Reliance unit signs binding deal with Brookfield for Rs 252.15 billion investment
Reliance Industrial Investments and Holdings Ltd (RIIHL), a wholly-owned subsidiary of Reliance Industries Ltd, has signed binding agreements with Canadian asset manager Brookfield Infrastructure Partners for an investment of Rs 252.15 billion. The companies had announced the deal earlier on July 19, 2019. Brookfield and its institutional partners will invest in the units to be issued by Tower Infrastructure Trust. After the closure of the deal, the trust will own the entire equity capital of Reliance Jio Infratel Pvt Ltd (RJIPL), RIL said in a regulatory filing. “We are pleased to enter into this long and strategic relationship with Brookfield, which is one of the largest and most respected managers of infrastructure assets globally. We are confident of Brookfield’s abilities to manage this large portfolio of high-quality infrastructure assets and further enhancing value creation opportunities,” RIL Chairman and Managing Director Mukesh D Ambani said. “This transaction demonstrates the belief of global investors in the potential of India’s digital opportunity,” he added. RJIPL has a portfolio of about 1,30,000 communication towers that forms the infrastructure backbone of Reliance Jio Infocomm’s (RJio) telecommunication network. It plans to increase the total number of towers to about 1,75,000. RJio is an anchor tenant of the tower portfolio under a 30-year Master Services Agreement. The deal is subject to regulatory approvals, which are expected shortly, RIL said. In July, Brookfield agreed to invest Rs 252.15 billion to take control of Mukesh Ambani-led RJio’s tower infrastructure, making it the largest foreign investment in the Indian infrastructure space. RJio’s tower assets were transferred to a special purpose vehicle — Reliance Jio Infratel Pvt Ltd (RJIPL).
BP encounters gas in drilling offshore Mauritania, Senegal
BP on Monday said a three-well drilling program offshore Mauritania and Senegal encountered gas in “high quality”, bolstering its confidence in gas resources in the region. The oil and gas major said the three appraisal wells drilled this year, GTA-1, Yakaar-2 and Orca-1, encountered 160 meters of net pay, a measure of a reservoir’s thickness. In November, the Orca-1 well offshore Mauritania, partly owned with Kosmos Energy and Societe Mauritanienne Des Hydrocarbures et de Patrimoine Minier, was further deepened and encountered more gas. “We have identified a large prospective area with considerable resource potential in Southern Mauritania. We will now conduct further appraisal drilling to help inform future development decisions,” said Howard Leach, BP’s head of exploration.
Reliance Industries topples IOC to become India’s largest company
Boosted by its consumer-facing businesses like organised retail and telecom, Reliance Industries ended state-owned Indian Oil Corporation’s (IOC) 10-year reign as India’s largest company, topping the Fortune India 500 list. With a revenue of Rs 5.81 lakh crore in 2018-19, the Mukesh Ambani-led conglomerate also became the first privately-held and the only other company to become India’s largest corporation apart from IOC for the first time in 10 years, Fortune India said. State-owned Oil and Natural Gas Corporation (ONGC) was ranked third, same as in 2018. It was followed by State Bank of India, Tata Motors and Bharat Petroleum Corporation Ltd (BPCL) — all with no changes in their ranking between 2018 and 2019. The list does not take into account subsidiaries of companies and so ONGC’s ranking does not reflect those from its recently acquired Hindustan Petroleum Corp Ltd (HPCL) as well as ONGC Videsh Ltd. Rajesh Exports climbed one position to be ranked 7th on the 2019 list and so did Tata Steel, Coal India, Tata Consultancy Services and Larsen & Toubro that were ranked 8th, 9th, 10th and 11th, respectively. ICICI Bank rose two positions to be ranked 12th, followed by Hindalco Industries and HDFC Bank. Vedanta Ltd slipped three positions to be ranked 18th on the 2019 list. Fortune India said RIL posted a 41.5 per cent rise in its revenue in the financial year 2018-19, which was 8.4 per cent more than IOC, the second-largest company on the list. RIL’s 2018-19 revenue stood at Rs 5.81 lakh crore, while IOC posted a growth of 26.6 per cent in sales to Rs 5.36 lakh crore in the same year. RIL’s profit for 2018-19 was also more than double that of IOC, at Rs 39,588 crore. “Over the past 10 years, the oil-to-retail conglomerate’s profit has been an average three times higher than that of