Ethanol to be central issue in India-Brazil meeting: Industry group
Brazil and India are expected to sign a memorandum of understanding on production and trade of ethanol when leaders of the two countries meet in Brasilia later this year, an industry group said on Tuesday. According to UDOP, a Brazilian association of sugar and ethanol producers, the suggestion to discuss a partnership on ethanol came from the Indian government, which has a target to gradually increase blending of ethanol to gasoline to up to 20%. Indian Prime Minister Narendra Modi was reelected in May and will make an official visit to Brazilian President Jair Bolsonaro in November. Bolsonaro posted messages on Twitter congratulating Modi and expressing intentions to boost ties with India, particularly in trade. Modi and Bolsonaro later met during the G20 summit in Osaka, Japan at the end of June. UDOP said, citing information from the energy department in Brazil’s foreign relations ministry, that Bolsonaro’s government plans to help India to boost ethanol production and open the Indian market for the biofuel, helping to expand global use of ethanol. Brazil is the second-largest ethanol maker after the United States. Large-scale use of ethanol takes place only in those two countries, basically, despite efforts in the past to make ethanol an internationally traded commodity. Despite the positive tone for November’s meeting, Brazil is fighting India in the World Trade Organization because of sugar export subsidies. India has surpassed Brazil as the world’s largest sugar producer as it gives financial help to cane producers and sugar mills, a stimulus that is hampering a potential price recovery in the depressed global sugar market. India has been providing transport subsidies of between 1,000 rupees ($14.59) a tonne to 3,000 rupees a tonne to sugar mills, depending on the distance to ports. The government has also raised the amount it directly pays to cane growers to 138 rupees a tonne in assistance from 55 rupees a year ago. India has no intention of halting the subsidies, Reuters reported on Monday. But using more cane in India to produce ethanol, instead of sugar, could reduce the global supply of the sweetener, as Brazil has been doing for the last two seasons with cane allocation to sugar production hitting a record low of 35% in 2018-19.
Reliance, BP spending $5 bn on three gas projects in KG-D6 block: Bernard Looney, BP
BP, British oil and gas firm, and Mukesh Ambani-led Reliance Industries (RIL) are collectively spending $5 billion to execute three gas development projects in the Krishna-Godavari (KG) basin, said Bernard Looney, BP’s chief executive (upstream), on Tuesday. “Strong relationship between BP and reliance is another great example of what can be achieved by working together at scale. Together we are spending up to $5 billion to execute three gas development projects in the KG-D6 block and together we are expected to bring about one billion cubic feet per day of new domestic gas on stream by 2022,” said Looney. RIL and BP had last month announced the sanction of the MJ project, also known as D55, in Block KG D6. MJ would be the third of three new projects in the Block KG-D6 Integrated Development Plan. The approval follows sanctions for the development of ‘R-Series’ deep-water gas field in June 2017 and for the satellites cluster in April 2018. Together the three projects are expected to develop a total of about three trillion cubic feet of natural gas. He added that the companies’ hope to unlock a new offshore base in Odisha and are currently working in the Mahanadi basin to explore ways of both economically developing discoveries and building a pipeline of exploration and development opportunities. “As partners, we are delighted to also win the new KG-UDW1 block, which is located adjacent to our existing KG-D6 block and within a reasonable time and distance of the existing infrastructure, it, therefore, provides additional resources to extend the production profile for the KG-D6 facilities,” Looney said. BP exploration and RIL had also won an ultra deep-water offshore block in the KG basin under the latest Open Acreage Licensing Programme. According to Looney, India as per the current trends will overtake China as the largest growth market for energy in the mid-2020s and according to BP’s energy outlook, the country’s primary energy demand will increase two-and-a-half times till 2040. “India has a natural gas base with a potential to meet 50 percent of anticipated demand for gas through to 2050. Natural gas burns at half of the emission of coal for power generation and offers significant benefits for air quality. In renewables, there are large untapped solar and wind resources with a potential to be utilized at a cost which is increasingly competitive with hydrocarbons,” Looney said. According to BP’s 2018 annual report the company has participating interest in two oil and gas blocks (KG-D6 30 percent and NEC25 33.33 percent) both operated by RIL. BP also has a stake in a 50:50 joint venture (India Gas Solutions) with RIL for the sourcing and marketing of gas in India.