China’s natural gas demand growth in 2020 seen slowest in 4 years
China’s natural gas demand in 2020 is expected to grow at its slowest pace in four years due to a faltering economy, according to a think-tank at the country’s largest energy producer, China National Petroleum Corp. Slower demand growth in China would drag down global LNG markets already grappling with oversupply and low spot prices. In its annual outlook report released on Monday, the think tank forecast natural gas consumption to rise 8.6 per cent this year to 330 billion cubic metres. That would mark the slowest demand growth since 2016. CNPC expects 2019 gas consumption up 9.6 per cent year-on-year at 304 bcm. “Chinese economy is in the process of structural upgrade while macro-economy will continue to bear pressure. Also, the coal-to-electricity and the use of clean coal will slow down the growth of gas demand,” CNPC Research said. China’s natural gas output would hit 187.5 bcm in 2020, up 8.2 per cent year-on-year, boosted by Beijing’s push to increase domestic production, it said, adding that imports of the fuel is expected to reach 150 bcm, up 9.3 per cent from a year ago. The imports will partly come from Russia, driven by the landmark Siberian gas pipeline which was launched in December. In 2020, LNG imports are expected to rise 9.5 per cent year-on-year to around 94 bcm. The think-tank also expects China’s LNG receiving capacity to exceed 88 million tonnes per year. China overtook Japan as the world’s top importer of liquefied natural gas (LNG) in November and December on a monthly basis, but on an annual basis Japan is still the No. 1 LNG importer worldwide. The national’s crude oil output is forecasted to rise only 1.57 per cent from 2019 levels to around 194 million tonnes in 2020,the CNPC outlook shows. But apparent crude oil demand is expected to rise 3.6 per cent year-on-year to 719 million tonnes in 2020. Crude oil imports are forecast to rise 4.4 per cent to 525 million tonnes. Having added 900,000 barrels per day of crude processing capacity in 2019, China is expected to add 27 million tonnes, or around 540,000 bpd of new refining capacity this year, which would worsen fuel supply in the country and put pressure on refineries to sell overseas. “In 2020, oversupply of refined oil products will be intensified, and (we expect the) exports quota for refined oil products to continue increasing,” CNPC Research said. China has raised the volume of its first batch of 2020 fuel export quotas by 53 per cent from a year earlier to 27.99 million tonnes. China’s total fuel demand is forecast to rise 2.3 per cent to 393 million tonnes in 2020, while refined products exports is expected to surge 18.1 per cent to 64.5 million tonnes in 2020. The country’s crude throughput is forecast to rise 3.9 per cent year-on-year to around 675 million tonnes in 2020. China’s total exports of refined oil products are forecast to rise 18.1 per cent to exceed 64.5 million tonnes in 2020. In 2020, gasoline exports are expected to rise 35.39 per cent year-on-year to 23.68 million tonnes while diesel exports are forecasted to rise 10.69 per cent to 25.8 million tonnes. Kerosene exports are expected to rise 8.73 per cent to 15.07 million tonnes.
No dearth of crude oil in global market, says Union Minister Dharmendra Pradhan
Minister of Petroleum and Natural Gas Dharmendra Pradhan on Saturday said that there was no dearth of crude oil in global market and government was keeping a sharp eye on the global developments. Speaking to reporters on the sidelines of an event, Pradhan said, “Due to geopolitical situation, conflict in the Middle East there was a spike in the price of crude oil. It is subdued in the last two weeks. Let us wait and watch, let’s not create panic. Things are under control. Government of India (GoI) has kept a sharp eye on global development.” He also appealed to oil-producing countries and their leadership for peace and stability in the global economy. “There is no dearth of crude oil in the global market. We are taking it from OPEC, OPEC+, non-OPEC countries. Issue is – price. We are appealing to oil-producing countries and responsible leaderships that there should be peace and stability in the global economy”, he added. Earlier in the day, Pradhan had launched PURVODAYA: Accelerated development of eastern India through integrated steel hub in Kolkata.