IOC. The highest it touched compared to IOC was up to 4.8 times, in FY15 when RIL’s profit was Rs 23,566 crore and the public sector major’s stood at Rs 4,912 crore,” it said. Overall, the revenue of the Fortune India 500 companies in the 2019 list grew 9.53 per cent, while profit rose 11.8 per cent. A total of 57 companies dropped off the list for reasons including consolidation within the public sector banks, public sector undertakings, as well as the private sector. This year, the total loss posted by the 500 companies also came down, with 65 companies posting a cumulative loss of Rs 1.67 lakh crore, compared to last year’s Rs 2 lakh crore racked up by 79 companies, Fortune India said. Public and private sector banks faced diverse fortunes in 2019. As many as 14 of 22 public sector banks reported cumulative losses of Rs 74,253 crore. In contrast, just two private sector banks posted losses (IDFC First Bank, at Rs 1,907.9 crore; and Lakshmi Vilas Bank, at Rs 894.1 crore). The total profit of 24 of private sector banks (including foreign banks and cooperative banks) was Rs 60,747 crore, a 6.16 per cent increase over 2017-18. Fortune India said the oil and gas sector (with eight companies) accounted for 22.3 per cent of the total revenue of the 500 companies, followed by banking with 15.88 per cent of the total. The banking sector, with 48 companies, is also the biggest contributor by way of the number of companies on the list. Oil and gas, however, has the highest share of profit in the 500, at 23.44 per cent.
Vedanta interested in BPCL, evaluation on: Anil Agarwal
Vedanta Resources Ltd is evaluating an investment in Bharat Petroleum Corporation which has been put on the block by the government as part of its privatisation drive. “We are looking (at BPCL). Evaluation is going on,” Anil Agarwal, chairman of Vedanta Resources, said while speaking to ET Now at the Times Network India Economic Conclave 2019 here on Monday. “One by one privatising these companies will take 10 years. It is better to (do it in) one-shot. The government has no business to be in business,” Agarwal said. Vouching for the privatisation of public sector companies, he said that the public companies acquired by his group have fared better under private ownership. “I have acquired four government companies. All four have become three times more (in terms of) production and have shown tremendous capability,” said Agarwal. Drawing attention to the difference that private ownerships can make, he said these companies are still being run by the public sector employees. Agarwal’s Vedanta Resources has acquired Bharat Aluminium Company (Balco), Hindustan Zinc (HZL), and Sesa Goa, among other companies over the years. The “Babu-raj” (bureaucrat-raj) should end, Agarwal said. “The job of bureaucrats is to make policies and not execute them. They shouldn’t be deciding where a plane (Air India) goes to or how aluminium or oil is extracted,” Agarwal said. And now is the time that the government can change these policies, given its strong mandate, he said. “This government has the ability to take strong decisions. If we can’t advance now, we will never advance,” said Agarwal. India has some of the best natural resources reserves and yet the country spends about $500 billion to import resources, he said. Importing natural resources results in loss of not just foreign exchange reserves but also a loss of jobs. If we can make all our natural resources companies private, we could curb these imports, said Agarwal, adding that even if the government’s shareholding goes down to 50%, the management and the chief executive will become independent and the markets will appreciate that.
Work at oil & gas fields hit, fuel crisis looms
The north-east could be staring at a fuel crisis as the public agitation against changes in the Citizenship Act and curfew in 10 districts of Assam has affected functioning of oil and gas fields, refineries as well as transportation of petro products. Operations at these facilities had to be halted or curtailed either because employees were unable to report for work or the output could not be wheeled out due to disruption in movement of truck-tankers, the main mode of transportation, oil company executives said. Executives from IndianOil claimed there was no disruption in supply of LPG refills to households and there were adequate stocks with distributors. Petrol pumps too were well stocked. Crude production from fields operated by Oil India Ltd has fallen by 20% and the company had to stop LPG production in the absence of offtake by IndianOil.
