All content in this website is sourced legitimately
Archives
All the news items since the launch of our web site are preserved in the archive section. The archive entries are freely accessible to all the users.
Mar 2016
PNGRB has drawn up a list of Geographical Areas( GA)s in smart cities where City Gas Distribution (CGD) networks will come up for bidding.
8The Board has now unfolded a plan that includes a list of 11 smart cities.
8The cities are: Bhubaneshwar, Jaipur, Jabalpur, Vishakhapatnam, Solapur, Davanagiri, Coimbatore, Udaipur, Guwahati, Chennai and Bhopal.
8The list also includes 45 more additional smart city locations
Click on Reports for more Details
8The Board has now unfolded a plan that includes a list of 11 smart cities.
8The cities are: Bhubaneshwar, Jaipur, Jabalpur, Vishakhapatnam, Solapur, Davanagiri, Coimbatore, Udaipur, Guwahati, Chennai and Bhopal.
8The list also includes 45 more additional smart city locations
Click on Reports for more Details
In a big push. the PNGRB has identified many potential Geographical Areas (GAs) for setting up city gas distribution projects in the country.
8These include 102 identified areas that are already connected to natural gas pipelines or may be in the vicinity of natural gas sources.
8Entities may bid to build CGDs in these GAs where gas pipelines are already provided by GAIL, IOCL, ONGC, RGTIL, Reliance and GSPC.
8These areas will bring a clear advantage to the bidding entity in terms of costs on account of readily available gas infrastructure .
8Then again, the Board has included as many as 126 GAs which can come up in the hinterland of upcoming or under construction natural gas pipelines. Entities can bid for these areas subject to the progress of pipeline construction.
8With this, the Board has drawn up a near exhaustive list of city gas distribution companies which will come up across the country.
8The phased manner of CGD bidding assigned to these GAs is likely to cover the gas distribution network of the entire country by 2018.
8This is a big step forward indeed.
Click on Reports for more Details
8These include 102 identified areas that are already connected to natural gas pipelines or may be in the vicinity of natural gas sources.
8Entities may bid to build CGDs in these GAs where gas pipelines are already provided by GAIL, IOCL, ONGC, RGTIL, Reliance and GSPC.
8These areas will bring a clear advantage to the bidding entity in terms of costs on account of readily available gas infrastructure .
8Then again, the Board has included as many as 126 GAs which can come up in the hinterland of upcoming or under construction natural gas pipelines. Entities can bid for these areas subject to the progress of pipeline construction.
8With this, the Board has drawn up a near exhaustive list of city gas distribution companies which will come up across the country.
8The phased manner of CGD bidding assigned to these GAs is likely to cover the gas distribution network of the entire country by 2018.
8This is a big step forward indeed.
Click on Reports for more Details
Now that long pending reforms has been unleashed in the petroleum sector, how many of these were rooted in new ideas and how many have been actually adopted from initiatives mooted by the earlier Congress led regime.
8Sadly enough, all but a few have been borrowed from the previous regime.
8The one new idea is to free the price of gas and impose a ceiling on it. The earlier government had got itself into a corner trying to fix a premium. The bureaucracy tried to muddle it further by setting a time line below which deepwater discoveries were not to be entitled to a premium.
8The PSC extension policy was already fleshed out by the Congress and so was the Unified Licensing Policy.
8The other new idea is to push for greater LPG coverage in rural areas but that follows as a natural corollary to the DBTL scheme.
What the government can do now
8One reform that the government can do now is to free up the DGH. Once it shifts to a revenue sharing model, the DGH can transform into a genuine regulator if the government wants to let go of its control. Today, every little decision relating to the PSC needs the approval of the minister. It therefore remains a moot point whether this government is going to let go of its powers.
8Empowering the PNGRB by notifying more rights will be another great step forward. The regulator has been at loggerheads with the government so far, primarily instigated by its defence of GAIL's monopoly over the gas sector. But now that the grip is weakening, the government must let go and allow the regulator to do its job not just in the gas sector but in the petroleum sector as a whole.
8Breaking up GAIL into two entities as was recommended by the PNGRB will fast-forward the reforms process.
A lot depends on Dharmendra Pradhan
8A lot of how the petroleum sector will fare depends on Dharmendra Pradhan.
8He enjoys enough clout with the Prime Minister and the Finance Minister to push through the next set of reforms.
8Letting the regulatory bodies work freely will be one gigantic step forward.
8Getting the government's stake to less than 50% in some of the public sector companies will be a game-changer. It will transform the sector completely.
8Or will he be like the ministers in the past, who concentrated power and exploited the system?
8If Pradhan wants to leave a mark for posterity, now is the time to act Details
8Sadly enough, all but a few have been borrowed from the previous regime.
8The one new idea is to free the price of gas and impose a ceiling on it. The earlier government had got itself into a corner trying to fix a premium. The bureaucracy tried to muddle it further by setting a time line below which deepwater discoveries were not to be entitled to a premium.
