Russia’s Gazprom Neft says its plans are resistant to low oil prices
Russian oil producer Gazprom Neft’s strategic plans are sustainable even at low oil prices, the company’s chief executive officer Alexander Dyukov said on Thursday. In an interview with Rossiya-24 TV, Dyukov also said that Gazprom Neft’s has used an oil price of $50 per barrel in its plans for 2019 and company’s new strategy sees production rising faster than the market average.
Leg-up to LPG infra: OMCs receive nod for pipeline between Kandla & Gorakhpur
The LPG infrastructure of the country is set to get a major leg-up as the oil marketing companies (OMCs) will soon have 60 new bottling plants to be set up and operated by private players. At present, there are a total of 189 bottling plants in the country. A joint venture of the state-owned firms has recently got authorisation to lay the Rs 100 billion Kandla-Gorakhpur LPG pipeline. The OMCs are in the process of evaluating tenders for 60 small-capacity bottling plants, said Sanjiv Singh, chairman of Indian Oil Corp. Of the 60, 21 will be operating for Indian Oil, 20 for BPCL and 19 for HPCL. Private firms-operated plants will pay tolling charges to the OMCs. While a bottling plant operated by OMCs of larger capacity typically has production capacity of 120,000 ton a year, new bottling plants will have a maximum capacity of 30,000 ton each. The total investment envisaged across these plants is Rs 4 billion. While some of the plants will produce 7,000 LPG cylinders a day, a few will have capacity of 3,000 cylinders a day. There are a few private bottling plants already in the country which operate on a tolling basis, but are insignificant in terms of contributing to the total LPG demand. The bottling capacity addition is in line with the increase in the number of households using the cleaner fuel because of the Pradhan MantriUjjwalaYojana (PMUY). From around 62% in May 2016 when the flagship scheme was launched, households having access to LPG at present is 90% with 59 million PMUY beneficiaries apart from general consumers. The government earlier this week expanded the scope of the PMUY to include “all poor households” under the scheme. With this move, the government expects the LPG coverage to be near 100% soon. “There is a lot of work going on behind the scene in terms of improving LPG distribution infrastructure,” said Singh, adding that the OMCs are also increasing production from the existing plants. While most of the bottling plants utilise 100% capacity, OMCs have increased the number of hours the plants operate including night shifts and enhancing capacity of existing carousels. In what will help to feed LPG to bottling plants, the OMCs after much delay have got authorisation to lay the LPG pipeline from Kandla to Gorakhpur. “It will be laid by a JV between IOC, HPCL and BPCL. The pipeline will link 22 bottling plants apart from Gujarat refinery and Bina refinery,” said Singh. The plan to lay the 2,000-km pipeline from the coast in Gujarat to Uttar Pradesh was floated in 2016 by Indian Oil. The pipeline will cross Ahmedabad (Gujarat), Ujjain, Bhopal (Madhya Pradesh), Kanpur, Allahabad, Varanasi and Lucknow (Uttar Pradesh). “We are moving towards safer and faster transportation of LPG,” said Singh. Indian Oil has already commissioned an LPG pipeline from Paradip (Odisha) to Haldia (West Bengal) and extended up to Durgapur (West Bengal). This will also be extended up to Gorakhpur. Singh said not only will this pipeline transport LPG from Paradip and Haldia refineries, it will also carry imported LPG from Haldia to the interiors of the country. India imports 50% of its LPG requirement, and Singh expects the overall consumption in the country to grow by 6-8% every year. Total LPG consumption recorded a negative growth of 7.8% in November 2018 and a cumulative growth of 4.9% for the period of April-November 2018, according to the Petroleum Planning and Analysis Cell.
Shell completes sale of New Zealand entities to OMV for $578 million
British-Dutch multinational oil and gas giant Royal Dutch Shell plc today announced it has completed the sale of its shares in Shell entities in New Zealand, to OMV for $578 million. This includes the Māui, Pohokura, and Tank Farm assets, and the sale of Shell’s interest in (and operatorship of) the Great South Basin venture, which was subject to a separate agreement. The company said in a statement the sale is consistent with Shell’s global drive to simplify the upstream portfolio and re-shape the company into a world-class investment. “We are proud of having worked in New Zealand for more than 100 years and completion of the sale to OMV marks an important milestone in the company’s history. Shell staff in New Zealand, past and present, have been key to building a successful New Zealand business. I wish our colleagues all the very best as OMV takes the business forward,” said Zoe Yujnovich EVP, Australia and New Zealand. Employees of Shell Taranaki Limited and Shell NZ 2011 Limited are now part of OMV New Zealand.
