What should be India’s priority: Energy security or ‘America first’?
Although no final decision has been taken yet by New Delhi, speculation is rife that oil imports from Iran could slow down from August when some U.S. sanctions against Tehran take effect. However, for now, there is reason to cheer for those want to see India stand its ground and refuse to buckle under the U.S. pressure. According to reports, India’s monthly oil imports from Iran touched a record high in July, jumping by about 30 percent to 768,000 barrels per day (bpd). The shipments include tankers that were loaded in June and arrived in India in July, based on preliminary tanker arrival data. The volume of oil trade in July between New Delhi and Tehran marked a significant 85 percent jump from the same period last year when it was 415,000 bpd. Pertinently, Indian state refiners had reduced oil imports from Iran last year following a dispute over development rights of Farzad-B gas field, located in Persian Gulf. Since the beginning of this fiscal year in April, the oil purchase from Tehran has surged, primarily due to heavy discounts, free shipping and extended credit period for oil sales offered by Iran. According to reports, Iran has employed its own ships to transport oil to India as very few shipping lines had participated in recent tenders. Indian oil firm Hindustan Petroleum Corp Limited (HPCL) had to annul the purchase of an Iranian cargo a few weeks ago after it faced issues related to insurance cover. Other major Indian petroleum companies like Indian Oil Corporation (OIL) are expected to renew their insurance cover in next few months. But everything hinges on the final decision New Delhi takes. Importantly, India is now the top oil client for Iran after China, having shipped in 5.67 million tons or about 457,000 barrels per day (bpd) of oil in the first three months of this fiscal year, India’s Union Petroleum and Natural Gas Minister Dharmendra Pradhan informed Indian parliament last week. And according to the latest data, quoted by Reuters and other news agencies, in the first four months of this fiscal year, India’s oil imports from Iran had reached 677,500 bpd. However, it remains to be seen whether or not the oil keeps flowing after August. Some U.S. sanctions will take effect from August 6, while others, including those pertaining to oil and petroleum, will come into force from November 4. India has been under tremendous pressure from the U.S. to cut oil imports from Iran in the wake of sanctions against Iran. New Delhi, which shares deep historical ties with Iran, had initially said that it does not recognize unilateral sanctions imposed by Washington, and only recognizes UN sanctions. However, later reports emerged in local and international media that a message had been sent to state refiners to be prepared for cut in oil imports from November. In an attempt to allay fears and put speculation to rest, India’s Petroleum Minister Dharmendra Pradhan told a leading Indian daily last month that India sees U.S. sanctions on Iran as a “challenge” given its close ties with both the countries, and said New Delhi will take a “considered and considerate’ view based on ‘national interest’ on the issue of U.S. sanctions against Iranian oil. A high-level U.S. delegation visited New Delhi last month to hold talks with Indian officials over the matter. Iran’s deputy foreign minister Seyyed Abbas Araghchi also visited New Delhi and held wide-ranging discussions with Indian foreign secretary Vijay Gokhale. Meanwhile, an intense debate is underway in India’s media and intelligentsia circles over the issue of oil imports from Iran. Many experts and political stalwarts maintain that buying oil from Iran is in India’s national interest and succumbing to the U.S. pressure will send a wrong message to the world. India’s former vice president Hamid Ansari believes Iran is an important country for India, and not just as an oil supplier. “We have to keep in mind two things. We get a good amount of energy supply from Iran. But Iran is not only an energy supplier,” Ansari told reporters in New Delhi. “Iran is a big and important country for us. It is a country which is next to Pakistan and Afghanistan. So when we look at Iran we have to understand these things too.” Former Indian diplomat M K Bhadrakumar, writing in an Indian daily Deccan Herald, said India’s strategic autonomy and independent foreign policy demands that the approach to this Iran question should be based on national interests. “Nothing should be done to cause damage to the mutual trust and understanding in India’s relations with Iran. Equally, energy security – not ‘America First’ – should be our priority,” he wrote. Last week, Germany also urged India not to buckle under the U.S. pressure and continue