Pune: 20 PMPML buses to run on bio-CNG from mid-October
Twenty buses of the Pune Mahanagar Parivahan Mahamandal Limited (PMPML) will run on fuel made from food waste collected from different hotels from October 20. Called bio-CNG or CBG (compressed bio-gas), Indian Oil will supply it to the transport body, PMPML chairman- cum-managing director Rajendra Jagtap told TOI, adding that the trials have been completed. “There is a refuelling station in Talegaon, and buses from the Bhosari depot of the PMPML moving towards Talegaon area will be running on this fuel. Another fuelling station at Nigdi will be ready within three months. More than 50 buses in the PMPML fleet will run on bio-CNG. We are keen on use of alternative and eco-friendly fuel,”Jagtap said. In 2014, the Pune Municipal Corporation and the Pimpri Chinchwad Municipal Corporation got into an agreement with Noble Exchange Environment Solutions Private Limited to collect hotel food waste and convert it into bio-fuel. “The PMPML buses have undergone trials twice. We want more than 100 buses to use this alternative fuel by next January. The buses, instead of the normal CNG, have been fuelled by bio-CNG. Permissions and approvals have been obtained from Central Institute of Road Transport and Automotive Research Association of India,” the CMD added. There are more than 1,500 CNG run buses in the fleet.“The costs for CNG and bio-CNG are almost the same. Work on construction of the fuel station at the Nigdi depot is going on. It has been approved by the board of directors,” a PMPML official said .
Pakistan invites bids for record six LNG spot cargoes for December as gas crisis looms
Pakistan will ramp up spot buying of liquefied natural gas (LNG) from the international market, seeking up to six cargoes for December, its procurement subsidiary said on its website, as the country prepares for a potentially crippling gas shortage. December and January see the largest spike in demand for gas in Pakistan, but this year the demand-supply shortfall will be greater on the back of higher consumption and diminishing indigenous supply, authorities believe. A source in Pakistan LNG Ltd (PLL), which handles LNG imports, told Reuters that six spot cargo purchases for delivery in December would be the most in a single month by the country. An advertisement by PLL said the country was seeking the cargoes, each of 140,000 cubic metres, in six delivery windows and Nov. 2 is the deadline for submission of bids. Pakistan has long term LNG agreements in place, including one with Qatar, but has also been active on the spot market since August. The country has advertised tenders for delivery of two cargoes in August, three in September, two in October and three in November. In a press conference last week, Pakistan’s Minister for Petroleum Nadeem Babar said the country was headed towards a major gas shortfall in December and January, and blamed dwindling indigenous gas supply and rising demand. He added that there had been a lack of local exploration licenses granted by the previous government, and while new gas discoveries were found, they were small in size. He said his government would advertise more exploration licences this month. According to a report put out in August by the Oil and Gas Regulatory Authority increased demand had resulted in natural gas availability constraint. The main consumer of natural gas was the power sector, which consumed 38 per cent, while the domestic sector was at 22 per cent and fertiliser 16 per cent. Up to 45 per cent of Pakistan’s power sector energy mix is based on natural gas, according to the report, which added: “The demand supply gap during FY2018-19 was 1,440 MMCFD, which is expected to rise to 3,684 MMCFD by FY2024-25 and 5,389 MMCFD by FY2029-30”.
Gas price reduction will lower earnings for ONGC, Oil India: Moody’s
The recently-announced 25 per cent reduction in domestic natural gas prices to 1.79 dollars per million British thermal units (MMBtu) from 2.39 dollars per MMBtu on a gross calorific value basis is credit negative for upstream companies like Oil and Natural Gas Corporation (ONGC) and Oil India Ltd (OIL) as it will lower their revenue from gas sales, according to Moody’s Investors Service. These companies are already grappling with low oil prices and a further reduction in natural gas prices will exacerbate their earnings decline. However, said Moody’s, gas sales account for 18 to 19 per cent of the companies’ upstream revenues. After three consecutive price reductions in 12 months, India’s gas prices are at their lowest level since November 2014. “We estimate ONGC’s revenue and EBITDA will decline by Rs 1,500 crore to 1,600 crore because of lower gas prices. The decline equates to around 0.4 per cent of the company’s expected consolidated revenue and around 3.5 per cent of consolidated EBITDA for fiscal 2021,” said Moody’s. However, ONGC’s credit metrics have sufficient capacity to withstand the decline in gas prices and remain supportive of its baa3 baseline credit assessment and Baa3 ratings. In comparison, reduction in gas prices will lower OIL’s revenue and EBITDA by around Rs 220 crore. The decline equates to around 2.5 per cent of the company’s expected consolidated revenue and around 8 per cent of consolidated EBITDA for the fiscal year ending March 31, 2021. “We expect OIL’s credit metrics in fiscal 2021 to remain weakly positioned relative to its baa3 baseline credit assessment, but to improve and come back within its ratings thresholds by fiscal 2022 as oil prices start to recover,” said Moody’s. Both companies are government-related issuers and their ratings incorporate the expectation of extraordinary support from the Indian government, it added. Consequently, their ratings can be maintained at the current level (assuming no change in the sovereign rating) as long as their baseline credit assessments do not fall below ba3.