CAB protests: Oil India appeals to people in Assam to allow day-to-day operations
Protesters opposing the Citizenship Amendment Act, a new law that grants Indian citizenship based on religion and excludes Muslims, throw stones at police at Santragachi in Howrah district of West Bengal state, India, Saturday, Dec.14, 2019.Photo)GUWAHATI: Amid fervent protests in Assam over the Citizenship Amendment Act, PSU major Oil India Limited (OIL) issued an appeal to the people of the state on Saturday to allow it to carry out day-to-day operations, which the firm said has been “severely impacted”. The appeal issued in leading English daily of the state, the Assam Tribune, cautioned that the “total disruption of OIL’s operational activities will adversely impact the economy of the State and the lives of the common people”. Besides loss of production of crude oil and natural gas, the stoppage of OIL’s operations has badly hit production of LPG and supply of crude oil to refineries and consumers of natural gas like BVFCL, BCPL, NEEPCO, AGCL and APL among others, it said. Assam has been facing a shortage of fuel supply due to the ongoing protests which have also affected the daily lives of people in Guwahati and several other districts of the state. On Friday, long queues were seen at the petrol pumps that were functioning, while others remained shut. “I saw many petrol pumps that were operating today did not have enough fuel to sell. I purchased 1L for my bike, while many others had queued up with bottles to buy fuel,” said Tutu Ali, a resident of Hatigaon area here. The situation may worsen if the fuel stock is not replenished. “The ongoing agitation in the state has severely impacted day-to-day operations of Oil India Limited,” the crude oil major said. “This will have an adverse impact on the power situation in the state as well as lead to shortage of essential items like LPG, which will impact the common people the most,” it added. “In the greater interest of the people of the state and the local economy, Oil India Limited makes an ardent appeal to the people of Assam to allow OIL to carry on with the day-to-day operations so that the company can ensure uninterrupted supply of crude oil, LPG and natural gas to the various industries based in Assam,” the appeal said. This is also to ensure that these industries in turn help the common people to have uninterrupted supply of essential amenities like LPG, electricity, petrol, diesel, kerosene and fertilisers, it added. The OIL, in its appeal, also said that it appreciates the present situation and the sentiments of the people. The curfew, imposed in Guwahati and Dibrugarh town amid violent protests against the amended Citizenship Act, was relaxed on Saturday for a few hours, officials said. The curfew was relaxed in Guwahati from 9 am to 4 pm and in Dibrugarh from 8 am to 2 pm, they said. Assam and other north-eastern states might face fuel supply issues if the agitation against the Citizenship Amendment Act continues for another week, as it has already led to shutdown of refineries, petrochemical plant and oil-producing facilities in the region. Indian Oil Corp (IOC) has been forced to shut down its Digboi refinery in Assam and is operating its Guwahati unit at minimal throughput, while OIL has been forced to shut LPG production and its crude oil production has dropped by 15-20 per cent, multiple sources at the state-owned companies said. Oil and Natural Gas Corp (ONGC) has seen up to 25 per cent drop in production, and gas supplies to Brahmaputra Cracker and Polymer Ltd were snapped, leading to shutting down of Assam gas cracker project.
Iran loses market share in India as its oil exports slump in November
Iran loses market share in India as its oil exports slump in November India’s oil imports from Iran dropped to a one-year-low in November, plunging by 41 percent from October due to the US sanctions, Reuters reported on Thursday, citing industry sources and ship-tracking data. Iran also dropped to sixth place on India’s largest oil suppliers list, from fourth in October, losing market share to fellow OPEC members Saudi Arabia, Iraq, the United Arab Emirates (UAE). In November, the month on which the US sanctions snapped back, India’s oil imports from Iran averaged 276,000 bpd (barrels per day), a 41-percent plunge from October, as India had cut back significantly allocations for November amid uncertainties over who might be getting a US waiver to continue importing oil from Iran. India did get a waiver, alongside seven other Iranian oil customers, including the single biggest, China. The waivers allow those eight countries to continue Iranian oil imports at reduced volumes until early May next year. India’s allowed imports from Iran are about 300,000 bpd. In November, Iran was only sixth among India’s top oil suppliers. Iraq and Saudi Arabia held the first two spots, while the UAE—sixth in October—moved up to third place, ousting Venezuela to fourth. Nigeria held onto its fifth position, but Iran moved from fourth in October to sixth in November, according to industry and ship-tracking data obtained by Reuters. India’s oil imports from Iran before the US sanctions returned were higher than last year’s low base for comparison, when India had cut back Iranian oil purchases over a dispute with Tehran that had snubbed Indian companies in developing a gas field in Iran. In April to November this year, India’s oil imports from Iran averaged 563,000 bpd, up by 32 percent compared to the same period last year, according to the data from industry sources reviewed by Reuters. In its imports of Iranian oil going forward, until the waivers last, India will have to rely on Iranian ships for the oil transportation because its own shipping firms and international companies are not risking crossing the US by carrying Iranian oil, and wound down Iranian crude shipment operations well in advance of the sanctions.
