NGT slaps Rs 1 billion damages on shipping firm for oil spill
A Panama-based shipping company and its two Qatar-based sister concerns were today directed by the National Green Tribunal (NGT) to pay up Rs 1 billion as damages for causing an oil spill when a cargo vessel sank off Mumbai coast in 2011, damaging marine ecology. While asking the three companies to pay Rs billion as environmental compensation (EC) to the Ministry of Shipping, a bench headed by NGT Chairperson Swatanter Kumar also ordered Gujarat-based Adani Enterprises Ltd to pay Rs 50 million as EC for dumping in the seabed 60054 MT coal, being carried by the ship M V RAK, and polluting the marine environment. The tribunal asked Republic of Panama’s Delta Shipping Marine Services SA, Qatar-based Delta Navigation WLL and Delta Group International to pay Rs 1 million to the Ministry, observing that reports showed that the documents in favour of the ship were issued in a biased manner and the vessel was “not seaworthy”, right from the inception of its voyage. It also held the respondents to be defaulting entities which had adopted the “most careless and reckless attitude” in protecting the marine environment. “We are of the considered view that determined damages of Rs 1 million should be paid by and recovered from respondents number 5, 7 and 11, jointly and severally while respondent number 6 is held liable to pay Rs 50 million as environmental compensation for dumping of the cargo in the sea and then failing to take any precautionary or preventive measures. “The consignment of 60054 MT of coal has caused marine pollution and continues to be a cause and concern for environmental pollution. The respondents are defaulting entities which have not complied with law and have adopted a most careless and reckless attitude in relation to protecting the marine environment,” the bench, also comprising Judicial Member U D Salvi, Expert Members A R Yousuf and Ranjan Chatterjee, said in its 223-page judgement. The tribunal constituted a committee to look into various aspects, including to study and report to it within a month on whether removal of the ship wreck and cargo from its present location should be directed as per global conventions and in the interest of marine environment. NGT passed the verdict on a petition filed by Samir Mehta, a Mumbai-based environmentalist, who had sought compensation for damages caused to the marine ecology due to the oil spill. The ship, which was sailing from Indonesia to Dahej in Gujarat, sank 20 nautical miles off the South Mumbai coast in the Arabian Sea on August 4, 2011. The vessel was owned by Delta Shipping Marine Services SA. While Delta Navigation WLL and Delta Group International were responsible for its voyage. The ship was also carrying more than 60,000 metric tons of coal for Adani Enterprises Ltd thermal power plant in Gujarat besides containing 290 tons of fuel oil and 50 tons of diesel. The bench said it was “a clear case where negligence is attributable to the four firms” and added that it was not a case of sinking of a ship by “accident simpliciter”. “But it is a case where element of mens rea can be traced from the unfolding of the events that finally led to the sinking of the ship on August 4, 2011. Non-rendering of requisite help by the ship owner and other persons interested and responsible, to the Master of the ship, despite the fact that they had complete knowledge about the status of the ship prior to the occurrence of the incident on August 4, 2011. “The ship had developed mechanical and technical snags at Colombo and Singapore and the Master of the ship had asked for help there during its onward journey. There is nothing on record to show that ship owner and other respondents provided timely assistance to the Master of the ship,” it said. The bench said “on the true and purposive construction of the International Conventions and the statutory provisions afore-referred, no party from any country in the world has the right/privilege to sail an unseaworthy ship to the Contiguous and Exclusive Economic Zone of India and in any event to dump the same in such waters, causing marine pollution, damage or degradation thereof.” It said the ship and its cargo should be removed by the four companies or they shall get it removed within six months from the date of submission of report of the committee, consituted by it, before the tribunal. “The liabilities to pay environmental compensation as aforedirected are on account of and subject to adjustments, after the submission of the final report by the Committee,” it added. A year before this oil spill off the Mumbai coast, another such accident had occured in the Gulf of Mexico when an oil rig ‘Deepwater Horizon’ had exploded, leading to sea- floor oil gushing out for 87 days till it was capped. Eleven people had gone missing in what is considered to be the largest accidental marine oil spill in the history of the petroleum industry. In July 2015, after a long legal battle, BP, formerly known as British Petroleum which owned the rig, agreed to pay USD 18.7 billion in fines, the largest corporate settlement in US history so far. Lester Hayes Authentic Jersey
