Centre advances target of 20% blending of ethanol in petrol from 2030 to 2025-26
The Minister of State for Petroleum and Natural Gas Rameswar Teli in a written reply to a question in the Rajya Sabha informed that the Government is promoting Ethanol Blended Petrol (EBP) Programme with broader objectives of providing boost to domestic agriculture sector, environment benefits, reducing import dependency and savings in foreign exchange. Government has also notified the National Policy on Biofuels – 2018 which laid out indicative target of 20% blending of ethanol in petrol and 5% blending of biodiesel in diesel by 2030 in the country. Based on the encouraging initiatives on supply side of ethanol, Government has advanced the target of 20% blending of ethanol in petrol from 2030 to 2025-26. The measures taken by the Government for the benefits of ethanol manufacturers inter alia, include permitting multiple sugarcane and grain based feedstock for ethanol production, fixing feedstock wise remunerative ethanol procurement prices, introducing amended Industries (Development and Regulation) Act, 1951 for uninterrupted production, storage and movement of ethanol across the country, bringing ethanol meant for EBP Programme under lowest GST slab rate of 5% to increase production of ethanol and promote EBP Programme and introducing interest subvention schemes during 2018, 2019, 2020 and 2021 for augmentation and enhancement of ethanol production capacity in the country.
India to lead in pipeline projects
India is likely to remain as one of the major countries to drive Asia’s new-build trunk / transmission pipeline additions, contributing about 37% of the region’s oil and gas pipelines projects count by 2026, says GlobalData, a leading data and analytics company. GlobalData’s latest report, New Build Trunk-Transmission Pipelines Projects Analytics and Forecast by Project Type, Regions, Countries, Development Stage, and Cost 2022-2026, reveals that out of 57 projects to commence operations by 2026 in India, gas pipelines projects would be at 30, product pipelines would be at 23, and oil pipelines at four. Sudarshini Ennelli, Oil & Gas Analyst at GlobalData, comments: “India is striving to develop a robust transmission pipeline infrastructure for greater transport of oil and gas to meet the ever-growing demand for energy.” The Kandla–Gorakhpur product pipeline is one of the key projects with a length of 2,809 km and costing US$1.4bn. The LPG pipeline would run from Kandla port in Gujarat state to Gorakhpur in the Uttar Pradesh state. The pipeline project would serve LPG bottling plants in the states of Gujarat, Madhya Pradesh, and Uttar Pradesh and meets growing demand for the commodity. The Jagdishpur–Haldia Phase II gas pipeline is also one of the key projects with a length of 1,900 km and estimated at US$1.4bn. The pipeline would be operated by GAIL covering the Indian states of Uttar Pradesh, Bihar, Jharkhand, Odisha, and West Bengal. The pipeline project aims to connect India’s eastern region with national gas network catering to the needs of domestic and industrial consumers.
NTPC and Gujarat Gas to Blend Green Hydrogen with PNG
The Ministry of Power has informed that India’s leading power generator National Thermal Power Corporation (NTPC) has joined hands with Gujarat Gas Limited to undertake a novel initiative of blending ‘Green Hydrogen’ in the Piped Natural Gas (PNG) supplied by the city gas distributor. Both the companies are state owned and the blending will be done at NTPC Kawas, Gujarat. NTPC is the first company to be employing green hydrogen with natural gas. NTPC will produce green hydrogen through the process of electrolysis of water by employing 1 MW floating solar power plant project established at NTPC Kawas. First , the Hazira gas pipeline network run by Gujarat Gas will be extended to NTPC township of Kawas and thereafter the blending will take place in a predetermined proportion. The blended gas will be supplied to the households for cooking purposes.
