation age. “It is hereby notified that in terms of a letter by ministry of petroleum and natural gas dated February 15, 2019, the Board of IOC has appointed A K Sharma as Additional Director and designated as Director (Finance) of the company with effect from February 18, 2019, for a period of three months,” IOC said in the regulatory filing. Sharma, it said, is a commerce and law graduate and a Chartered Accountant. He “has rich and varied experience in the petroleum industry and has handled various assignments in finance function both in marketing as well as the refinery division of Indian Oil.” As the Head of Treasury, he was credited for issuing the first ever Foreign Currency Bonds (USD500 million) of IOC in the international markets in 2010. “Sharma brings with him the vast experience of project appraisal, project finance, and treasury operations,” it said. He was appointed Director (Finance) of IOC in October 2014. He superannuated from the position on January 31 this year.
Gazprom sees its gas price in Europe at $230-250 per 1,000 cubic metres in 2019
Russian gas giant Gazprom expects its gas export price in Europe to reach $230-$250 per 1,000 cubic metres this year, Elena Burmistrova, the head of Gazprom Exports, told a meeting with investors in Hong Kong on Tuesday. In 2018 the average price was $245.5 per 1,000 cubic metres.
Access to pipelines a key issue in unlocking India’s natural gas potential: Ajay Shah, VP, Shell Energy Asia
India will have to address key issues pertaining to access to natural gas pipelines and ensure a level-playing field by including natural gas into the ambit of Goods and Service Tax (GST) if it wants to unlock the country’s natural gas potential, Ajay Shah, Vice President, Shell Energy Asia told ETEnergyWorld. “Countries like US and Europe were able to increase the use of natural gas in their overall energy mix primarily due to unbundling of natural gas marketing and transportation services. While India does have open access to its pipeline and a regulator in place the practical reality is it is difficult to access natural gas pipeline infrastructure for a variety of reasons,” Shah said in an interview. He added that the company was a bit disappointed because natural gas was being left out of the ambit of GST. According to Shell’s Liquefied Natural Gas (LNG) outlook 2019, India’s natural gas share in the overall energy mix will remain between 5-10 per cent by 2035. The projection made have been an interpretation of Wood Mackenzie’s data, the company said. Shah told ETEnergyWorld that the company’s 5 Million Tonne Per Annum (MMTPA) Hazira LNG terminal plans to have a truck loading unit which will allow transportation of natural gas through trucks and the facility can also be used to fuel heavy-duty vehicles run on natural gas. Shell had last month acquired 26 per cent equity interest in the Hazira LNG and Port from Total. According to data available on Petroleum Planning and Analysis Cell (PPAC), Hazira LNG recorded a capacity utilization of 87.6 per cent in the April-January period of 2018-2019 “We are excited about our journey in India. We may in the future think about expanding our Hazira terminal. We may also in the coming years choose to invest in India’s City Gas Distribution (CGD) network, get into gas-based electricity generation and are also eyeing the possibilities in using natural gas in the transportation sector. Petronet has already started a project for setting up LNG fuel stations across the country, which is a good move,” Shah said. Shah said that while China currently has over 300,000 heavy-duty vehicles running on natural gas and is taking big strides towards the use of natural gas in the transportation sector, India currently has none. China currently uses 6.7 Million Tonne of LNG for road transport and has close to 2,552 LNG fuel stations across the country. According to Shell, LNG’s share of India’s total gas supply mix exceeded 50 per cent for the first time in 2018. “India is also using LNG to meet its increasing needs for a secure energy supply. Domestic gas production dropped and the resulting increase in demand for imported gas was met by LNG (up 10% year on year). LNG’s share of India’s total gas supply mix exceeded 50% for the first time in 2018,” the report read. It adds that in 2019, 35 million tonnes of additional LNG supply is expected to come on line with Europe and Asia being the major demand centres for the additional supply. According to the report, more than 70 per cent of energy demand growth by 2035 is estimated to be met by gas and renewables combined, with natural gas supplying more than 40 per cent of the additional demand and major LNG importing countries like China and India are putting policies in place which drive preference for gas over coal.