How India Saved $470 Million a Year With Real-Time Data
A new system for LPG pricing in India involved real-time consumption data. Name of Organization: Indian Oil Corporation Ltd. Industry: Oil and gas Location: Mumbai, Maharashtra, India Business Opportunity or Challenge Encountered: When the Indian government decontrolled petroleum prices recently, that paved the way for market-driven LPG pricing in India. But for Indian Oil, the challenge to tie prices to the market was immense. The company has 43,000 customer touchpoints in oil and gas refining, distribution, and retailing. LPG pricing in India: The Indian government used to have a dual pricing system for liquid petroleum gas, including a subsidized and market price. “We have the largest refining capacity in India,” says Abhishek Choudhary, manager of information systems at Indian Oil, which is 80-percent owned by the Indian government. The company faced challenges implementing a dual pricing system for liquid petroleum gas (LPG). As Choudhary explained, every household in Indian has a connection for LPG, which Indians use for cooking. The Indian government subsidizes LPG, but wanted to bring the product under market pricing while still allowing subsidies to continue through direct transfers to a customer’s bank account. How This Business Opportunity or Challenge Was Met: Indian Oil deployed the Informatica Platform, which included the Vibe Data Stream and Real-Time Data Integration components. The challenge was to be able to recognize if a sale qualified for a government subsidy, and to immediately transfer money into the consumer’s bank account, versus selling LPG at a separate subsidized price. “We converted our systems into a real-time consumption package,” says Choudhary. “We actually know how much consumption happened yesterday night. We’re capturing real-time data from secondary sales through gas stations across India.” Leveraging Internet of Things capabilities also plays a role in the effort, Choudhary adds. The initiative takes “old-line LPG and petrol refinery stuff, and modernizes it with the real-time analytics from Informatica,” Choudhary points out. “We’re getting this data on a real-time basis, and then putting in systems or real-time systems that decide whether these subsidies get transferred to consumers or not, to make settlement.” Measurable/Quantifiable and “Soft” Benefits from This Initiative: Indian Oil saw a number of benefits from real-time data integration, including: ? The audited savings from the effort were $470 million a year, which included benefits of $200 million in a year preventing subsidy leakage by integrating consumer accounts across LPG companies in India. ? The company met the goals of the Indian Government to remove$1.5 billion (USD) in budget provisioning for LPG subsidies. Rather, the new system ensured that $125 million in subsidies reached the correct end consumer. Plus, citizens can log into the system and check the status of their accounts, Choudhary adds. ? Indian Oil was able to make better decisions on dynamic pricing of petroleum and gas as well as achieve better monitoring of stock and dispensing units at retail outlets. Monitoring enabled preventative maintenance on equipment and averted market dry-out situations at petrol stations. The impact, however, goes well beyond the company, and is playing a role in the Indian economy, Choudhary says. “We are capturing the data on a real-time basis direct from these devices and applying real-time analytics. We’re sourcing the secondary sales coming out of these deals. Once we have this data, since we control 70 percent of the Indian market, we actually know the consumption that India is having on a real-time basis. That is huge data.” The real-time initiative is helping to “change the way business is done in India, at least for the oil industry,” he adds. “The sheer magnitude makes it so large, that up to today, we have actually transferred $120 billion into the banking industry that was not there.” Jordan Reed Authentic Jersey
ONGC Videsh Ltd gets 1-year extension for exploring Vietnamese oil block