RIL may get new MD before April 1; Manoj Modi, Meswanis among probables
Reliance Industries Limited (RIL) could get a new Managing Director soon if the directive by the Securities and Exchange Board of India (SEBI) on separation of the Chairman and Managing Director posts is implemented as per schedule on April 1. Mukesh Ambani, CMD of RIL will become the non-executive Chairman while a non-Ambani may become RIL’s MD for the first time in the company’s history. While there is buzz around RIL Executive Director Nikhil Meswani’s name, Mukesh Ambani’s confidante and right hand man, Manoj Modi, who is virtually CEO of the company would be a natural choice. The other two Executive Directors, Nikhil’s younger brother, Hital and P.M.S. Prasad would also be on the probables list. The Meswanis have been on the RIL board since mid to late 90s and are Mukesh Ambani’s cousins. Their father, Rasiklal Meswani was one of the founder directors when Dhirubhai Ambani founded RIL. Manoj Modi is not on the RIL board and does not hold a designated senior executive position but by all accounts has been one of the most important persons in RIL hierarchy. A questionnaire sent to RIL by IANS did not receive any response. SEBI has mandated to separate the roles of chairman and managing director/CEO of all listed entitled by April 1. The directive excludes family members and relatives from taking up the MD position. The meaning of relative as defined in Section 6 of the Companies act, 1956 defines the particular relationships: “A person shall be deemed to be a relative if and only if, they are members of the Hindu undivided family, they are husband and wife or the one is related to the other in the manner indicated in Schedule 1A. “These include father, mother (including step mother), son (including step son), son’s wife, daughter (including step daughter), father’s father, father’s mother, mother’s mother, mother’s father, son’s son, son’s son’s wife, son’s daughter, son’s daughter’s husband, daughter’s husband, daughter’s son, daughter’s son’s wife, daughter’s daughter, daughter’s daughter’s husband, brother (including step brother), brother’s wife, sister (including step sister) and sister’s husband. These are the categories counted as relatives under the Companies Act and while the definitions may look repetitive,” they are precise. In all of these definitions, cousins are not included, which implies that Nikhil and younger brother, Hital Meswani, also Executive Director and both of them having been longstanding members of the RIL board of directors are not precluded from becoming Managing Director. Hital Meswani’s name in the board of directors list appears only after Mukesh Ambani and his wife, Nita Ambani. According to his bio data on the RIL website, Hital Meswani joined Reliance Industries Ltd. (RIL) in 1990 and is the son of Rasiklal Meswani, one of the Founder Directors of the company. He is on the Board of RIL as Whole-time Director, designated as the Executive Director, RIL, since August 4, 1995. His overall responsibility spans the petroleum refining and marketing business, petrochemicals Manufacturing and several corporate functions of the company including human resources management, information technology, research & technology and capital projects execution. He has been involved with almost all mega initiatives of the group through its growth journey. He was instrumental in execution of the world class petrochemicals complex at Hazira and the mammoth Reliance Jamnagar Refinery complex, the largest in the world at any single location. He had also led a company-wide business transformation initiative, which has resulted in the development of the constitution of RIL – the Reliance Management System. Nikhil Meswani joined Reliance in 1986, and since July 1, 1988, he has been a whole-time director, designated as Executive Director, on the Board of the company. He is primarily responsible for the petrochemicals division, and has made major contributions towards Reliance becoming a global leader in petrochemicals. Between 1997 and 2005, he handled the refinery business of the company. In addition, he continues to shoulder several other corporate responsibilities, such as Corporate Affairs and Group Taxation. He is also involved in the affairs of Reliance-owned Indian Premier League cricket franchise Mumbai Indians and other sports initiatives of the company. Manoj Modi is Mukesh Ambani’s closest aide and friend over many years. He has been involved in key projects and is known to take over from Mukesh Ambani in meetings after Ambani has left. He has helped lead several new projects, from refining to retail to telecom, but carries no designated senior executive or board position and maintains a low profile. He is not on the board of RIL but has been on the board of Reliance Jio Infocomm. As per a resolution for re-appointment as director, Manoj Modi, a Chemical Engineer from Institute of Chemical Technology, Mumbai, has played an invaluable role in the growth and evolution of the Reliance Group. He has been associated with the Group for over three decades and has led several of the initiatives of the Group in this period of time. He has driven the overall corporate strategy for the Group and has been instrumental in formulation of strategy and policies, project planning & implementation and commercial, financial and regulatory matters. Modi was part of the core team, along with Mukesh D. Ambani, which conceived and executed Reliance’s petrochemical project at Hazira and refinery project at Jamnagar. Modi also drove the Group’s first entry into the telecommunications business in 2002. He conceptualized and developed the strategy for setting up Reliance Infocomm (now Reliance Communications Limited), which was a transformational event for the telecom industry in India. He is leading Reliance’s implementation of a pan-India organized retail network spanning multiple formats and supply chain infrastructure. Reliance Retail is the largest retail player in the country. Modi has been instrumental in the Group’s re-entry into the telecommunications business through Reliance Jio Infocomm Limited. He is leading the project which involves setting up one of the most complex 4G broadband wireless services in the world, offering end to end solutions that address the entire value chain across various digital services in key domains of
India’s petroleum products demand falls marginally in December 2019
India’s petroleum product demand in December fell by a marginal 0.12 per cent to 18,787 Thousand Tonne (TMT) as compared to the demand in the same month last year, fresh data published by Petroleum Planning and Analysis Cell (PPAC), the oil ministry’s statistical arm, showed. The demand in December fell after recovering in the previous month. Overall, in the first nine months of the current financial year, the demand rose 1.84 per cent to 160,603 thousand tonne. Overall slowdown in the economic activity coupled with an erratic rainfall have dented the petroleum products’ demand which is expected to remain below 3 per cent in the current financial year, according to rating agency ICRA. Within petroleum products, the demand for diesel fell 0.70 per cent in December to 7,337 TMT as compared to 7,389 TMT recorded in the same month a year ago. Overall, in the first nine months of the current fiscal, diesel demand rose 0.76 per cent to 62,737 TMT. Demand for petrol increased 3.21 per cent to 2,472 TMT in December and 8.42 per cent to 22,850 TMT in the April-December 2019 period. Demand for bitumen, an indicator of road construction activity, declined 8.40 per cent 567 TMT in December but remained flat in the first nine months of the current financial year. Demand for Liquefied Petroleum Gas (LPG) and Aviation Turbine Fuel (ATF) increased 9 per cent and 2 per cent, respectively, during the month. The heads of both Indian Oil Corporation and Hindustan Petroleum had recently said petroleum consumption growth in 2019-20 may be lower as compared to previous years as demand took a hit during the first half of the fiscal.
