IEX launches trading platform Indian Gas Exchange; norms yet to be framed
India’s leading power trading platform Indian Energy Exchange (IEX) launched its natural gas trading platform last week. Called the Indian Gas Exchange (IGX), it is now looking for trader members and gas buyers. This even as the Petroleum and Natural Gas Regulatory Board (PNGRB) is yet to come out with guidelines for gas trading. IGX would offer spot and forward contracts at Dahej, Hazira and Kakinada. While Petronet LNG Ltd (PLL) operates an LNG terminal at Dahej, Shell operates another one at Hazira. Kakinada is the landfall point for natural gas being produced from the Krishna Godavari basin. IGX will be offering a spot contract for the day ahead market, which means gas will be physically delivered the next day. The forward contract is for daily, weekly, monthly and fortnightly markets. Currently, LNG is not regulated both in terms of supply contracts and pricing while domestic gas prices are notified by the government. Supply contracts for gas produced by government-owned companies are dictated by government norms. IEX, which has 90 per cent share in day-ahead power trading, is planning an initial investment of Rs 10 crore for IGX over the next five years. Senior executives said this was planned keeping in mind the growth potential of the gas market. “Gas market in India is poised for a break outgrowth of 2.5 times, from 166 to 380 MMSCMD by 2030. With conducive policies, the share of natural gas in India’s energy basket could double to 15 per cent,” said a company executive. While the current government has been vocal about having a gas trading hub for the past three years, regulations are yet to be framed. PNGRB is yet to take a call on IEX’s plans. A PNGRB official indicated that they were in the process of coming up with regulations on the gas hub and gas trading guidelines will take shape only later. GAIL and Oil and Natural Gas Corporation (ONGC) were expected to take equity in the planned gas exchange, which would have helped create a natural gas trading hub. In April 2018, KPMG came out with an initial report submitted to the PNGRB for the creation of a gas hub in India. A GAIL official said the company was not against the IEX move so far. “It is a free world. But one has to see the legal validity of such an institution as the regulations by PNGRB are yet not out,” said a GAIL official. The government needs to take a call on whether gas produced out of domestic fields allotted on nomination basis and currently given on priority to notified sectors will be traded. In a presentation to investors, IGX said an exchange would help in increasing volumes and infrastructure utilization of terminals and pipelines. “Even small industries can use the exchange to procure gas at competitive prices. This will also help in revival of gas-based power plants. Exchange can provide gas at competitive rates for grid balancing purpose in upcoming high renewable energy scenario,” said the presentation. Peak power from gas and hydro is needed to balance the power grid with a rising share of intermittent renewable. IGX is also looking at the fertiliser industry and city gas distributors as buyers on their platform.
Tata Motors completes delivery of India’s first LNG bus order
Tata Motors on Monday has announced that it has completed the delivery of India’s first LNG bus order. The homegrown auto manufacturer has delivered four Starbus LNG models to LNG Petronet Limited, with two of them delivered in Dahej, Gujarat and rest in Kochi, Kerala. The automaker first showcased a LNG bus at the Auto Expo 2020 last month. Tata Motors claims that these 36-seater LNG buses reduce greenhouse gas emissions by 30 per cent in comparison with conventional fuels. These LNG buses have been indigenously developed by the automaker, as Tata Motors has claimed. Commenting on the occasion, Rohit Srivastava, Vice President, Product Line, Buses, Tata Motors, said, “Tata Motors has taken a significant leap forward with a slew of alternate fuel technologies for sustainable mobility solutions and with the delivery of first Starbus LNG bus, we have ushered into a new era of transportation. We are proud to work with LNG Petronet Limited in an effort towards creating a lower-carbon future.” He also said, “Our in-depth understanding of sustainable public transport, while developing reliable and environment-friendly public transit options, has led us to excel in this competitive industry. With the LNG technology, Tata Motors is not only optimistic and future-ready but is also extending that capability towards the energy security of the nation.” As Tata further claims, these LNG buses come with a fuel arrying capacity of up to 2.5 times more than CNG ones. Also, these buses can run up to 600-700 kilometres with full tank.