ONGC Videsh Ltd, the overseas arm of Oil and Natural Gas Corp (ONGC), has received one-year extension to explore a Vietnamese oil block in the contested waters of the South China Sea. This is the fourth extension for OVL to explore Block-128, the license for which is now valid till June 15, 2017, sources privy to the development said. OVL had in May applied to the Vietnamese authorities for a fourth extension of the exploration licence for the deepsea block to maintain India’s strategic interest in the South China Sea. Vietnam’s national oil company PetroVietnam has granted the extension, sources said. OVL had signed Production Sharing Contract (PSC) for the 7,058 square km Block 128 in offshore PhuKhanh Basin, Vietnam on May 24, 2006. Ministry of Planning & Investment (MPI), Vietnam issued investment licence for the block on June 16, 2006, being effective date of the PSC. The company has not found any hydrocarbon in the block but is continuing to stay invested. OVL first took a two-year extension of the exploration period till June 2014 and then another one year. A third extension was granted on May 28, 2015 and now a fourth extension has been granted. The company has so far invested USD 50.88 million in the block. The block lies in the part of South China Sea over which China claims sovereignty. In 2011, Beijing had warned OVL that its exploration activities off the Vietnam coast were illegal and violated China’s sovereignty, but the company continued exploring for oil and gas. OVL forayed into Vietnam as early as 1988, when it bagged the exploration licence for Block 6.1. The company got two exploration blocks – Block 127 and Block 128 – in 2006. However, Block 127 was relinquished due to poor prospectives, the other Block was retained. The first extension followed China putting the area under Block 128 for global bidding. China claims sovereignty over most of the South China Sea where the two Blocks are located and had warned the Indian arm from drilling in the region. OVL continues to own 45 per cent stake in Vietnam’s offshore Block 6.1 and its share of production was 2.023 billion cubic metres of gas and 0.036 million tonnes of condensate. The company in October 2014 signed an agreement to pick up to 50 per cent stake in the two exploration blocks in the South China Sea. OVL took 40 per cent stake in Block 102/10 and 50 per cent in 106/10 that lie outside the sea territory claimed by China. In return, PetroVietnam took half of OVL’s 100 per cent stake in Block 128. Brooks Reed Authentic Jersey
Gulf Petrochem to distribute IPOL lubricants in UAE & Oman
For this, the company has partnered with UAE’s NGC Energy and Oman’s National Gas Company SAOG. The UAE-based Gulf Petrochem will distribute Indian subsidiary GP Petroleums Ltd’s IPOL brand of lubricantin the UAE and Oman, in partnership with NGC Energy and with National Gas Company SAOG in Oman over a period of five years. Both partners have set targets of 100 metric ton per month of lubricant volumes each in the UAE and Oman, by the end of the first year of trading. Prerit Goel, group director, Gulf Petrochem, commented, “This partnership seems like a natural step for all concerned and will only serve to enhance the availability of quality products on the market in UAE and Oman. We believe there is a huge market in the region for IPOL, which is specially tailored for industries, and in partnering with National Gas Company and NGC Energy, we have secured business with trusted firms who share our ambition and drive.” Operations are expected to fully commence in Q3 of 2016, with National Gas Co and NCG Energy currently recruiting additional sales staff and developing infrastructure facilities, including warehouses and delivery vehicles, as part of the agreement. Nalin Chandna, general manager of National Gas Company SAOG, said, “Since we signed the agreement in September 2015, we have been working together to put all the necessary infrastructure in place, in order to meet our expected demand levels when operations begin. In this time, we have seen similarities in the way we both work and believe our partnership can only be fruitful for all concerned. IPOL is a quality product which suits the market in UAE and Oman and we are delighted to be able to distribute the product there.” Gulf Petrochem Group, with a turnover of about $ 3 billion, specialises in oil trading & bunkering, oil refining, grease manufacturing, oil storage terminals, bitumen manufacturing, and shipping & logistics. Headquartered in UAE, and having a presence in South Asia, the Far East Asia, Africa and Europe, the group has emerged as one of the well-established manufacturers of petroleum products in major parts of the world. In India, its subsidiary GP Petroleums Ltd manufactures and markets industrial & automotive lubricants, process oils, transformer oils, greases and other specialties under the brand name IPOL. GP Petroleums plants in India has an annual production capacity of 80,000 KL. Its in-house base oil storage plant of 15,000 kilo litre (KL) is one of the largest facilities in the Indian industry. Terry Bradshaw Womens Jersey
Greenfield refinery in TN to meet fuel supply shortfall?