Centre to spend Rs 700 bn to spread gas pipelines across country: Pradhan
The Centre will initially spend Rs 700 billion to spread gas pipelines across the country, and is working out plans to expand gas network to Myanmar through Bangladesh, Union Minister said on Wednesday. The central government is promoting gas-based economy which needs a massive network of pipelines for transportation of natural gas to various corners of the country, he said. “In the first phase Rs 700 billion will be invested to spread across the country,” the petroleum minister said while addressing the 19th National Conference on Corrosion Control organised here. Pradhan said India is also planning to expand to Myanmar through Bangladesh. “Under this programme, pipelines are proposed to be constructed between Dhamra to Bangladesh and Siliguri to Bangladesh to export according to the requirement of the neighbouring nation,” he said. Turning to Odisha, Pradhan said the state needs a huge infrastructure to store, refine and transport the natural gas to the doorstep of the industry from Paradip, Dhamra and Gopalpur. He said the Centre is contemplating to promote port based industries in Odisha and also in other coastal states having natural ports. The eastern part of India, including Odisha, needs a high double-digit growth rate to be on a par with the Western region. In Odisha, around Rs 45 billion would be pumped in to construct 1700 kms of pipeline network in first phase. A strategic oil reserve project will also be launched in Chandikhol after acquiring land there, said Pradhan. The petroleum minister also announced that commercial production of polypropylene from Paradip refinery would commence this month (SERPL) is presently operating cross-country pipelines network of and refined products as well as LPG of 1570 kms length with 19.35 MMTPA capacity, he said. Under this region, India Oil is having the biggest and largest handling facility at Paradip, which is feeding four most important refineries – Paradip, Haladia, Barauni, and Bangaigaon. As future expansion plans under SERPL, laying works of 1212 km Paradip-Hyderabad pipeline with capacity of 4.5 MMTPA is in progress. Moreover, preconstruction works for 360 km long Paradip-Dhamra-Haladia LNG pipeline and 345 km long Paradip-Somanathpur-Haladia pipeline are also under progress, said the Petroleum Minister. Pradhan asked participating delegates, scientists and engineers to chalk out a roadmap for creation of better and advanced infrastructure for energy storage, refining and transportation with utilisation of corrosion free metals. The meet aims at analysing various industrial corrosion problems and provide a platform for interaction among industrialists, scientists, engineers and professionals. The three-day conference is being organised jointly by National Corrosion Council of India, Karaikudi, SERPL, Central Electrochemical Research Institute and (IOCL).
