India stages roadshow in UK to attract investors for oil, gas sector
India has reached out to UK-based investors to attract international public-private-partnerships (PPP) in the country’s oil and gas sector with a roadshow in London. The Ministry of Petroleum and Natural Gas, along with the Directorate General of Hydrocarbon (DGH), held an interactive session on Monday which attracted around 125 participants. The session was aimed at sharing the new policy and regulatory regime in India and details of investment opportunities in the field of oil and natural gas exploration and production (E&P). “India is a bright spot in the world economic order, where demand for petroleum products is on the rise. The primary energy demand of the country will almost double in the next 12 years. This roadshow is a call to involve international partners in this journey,” said HPS Ahuja, CEO and Managing Director of Indian Strategic Petroleum Reserves Limited (ISPR). Earlier this year, Petroleum and Natural Gas Minister Dharmendra Pradhan had launched Bid Round-II under Discovered Small Field Policy (DSF) and Open Acreage Licensing Policy (OALP) for competitive bidding. Under OALP Bid Round II, 14 blocks will be offered with a total area of 29,233 sq km and under DSF Bid Round II, 25 contract areas are on offer covering 59 discovered oil and gas fields, spread over 3,000 sq km, the ministry said. The DSF-II and OALP-II Bid Rounds are aligned to India’s Hydrocarbon Exploration and Licensing Policy (HELP), which adopts the Revenue Sharing Model in an effort to improve ease of doing business in India’s E&P sector. “It comes with attractive fiscal terms like reduced royalty rates and no cess, single license for all hydrocarbons, pricing and marketing freedom, freedom to exploration throughout contract period, no signature bonus and provision for sharing of common facilities,” the ministry said in a statement. Manish Singh, Minister (Economic) at the High Commission of India in London, inaugurated the Investment Promotional Event for Exploration and Production Opportunities in London, which was chaired by VP Joy, Director General, DGH. Besides a presentation for UK investors on the various opportunities in store, an overview of the Indian taxation regime was provided by KPMG – as knowledge partners. Under Phase I SPR, ISPRL said it has successfully created 5.33 MMT of crude oil inventory storage installations in underground mined rock caverns at three locations namely Visakhapatnam (1.33 MMT), Mangalore (1.5 MMT) and Padur (2.5 MMT). In line with the integrated energy policy of the Indian government, which calls for 90 days’ reserves, the Union Cabinet accorded “in principle” approval for Phase-II SPR programme, which involves the creation of additional 6.5 MMT of storage inventory entailing underground mined rock cavern storages and associated facilities at Chandikhol, Odisha (4.0 MMT) and Padur-II, Karnataka (2.5. MMT). “In order to explore feasibility of commercialisation of the Phase I SPR at Padur (2.5 MMT) and the planned Phase II SPRs at Chandikhol, Odisha (4.0 MMT) and Padur II, Karnataka (2.5 MMT), it is planned to solicit investment partners and pursue the initiatives of Phase II SPRs through PPP mode of implementation for construction, filling, and operation respectively and also filling and operation of the existing Phase I SPR at Padur,” ISPR said in a statement. It added: “Since India has the second-largest refining capacity in Asia and fourth-largest in the world, these storage inventories would offer a unique opportunity for various stakeholders and investors including construction companies, financing institutions, trading firms, developers, oil & gas companies etc to explore the possibility of participating in the process. “Given the vantage coastline of India, the storage locations fall on the transhipment routes of crude oil from the Middle East source countries to the Far East consuming nations.” Based on the response of investors around the world, a suitable PPP model will be prepared for international competitive bidding by an individual organisation or through joint venture partners.