Expecting a fuel shortage in Tamil Nadu and other parts of South India, a report on logistics bottlenecks by the Shipping Ministry proposed setting up a new refinery in the central part of the State, near the coast between Cuddalore and Karaikal. Besides Tamil Nadu, a greenfield refinery is also being planned in Maharashtra. The report, Final Traffic Projections and Logistics Bottleneck, prepared by the ministry with the Indian Port Association as a part of its Sagarmala project, states that Tamil Nadu needs eight million metric tons per annum (MMTPA) of motor spirit or high speed diesel. This is expected to rise to 15 MMTPA by 2025. The report says the Centre is working on a two-fold strategy to bridge India’s shortfall of 12-13 million metric tons a year. First, by creating additional refineries, and then by redistributing supply to set right regional supply-demand imbalances through increased coastal shipping to the south and additional pipelines to move the product to deficit areas in the north. Creating additional capacity is the first step. At present, the State has only two refineries: Chennai Petroleum Corporation Ltd runs one at Manali near Chennai and another at Cauvery basin near Nagapattinam with capacities of 10.50 and 1 MMTPA respectively. However, the actual supply is only 7 MMTPA, resulting in a deficit of 1 MMPTA, says the report. The third refinery being built at Cuddalore, a joint venture between Nagarjuna Group and Tata, is to meet the present and projected demand, but the project has been delayed. As the CPCL plant in Chennai is in the interior of the city, it cannot be expanded due to environmental and safety concerns. A new refinery with a capacity of 5-7 MMPTA is being recommended between Cuddalore and Karaikal by 2018 with a ramp up potential of 3-5 MMTPA, the report says. Gujarat is the refinery hub with a surplus of about 20 MMPTA. This can be redistributed to areas in the North and Maharashtra through coastal shipping and pipelines. Redistribution from Kochi to Chennai and Odisha to Andhra Pradesh by ship will address the deficits, adds the report. Joey Gallo Womens Jersey
Gail to use fuel cell technology to generate clean energy
For this, the company has partnered with the US-based Bloom Energy, which provides solid oxide fuel cell technology that generates onsite power from multiple sources. Gail India Ltd will partner with the US-based BloomEnergy to deploy natural gas-based fuel cell technology to generate clean and reliable electricity. An MoU to this effect was signed by the two companies today. Speaking on the occasion, Dharmendra Pradhan, Minister of State for Petroleum and Natural Gas, said, “The biggest beneficiary of this MoU will be urban India because it will significantly decrease pollution caused by back-up power generation.” The solid oxide fuel cell (SOFC) technology of Bloom Energy Servers convert fuel into electricity using natural gas as the base fuel to generate reliable and resilient power in a highly efficient non-combustible process that reduces emissions of greenhouse gas and harmful air pollutants, with minimal use of water vis-a-vis the conventional power producing technologies. The Bloom Energy Servers could be installed onsite at any operating premises or building and can be plugged into natural gas pipeline to generate uninterrupted, efficient, noise-less power round-the-clock. The technology is presently used by over 100 of the Fortune 500 companies such as Apple, Google, Coca-Cola, Walmart, etc that operate in sectors like FMCG, IT, telecom, retailing and e-commerce. Gail’s subsidiary at Bengaluru is already supplying natural gas for energising a multi-MW Bloom Energy project for a large global technology company at the Technology Park. The tie-up seeks to leverage the strengths of both the organisations. While Gail brings a portfolio of natural gas to ensure reliable and competitively available natural gas for Bloom Energy projects, Bloom Energy’s power systems run on advanced solid oxide fuel cell technology that efficiently produces electricity based on natural gas. Dr K R Sridhar, CEO & founder, Bloom Energy, said, “This partnership brings us closer to realise Bloom Energy’s mission to provide access to clean, reliable and affordable energy for India and the world.” Justin Williams Womens Jersey
OVL gets another extension to continue operations in South China Sea block