RIL plans to develop chemical facility in Ruwais with Adnoc
In what may further bolster India’s robust ties with West Asian energy producers, Mukesh Ambani-promoted Reliance Industries Ltd (RIL), plans to develop a Ethylene Dichloride facility in Ruwais with Abu Dhabi National Oil Co (Adnoc), the state-run oil company of the United Arab Emirates (UAE), the companies said in a joint statement on Tuesday. Ethylene Dichloride is a basic building-block for manufacture of Polyvinyl chloride (PVC), which is used in the housing and agriculture sectors. “Under the terms of the agreement, ADNOC and RIL will evaluate the potential creation of a facility that manufactures EDC adjacent to ADNOC’s integrated refining and petrochemical site in Ruwais, Abu Dhabi and strengthen the companies’ existing relationship supporting future collaboration in petrochemicals,” the statement said. This comes in the backdrop of India’s evolving energy security architecture, with the UAE supplying 6% of India’s crude oil imports. With three million barrels per day of crude oil production, Adnoc is the world’s 12th-largest producer. The UAE is a member of the Organization of Petroleum Exporting Countries (Opec), which accounts for around 83% of India’s total crude oil imports and 40% of global production. “ADNOC would supply ethylene to the potential joint venture and provide access to world-class infrastructure at Ruwais, while RIL will deliver operational expertise and entry to the large and growing Indian vinyls market, in which it is a key participant,” the statement added. Adnoc is also looking to expand its presence in India by investing in refining and petrochemical projects and stocking more crude oil in India, the world’s third-largest energy consumer. It is the only foreign energy company, so far, to partner in India’s strategic petroleum reserves programme. It is also a stakeholder in one of India’s largest refinery and petrochemicals projects, that now hangs in uncertainty after the new ruling alliance came to power. The 60 million tonnes per annum (mtpa) refinery is a joint venture between Saudi Aramco, Abu Dhabi National Oil Co. (Adnoc), and three state-run oil marketers— Indian Oil Corp. Ltd, Hindustan Petroleum Corp. Ltd and Bharat Petroleum Corp. Ltd. “This is a significant step towards Reliance’s commitment to pursue backward integration and will pave the way for enhancing PVC capacity in India to cater to the fast growing domestic market. This co-operation ideally combines advantaged feedstock and energy from the UAE with Reliance’s execution capabilities and the growing Indian market,” Nikhil R. Meswani, RIL executive director said in the statement. RIL is also in the process of selling a 20% stake in the company’s flagship chemicals and refining business to Saudi Aramco in a deal valued at $15 billion, as the Indian company seeks to cut its massive debt and secure an assured supply of crude oil to its refineries. RIL has developed a strategy to transform the Jamnagar refinery from a producer of fuels to chemicals, moving up the value chain.
Total length of LPG Pipeline network in India is 8,296 km: Natural Gas Minister Pradhan
The Union Minister for Petroleum and Natural Gas, Dharmendra Pradhan, stated in Parliament today that establishment of LPG Pipeline infrastructure is taken up by the Public Sector Oil Marketing Companies (OMCs) based on techno-commercial feasibility studies. LPG Pipelines are laid from refineries to LPG bottling plants. Petroleum and Natural Gas Regulatory Board (PNGRB) established under the PNGRB Act, 2006, in the year 2007, is the authority to grant authorization for laying of LPG pipelines. Entities that propose to lay, build, operate or expand a pipeline apply to the Board for obtaining authorisation under the Act. The total length of LPG Pipeline network in the country is 8,296 km comprising of the following pipelines: 1. Panipat-Jalandhar LPG Pipeline (Length: 280 Km) 2. Paradip-Haldia-Durgapur LPG pipeline (Length: 673 Km); (extension of pipeline to Patna and Muzaffarpur results in total length of 918 Km) 3. Ennore-Trichy-Madurai LPG pipeline (Length: 615 Km) 4. Kandla-Gorkhpur LPG pipeline (Length: 2757 Km) 5. Jamnagar-Loni LPG pipeline (Length: 1414 Km) 6. Vizag-Secunderabad LPG pipeline (Length: 621 Km) 7. Mangalore-Hassan-Mysuru-Yediyuru LPG pipeline (Length: 356 Km) 8. Uran-Chakan/Shikrapur LPG pipeline (Length: 168 Km) 9. Hassan-Cherlapally LPG pipeline (Length: 680 Km) 10. Mumbai-Uran LPG pipeline (Length: 29 Km) 11. Kochi-Coimbatore-Salem LPG pipeline (Length: 458 Km) Three OMCs namely, Indian Oil Corporation Limited, Hindustan Petroleum Corporation Limited and Bharat Petroleum Corporation Limited have formed a consortium for submitting the bid to PNGRB for authorization for Kandla-Gorakhpur LPG Pipeline. PNGRB has granted authorization to the consortium for implementing and operating Kandla-Gorakhpur LPG Pipeline. This information was given by the Union Minister for Petroleum and Natural Gas Dharmendra Pradhan in a written reply in the Rajya Sabha .