8The PSC extension policy was already fleshed out by the Congress and so was the Unified Licensing Policy.
8The other new idea is to push for greater LPG coverage in rural areas but that follows as a natural corollary to the DBTL scheme.
What the government can do now
8One reform that the government can do now is to free up the DGH. Once it shifts to a revenue sharing model, the DGH can transform into a genuine regulator if the government wants to let go of its control. Today, every little decision relating to the PSC needs the approval of the minister. It therefore remains a moot point whether this government is going to let go of its powers.
8Empowering the PNGRB by notifying more rights will be another great step forward. The regulator has been at loggerheads with the government so far, primarily instigated by its defence of GAIL's monopoly over the gas sector. But now that the grip is weakening, the government must let go and allow the regulator to do its job not just in the gas sector but in the petroleum sector as a whole.
8Breaking up GAIL into two entities as was recommended by the PNGRB will fast-forward the reforms process.
A lot depends on Dharmendra Pradhan
8A lot of how the petroleum sector will fare depends on Dharmendra Pradhan.
8He enjoys enough clout with the Prime Minister and the Finance Minister to push through the next set of reforms.
8Letting the regulatory bodies work freely will be one gigantic step forward.
8Getting the government's stake to less than 50% in some of the public sector companies will be a game-changer. It will transform the sector completely.
8Or will he be like the ministers in the past, who concentrated power and exploited the system?
8If Pradhan wants to leave a mark for posterity, now is the time to act Details
For reference purposes, the website carries here details of the extension policy for PSCs for small and medium discovered fields.
8The royalty and cess rates for pre-NELP concessional regimes are given here.
8A comparison is made between such rates in nomination blocks, and with the regime under the new extension policy.
8The government expects an additional investment of between $3 to $ 4 billion as additional investment as a result of this policy.
Click on Reports for more Details
8The royalty and cess rates for pre-NELP concessional regimes are given here.
8A comparison is made between such rates in nomination blocks, and with the regime under the new extension policy.
8The government expects an additional investment of between $3 to $ 4 billion as additional investment as a result of this policy.
Click on Reports for more Details
The PNGRB has earmarked a list of GAs that will spawn on the Green Corridors along important national highways.
8These GAs fall under 12 districts along the NH-1, the Delhi-Amritsar highway,and the NH-8, the Delhi-Mumbai highway
8These are areas where no CGD entities were authorized before.
8This augurs well for the greening mission undertaken by the government which envisages CGD networks feeding clean gas to cities and rural settlements along these two highways.
8These sets of GAs fall under two separate lists of 6 districts each:
8One list includes Kurukshetra , Karnal Kapurthala , Patiala , Alwar and Jaipur
8The other has Sangrur, Ajmer, Pali, Dungarpur, Udaipur and Rajasmand.
8The Board has further noted that some of the bids under these lists may be taken up on a pilot trial basis to test the efficacy of the greening project.
Click on Reports for more Details
8These GAs fall under 12 districts along the NH-1, the Delhi-Amritsar highway,and the NH-8, the Delhi-Mumbai highway
8These are areas where no CGD entities were authorized before.
8This augurs well for the greening mission undertaken by the government which envisages CGD networks feeding clean gas to cities and rural settlements along these two highways.
8These sets of GAs fall under two separate lists of 6 districts each:
8One list includes Kurukshetra , Karnal Kapurthala , Patiala , Alwar and Jaipur
8The other has Sangrur, Ajmer, Pali, Dungarpur, Udaipur and Rajasmand.
8The Board has further noted that some of the bids under these lists may be taken up on a pilot trial basis to test the efficacy of the greening project.
Click on Reports for more Details
Now that gas prices have been freed, the government will have make some of the provisions of the Production Sharing Contract more flexible so that the deepwater discoveries can get off the ground
8Most discoveries will only get into production by 2020. So the likely price that will prevail at that point in time will be the relevant parameter for the operator to take a decision to invest.
8A few operators are speaking of forward contracts with equipment and service providers. Given the distress in which the suppliers are in, they are willing to try out innovative contracts and domestic E&P operators are of the view that now is the time to get them done. For example, an operator can commit to using a deepwater rig for a 24-month period within a three year time slot. The time slot is to be chosen by the operator when he finds the conditions favorable to begin development work in his discoveries.
8Given the current low prices for equipment and services, the operator can pin down a bulk of their capex commitments in the future through forward contracts without a specific deployment date in mind. Also, some operators are looking at another 15 to 20% drop in equipment and service costs and they want to wait for this to happen before placing orders.
8However, what the operator will need is flexibility in the existing PSC so that he can make the best of the low prevailing prices for equipment and services and pick up flexible options for future development work.
8The system will have to build in an element of trust. Already a large quantum of money had been invested in getting to the discovery stage. The sunk cost is high for an operator when he goes from exploration to the discovery stage in a deepwater block.
8It will be in the operator's best interest to get the discovery off the ground as soon as possible and the government will do well to repose trust in his judgment to do so than keep him bound and beholden to a set of inflexible rules.