ONGC Videsh Ltd (OVL) will continue exploration in its South China Sea hydrocarbon block awarded by the Vietnam government, after it got a fresh extension. The previous extension for block No.128 lapsed on 15 June. This comes in the backdrop of Beijing’s claims over most of South China Sea rejected by the Permanent Court of Arbitration at The Hague last month. The decision came after the Philippines took its territorial dispute with China to the international court. “Extension to OVL for the block has been granted,” said a person aware of the development requesting anonymity. OVL has already got two extensions on the block. The first two-year extension was granted till June 2014, followed by a one-year extension. “The government of Vietnam wants India with them,” said a second person aware of the development requesting anonymity. Vietnam did not want the overseas arm of Oil and Natural Gas Corp. Ltd (ONGC) to exit the block as part of its strategy to leverage India’s state-owned firm’s presence in the controversial waters. It had earlier extended the investment licence by a year till June 2016. “In the process, OVL will also be saving $15 million that it would have to pay if it failed to drill the required number of wells,” said the second person quoted above. OVL has relinquished block No.127, but continues to hold the licence for block No.128 despite finding no hydrocarbons in it. The move is part of a larger strategic imperative on part of India to contain China in the region. Earlier, China had objected to India’s hydrocarbon exploration projects in the South China Sea, off the coast of Vietnam, asserting its sovereignty over the area covering the two blocks. Experts believe this has more to do with India’s national interests rather than being a commercial initiative. “The block is not commercially viable for OVL. However, instead of having a profit motive, the state-run unit has strategic motives behind this. The South China Sea block has always been a tough bet for OVL,” said Jabin T. Jacob, assistant director and fellow at New Delhi-based Institute of Chinese Studies. This comes at a time when ONGC is battling concerns over its domestic production capabilities and diminishing yields at its ageing oilfields. OVL has also set a target of 20 million tons (MT) of oil and oil-equivalent gas by 2017-18 from the current levels of 8.36 MT. Queries emailed to the spokespersons of OVL, embassies of Vietnam and China in New Delhi, India’s ministry of external affairs, petroleum ministry and Petro Vietnam remained unanswered. According to ONGC’s Perspective Plan 2030, OVL will have to contribute 60 MT of the 130 MT targeted total production of oil and oil-equivalent gas, with the balance coming from ONGC’s domestic production. ONGC produced 57.38 MT of oil and oil-equivalent gas in 2015-16. OVL has 37 projects in 17 countries and has invested $23.81 billion in overseas assets. Jordan Wilkins Jersey
Essar Oil eyes LPG business
In the non-subsidied LPG distribution business, Essar Oil looks to target customers with an annual income of Rs 1 million and above. Oil refiner, Essar Oil Ltd, wants to enter the liquified Petroleum gas (LPG) distribution business in the country, said an Essar Oil official on Monday. Mahesh Advani, head of direct sales, Essar Oil, said the company was open to subsidised as well as non-subsidised LPG distribution business in the country. Advani was talking on sidelines of the Indo-American Chamber of Commerce annual convention in Mumbai. At present, Essar produces about one million ton LPG, Advani said. In the non-subsidied LPG distribution business, Essar Oil looks to target customers with an annual income of Rs 1 million and above — who don’t get any subsidies. Advani added, the company expects better margins by selling LPG directly to the customers than to the state oil marketing companies. At present, Essar Oil sells its LPG production to the oil marketing companies and does not have any presence in the LPG distribution business. Reliance Industries Ltd is the only private oil refiner in India with an exposure to the non-subsidised LPG business. The current regulations in the country does not allow private companies to distribute subsidised LPG to households. “We can start with the non-subsidised segment which constitutes 30 per cent of the market and then there is commerical LPG,” Advani said. On the timeline of starting operations in the non subsidised LPG distribution business, Advani said,” It is all in the application stage. We are open to doing the non subsidised if the government allows us to do it. ” Essar Oil is also increasing its presence in the fuel retailing business for Petrol and diesel by adding new outlets. Advani also said the company looks to increase the number of fuel outlets from the current 2500 outlets to 5000 outlets in the next eighteen months. The subsidised LPG business in India is currently dominated by the state run companies like Bharat Petroleum Corporation Ltd, Indian Oil Corporation Ltd and Hindustan Petroleum Corporation Ltd with a combined bottling capacity of 15. 