No queue of bidders at GSPC for onshore blocks
Gujarat State Petroleum Corp (GSPC) has once again extended the bid-submission deadline for the 12 onshore blocks that it has put on auction. The Gujarat government company, which is on a debt reduction path, has met a roadblock, as likely bidders didn’t show interest and instead sought an auction-date extension. While GSPC received bid interest from one foreign private equity firm, central PSUs like Indian Oil Corp Ltd (IOCL), Hindustan Petroleum Corp Ltd (HPCL), and Bharat Petroleum Corp Ltd (BPCL) have sought further extension of the May 15 deadline, said a state government official. These companies have sought extension as the GSPC’ deadline coincided with the central government’s Open Acreage Licensing Policy (OALP), its last day of bid submission also being May 15, the official said. “The last date of bid submission for the GSPC blocks has been extended from May 15 to June 17,” said an official privy to the matter. Under the new Hydrocarbon Exploration and Licensing Policy (HELP), OALP Bid Round-1 was launched in January 2018 by the Centre. The new policy aims to bring companies to carve out blocks of their choice with a view to tap 28 billion tonnes of unexplored hydrocarbon resources in the country. The second and third rounds of OALP have been underway. On March 1, Gujarat Energy Research and Management Institute, GSPC’s energy research arm, floated a tender to farm out two operating and 10 non-operating exploration and production fields. GSPC had opened its data room for bidders and had invited proposals from companies till April 15. However, it had to extend the deadline to May 15 citing that some companies sought extension due to OALP. It has now extended the deadline once more. “Later on, OALP also extended its deadline to May 15 which coincided with GSPC’s,” said the second official. Of the 12 fields, GSPC is the operator of two – Unawa and Miroli, while it is the non-operating partner in the rest. GSPC plans to use the proceeds of sale to retire its debt. In July 2016, GSPC had unsuccessfully attempted to sell its stake in 20 blocks. “The gas prices are currently down so it’s a good time to for buyers but not for sellers. GSPC can get a good price for its blocks if the prices move upward in the near future,” said an industry expert.
Reliance-BP makes first bid for oil block; Vedanta bids for 30, ONGC 20
The RIL-BP combine made its first bid for an oil and gas exploration block in more than a decade, vying for one of the 32 blocks up for auction in the OALP-II and III bid rounds, which saw mining major Vedanta put in as many as 30 bids and ONGC, for 20 areas. Bidding for 14 blocks on offer in the Open Acreage Licensing Policy (OALP) round-II and another 18 oil and gas blocks and 5 coal-bed methane (CBM) blocks on offer in OALP-III closed on Wednesday. Official sources said Vedanta, which had walked away with 41 out of the 55 blocks offered in OALP-I last year, bid for 30 areas. Oil and Natural Gas Corp (ONGC) bid for 20 blocks while Oil India Ltd (OIL) bid for 15. Indian Oil Corp (IOC), GAIL (India) and SunPetro bid for two blocks each, they said. Reliance Industries-BP made an offer for one block off the east coast. The block they bid for possibly is the one which BP had demarcated during the expression of interest (EoI) stage. India had in July 2017 allowed companies to carve out blocks of their choice with a view to bringing about 2.8 million sq km of unexplored area in the country under exploration. Under this policy, called open acreage licensing policy or OALP, companies are allowed to put in an EoI for prospecting of oil and gas in any area that is presently not under any production or exploration licence. The EoIs can be put in at any time of the year but they are accumulated twice annually. The blocks or areas that receive EoIs at the end of a cycle are put up for auction with the originator or the firm that originally selected the area getting a 5-mark advantage. The two window of accumulating EoIs end on May 15 and November 15 every year. EoIs accumulated till May 15 are supposed to be put on auction by June 30 and those in the second window by December 31. Sources said EoIs accumulated till May 15, 2018 were offered in OALP-II and those that came in by November 15, 2018 in OALP-III. The two rounds ran concurrently. The government had in January offered 14 blocks in OALP-II bid round and a month later offered another 23 oil and gas blocks and CBM blocks in third round. Bids for the 14 blocks offered in OALP-II bid round, covering an area of 29,333 square kilometers, were to close on March 12 but the deadline was extended to April 10 and then again to May 15, according to the Directorate General of Hydrocarbon (DGH). April 10 was also the bid deadline for the 23 oil and gas and CBM blocks offered in the third round, which was launched on February 10. Its bid deadline too was extended to May 15. OALP-II bid round was delayed by six months and its launch came barely a month before the third round. Sources said OALP-II and OALP-III ran concurrently. Oil Minister Dharmendra Pradhan had at the time of launch of OALP-II bid round on January 7 stated that an investment of about Rs 40,000 crore is expected in the prospecting of oil and gas in blocks offered. In