Mohali and Chandigarh to get more gas distribution stations
Chandigarh, Mohali to get fully-developed City Gas Distribution (CGD) stations networks. This was declared during the Petroleum and Natural Gas Regulatory Board (PNGRB) road show for promoting 10th city gas distribution (CGD) bidding round in Chandigarh on Thursday. Mohali already has one such operational CGD and by January 19, two more CGD will be made operational. Similarly, in Chandigarh one CGD is already operational and city will get one more by February 19. Whereas by March 19, the remaining CGD will be made functional in Mohali and Chandigarh. Petroleum and Natural Gas Regulatory Board (PNGRB) is the nodal agency for facilitating economic activities in natural gas distribution with the objective to promote competitive markets, create infrastructure and increase share of natural gas in country’s energy mix. PNGRB has so far concluded 9 CGD bidding rounds for selection of authorised entities for development of CGD networks in their geographical areas (GAs). The recently concluded ninth bidding round for 86 GA’s covering 174 districts in 21 states/ UTs was a huge success attracting interest from investors in all offered GAs. “At present, CGD authorisation has been given by PNGRB in 10 GAs in state of Punjab covering 13 districts namely Mohali, Patiala, Sangrur, Ludhiana, Barnala, Moga, Jalandhar, Kapurthala, SBS Nagar, Amritsar, Bhatinda, Rupnagar, and Fatehgarh Sahib. In the 10th CGD bidding round, 3 GAs covering 6 districts- Mansa, Ferozepur, Hoshiarpur, Faridkot, Sri Muktsar Sahib and Gurdaspur are being offered”. CGD authorisation has been given by PNGRB in 13 GAs in state of Haryana covering 16 districts namely Sonipat, Panipat, Yamunanagar, Rewari, Rohtak, Karnal, Ambala, Kurukshetra, Panchkula, Bhiwani, Charkhi Dadri, Mahendragarh, Hisar, Jind, Nuh and Palwal. In the 10th CGD bidding round, 2 GAs covering 3 districts of Sirsa, Fatehabad and Kaithal are being offered. It may be noted that a total of 4 GAs are on offer for both the state combined with Sirsa, Fatehabad (Haryana) and Mansa (Punjab) Districts grouped in 1 GA. After the 10th round, Punjab and Haryana and Chandigarh would be fully authorised for the development of CGD Networks.
Qatar’s Pearl gas-to-liquids plant back to normal production rate: Shell
Qatar’s Pearl gas-to-liquids plant has returned to its normal production capacity since December 26, a Shell representative said on Thursday. The plant, which produces 1.6 billion cubic feet of gas per day from the North Field, had operated at a reduced production rate since November 30. “There has not been any impact on customers,” the statement added.
Saudi Aramco creates fuel retail subsidiary to expand downstream
Saudi Aramco said on Wednesday it was establishing a domestic fuel retailing subsidiary as part of the national oil company’s drive to expand into downstream businesses. The new firm, Saudi Aramco Retail Co, will create a network of filling stations within Saudi Arabia to sell automotive fuels, Aramco said without giving details of the size, cost or time-frame for the network.
LNG imports into Northeast Asia climb to record high in December
Shipments of liquefied natural gas (LNG) into Northeast Asia have risen to a record in December, mainly driven by China’s continued gasification push, and as the region faces colder-than-usual temperatures this week. LNG imports into China, Japan, South Korea and Taiwan, have climbed to 20.5 million tonnes so far in December, 5 percent higher than the previous monthly record of 19.5 million tonnes back in January, data from Refinitiv Eikon showed. December shipments were nearly 15 percent higher than November, the data showed. ALSO READ: China’s LNG imports hit record in November “When we look at the region, we think it is mainly China which has been driving the North Asian growth over November to December,” said Kittithat Promthaveepong, lead analyst at energy consultancy FGE. “This was likely because of the spot supplies they had contracted for earlier in the year to avoid a shortage this winter.” LNG imports into China have risen to a record of about 6.5 million tonnes so far in December, up 6 percent from the previous high in November as households and businesses crank up their heating with the start of the Northern Hemisphere winter. China’s government has ordered residents and businesses to shift to natural gas for heating from coal to reduce air pollution. To avoid shortages, Chinese companies procured supplies ahead of the winter. Shipments to Japan also rose to a 10-month high in December, likely due to colder weather, but this could be a temporary increase as inventories are high, a Japan-based trader said. He added that buyers have largely finished their spot procurement for winter. Temperatures across Tokyo, Beijing and Seoul are expected to be colder than normal this week, with a widespread cool-down likely to cover China over the next 10 days, weather forecasts from Refinitiv Eikon show. However, Japan is likely to experience average-to-warmer weather between January and March next year. In South Korea, LNG imports also rose in December. The country’s LNG imports have generally been strong this year due to maintenance at nuclear power plants and a delay in the start-up of new nuclear plants, said Ken Lee, a senior analyst at FGE. “Over January to February, we expect these relatively high imports to continue, but the recent cold spell in China means that they’ll be able to absorb more volumes over first quarter of 2019 as stocks diminish,” FGE’s Promthaveepong said.