2 million ton. As of April 1, 2016, the combined consumer enrollment of the three companies was 204.1 million of which 201.8 million were domestic users. The three state run companies added more than 20 million new customers in the last financial year. Mike White Womens Jersey
Stepping on the gas
Petroleum minister Dharmendra Pradhan’s decision to move towards market pricing for natural gas in difficult areas in the deep seas—or ones where the temperatures or pressures are very high—appears to be paying off after several months. While exploration firms looked a bit hesitant to make a commitment to invest given the uncertain oil price scenario, with costs of exploration/drilling equipment also falling significantly, the investment outlook looks much brighter today—if oil/gas prices start rising over the next year or two, those investing now will stand to reap bigger gains. Briefing the media after a CII presentation to Pradhan, BP India head Sashi Mukundan estimated that the gas exploration companies would end up investing anywhere between Rs. 2500-3000 billion over the next 4-5 years based on the likely existing reserves—a ballpark investment of around $3-4 billion is required for every 1 tcf and estimates are India has around 10-15 tcf of discovered gas between ONGC, RIL-BP, GSPC and Cairn India. Based on that, CII estimates this will generate around Rs. 2500 billion of revenues for the government—from royalty, profit shares and taxes on corporate profits—and, more important, it will result in import savings of around R10 lakh crore. Equally important, from the point of view of global warming, it will also increase the share of natural gas in India’s energy mix significantly. Apart from the obvious gains to the economy as gas-based power and fertiliser plants start functioning at higher capacity, the more important lesson for the government is the implications of messing with free-market pricing. Though the gas exploration policy clearly specifies that free-market pricing will be allowed, this was given the go-by and though the UPA government tried to make amends towards the end of its tenure, the NDA refused to implement the recommendations of the Rangarajan committee on this. While enough analysts pointed out that it was uneconomic to extract gas at the current prices, even the state-owned ONGC’s break-even estimates for its deep-water wells was significantly higher than the price the government had fixed—the government, however, refused to relent, and a valuable two years were lost. While the government appears to have learned its lesson the hard way—last year, RIL decided to start concentrating on Mexico for exploration—in the gas sector, what is worrying is that it doesn’t seem to be applying the same learning to other sectors like pharmaceuticals or, more recently, genetically modified seeds. P. J. Williams Authentic Jersey
TSRTC MoU with HPCL for retail outlets
In a bid to augment its non-traffic revenues, the Telangana State Road Transport Corporation (TSRTC) has leased out 52 of its unused spaces across the State for commercial business by way of setting up retail fuel outlets on rental basis to the Hindusthan Petroleum Corporation for a duration of 30 years. A memorandum to this effect was signed by officials of both organisations at the corporate office on Saturday. The entire cost of construction for the retail outlets would be borne by Hindusthan Petroleum and it was estimated that the TSRTC would get a revenue of about Rs. 100 million annually towards lease rentals and sale of fuel. Among those present while the MoU was signed were TSRTC MD G.V. Ramana Rao and Hindusthan Petroleum’s General Manager-Retail (South Central Zone) G.S.V. Prasad. Interestingly, all the 52 outlets would be operated by the TSRTC on its own by appointing service providers who would handle the logistics of having the required personnel on outsourcing. The service providers would be appointed through open tenders on competitive bidding, a press release said. Charlie Blackmon Authentic Jersey