Centre contemplating bringing petrol, diesel under GST: Athawale
The Narendra Modi government is contemplating to bring petrol and diesel under the ambit of Goods and Services Tax (GST), Union Minister Ramdas Athawale said here. “We have done so much work, but there is some problem pertaining to petrol and diesel prices. The issue persists even though the prices have fallen a bit. But the Centre is contemplating to bring petrol and diesel under the ambit of GST,” the Union Minister of State for Social Justice and Empowerment said at a news conference here. “If petrol and diesel are brought under GST, it will help bring down their prices by Rs 20-30, which will provide relief to people of this country including the middle class and common masses,” he added. Athawale said the states should also cut the taxes on petrol and diesel to provide some relief to people. In the past, the opposition parties have demanded that petroleum products be brought under GST. Asked about the Congress pointing fingers at the Modi government over the Rafale jet deal, Athawale said, “There is no corruption involved. The Congress and Rahul Gandhi are spreading lies.” Athawale also defended the Centre’s decision to send CBI Director Alok Kumar Verma and his deputy, Special Director Rakesh Asthana on leave. “Under such circumstances, how could the government have kept such officers in office. Had the government not sent them on leave, then the Congress would have said why no action was taken. When we took action then they are speaking otherwise. The Congress is looking to hold a protest on every issue,” he said. On Friday, the Congress, led by its president Rahul Gandhi, staged protests outside CBI offices across the country against the Centre’s decision. Speaking about the next year’s general election, the Republican Party of India (RPI-A) leader claimed the NDA will win over 400 seats in the Lok Sabha elections, while the Congress will not bag more than 70. “The BJP will increase its tally to 300-plus seats in the Lok Sabha and overall the NDA will get over 400 seats,” he claimed. “We will go to people on the basis of the work the NDA government has done. Rahul Gandhi is practising a lot for the 2019 match, but the Congress cannot score beyond 60-70 runs, I mean they cannot get more than these many seats,” he said. The Union minister said the BJP will win comfortably in Madhya Pradesh and Chhattisgarh. The two states go to polls next month. In Rajasthan, where polling will be held on December 7, he said though there is a tough fight, the NDA will win. Athawale reiterated his demand for raising the reservation for the economically weak sections of all castes to 75 per cent from the existing around 50 per cent, with an additional 25 per cent quota in government jobs and colleges. He said he has always demanded reservation for economically backward classes from all castes, be it Jats in Haryana, Patels in Gujarat, Marathas in Maharashtra or Brahmins. “The reservation given to SCs, STs and OBCs should remain intact, but there are many other castes who are also demanding reservation..25 per cent reservation should be for these castes,” he said. He added his party wants the government to bring a bill in this regard in Parliament. Athawale claimed granting reservation to others will also help bring down the atrocities against Dalits. “One of the reasons for atrocities against Dalits is that they are getting the benefit of reservation, while the others are feeling left out,” he said.
Energy firm BP profits soar to five-year high
BP reported on Tuesday that profits had more than doubled in the third quarter, boosted by stronger oil prices that hit a four-year high in the period and as production rose thanks to new fields. BP reported third-quarter underlying replacement cost profit, the company’s definition of net income, of $3.8 billion, far exceeding forecasts of $2.85 billion based on a company-provided survey of analysts. That compared with a profit of $1.86 billion a year earlier and $2.8 billion in the second quarter of 2018. “Operations are running well across BP and we’re bringing new, higher-margin barrels into production faster through efficient project execution,” Chief Executive Officer Bob Dudley said in a statement.
BPCL to shut crude unit at Kochi refinery for 3 weeks from December 1
India’s state-run Bharat Petroleum Corp will shut a 120,000 barrels per day (bpd) crude unit and some secondary units at its Kochi refinery for about three weeks from early December for maintenance, its head of refineries said. “It (this shutdown) is mandatory to inspect the new plant after you run it for a year. We will open up some of the critical equipment to see if things are intact,” R. Ramachandran told Reuters on Tuesday. BPCL last year raised the capacity of the Kochi refinery in southern India by about 63 per cent to 310,000 bpd. As part of the expansion BPCL installed a new crude unit and secondary units including a delayed coker, fluid catalytic cracker, vacuum gasoil hydro-treater, diesel hydro-treater, sulfur Recovery Unit, and hydrogen generation unit (HGU). Ramachandran said the three-week shutdown will begin around December 1.
Indonesia does not need to import gas until 2027 at current demand growth rate, says official
Indonesia will not need to import any gas until at least 2027 if its average gas demand growth rate is maintained at just over 1 per cent, the country’s vice minister of energy and mineral resources said on Tuesday. Indonesia’s average gas demand growth over the last five years was about 1.1 per cent, Arcandra Tahar told a panel session at the Singapore International Energy Week (SIEW) conference. The country plans to meet its demand growth from existing fields until then if there is no big uptick in needs. “Up to 2027, we believe our domestic demand can be fulfilled by existing production internally,” the official said. Indonesia has committed to buying liquefied natural gas from the United States, starting from 2018, but has been reselling the cargoes after pushing back the date at which it might need to rely on imported gas. If demand accelerates sharply, the official said that date might be brought forward. “If we assume (demand) growth of 5.5 per cent, in 2024 there is possibility that we are going to import gas in the form of LNG,” he said.
Bengaluru: Gas leaks as metro corridor work damages Gail pipeline
An underground gas pipeline was damaged when metro construction workers were drilling the ITPL main road and this led to panic and disruption of traffic early on Monday morning. The leaking gas made a loud noise and left a bad odour in and around Garudachar Palya and Mahadevapura. As a precautionary measure, the police barred the entry of vehicles between the Hoodi Junction and KR Puram for two hours from 7.30 am. This resulted in heavy traffic congestion. The GAIL pipeline was attended to by its fire safety team even as the fire brigade rushed to the spot. “The underground natural gas steel pipeline of eight-inch diameter got punctured due to metro work. The natural gas pipeline has been laid as per safety standards and prescribed norms. Necessary civic permission is required for undertaking construction work by any agency but no permission was taken by Bengaluru Metro,” said an official statement from GAIL. On a complaint from GAIL, the Mahadevapura police booked the Bangalore Metro Rail Corporation (BMRCL) and its contractor ITD Cementation India under the Petroleum and Natural Gas Regulatory Board Act, Section 49 (Punishment for willful damages to common carrier or contract carrier) and Section 50 (Offences by companies) and IPC section 285 (negligent conduct with respect to fire or combustible material) and 427 (Mischief causing damage). BMRCL’s managing director Ajay Seth admitted that no permission was sought from GAIL as the utility was not aware of the existence of a gas pipeline on the stretch. “We conduct a detection test before starting underground work. The test did not show the gas pipeline,” he said. Seth said that BMRCL would be seeking a map of the gas pipeline network from GAIL and would superimpose it on the metro alignment to ensure that such mistakes do not repeat.