buying oil from Iran. German minister of state for International Affairs Niels Annen, during his visit to New Delhi, described the pressure being put by Washington on its allies to stop buying oil from Iran as “irritating”. “It will be India’s sovereign decision. I am not a salesman for Iran but I have an impression that India is willing to continue buying oil from Iran and this will be a very important statement,” he said. Pertinently, Iran’s deputy envoy to New Delhi Massoud Rezvanian Rahaghi had last month warned that India stands to lose many privileges if it betrays Iran and imports oil from other countries. At a time when the oil imports from Iran are touching record high and Tehran is offering ‘privileges’ like discount, free shipping and insurance cover to Indian refiners, the decision between energy security and ‘America first’ should not be too difficult to make for New Delhi. Tom Waddle Authentic Jersey
Northeast to be connected with National Gas Grid: Oil India CMD
A top Oil India Limited (OIL) official on Saturday said Guwahati and other state capitals of northeastern states are likely to be connected to the National Gas Grid within next three years. The ambitious project of gas pipeline from Barauni to Assam and other northeastern states is likely to be completed within next three years’ time, OIL Chairman cum Managing Director Utpal Bora said at a press conference. Bora said while work for the gas pipeline from Barauni to Guwahati has already started, a joint venture has also been formed involving the OIL, Numaligarh Refinery Limited (NRL), Indian Oil Corporation Limited (IOCL) and GAIL for connecting all the capital of northeastern states through a gas pipeline from Guwahati. “While the gas pipeline from Barauni to Guwahati involved setting up of pipeline of 700 km at an estimated cost of Rs 45 billion, the North Eastern Gas Pipeline project would see setting up of 1,500 km of pipelines at an estimated cost of Rs 60 billion,” Bora said. He said connecting Guwahati with the National Gas Grid through the pipeline from Barauni and connecting the capitals of northeastern states with the gas pipeline are two major projects, which are expected to help the northeastern states in multiple ways. The Oil CMD further said households in Guwahati metro area (which involves Guwahati and some other neighbouring areas) are likely to be provided piped gas soon. “Recently there were bid for distribution of piped gas in Guwahati Metro areas and Silchar, Karimganj and Hailakandi areas. We have bid for the project and we are hopeful that we will be successful in our bid. If awarded to us, piped gas service can be started in Guwahati within next three years time,” he said, adding that along with piped gas distribution, the OIL also plans to set up some CNG stations in Guwahati which will help tackle the pollution in and around the city. Asked about the new discoveries of OIL, Bora said that the public sector undertaking has been awarded nine new blocks in India, which includes seven blocks in northeast and one each in Rajasthan and Krishna Godavari (KG) basin. He said that the Oil has recorded an impressive growth of 72.27 percent terms of production in the 2017-18 with a turnover of Rs 26.6793 billion compared to 2016-17 which was Rs 15.4868 billion. Dion Sims Authentic Jersey
LNG demand to stay strong despite 70 per cent price rise: Report
The steep 70 per cent spike in global liquefied natural gas(LNG) price is unlikely to curb domestic demand, but may crimp the margin of city gas distribution (CGD) companies to some extent as volume growth will support marketing margins, according to a report. Over the past five to six months, LNG prices in Asia have increased by over 70 per cent, driven by rising Chinese imports. The spurt was also due to plant shutdowns and healthy demand from Japan, Korea, India and Pakistan, Crisil said in a weekend note. “But with crude prices breaching USD 75 a barrel, traders see an opportunity to price LNG in lockstep with crude. Earlier, there wasn’t much correlation between crude and spot LNG prices,” the report said. It also noted that over the rest of this fiscal year, too, prices are expected to hold at USD 8-8.5/mmBtu for non- peak months and reach USD 10-10.5/mmBtu during the peak season even as supply is restored from plant turnarounds and incremental liquefaction capacity of 25 million tonne coming on stream. Last fiscal, after stabilising at USD 8-8.5/mmBtu during the lean months (between May-June and September- October), Asian spot LNG prices peaked at USD 10-10.50/mmBtu, said Crisil. “The Supreme Court banning polluting fuels like fuel oil and petcoke for industrial use in some northern states has been favourable for LNG demand. “The Gujarat High Court has also tightened norms on use of coal