IGL to set up gas meter manufacturing unit to cut reliance on imports
As city gas distribution network in India expands rapidly, Indraprastha Gas Ltd plans to set up a factory to manufacture gas meters used to bill households and industries for the consumption of the environment-friendly fuel, as it looks to cut reliance on imports from China for the same. IGL will invest about Rs 100 crore for setting up a unit in the national capital region to manufacture 1 million meters annually, its Managing Director E S Ranganathan said here. The plan is part of the Modi government’s push towards raising the share of environment-friendly fuel in India’s energy basket to 15 per cent by 2030 from the current 6.2 per cent. As part of this, the city gas distribution (CGD) network for retailing CNG to automobiles and piped natural gas (PNG) for household kitchens and industries is targeted to expand to more than 400 districts spread over 27 states and Union Territories covering approximately 70 per cent of India’s population and 53 per cent of its geographical area. “Currently, gas meters are mostly imported from China and we felt there is a need for a domestic manufacturing unit to cut reliance on imports and boost ‘Make in India’,” Ranganathan said. IGL, which retails CNG and PNG in the national capital region, is in talks to finalise a partner for the metering unit. “We are in the advanced stage of talks,” he said without elaborating. The company will invest Rs 50 crore in plant and machinery and the remaining in land and building. Currently, CGD network spans close to 100 cities and districts covering about 90 lakh households and industries and about 35 lakh CNG vehicles. The network is targeted to be expanded to over 400 districts, covering 2 crore households with PNG connections. As the CGD network expands, the demand for meters will also rise. Ranganathan said city gas demand is likely to grow 10 per cent in the near future and IGL is planning an investment of Rs 1,100 crore next fiscal, mostly in setting up of CNG dispensing stations and laying piped gas lines to households and industries. The company will have 559 CNG stations by the end of the month and it plans to add another 60 in the next fiscal (April to March), he said adding IGL gave 2.8-3 lakh PNG connections in the current financial year and the same pace will be maintained in the next. Natural gas in the form of CNG is 60 per cent cheaper as compared to petrol and 45 per cent cheaper as compared to diesel. Also, PNG is 40 per cent cheaper as compared to the market priced LPG and the price of PNG almost matches that of subsidised LPG based on prices in Delhi. Natural gas is the cleanest and most efficient of fossil fuels and has the potential to play an important role in the world’s transition to a more affordable and secure cleaner energy future. Because of its high energy content, it provides substantial environmental benefits, such as improved air quality and reduced carbon emissions. IGL supplies compressed natural gas (CNG) to over 11 lakh vehicles in the national capital region through a network of CNG stations. It also sells PNG to over 12 lakh household kitchens in the national capital and adjoining towns.
Petrol, diesel prices see sharp decline for second day in a row
Petrol and diesel prices declined today across all major cities in India for the fifth day in a row. Petrol prices were cut by 22-23 paise per litre and diesel prices were down by 20-21 paise a litre. The fuel prices had declined sharply yesterday as well. In Delhi, a litre of petrol is being sold at Rs 71.49 per litre, Rs 77.18 in Mumbai, Rs 74.16 in Kolkata and Rs 74.28 in Chennai. Diesel costs Rs 64.10 a litre in Delhi, Rs 67.13 a litre in Mumbai, Rs Rs 66.43 a litre in Kolkata and 67.65 per litre in Chennai, according to Indian Oil Corporation website. Domestic fuel prices have been seeing a sharp decline in prices since last one week due to falling global crude oil prices amid fears of a Coronavirus pandemic. Prices registered a big drop yesterday as well with petrol price dropping by 17 paise and diesel by 21 paise on Sunday. In international markets, global benchmark Brent crude was hovering around $51 a barrel, after earlier dropping to $48.40, the lowest since July 2017. The fuel prices are reviewed by oil marketing companies on a daily basis.