$150 Oil Is Still A Distinct Possibility
The European Union seems to be warming to the idea of direct sanctions on Russia’s energy industry, slapping a ban on imports of coal for starters. The United States is releasing 180 million barrels of crude, and several IEA members are releasing another 60+ million barrels. And Saudi Arabia just hiked its prices for all buyers. Much higher oil prices may be around the corner. When a few months ago analysts were seemingly trying to out-forecast each other on crude oil prices, the most commonly cited bullish factors were OPEC+’s unwillingness to boost production by more than originally agreed while demand for oil continued strong. Now, all the news appears to be on the war in Ukraine, and the main bullish factor for oil is the expected continued decline in Russian oil exports. The country is the largest exporter of crude oil and oil products and a big supplier to the European Union, which explains the EU’s reluctance to directly target its energy industry. Yet pressure is growing on Brussels to do just that, and with coal already on the sanction list, it’s probably only a matter of time before oil becomes a target, too. When this happens, Brent may well top $120 and stay there. In the meantime, the United States has publicly stated it had banned all Russian oil and fuel imports, but in fact, the ban is only coming into effect on April 22, and in the meantime, the U.S. is stocking up on Russian oil and products. Per data from the Energy Information Administration, in the week to March 25, the U.S. imported an average of 100,000 barrels of Russian oil and fuels, up from 70,000 bpd in the previous week and zero barrels daily a month earlier. While all this was happening, oil prices dipped after the announcement of the U.S. SPR release, with West Texas Intermediate even falling below $100 per barrel. Yet the dip was only a brief one, and prices are once again above $100 as fundamentals reassert themselves after the initial market reaction to the Biden administration’s decision for the reserve release. Now, prices are likely to continue climbing, just like they did after the first Biden SPR release last year, again in an attempt to put a lid on retail fuel prices. At the time, prices reacted with a dip immediately after the news and then rebounded as emotions gave way to facts. These included the one that oil grades to be released from the reserve were not the ones refiners needed to boost their fuel production and the one that a reserve release can only provide temporary relief at the pump without actually fixing the supply problem. Now, the release is massive in comparison to the first one. It would amount to 1 million bpd over a period of six months. Theoretically, this would cover a third of the Russian oil export dip as predicted by the IEA. In practice, traders have probably already started to worry about how the administration will replenish the SPR after the release and what that would do to oil prices. Meanwhile, in Europe, coal prices jumped following the news of a coal import ban on Russia, with European Commission President Ursula von der Leyen saying, “We will impose an import ban on coal from Russia, worth 4 billion euros ($4.39 billion) per year. This will cut another important revenue source for Russia.” Sadly, it will also raise energy costs for European further, heating up the debate about who are anti-Russian sanctions actually hurting more: Russia or the EU. The European Union imports 45 percent of the coal it uses from Russia, according to European Commission data. That’s 45 percent of coal imports it will now need to replace because cutting coal use sharply is simply not an option. Incidentally, Indonesia, which is the world’s largest coal exporter, hiked its April delivery prices by as much as 42 percent. This sounds quite similar to what Saudi Arabia did with its oil prices and likely means the same thing: buyers have fewer options now; it’s a sellers’ market. But coal prices are set to rise further because Russia supplies as much as 70 percent of Europe’s thermal coal, the sort used for power generation and heating. And to make things more interesting, global stocks of thermal coal are tight, according to Rystad Energy. What does this mean for oil? Based on what we saw with gas and coal prices in Europe last year, the prices of all fossil fuels are linked. When one becomes prohibitively expensive, demand for the others rises. That’s why coal prices soared last year, in fact, as utilities turned from gas to coal in search of a more affordable source of energy. In this situation, the normal rule of the cure for higher oil prices being even higher oil prices does not really apply, at least not completely. Energy demand is hard to kill, regardless of costs, especially in places like the European Union, where people have lived in complete energy comfort and security for several generations. Oil prices will likely rise after the EU’s ban on Russian coal. And if the EU decides to go further and target oil itself, things could get really interesting on the price front and on the streets of European cities.
Petroleum dealers complain of short supply by HPCL
The Kerala State Petroleum Traders’ Association has alleged that around 200 retail fuel outlets had been affected in the State by a short supply of petrol and diesel by Hindustan Petroleum Company Limited (HPCL). Sabarinath, vice-president of the Federation of All India Petroleum Traders, said the fuel dealers had met the District Collector on Wednesday to impress upon him the seriousness of the situation and that the district authorities had agreed to intervene in the matter. While there had been an allegation that the oil company was trying to pile up stocks to take advantage of the daily rise in the price of petrol and diesel, sources in the oil company denied the allegation and said the company had stopped providing credit to the dealers and had now been demanding ready payments for supplies. This had resulted in some of the dealers not taking delivery of products. HPCL has about 25% share in the Kerala petrol and diesel market and has a total of 700 outlets across the State.