Petronas CEO says gas price at $7-$8/mmBtu is ‘sweet spot’ for customers
The chief executive of Malaysia’s state energy firm Petronas said on Tuesday that a gas price at $7-$8 per metric million British thermal units (mmBtU) could be a “sweet spot” for customers and allows investments to continue to happen. “Natural gas needs to be embraced as a transition fuel. A decarbonised future does not mean hydrocarbon-free future,” Tengku Muhammad Taufik said at the Gastech industry conference in Dubai. Global gas prices have been rallying all summer due to low storage inventories, high demand for gas in Asia, less Russian and LNG supply to Europe than usual, high carbon prices and outages. The average liquefied natural gas price for November delivery into Northeast Asia was estimated at about $24 to $25 per mmBtu last week. Benchmark Dutch natural gas prices in northwest Europe have surged to around $25/mmBtu from around $6-7/mmBtu at the start of the year.
India refiners’ August crude oil processing lowest in 10 months
Indian refiners’ crude oil throughput in August dipped to its lowest in 10 months due to ongoing maintenance activities at multiple refineries, government data showed on Wednesday. Refiners processed 4.36 million barrels per day (18.44 million tonnes) of crude oil last month, the lowest since October 2020 and about 4.8% lower than 4.58 million bpd processed in July. Maintenance activities at some facilities limited production in August, Refinitiv analyst Ehsan Ul Haq said, adding that demand was likely to resume as the festival season approaches, provided cases of COVID-19 remain low. On a year-on-year basis, however, refiners’ crude oil throughput in August jumped about 14.2%, while crude oil production fell about 2.3% to 596,000 bpd (2.52 million tonnes), the data showed. Indian refiners operated at an average rate of 86.89% of capacity in August, down from 91.34% of capacity in July, the government data showed. India’s top refiner, Indian Oil Corp (IOC), last month operated its directly owned plants at 82.83% capacity, as per the data. Reliance, owner of the world’s biggest refining complex, operated its plants at 88.22% capacity in August. Reliance’s oil imports in August declined 11.8% from last year, preliminary tanker data from shipping and industry sources showed on Tuesday. Natural gas output jumped 20.2% to 2.92 billion cubic metres from a year earlier, data showed. “Natural gas numbers might provide some cold comfort at a time when the whole world is complaining about high gas prices, which could incentivise even more production of the fuel,” Ul-Haq said. European and Asian Liquefied Natural Gas prices have soared over the past few weeks, pushing up energy bills and raising fears over shortages for the upcoming winter.
OVL seeks another 2-yr extension for exploring Vietnamese oil block in South China Sea
ONGC Videsh Ltd, the overseas arm of Oil and Natural Gas Corp (ONGC), has for the seventh time sought an extension to explore a Vietnamese oil block in the contested waters of the South China Sea. Officials said OVL has applied for a two-year extension to explore Block-128, the licence for which was valid till June 15, 2021. While India wants to maintain its strategic interest in the South China Sea, Vietnam wants an Indian firm to counter China’s interventions in the contested waters. OVL had signed a production sharing contract (PSC) with PetroVietnam for deepwater exploratory Block- 128 having an area of 7,058 square kilometers in Offshore PhuKhanh Basin, Vietnam in May 2006. An investment licence was issued to it on June 16, 2006, thereby giving effect to the PSC. Officials said the company continues to explore for oil and gas in the block that lies in a water depth of 200-2,000 meters. No discovery has yet been made on the block, they said. OVL during the exploration period acquired 3D seismic data, reprocessed 2D seismic data and carried out G&G studies. But it is yet to drill the one well it had committed as part of the minimum work programme, they said adding further G&G studies are being carried out. Vietnam on October 29, 2019, had granted a two-year extension from June 16, 2019 to June 15, 2021 and a request for a further two years of extension of Exploration Phase-1 of the PSC was made on March 12 this year. “We are hoping they will agree to extend the PSC till June 15, 2023,” an official said adding the Vietnamese national oil company PetroVietnam has agreed to share some of the technical data pertaining to the nearby area of Block 128 for Petroleum System Modelling and other related studies for better geological