India’s oil imports from Iraq, Nigeria and UAE increase in Nov 2019
India’s oil imports from Iraq, Nigeria, and United Arab Emirates (UAE) increased in November 2019 as compared to the corresponding month a year ago as the country tries to replace Iranian and Venezuelan crude. With Iranian crude out bounds for India since the middle of last year, the country’s oil imports from Iraq, Nigeria, and the United States (USA) have increased sizeably during the first eight months (April-November) of financial year 2019-20 (FY20) as compared to the corresponding period a year ago. India had imported 19 million tonne (mt) of Iranian crude in the April-November period of FY19. India’s oil imports from Iraq increased 25 per cent to 4.72 mt in November last year, as compared to the year-ago period. Overall, India’s oil imports from Iraq increased 10.25 per cent to 33.44 mt in the first eight months of FY20. Iraq had replaced Saudi Arabia to become the largest oil supplier to India in FY18. India’s oil imports from Saudi Arabia in the month of November 2019 declined marginally to 4.27 mt, as compared to the year-ago period. Overall, oil imports from Saudi Arabia increased marginally to 27.97 mt in the first eight months of FY20, as compared the corresponding period a year ago. Oil imports from Nigeria increased 59 per cent to 2.08 mt in November 2019, as compared to the year-ago period. Overall, oil imports from Nigeria in the first eight months of FY20 increased to 12.25 mt, as compared to the corresponding period a year ago. The country replaced Iran to become the third-largest crude oil supplier to India in FY20. Oil imports from Venezuela declined to 0.98 mt in 2019, as compared to 1.83 mt imported in the year-ago period. India’s overall oil imports during the first eight months of the FY20 declined marginally by one mt to 150 mt.
Indian Oil to spend Rs 22,000 crore for expansion of Gujarat refinery
Indian Oil Corporation (IOC), the country’s largest fuel retailer and the largest refiner in the country, plans to expand its Gujarat refinery to 18 million tonne per annum (mmtpa) from 13.7 mmtpa currently at the cost of Rs 22,210 crore, the company said in an application to the environment ministry. “IOCL is now considering expansion of the refinery, with an objective to increase the processing capacity from current 13.7 mmtpa to 18.0 mmtpa. The expansion project also aims at substitution of existing smaller capacity atmospheric unit and vacuum units with a large atmospheric vacuum unit (AVU) to enhance the efficiency of operation,” the company said as part of its application. According to the company, Engineers India Limited (EIL) had in 2013 prepared a configuration study and prepared a feasibility report for capacity expansion of Gujarat refinery to 18 mmtpa. However, in light of the Auto Fuel Policy 2025, the company updated the study carried out in 2013 with additional facilities required for meeting 100 per cent BS-VI auto fuel production. The expansion will include revamp of existing hydrogen generation unit for production of syngas and hydrogen, a new n-butanol processing unit and a revamp of liner alkyl benzamine (LAB) unit. The expanded 18-mmtpa refinery located in Koyali, Vadodara, is expected to process crude grades from Kuwait, Basrah light (Iraq), Mangla in Rajasthan and oil produced from north and south of Gujarat, while the feasibility study of the expansion project has been carried out for processing of additional 4.3 mmtpa Basrah light crude. The refinery plans to spend close to Rs 2 lakh crore in the next five to seven years across its operations and has targeted to expand its refining capacity to 150 mmtpa per annum by 2030 from 69.2 mmtpa currently as well as increase its petrochemical production capacity to 13 mmtpa, according to the company’s annual report. IOC accounts for 32 per cent of the country’s 250 mmtpa refining capacity.