gassifiers by ceramic companies in Morbi and Wankaner. These moves resulted in a 20 per cent growth in imports in the first half of FY18,” it said. What enhances the attractiveness of LNG as an industrial fuel is its improved competitiveness compared with alternatives like fuel oil and LPG. The regulatory push to expand CGD networks is also stoking demand. Though in the past, higher prices dented LNG demand in the country, things are different now with consumption rising 6-7 per cent to 20 million tonne in FY18. At an average crude price of USD 75 a barrel, the landed cost of the fuel oil and LPG is expected to be USD 14.3/mmBtu and USD 19.2/mmBtu, respectively. In comparison, with LNG ruling at USD 9.5/mmBtu, industrial piped natural gas is expected to rule at USD 14.8/mmBtu, the report said. Crisil expects LNG demand in the medium term to be supported by development of gas infrastructure in eastern region which is largely untapped. Government focus on increasing the share of gas in the overall energy mix and the development of LNG terminals and pipelines, bode well for demand over the medium to long-term, it added. “But this will have a bearing on the margins of CGD companies,” warns the report, as “higher LNG prices, coupled with upward revision in domestic gas prices, are expected to impact the operating margins.” “Their cost is expected to increase 25-30 per cent this fiscal, impacting their operating margins by 400 bps. But absolute marketing margins are expected to be supported on healthy volume growth,” it said. It can be noted that despite the price spiral, the recently concluded CGD auctions have seen good demand from domestic companies, wherein the Adani group has emerged the biggest winner bagging 11 city licences, followed by Bharat Gas Resources, a unit of Bharat Petroleum, winning licences for six cities; IOC four and Gail Gas three cities. Montae Nicholson Womens Jersey
IOC to invest Rs 1.75 lakh crore for expansion: Chairman Sanjiv Singh
Indian Oil Corp, the nation’s largest oil firm, plans to invest Rs 1.75 lakh crore to nearly double refinery capacity, boost petrochemical production, expand gas business and lay new pipelines to become a vertically integrated company, its Chairman Sanjiv Singh said. It plans to raise capacity to turn crude oil into fuels like petrol and diesel to 150 million tonnes per annum by 2030 from the current 80.7 million tonnes. The company currently owns and operates 11 out of the 23 oil refineries in the country. “As the leading refiner in the country and a dominant player across a diverse portfolio of offerings in energy, IOC is focussing on all emerging opportunities for organic and inorganic growth through vertical integration and strategic diversification, besides pursuing value-creating research areas,” Singh said in the company’s latest annual report. As part of this, projects costing Rs 32,000 crore are in various stages of execution and plans are underway for implementing more projects costing about Rs 1.43 lakh crore, he said. Singh said plans to nearly double refining capacity by 2030 include “greenfield refineries of subsidiary Chennai Petroleum Corp Ltd (CPCL) and the proposed Ratnagiri Refinery & Petrochemicals Ltd (RRPCL), apart from numerous brownfield expansions.” RRPCL is building the world’s largest integrated greenfield refinery-cum-petrochemicals complex with a capacity of 60 million tonnes per annum. The project is being executed in partnership with state-owned BPCL and HPCL along with Saudi Aramco and ADNOC of UAE. “Several pipeline projects with a combined capital expenditure of over Rs 20,000 crore are under implementation. Upon completion, IOC’s pipeline network would expand to about 20,000 km in length,” he said, adding a 69-km pipeline is also being laid to transport petroleum products to Nepal. Currently, its investment cycle includes Rs 16,628 crore in upgrading refineries to produce Euro-VI emission norm compliant petrol and diesel by 2020 as against Euro-IV fuel being produced now. Besides, the company is investing Rs 15,600 crore in expansion of petrochemical projects and another Rs 74,600 crore in raising the capacity of its existing refineries. Another Rs 36,500 crore worth of projects are in pipeline but have not been approved by the company board as yet. These include expansion of its newest refinery at Paradip in Odisha to 18 million tonnes from current 15 million tonnes as also the expansion of Bongaigaon unit. Expansions are planned at the firm’s Panipat refinery in Haryana, Koyali refinery in Gujarat, Barauni refinery in Bihar and Mathura refinery in Uttar Pradesh. IOC is also looking at adding 9 million tonnes capacity to its subsidiary CPCL. On diversification, Singh said IOC has decided to infuse equity in Paradip Plastic Park Ltd, a joint