IOC-Phinergy to begin metal-air battery field trials; in talks with auto companies
Indian Oil, which has picked up a minority stake in high-tech battery maker Phinergy earlier this month, is in talks with leading domestic electric vehicle makers to start field trials for the metal-air batteries that the Israeli company specialises in. Indian Oil chairman Sanjiv Singh has also said they will soon form a joint venture with Phinergy to set up an unit to manufacture metal-air batteries called al-air battery system, which does not use electricity to recharge. Singh said, IOC has a board position at the Israeli company but refused to quantify the equity it has picked up in the Israeli firm. Phinenergy specialises in aluminium-air (al-air) and zinc-air battery systems. Metal-air batteries use metals like aluminum as the anode and air as the cathode, along with a liquid electrolyte. Aluminium-based metal-air battery uses oxygen from the air and combines it with the metal to create an aluminum hydroxide, which activates the electrolysis process and creates an electric current. These batteries are lighter and compact with high energy density. Metal-air batteries have great potential in electric mobility and stationary applications, aluminium is naturally available in the country with good extraction and recycling technologies. “If the field trials are successful and if our talks with EV makers fructify, the metal-air batteries can complement the lithium-ion batteries to provide a hybrid solution for large-scale adoption of electric vehicles. In terms of range, it can easily offer over 600 km,” the chairman said. It can be noted that one of the biggest impediments facing EV adoption in the country is the lower battery range, coupled with public charging stations. The best available range is under 150 km per charge now, even though Tata Motors had last month said it would offer up to 300 km for the electric version of its compact SUV Nexon but commercial supply is yet to begin. The al-air batteries offer many an advantage like higher range, energy density, safety, longer life-cycle among others. Singh also said the company has already set up 43 EV charging stations and will pursue its plans to manufacture lithium-ion battery cells and also hydrogen cells.
Demand-supply gap in biofuels shows we have only scratched the surface: Shishir Joshipura, Praj Industries
Praj industries, a domestic biofuel technology provider, is bullish on the recent push by the government for the biofuels sector. The country will expand production capacity going forward, Shishir Joshipura, Chief Executive Officer and Managing Director told ETEnergyWorld in an interview. He talked about the company’s plan to offer technology allowing industry players to make renewable natural gas, second generation ethanol and bio jet fuel. Edited Excerpts: What is the status of the 2G ethanol projects you are helping set-up for the Oil Marketing Companies? There are four plants which we won through competitive bidding. Among the four, the first one was in Panipat for Indian Oil Corporation, the second one was for Bharat Petroleum in Odisha and the other two projects have now gone into construction phase. We have finished engineering for all the four. Civil works have begun, equipment ordering has started and major contracts have been awarded. Those sites are progressing towards mechanical completion. In 12-14 months we should see these two plants get commissioned. The other two plants are at different stages and we will make announcements during the year. Are the capacities for all the four facilities same? What would be feedstock requirement for such plants? Three of the projects, being set up for IOC, BPCL and HPCL, have same capacity of 1 lakh litres per day, while the one for MRPL would have a capacity of 60,000 litres per day. The feedstock requirement will not be the same for all the plants as there are some variations locally. We are looking at a feedstock requirement of 400 tonnes of material per day. The three facilities by IOC, BPCL and HPCL will be based on rice straw and the MRPL one will use rice straw as well as corn stover. Is the demo Compressed Bio-gas plant which Praj was working on ready? The plant will be commissioned in two weeks from now. The technology is state-of-the art and these plants are unique. These CBG plants will mostly come up in rural areas near fields. Therefore, we have ensured that the technology we have brought is virtually maintenance free. Once the plants start operations you do not have to worry about it. The yields from our technology are expected to be at least 1.5 times more than any other existing technology. Both these factors should ensure a healthy growth in business. How many domestic technology licensors are currently present in India? Essentially there are only two schools of technology worldwide — Continuous Stirred Reactors (CSTR) and Plug Flow Reactors (PFR). PFR technology is a bit complex to master but it is very easy in the hands of the customers. We also have CSTR but we are still offering PFR because we believe that really addresses the needs of the customers and there are many companies in this space. What would be the minimum size a CBG plant that a farmer or an entrepreneur can set-up? The way this works is, it is not only about consuming the bio-mass. It is also about managing the gas output that happens. Typically, 100 ton of biomass would be required as feedstock. It is not as if every field will have a CBG plant. It will be more of an aggregated model, where multiple fields will be involved. The yield for such a plant would be around 10 tonne of gas per day. The chairman, in the 2018-2019 annual report, mentioned the company’s focus on renewable chemicals. Can you explain the plan? It is a very natural evolution from single bio-fuel to a whole basket of bio-fuels — liquid biofuels to gaseous bio-fuels