the first round of OALP last year, as much as Rs 60,000 crore was committed in the exploration of oil and gas in 55 blocks or areas. In the third round, the government is expecting up to $700 million (about Rs 49,000 crore) of investment that it hopes will help raise domestic output and cut imports. The first OALP round was launched in 2017 and bids came in by May 2018. EoIs for second round closed on May 15, 2018, and the blocks were supposed to be put for auction by June but the round was delayed for unknown reasons. OALP-II was finally launched on January 7. In the meanwhile, EoIs in the third window also closed on November 15, 2018 with as many as 18 blocks and five CBM blocks, measuring 31,722 sq km, being sought for. OALP-III bid round was launched on February 10 with April 10 as the last date for bidding. Officials said the 14 blocks in OALP-II are estimated to hold in-place resource of 12,609 million tonne oil and oil equivalent gas. In OALP-1, mining mogul Anil Agarwal-led Vedanta walked away with 41 out of 55 blocks bid out. State-owned Oil India won nine blocks while ONGC managed to win just two. The 55 blocks have a total area of 59,282 sq km. This compares to about 1,02,000 sq km being under exploration prior to OALP. Blocks are awarded to the company which offers the highest share of oil and gas to the government as well as commits to do maximum exploration work by way of shooting 2D and 3D seismic survey and drilling exploration wells. Increased exploration will lead to more oil and gas production, helping the world’s third largest oil importer to cut import dependence. Prime Minister Narendra Modi has set a target of cutting oil import bill by 10 per cent to 67 per cent by 2022 and to half by 2030. Import dependence has increased since 2015 when Modi had set the target. India imports nearly 84 per cent of its oil needs. The new policy replaced the old system of government carving out areas and bidding them out. It guarantees marketing and pricing freedom and moves away from production sharing model of previous rounds to a revenue-sharing model, where companies offering the maximum share of oil and gas to the government are awarded the block.
GAIL accelerates work for Jagdishpur-Haldia & Bokaro-Dhamra Pipeline project
Stepping up the momentum for construction of the Jagdishpur-Haldia & Bokaro-Dhamra Natural Gas Pipeline (JHBDPL) and Barauni – Guwahati Pipeline (BGPL) pipeline, GAIL (India) Limited has completed awards for all major contracts worth Rs. 10,500 crore for pipe supply and laying for the integrated 3,400 km. long project. GAIL has placed an order worth Rs. 475 crore for steel line pipes of approx. 280 km. to provide pipeline connectivity from Durgapur to Haldia including spur line to Kolkata in West Bengal. Till date, the company has committed over Rs. 12,500 crores for the project. The pipeline has already reached Barauni and GAIL is ready for supplying gas to a refinery and upcoming fertilizer plant. The pipeline also supplies Natural Gas for Patna City Gas Distribution network (CGD). This is a major milestone towards providing green fuel to the eastern part of the country. The work for balance portion is going on in full swing and is scheduled to be completed by December 2021 in a phased manner. The construction work of Dobhi – Durgapur Pipeline section is likely to be completed by December 2019 for supplying gas to Matix Fertilizers, Durgapur, West Bengal. GAIL is currently executing around 5,500 km. of pipeline related projects for Rs. 25,000 crore to provide gas supply largely to areas of Eastern and Southern parts of the country. Another 1,400 km. pipeline involving capex of Rs. 7,000 crore is under evaluation which is targeted to be completed by 2023. These pipeline projects by GAIL will be part of the National Gas Grid providing Natural Gas to areas hitherto untouched by the green fuel. Shri B. C. Tripathi, Chairman & Managing Director, GAIL (India) Limited said, “GAIL is committed to creating the National Gas Grid providing Natural Gas connectivity throughout the country. GAIL will soon raise loan for the upcoming huge Capex programme for laying Natural Gas related infrastructure.” Shri Tripathi further added that “GAIL has exceeded its Capex target of Rs. 6,400 crore for FY 2018-19. Major contracts for integrated JHBDPL including BGPL have been awarded which will contribute to the economic development of the country and provide employment opportunities in the pipeline project and City Gas Distribution networks in the country. ”
Russia’s Gazprom considers Linde, Shell technologies for Baltic LNG
Russian gas producer Gazprom is considering using technology made by industrial gases group Linde or Royal Dutch Shell at its Baltic LNG project, Gazprom board member Vitaly Markelov said on Tuesday. Russia does not have its own LNG technology. “We’ve looked at the efficiency of both technologies and they basically have the same indicators in terms of workability. The rest is a question of negotiation,” Markelov said. Royal Dutch Shell quit Gazprom’s liquefied natural gas project near the Baltic Sea port of Ust-Luga last month after the Russian company moved to integrate its Baltic LNG project and gas processing plants. Gazprom has already started designing the Baltic LNG complex, Markelov said.
