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.
World’s largest floating LNG platform starts production in Australia
Royal Dutch Shell said on Wednesday it has begun output at its Prelude floating liquefied natural gas (FLNG) facility in Australia, the world’s largest floating production structure and the last of a wave of eight LNG projects built in the country over the last decade. Though the project started up later and cost more than originally estimated, it is expected to further cement Australia’s lead as the world’s biggest LNG exporter, after the country took the crown in November. In a statement, Shell said wells have now been opened at the Prelude facility, located 475 kilometers north-northeast of Broome in Western Australia. This means Prelude has now entered start-up and ramp-up, the initial phase of production where gas and condensate – which is an ultra-light form of crude oil – is produced and moved through the facility. Prelude is expected to have an annual LNG production capacity of 3.6 million tonnes, 1.3 million tonnes a year of condensate and 400,000 tonnes a year of liquefied petroleum gas (LPG). Shell did not immediately respond to a Reuters query on when first LNG will be exported from the facility, but analysts estimate exports to start by early next year, with condensates likely to start first. “First LNG cargo is still several weeks assuming all proceeds as planned, but the timing of first cargo and pace of ramp-up is still subject to technical risk,” said Saul Kavonic, energy analyst at Credit Suisse in Sydney. “Given Prelude’s novelty, geographic conditions and challenges, it may be subject to greater risk to timeline from wellhead production to first cargo than an average LNG project,” he said. “We expect Shell to seek to get it done right, rather than rush things.” Shell owns 67.5 percent of the project, while Japan’s Inpex Corp, Taiwan’s CPC Corp and Korea Gas Corp hold the rest of the shares. Australia overtook Qatar as the world’s largest exporter of LNG for the first time in November, after the start-up of a number of export projects over the past three years, most recently the Ichthys facility. The start-up of Prelude, following the ramp-up in production at Ichthys and Russia’s Yamal LNG is expected to put pressure on the Asian market next year, said Kittithat Promthaveepong, a senior analyst at FGE.
Private buyers of Iran crude had no problems exporting it: Oil minister
Private buyers of Iranian crude have had “no problems” exporting it, Iran’s oil minister was quoted as saying on Wednesday by state news agency IRNA, despite US sanctions targeting Iran’s oil exports. Iran began selling crude oil to private companies for export in late October, just ahead of US sanctions on sectors including oil which came into effect on November 5. “Those who bought oil on the bourse have been able to export and there have been no problems in this regard,” IRNA quoted Oil Minister Bijan Zanganeh as saying.
Petroleum price spike and crash: The crisis that wasn’t
Low oil prices were the biggest economic windfall for the Narendra Modi led NDA government when it assumed office in May, 2014. The average price of India’s crude oil basket (COB) fell from $106/barrel to $46/barrel between 2013-14 and 2015-16. This allowed the government to reap fiscal gains without having to worry about inflation. An analysis by TaditKundu published in Mint showed that almost the entire reduction in fiscal deficit in the first half of the present government’s tenure was due to the fiscal gains from petroleum taxes. This scenario changed drastically in the middle of this year. An interest rate hike by the US Federal Reserve, an economic recovery in advanced countries, and the US re-imposing trade sanctions on Iran led to a spike in crude oil prices. This also triggered a fall in the rupee’s value vis-à-vis the dollar. Between January and October this year, the price of petrol increased 20% reaching an all time high of Rs 84/litre in Delhi, triggering speculation of it even reaching triple figures. Politically, the timing could not have been worse for the Bharatiya Janata Party (BJP), as the spike came just before the crucial election cycle in the Hindi belt states. Under pressure to reduce petroleum prices, the Union government announced a cut in excise duties on petrol and diesel. This triggered speculation of a slippage on the fiscal front, and had crude prices continued to rise, that would have been a certainty. However, a moderation in oil prices diffused a major crisis. India’s COB price fell from $80/barrel in October 2018 to $65/barrel in November 2018. Petrol prices in Delhi on 24 December were the lowest this year at Rs 69.86. To be sure, the rupee-dollar exchange rate is still worse than what it was in the beginning of the year. However, given the low oil prices, its favourable impact (in terms of making exports competitive) will probably outweigh the inflationary effects (via petroleum imports) for now.