Trafigura denied licence to operate fuel pumps in India
The government has rejected for now global commodity trader Trafigura’s request for a licence to operate petrol pumps in the country, according to people aware of the development. Geneva-headquartered Trafigura, which along with Russian fund UCP and Russian oil firm Rosneft had purchased Essar Oil’s refinery and petrol pumps last year for $13 billion, had sought a separate licence to retail transportation fuels in the country but the government said the trader didn’t qualify for one just yet. Trafigura is the latest in a series of global players expressing interest in entering the rapidly expanding Indian fuel retail market. UK’s BP has obtained a licence and plans to launch filling stations soon. Saudi Aramco and French firm Total too have announced intentions to operate pumps here while Shell already operates more than 100 pumps in the country. Trafigura’s licence bid was not accepted on the grounds that it had not invested enough to be eligible for a licence, said one of the persons cited earlier. To qualify for a fuel retail licence, a company must have invested Rs 2,000 crore in the Indian oil and gas sector or proposed to invest the amount in the next 10 years, according to the official guidelines. Trafigura said its application was still pending. “A licence has been applied for on behalf of Puma Energy. The application is still pending. No decision has been taken to enter the retail market should a licence be granted,” Trafigura said in a response to ET’s emailed query. Puma Energy is a unit of Trafigura and operates fuel retail network in other countries. Trafigura said its investment in Essar Oil made it eligible for a separate retail licence but the government rejected the argument saying the rules allowed just one licence for one set of investment and since Essar Oil already owned a retail licence, an additional licence for its new shareholder could not be issued, the person said. “Every eligible company would get only one authorization i.e. the company that has invested or proposes to invest in the eligible activities either in its name or in the name of the company in which investment has been made or is proposed to be made,” says a provision in the 2002 rule on grant of authorisation. The government’s rejection, however, does not mean that it has shut the doors permanently for Trafigura. The company can approach the government again with a fresh request by proposing to invest Rs 2,000 crore in the hydrocarbon sector in the next 10 years, according to people with knowledge of the matter. Any new investment by Trafigura in expanding its Indian refinery or marketing infrastructure would count as the trader’s investment and contribute towards making it eligible for a licence, they said. Trafigura, which made $136 billion in group revenue last year, operates fuel retail network through its unit Puma Energy in several countries. India lifted price control on diesel in 2014 and petrol in 2010, encouraging private players in fuel retailing.
China’s total natural gas supply will increase by 25 bcm in 2018 versus last year-NEA
China’s total natural gas supply will increase by 25 billion cubic metres (bcm) in 2018 from a year ago, the National Energy Administration (NEA) said on Tuesday Gas supplies will be up at least 10 percent from total consumption of 237.3 bcm in 2017, according to a Reuters calculation based on historical data China will make it a priority to deliver gas to a key pollution control zone including the Beijing-Tianjin-Hebei area, and the Fenwei Plain which is comprised of the provinces of Shanxi and Shaanxi, the NEA said
India’s BPCL Q2 profit almost halved by refinery fire, misses estimates
Bharat Petroleum Corp Ltd’s profit nearly halved in the second quarter, well below analysts’ expectations, after a unit at its Mumbai refinery was closed by a fire. Profit in Bharat Petroleum’s fiscal second quarter ended Sept. 30 was 12.18 billion Indian rupees ($166 million), down from 23.57 billion rupees a year earlier, the Indian refiner said in a statement on Monday. Eighteen analysts on average had expected a profit of 18.42 billion rupees, according to Refinitiv data. Average gross refining margin, the difference between the cost of crude oil processed and the prices of refined products, fell to $5.57 per barrel from $7.97 per barrel a year earlier. Revenue from operations jumped 29.3 percent to 828.8 billion rupees at BPCL
Alphageo (India) bags contract worth Rs 338.9 million from ONGC
Alphageo (India) has received Notification of Award (NOA) of Contract from Oil and Natural Gas Corporation (ONGC), Western Offshore Basin for NSP Project, Mumbai for provision of2D Seismic Data Acquisition services in un-appraised on land areas of Sedimentary Basins of Ganga-Punjab Area for estimated Contract Value of Rs. 338.9 million (incl of taxes).