LNG import capacity to double in next two years
Regulatory approvals, construction of evacuation pipelines and end-use distribution grids will be key for execution, says a Bloomberg report 66 million tons – LNG import capacity likely by 2020 28.6 million tons – current LNG regasification capacity 17.2 million tons – India’s long-term contracts could reach by 2020 14.7 million tons – India’s long-term supply agreements currently in place 1,290 billion cubic meters – India’s gas reserves 50% – domestic gas production share 65% – China’s domestic production share
In 8 months, state refiners use 63% of Rs 89,000 cr capex target for FY 19
State-owned corporations Indian Oil, Bharat Petroleum and Hindustan Petroleum, as well as GAIL, are exhausting their capital expenditure budgets much faster than their upstream counterparts ONGC and Oil India in this financial year. The oil companies together spent about Rs 57,000 crore between April and November, 63% of their capex target of Rs 89,000 crore for 2018-19. State refiners are spending thousands of crores in expanding capacity and upgrading their facilities to produce low-emission fuel and improving their marketing infrastructure across the country to cater to the increasing demand for fuel. At 85% of capex target, refiner Bharat Petroleum was the fastest spender. Indian Oil, the country’s largest refiner and fuel retailer, spent 74% of its budget while HPCL, another refiner, used up 71% of its capital outlay. In 8 months, state refiners use 63% of Rs 89,000 cr capex target for FY 19 GAIL, the country’s largest gas marketer and pipeline operator, achieved 72% of its annual capex target, with most of its capital being deployed in laying a pipeline that would get natural gas to most of eastern India soon. ONGC and Oil India lagged peers in capital spending in the first eight months of the fiscal. ONGC, which has a capex outlay of Rs 32,000 crore for the year, spent only 54% till November. Its overseas arm, ONGC Videsh, spent 53% of its Rs 5,900 crore target. ONGC’s capex budget is usually much more than that of refiners such as Indian Oil and Bharat Petroleum, which have annual capex target of Rs 22,900 crore and Rs 7,400 crore, respectively. Oil India used up just 47% of its Rs 4,300-crore capex programme, figuring at the bottom of the spending table among oil firms. Higher investment in refining and marketing network is also needed to meet oil demand that has grown 2.5% this year.
Click on IGL app before you queue up for CNG in Delhi
Next time you want to tank up on CNG in Delhi-NCR, you need not wait in a long queue. A few taps on a new IGL app on your phone will tell you the average waiting time at stations within a radius of 5 km and beyond to help you chose the one where you can get the quickest refill. The ‘CNG Queue Management’ app is the key ingredient of a basket of digital initiatives launched by the NCR’s sole supplier of CNG and PNG services for improving consumer service and satisfaction. According to oil minister Dharmendra Pradhan, these initiatives will provide seamless information and convenience to consumers as well as a big push towards creating a ‘Digital India’. The New app divides CNG consumers into three broad categories- buses, cars and autos and help disperse demand in a particular area to ease the queues. IGL has been hamstrung by lack of land in expanding its CNG network, especially in east and south, to meet over 10 per cent rise in annual demand as more and more vehicles switch to the clean-burning fuel. Since law of physics — Joules-Thomson effect — does not allow CNG to be filled at the speed which petrol or diesel can be done, long queues have become the order of the day in the backdrop of limitations to network expansion. But still, IGL currently is refuelling a million vehicles daily and supplying PNG to an equal number of households, which drew a rare compliment from Pradhan. “Good to see that IGL has grown beyond the initial mandate of supplying CNG for public transport vehicles to become one of India’s biggest CGD companies. Of the 1,500 CNG stations operating in the country, more than 450 are in Delhi. IGL plans to add another 50 CNG stations in NCR,” Pradhan said.