venture with Industrial Development Corporation of Odisha to promote downstream plastics-based units near Paradip Refinery. The company has plans for setting up a Textiles Park in Odisha based on the feedstocks available from Paradip refinery. “Looking at the future, the company is strongly focussed on offering a bouquet of eco-friendly energy options other than liquid fuels to its customers. These would include natural gas, LNG, CNG, PNG, autogas, biogas, hydrogen and electricity,” he said. Singh said IOC’s 5 million tonnes a year LNG import terminal at Kamarajar Port in Ennore in Tamil Nadu would be commissioned by the end of the current year. Also, IOC is booking capacities in other LNG terminals, both on the east and west coasts of India. “IOC is developing three natural gas pipelines — Mallavaram-Bhopal-Bhilwara-Vijaipur, Mehsana-Bhatinda & Bhatinda-Jammu,” he said, adding it is also partnering in the development of a 1,500-km natural gas pipeline grid to connect Guwahati to other major cities of all north-eastern states. He said IOC retails CNG to vehicles and piped cooking gas to households in nine cities and is “aggressively taking part in the various bidding rounds for gas.” Robert Quinn Jersey
India plans to set up LNG terminal in Myanmar
India is planning to set up a liquefied natural gas (LNG) import terminal in Myanmar as it looks to expand energy diplomacy in its neighbourhood, Oil Minister Dharmendra Pradhan said today. The terminal to import super-cooled natural gas will be in addition to the similar facilities planned by Indian firms in Bangladesh and Sri Lanka as part of larger plan of energy connectivity in the South Asian neighbourhood, he said. Pradhan said Numaligarh Refinery Ltd (NRL) in Assam is exploring supply of diesel to Myanmar and is looking at options to build fuel storage and distribution sector in that country. “Indian Oil Corp (IOC) is also working with Myanmar companies in setting up LPG storage facilities and Petronet LNG is working on setting up an LNG terminal there,” he said. He, however, did not give details. “India is working with Bangladesh in interconnecting gas grids and supplying diesel through pipelines,” he said. Currently, Indian firms supply diesel through rail rake from Siliguri in Assam to Parbatipur in Bangladesh and are in the process of constructing a 130-km long product pipeline for uninterrupted supply. “Also, Indian companies are working on connecting India’s gas grid with that of Bangladesh and supply gas for power generation at Khulna Power Plant,” he said. “This will be an exemplary display of regional cooperation.” Bangladesh is setting up an 800-megawatt (MW) power plant in the country’s Khulna region, for which it has signed an agreement with the Asian Development Bank (ADB) for a $500 million funding. Pradhan said Petronet is also looking at building a 7.5 million tonne a year LNG import terminal in Bangladesh to feed that country’s energy needs using imported gas. “In view of providing energy access to the north-eastern part of India, there are plans to import LPG in Bangladesh and transport through road/pipeline to the region while catering to the demand of Bangladesh,” he said. In Sri Lanka, India is jointly developing Trincomalee oil storage tank farm and is also working on setting up an LNG terminal and a 500 MW LNG-fired power plant near Colombo. Also, there is a proposal to develop city gas distribution (CGD) and CNG market and infrastructure in Sri Lanka, he said. IOC Lanka, which is a subsidiary of IOC, has 43.5 per cent of the total fuel market share. “India is working with Sri Lanka on a proposal to set up a solar power plant at Sampur, which would be of 50 MW to begin with,” he said. To Nepal, India presently supplies all of its petroleum product requirements through trucks. A pipeline for supply of petroleum products is under construction, which will ensure uninterrupted supply. “There are also discussions with Nepal on an LPG and Natural gas pipeline,” he said adding Nepal has expressed interest in implementing free cooking gas (LPG) connection scheme for poor women on lines of the Pradhan Mantri Ujjwala Yojna (PMUY) to expand the coverage of LPG. “The Hydrocarbon Vision 2030 for North East India envisages a natural gas pipeline from Numaligarh towards Sittwe (in Myanmar) in different phases. The gas pipeline will open future possibilities of gas exchange and grid connectivity,” he said. India supplies all of petroleum product needs of Bhutan, which too is planning to extend LPG coverage to 100 per cent of the population by sourcing supplies from the refineries in Assam, he said. To Mauritius, India supplies all its energy products. “Our (neighbouring) countries are considering the construction of a bunkering facility along with a jetty,” he said