Petronet fourth quarter net profit drops 16 per cent on inventory losses
Petronet LNG Ltd, India’s largest importer of natural gas, today reported a 15.70 percent drop in net profit at Rs 440 crore for the quarter ended March 2019 on inventory losses due to falling gas prices. The company’s revenue from operations during the quarter also decreased by 3 percent to Rs 8,383 crore. “The increase in profit over the corresponding 2017-2018 is due to higher volumes processed at the Dahej Terminal and better efficiency in operations,” the company said in a statement. Managing Director and Chief Executive Officer (CEO) Prabhat Singh said the profit for the March quarter was down primarily due to inventory loss during the quarter, which was around Rs 119 crore. The company said during the quarter ended March, Dahej terminal operated at 104 percent of its nameplate capacity and processed 199 TBTU of LNG as against 197 TBTU processed during the previous quarter and 207 TBTU processed during the corresponding quarter. “The overall LNG volume processed by the company in the current quarter was 205 TBTU, as against the LNG volume processed in the previous and corresponding quarter, which stood at 202 TBTU and 213 TBTU respectively,” the company said. For the full financial year 2018-19, the firm reported a 5.68 percent increase in net profit at Rs 2,230 crore.
Australia’s Santos buys into Exxon-led PNG nat gas venture for $187 mln
Gas producer Santos Ltd said on Thursday it will buy a 14.3 percent stake in the Petroleum Retention License 3 Joint Venture (PRL 3) for $187 million, as part of expansion efforts at the PNG LNG project in Papua New Guinea. ExxonMobil, the largest holder in the venture has agreed to sell down its holding in the P’nyang gas field in Papua New Guinea to Santos, giving the Australian company a stake in the field to help smooth the way for an expansion of Exxon’s PNG LNG project.
GAIL Gas to set up 100 CNG stations, expand PNG network in Mangaluru
GAIL Gas Limited will set up 100 CNG stations and connect approximately 3.5 lakh households with Piped Natural Gas. Gail had recently rolled out opportunities to partner in building the CNG infrastructure in the Mangaluru city and urged people to join hands with them for a greener Dakshina Kannada. The company is motivating land owners and individuals to collaborate for developing Green Mangaluru by setting up CNG station on Dealer Owned Dealer Operated (DODO) Model. A K Jana, CEO, GAIL Gas, said people in Mangaluru will have a better quality of life by creating infrastructure to promote cheaper and cleaner fuel CNG. Partnering with the company will also be an opportunity for those in possession of land to join hands with GAIL Gas in their endeavor to provide clean fuel for the transport sector. GAIL Gas has won the authorization of the City Gas Distribution Project in DK through ninth round of bidding by Petroleum & Natural Gas Regulatory Board. The city gas distribution (CGD) project of Dakshina Kannada District will supply Compressed Natural Gas for transport sector, Piped Natural Gas for households, industries and commercial units. The project will cover 4861 sq. kms area in the district and will include five charge areas namely Bantwal, Beltangady, Mangaluru, Puttur and Sullia. The total capital investment for the project is Rs. 1972 crore for initial 25 years. A network of 1250-inch kms will be laid in the district, benefiting 20 lakh population. The supply of Piped Natural Gas to industries and commercial units will also help in reduction of pollution in the city, says GAIL. The Project will connect hotels and restaurants in cities. The main source pipeline for the CGD project will be GAIL’s Kochi-Koottanad-Bengaluru-Mangalore Pipeline project (KKBMPL) Pipeline. STRETCHES IDENTIFIED: Various stretches has been identified for putting up CNG station in the Chief Port Capital of Karnataka. These stretches are at KPT Junction to NMPT Office (on NH 66 towards Udupi); NMPT Office to Mulki (NH 66 towards UDUPI); KPT Junction to Nanthoor Junction (NH 66 towards Bengaluru); Nanthoor Junction to Adyar (NH 73); Adyar to BC Road Junction (NH 73); Nanthoor Junction to Moodbidri (NH 169); Nanthoor Junction to State Bank Circle; Balmatta to Talapady – Toll Gate (Kerala Border) (NH 66 Towards Kerala); Thokuttu Junction to Ullal (Abbakka Circle); Thokuttu Junction to Mudipu; Kottara Chowki (NH 66) to Lady Hill; Kuloor Junction to Kavoor Junction; Kavoor Junction to Bajpe; Kavoor Junction to KPT Junction; Kavoor Junction to Bharath Mall (Kavoor Bejai Road).