understanding. Another official said the company had a couple of years ago drilled a well on the block but it could not reach the target depth and so it now has to drill the well all over again. “If we don’t drill, we are liable to pay penalties,” he said. The company has not found any hydrocarbon in the block but is continuing to stay invested to maintain India’s strategic interest. OVL first took a two-year extension of the exploration period till June 2014 and then another one year. A third extension was granted on May 28, 2015, and a fourth in 2016. It got the fifth extension for two years in 2017. The block lies in the part of the South China Sea over which China claims sovereignty. In 2011, Beijing had warned OVL that its exploration activities off the Vietnam coast were illegal and violated China’s sovereignty, but the company continued exploring for oil and gas. OVL made a foray into Vietnam as early as 1988 when it bagged the exploration licence for Block 6.1. OVL owns a 45 per cent stake in Block 6.01 and its share of condensate and oil equivalent gas production from the block was 1.330 million tonnes during 2020-21 fiscal. The 955 sq km Block 06.1 located in Nam Con Son basin has two producing fields — Lan Tay and Lan Rosneft — and has a 35 per cent stake while the remaining 20 per cent is with PetroVietnam. The firm in 2006 got two exploration blocks — Block 127 and Block 128. While Block 127 was relinquished due to poor prospects, the other block was retained. The first extension for Block 128 followed China putting the area under Block 128 for global bidding. China claims sovereignty over most of the South China Sea where the two blocks are located and had warned the Indian arm from drilling in the region.
Petrol prices not coming down as states don’t want it under GST: Puri
Petrol prices in the country are not coming down as the states do not want to bring fuel under the ambit of the GST, Petroleum Minister Hardeep Singh Puri said. In an interview to PTI here, Puri said petrol prices crossed the Rs 100-mark in West Bengal as the TMC government is levying heavy taxes. “If your question is do you want the petrol prices to come down then the answer is yes. Now, if your question is why the petrol prices are not coming down, then the answer is because the states don’t want to bring it under GST,” he said. “The Centre charges Rs 32 per litre (as taxes on petrol). We charged Rs 32 per litre when the fuel price was USD 19 per barrel, and we are still charging the same even when the price rose to USD 75 per barrel. With this Rs 32 per litre, we provide free ration, free housing and Ujjawala, among several other schemes, to the people,” he said. Puri said the West Bengal government increased prices by Rs 3.51 per litre in July, resulting in the petrol crossing the century-mark. “The combined taxation is around 40 per cent here (West Bengal). It is very easy to make statements. Had you (TMC government) not increased the price by Rs 3.51, then it would have been still under Rs 100 per litre,” he said. Puri was in Kolkata on Wednesday to campaign for the Bhabanipur bypoll in which Chief Minister Mamata Banerjee is the TMC candidate against BJP’s Priyanka Tibrewal and CPI(M)’s Srijib Biswas. “If the result of the Bhabanipur by-election is a foregone conclusion, then why is the entire state cabinet campaigning there? We are confident about a victory, and post-poll violence is a major issue in this poll,” he claimed. On the political developments in Punjab, Puri said it reflects the “terminal decline” of the Congress. “Definitely it is an indication of Congress party’s terminal decline. I am choosing my words very carefully. In Bengal, they fought with one set of allies. In Kerala, they fought with a different set of allies. They are drawing almost blank everywhere. In UP, where the Congress party grew up, I don’t know who wants to partner them,” he said. “What is going with the Congress in Punjab is a comedy and theatre of the absurd,” Puri added. Pitching for the Citizenship Amendment Act (CAA), the minister said the Afghanistan crisis proved why it was necessary. “When the legislation was conceptualised, it was very clear that minority community in our neighbourhood would be facing a challenging situation,” he said. “In CAA, the cut-off date is 2014, and those who had opposed it are now saying that the cut-off date should be made 2021. CAA is to deal with persecuted minorities who fear for their life. As part of our overall philosophy, India as a country has accepted refugees. Those who had opposed CAA then are now looking silly,” he said.