adding Indian firms are working with Vietnam, the UAE and Oman for presence in upstream sector to produce oil and gas. “Regional integration through connectivity across all modes – physical, utilities-based and digital – among our countries in the immediate neighbourhood is one of the top priorities of our government. It is imperative that we, together as a group, address the weak links and overcome challenges,” he said. The BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) region is abundant in energy resources such as hydropower, hydrocarbons, and renewables. “Since the region enjoys high insolation, it is appropriate that we consider the development of a common Solar Grid here,” he said. Also, Bangladesh and Myanmar have large gas reserves which can be explored as alternate sources of gas supply. Similarly, Nepal and Bhutan have immense potential of hydropower, which is untapped due to the absence of a market that can create demand of this magnitude. On the other hand, India and Sri Lanka are net importers of energy like many other developing countries, he said. “The energy demand-supply sectors in Bangladesh, India, Myanmar, SriLanka, Thailand, Nepal and Bhutan offer a potential for regional resource cooperation, which could go beyond export-import trade relations and link the region in a Bay of Bengal Energy Community and thus contribute to the process of regional integration. “The key to developing such a community lies in identifying complementary conditions and the combination of inter related production characteristics among energy supply and demand sectors of these countries,” he said. Pradhan called for reform and restructuring of the energy sector in each of these nations in such a way that the bloc becomes more competitive and efficient. The national energy systems — gas and electricity networks — in the South Asian countries are largely isolated from each other. Currently only India, Bhutan and Nepal trade electricity. In addition, India supplies some amount of power to Bangladesh. Demand for electricity in South Asia and particularly in Bangladesh, Bhutan, India and Nepal is growing rapidly which call for cooperation and trade that should eventually create one of the world’s largest integrated energy market, he added. Jimmy Vesey Jersey
How DBT can improve subsidy payout and remove fake transactions
Over the past year, at least 12 citizens in Jharkhand have reportedly succumbed to hunger caused by a denial of direct benefit transfer (DBT)-linked public distribution system (PDS) rations, social security pensions and Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) payments. The Reserve Bank of India (RBI) has recently cautioned states from shifting to a DBT mechanism for food subsidies. The drive for efficiency in subsidy disbursement is a benign concept. But poorly implemented, it can have fatal consequences. Subsidy, With a Grain of Salt India’s subsidy disbursement system has historically been flawed, leakages in PDS being a key example. Almost 54% of PDS grains were diverted in 2005. Five years later, the figure was 41%. The lowest diversions were in Tamil Nadu (7%) and highest in Bihar (85%) in 2005. DBT is a newly embraced method for disbursing subsidies in a manner that could potentially eliminate spurious transactions, while cutting red tape and increasing efficiency. Coupled with Jan Dhan accounts, it can be an efficient way for providing benefits directly to beneficiaries while leaving a paper trail. As of March 2018, DBT is estimated to have helped save Rs 82,985 crore, while the number of beneficiaries has risen to 118.3 crore, with overRs 12,792 crore of savings coming from bringing the PDS system under its ambit. In addition, the estimated savings under DBT for liquefied petroleum gas (LPG) subsidy have been pegged atRs 38,877 crore. However, for a DBT implementation to succeed, there must be focus on three critical areas: proper identification of beneficiaries, timely transfer of money to beneficiaries, and their ability to access these benefits with relative ease. While Aadhaar, reaching over 89% of India’s population, can solve the identification problem, the transfer of money (about 15% households don’t have a banking account) and access issues pose additional challenges. Mobile penetration could substitute for some banking tasks. But last-mile physical connectivity to financial centres will be needed. There must be due care in choosing which sectors to roll out DBT in. Implementing it for farm sector remains particularly difficult, given a variety of subsidies. Meanwhile, DBT solutions are mostly focused on income support. The tyranny of distance in the hinterland, with the rural bank branches still far and few, along with poor village road infrastructure will make access to this subsidy