and derivatives thereof. The next progression is renewable chemicals. As the chairman mentioned this is the new horizon which the company is exploring but as things are at a Research and Development phase it will be too early for us to comment. We are confident that this space has a lot of potential. Could you update us on the partnership with US-based GEVO on producing iso-butanol through second generation route? We have finished the process of generating iso-butanol using different sugary feedstock and cellulosic sugar as well, which is second generation. The process has been developed, certified and we have shared it with GEVO and now we are in the process of starting out a plan of action as we have already figured out how to produce iso-butanol and how to produce bio-jet fuel from iso-butanol. Both the steps are clearly understood by both the companies and now we are in the process of offering it to the marketplace and making a commercial proposition. The government is promoting production of bio-diesel from used cooking oil. Has there been an increase in the use of this technology since the scheme was unveiled? We are already working on two-contracts for these plants. We have a very specialised enzymatic process which we have developed. That allows customers to use different kinds of feed stocks as compared to relying on just one kind. So our process is enzymatic and not chemical, which the traditional processes were. We are able to handle larger variations in the input than any other technology. Overall in the country, do you see the industry ramping capacity when it comes to second generation ethanol plants, biofuels etc? We have seen an increasing role of biofuels in the country whether it is ethanol, second generation ethanol, biodiesel, bio jet fuel, renewable gas. We are seeing biofuels starting to increase share in India’s energy basket. There is a clear gap between the demand and supply of these biofuels and the gap is very significant. We are just scratching the surface when it comes to capacity. The gap in demand and supply should drive capacity upwards and we are very positive about that. How did operations fare this fiscal? What are the key industry trends you have witnessed in the first nine months of this fiscal? One of the good things is that our Pharma HiPurity business is turning
Asian LNG prices steady but traders wary of demand slowdown
Asian spot liquefied natural gas (LNG) prices stabilised this week though traders remained wary regarding overall demand as the spread of coronavirus threatens to dent the global economy. The average LNG price for April delivery into northeast Asia is estimated at around $3 per million British thermal units (mmBtu), steady from the previous week, but still near record low prices, several traders said. “We were worried about China initially but now with the virus spreading, I don’t think spot prices will be recovering any time soon,” a Singapore-based trader said. Global share prices are on track for their biggest weekly fall since the global financial crisis in 2008 as virus-related disruptions to travel and supply chains fuel fears of recession in the United States and the euro zone. For LNG, some bargain hunters appeared in the market either seeking or buying cargoes for April while availability for March cargoes are limited, a second Singapore-based trader said. South Korea’s GS Energy, Posco and Prism Energy International entered the spot market seeking cargoes, while India’s Gujarat State Petroleum Corp (GSPC) and Bharat Petroleum Corp Ltd (BPCL) sought cargoes for March and April, traders said. China’s appetite for LNG also appeared to be slowly resuming with shipments to the world’s second largest importer of the super-chilled fuel rising last week for the first time in five. This week, LNG imports into China are expected to rise further by 11% from last week, Refinitiv Eikon data shows. PetroChina on Wednesday bought a cargo for delivery in April from commodity trader Vitol through the S&P Global Platts’ pricing process also known as market-on-close (MOC).This follows two cargoes the firm bought in the spot market, traders said, though this could not be immediately confirmed. It was also not clear if the cargoes are for delivery into China. Still, supply was more than ample with several cargoes being offered in the market, traders said. Oman LNG, Russia’s Sakhalin 2 plant, Angola LNG and Malaysia’s Petronas were all offering cargoes. Osaka Gas, is also discussing a swap deal offering a cargo for loading from the United States and buying one for delivery into Japan, sources said. Shipments of three LNG cargoes from Indonesia’s Tangguh LNG Plant to Fujian province in China have been delayed because of the coronavirus outbreak, Indonesia’s upstream oil and gas regulator SKK Migas said on Thursday.
French major Total acquires shares worth over Rs 50 billion in Adani Gas
French energy major Total on Friday picked up shares worth over Rs 50 billion in Adani Gas through an open market transaction. On Friday, five promoter entities of Adani Gas on Friday sold shares worth more than Rs 50 billion through open market transactions, , as per bulk deal data available on the BSE. Adani Tradeline LLP, S B Adani Family Trust, Afro Asia Trade And Investments Ltd, Worldwide Emerging Market Holding Ltd and Universal Trade And Investments Ltd, offloaded shares. The five promoters have sold a total .of 40,76,43,145 shares for around Rs 125 per share and the total deal value is Rs 50.95 billion, according to the data. Separately, Total Holdings SAS picked up 40,57,51,145 shares in Adani Gas at an average price of Rs 125.12 apiece. This deal is worth Rs 50.76 billion. On BSE, shares of Adani Gas on Friday ended at Rs 133.9 apiece, down 9.04 per cent. In October, it was announced that Total Holdings SAS would acquire 37.4 per cent stake in Gautam Adani-led Adani Gas.