difficult. The potential for expanding the utilisation of DBT in fertiliser allocation, for instance, holds significant promise. However, the DBT subsidy on fertilisers is currently given to the farmer whose name appears on the land title. Given that land settlements happen infrequently, and most farmers don’t tend to undertake mutations on land titles usually associated with their forefathers, this could lead to significant downstream implementation issues. Farmers who are sharecroppers could lose out. The source of subsidy will also add to complexity in disbursements. Some subsidies are administered by the Centre (e.g., fertilisers), some by state governments (e.g., electricity), while others are covered by both (e.g., seeds). The trifecta of Aadhaar, Jan Dhan and mobile phone connectivity can help the scale-up of DBT quickly when the subsidy is offered in a universal manner, with limited administrative coordination required between the Centre and the states. Gas, That Doesn’t Leak Consider how PAHAL (Pratyaksha Hastaantarit Laabh) has yielded impressive results in reducing LPG subsidies by about Rs 2,000 crore. Similarly, with MNREGA payments in Bihar, DBT has reduced leakages by 14% and disbursals by 38% through real-time individual payments, while reducing payment delays. However, any targeted subsidy schemes that have identification risks and seek to allocate subsidies across a family may not be suitable. Administrative ease also matters. Complex interfaces between institutions along with intermediary inertia can hamper rollouts. While cash transfers for food subsidies have been explored in pilots, surveys have highlighted a number of pertinent issues. Over 20% of those surveyed have claimed to have not received cash in lieu of market-linked prices, while those who received payments were aggrieved by lack of communication on bank transfers and inadequate grievance redressal mechanisms. RBI, in its latest report on state finances, has expressed the need for greater robustness in delivering benefits through cash transfer route. Finally, one must not give up on existing systems. Reforming the PDS, as Chhattisgarh did recently, may be a better way to improve delivery and access. The Chhattisgarh government de-privatised ration shops and increased commission on sales, while it issued fresh ration cards to weed out bogus ones. It broke the rice miller-ration shop nexus by taking control of logistics and procurement, leading to 90% of the domiciled population having food and nutrition security. Similar reforms in Odisha have increased coverage from 6.4% in 1993-94 to 58% in 2011-12, while reducing calorie deficiency by 31.4%, and prevented over 14 million from going hungry. Increasing density of PDS shops, enrolling larger population especially in rural areas, and advancements in supply chain, can further improve PDS delivery. One would hope that in our rush to push DBT, we don’t simply replace the (admittedly tyrannical) discretion of the local land records officer and village council chief with that of the database analyst.Over the past year, at least 12 citizens in Jharkhand have reportedly succumbed to hunger caused by a denial of direct benefit transfer (DBT)-linked public distribution system (PDS) rations, social security pensions and Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) payments. The Reserve Bank of India (RBI) has recently cautioned states from shifting to a DBT mechanism for food subsidies. The drive for efficiency in subsidy disbursement is a benign concept. But poorly implemented, it can have fatal consequences. Subsidy, With a Grain of Salt India’s subsidy disbursement system has historically been flawed, leakages in PDS being a key example. Almost 54% of PDS grains were diverted in 2005. Five years later, the figure was 41%. The lowest diversions were in Tamil Nadu (7%) and highest in Bihar (85%) in 2005. DBT is a newly embraced method for disbursing subsidies in a manner that could potentially eliminate spurious transactions, while cutting
India’s Cairn Drilled Two Oil Wells could collectively generate 2.6 GW Power for 40 years for Sri Lanka
Now Indian billionaire Anil Agarwal controlled Vedanta group owned Cairn India drilled two oil wells that had been identified to holding over several billions of cubic feet of Natural Gas could collectively generate over 2.6 GW (Giga Watt) Power for 40 years for Sri Lanka, reveals the latest annual review of the Ministry of Petroleum Resources Development that was recently released to the Parliament of Sri Lanka. Accordingly the report highlights that the development initiatives taken by the government during the recent past years from 2008 have laid the foundation for oil and gas exploration sector in Sri Lanka. “Sri Lanka has already discovered her own gas depositories in Mannar basin. It has been revealed that the smaller “ Dorado” reservoir has 300 BCF (Billion Cubic Feet) of Natural Gas (NG) that can fire 630 MW (Mega Watt) power plant for about 10 years” the report notes. “The more complex larger “Barracuda” discovery exceeds 1.8 TCF (Trillion Cubic Feet) of NG that can fire 2,000 MW power plant for 30 years” the review notes adding that at present, the actions are being taken to commercialize already discovered oil and gas deposits through International Competitive Bidding. The report also highlights that in addition, oil and gas exploration activities are being carried out through foreign investors on multi-client basis. Natural Gas is being used worldwide at present as a clean source of energy. “It has become an important fuel for Sri Lanka as well both in terms of energy and diversity of use” the report said adding that therefore, there is potential for Natural Gas (NG) to be used in power, industrial, transportation, household and commerce sectors in Sri Lanka as a fuel or a feedstock. The sectorial NG demand is expected to be met by exploitation of indigenous NG resources or imported Liquefied Natural Gas (LNG) which depend on the availability, market conditions and policy. “Currently, the government is keen on using Natural Gas initially for power generation of the country and the interests of other parties such as industrialists, transporters on usage of Natural Gas for their purposes are also being discussed” the report added. The report said that in the above context, the Petroleum Resources Development Secretariat (PRDS) under the guidance of the Ministry of Petroleum Resources Development in collaboration with Ceylon Petroleum Corporation has formulated a Draft National Policy on Natural Gas which is timely. “Currently, the policy is being reviewed by the Ministry, PRDS, CPC and CPSTL and once it is finished, stakeholder consultation workshops will be organized for further development of the said draft policy” the report noted. Cairn India’s 100% owned subsidiary – Cairn Lanka that had a 100% participating interest in the Block M2 of Mannar Basin in Sri Lanka, and the block contains two natural gas and condensate discoveries (Dorado and Barracuda) both of which were discovered by exploration activities carried out by Cairn Lanka in 2011. Earlier reports highlight that the volumetric analysis of these two discoveries has indicated a combined potential reservoir capacity in excess of 2 TCF (Trillion Cubic feet) of natural gas and 10 million BBL (barrels) of condensate. PRDS in their earlier statements had said that the economic analysis of these two discoveries indicates a very competitive gas price and about 11 oil and gas companies including few major exploration companies have already expressed their interest for this block and the Government expects to license this block by early 2018. According to reports during 2008 – 2015 a sum of US $ 26 million has been spent on petroleum exploration activities for local capacity building and procurement of local goods and services by the Operator of block M2 in Mannar (ex-Cairn SL 2007-01-001). Nearly 17 local suppliers transacted US $ 18 million services during this period demonstrating a slow emergence of a new industry. Four local universities had been assisted and guided to establish upstream petroleum related course modules. The M2 block exploration program itself is a US$ 240 million worth of a petroleum data asset, conclusive of two gas discoveries, as per an earlier report of PRDS. Thus far PRDS has made Rs. 700 million data sales and the owner of valuable petroleum data that may lead to massive production sharing contracts in the immediate future. Nolan Cromwell Authentic Jersey
Egypt sets tariff of $0.38 for use of national gas grid
Egypt has set a tariff of $0.38 per million British thermal units (mmBtu) for firms seeking to use its national gas network, the Gas Regulatory Authority said on its website. The tariff, which will be applied nationwide, allows companies to tap into the national gas grid and use it for private imports. The price is set for one year, the regulator said. Egypt in February issued long-awaited executive regulations to allow the private sector to import natural gas directly, hoping to attract greater private sector participation in the country’s rapidly expanding gas sector. It aims to be a regional hub for the trade of liquefied natural gas (LNG) after a string of major discoveries which are expected to make Egypt self-sufficient in gas by the end of 2018. Ryan Fitzpatrick Womens Jersey
Bangladesh sees stalled floating LNG terminal starting operations in days
A vessel that arrived in Bangladesh in April to offload its maiden cargo of liquefied natural gas and moor permanently as an import terminal should begin operations “within a week” after bad weather hampered its start-up, an official said on Thursday. The floating storage and regasification unit (FSRU) will allow Bangladesh to import LNG for the first time as its domestic gas production falls and will boost several power projects in a nation where 30 per cent go without electricity. Since its arrival at Moheshkhali, near Cox’s Bazar in southeast Bangladesh, bad weather has hampered the FSRU’s efforts to dock properly, connect to the import infrastructure and offload its first cargo of Qatari LNG, officials have said. “The delay was basically the rough sea. It (the project) will succeed very soon … hopefully within a week,” a director at state-run energy firm Petrobangla’s LNG division said. The Excellence FSRU is operated by privately owned U.S. company Excelerate, which launched the first FSRU in the world in 2005 and still dominates the industry alongside Golar LNG, Hoegh and BW Group’s LNG arm. Two senior Petrobangla officials said the state-run firm would contest Excelerate’s declaration of force majeure on the project due to the weather-related delays. Declaring force majeure absolves a company from responsibility for delays to fulfilling contracts due to circumstances beyond its control. “They have claimed force majeure for bad weather but we haven’t accepted it,” one of the officials said. “Petrobangla doesn’t have any obligation to pay any money before the gas flow starts. Excelerate will pay demurrage as per contract.” That official said technical experts from International Finance Corp, an arm of the World Bank which lent to the $180 million project, were on site monitoring progress. The country of 165 million people relies on its gas resources for 70 per cent of its energy production but as demand has risen its falling supply has struggled to keep up, prompting it to consider a host of LNG projects. Aside from the Moheshkhali project, several others are being considered, usually combining LNG imports with onshore power plants that would use the regasified fuel as feedstock or with fertiliser complexes that are heavily gas-reliant. Most recently, two projects costing a combined $5.8 billion were announced involving US firm General Electric. Energy trading houses Gunvor, Vitol and Trafigura have also chased projects in Bangladesh. Bangladesh is seen as an ideal LNG importer because it has the legacy of using gas and therefore much of the onshore infrastructure already, unlike some other countries that have struggled to get LNG projects off the ground. Nasrul Hamid, state minister for power, energy and mineral resources, said the Moheshkhali project would help Bangladesh import 81 million cubic metres of gas a day by 2025. “We have a robust internal gas supply system, which has historically transmitted our local gas. This grid will carry the LNG internally. This is an advantage for us,” he said. Jordan Wilkins Womens Jersey
UK GAS-Prices rise ahead of Forties pipeline outage
Prompt British wholesale gas prices rose on Thursday as domestic production ramped down in anticipation of a planned outage at the Forties pipeline on Friday, leaving the system slightly undersupplied. Day-ahead gas up 0.50 pence at 58.25 p/therm at 0830 GMT Within-day contract up 0.73 pence at 58.53 p/therm British offshore gas production is seen at 68 million cubic metres (mcm) on Thursday but is expected to drop to 46 mcm on Friday, when the Forties oil and gas pipeline system is due to shut down for maintenance. Additionally, Shell said a planned outage at its SEAL pipeline system from the Elgin and Franklin fields had been moved forward to start on Thursday rather than Friday. Maintenance at the SEAL pipeline system is due to end on Aug. 7 According to National Grid data, demand is expected at 156.2 mcm and flows at 154.0 mcm Exports to continental Europe through the InterconnectorUK are seen lower at 34 mcm and there may be withdrawals from storage on Friday in reaction to the Forties shutdown, Thomson Reuters analysts said in a daily note. Wind generation is expected to halve on Friday, which could raise gas-for-power demand Wind generation is expected to peak at 5.4 gigawatts (GW) on Thursday and drop to 2.0 GW on Friday, according to Exelon data. The Boris Vilkitsky liquefied natural gas tanker is expected to arrive at Isle of Grain on Friday but there is enough storage space at the import terminal for sendout to remain flat. Further along the curve, the September contract fell 0.2 pence to 57.60 p/therm Winter 2018 contract edged higher by 0.25 pence to 63.45 p/therm Day-ahead gas price at the Dutch TTF hub down 0.15 euro at 21.98 euros per megawatt-hour Benchmark Dec-18 EU carbon contract slipped by 0.13 euro to 17.65 euros per tonne Breno Giacomini Womens Jersey