8Needless to say an operator cannot take an infinitely long time to make up his mind, and caveats have to inserted to ensure that there is no willful default.
Click on Reports for more Details
8Most discoveries will only get into production by 2020. So the likely price that will prevail at that point in time will be the relevant parameter for the operator to take a decision to invest.
8A few operators are speaking of forward contracts with equipment and service providers. Given the distress in which the suppliers are in, they are willing to try out innovative contracts and domestic E&P operators are of the view that now is the time to get them done. For example, an operator can commit to using a deepwater rig for a 24-month period within a three year time slot. The time slot is to be chosen by the operator when he finds the conditions favorable to begin development work in his discoveries.
8Given the current low prices for equipment and services, the operator can pin down a bulk of their capex commitments in the future through forward contracts without a specific deployment date in mind. Also, some operators are looking at another 15 to 20% drop in equipment and service costs and they want to wait for this to happen before placing orders.
8However, what the operator will need is flexibility in the existing PSC so that he can make the best of the low prevailing prices for equipment and services and pick up flexible options for future development work.
8The system will have to build in an element of trust. Already a large quantum of money had been invested in getting to the discovery stage. The sunk cost is high for an operator when he goes from exploration to the discovery stage in a deepwater block.
8It will be in the operator's best interest to get the discovery off the ground as soon as possible and the government will do well to repose trust in his judgment to do so than keep him bound and beholden to a set of inflexible rules.
8Needless to say an operator cannot take an infinitely long time to make up his mind, and caveats have to inserted to ensure that there is no willful default.
Click on Reports for more Details
For reference purposes, the website carries here a presentation prepared by the government on the new subsidy outreach programme.
8There are currently 15.2 crore registered consumers
8The target is to provide 10 crore new connections in the next three years.
8Of the 10 crore connections, Rs 5 crore will be made up of BPL families
8The total number of connections will be around 25 crore, which will significantly push up the LPG coverage ratio from the current level.
The government claims to b emaking progress in other aspects of the problems as well, such as:
8Emergency helpline launched and up to 12,000 complaints are being resolved every month
8Online booking/payment for new connections is getting a good response
8A Pilot project for Introduction of Composite cylinder (transparent) has been started
8Monitoring of social media based grievances and disposal in real time has been started
8Cash Transfer Failure rate has come down to 0.24% in Feb, 2016
Click on Reports for more Details
8There are currently 15.2 crore registered consumers
8The target is to provide 10 crore new connections in the next three years.
8Of the 10 crore connections, Rs 5 crore will be made up of BPL families
8The total number of connections will be around 25 crore, which will significantly push up the LPG coverage ratio from the current level.
The government claims to b emaking progress in other aspects of the problems as well, such as:
8Emergency helpline launched and up to 12,000 complaints are being resolved every month
8Online booking/payment for new connections is getting a good response
8A Pilot project for Introduction of Composite cylinder (transparent) has been started
8Monitoring of social media based grievances and disposal in real time has been started
8Cash Transfer Failure rate has come down to 0.24% in Feb, 2016
Click on Reports for more Details
New players are finally emerging on the fertilizer horizon who are willing to take the risk and the consequences to set up mega sized urea units.
8VBC Fertilizers & Chemicals Ltd.(VFCL) claims it is one such player.
8The other companies of the Group are VBC Industries Ltd., VBC Ferro Alloys Ltd., Konaseema Gas Power Ltd., Orissa Power Consortium Ltd. and GITAM University.
8It started off as a bottling company for a coal company but now claims to be a professionally managed conglomerate.
8The plans are to set up an integrated fertilizer and chemical complex comprising of Ammonia (2x2200 MTPD), Urea (2x3850 MTPD), Nitric Acid (2x400 MTPD) and Explosive Grade Ammonium Nitrate (2x500), all based on gas as feed stock for the ammonia plant.
8A 2X67.5 MW coal based captive power plant will also be set up along with all required utilities and offsite facilities.
8The company claims that plant location at Jaggayyapet in the Krishna District in Andhra Pradesh is an ideal location because of its close proximity to the Paleru and Krishna Rivers, natural gas pipelines, railway lines and national highway in the vicinity.
8The plant will market urea within its primary home state and also cater to the requirements in the neighbouring states of Karnataka, Tamilnadu, Kerala and Odhisa.
Click on Reports for more Details
8VBC Fertilizers & Chemicals Ltd.(VFCL) claims it is one such player.
8The other companies of the Group are VBC Industries Ltd., VBC Ferro Alloys Ltd., Konaseema Gas Power Ltd., Orissa Power Consortium Ltd. and GITAM University.
8It started off as a bottling company for a coal company but now claims to be a professionally managed conglomerate.
8The plans are to set up an integrated fertilizer and chemical complex comprising of Ammonia (2x2200 MTPD), Urea (2x3850 MTPD), Nitric Acid (2x400 MTPD) and Explosive Grade Ammonium Nitrate (2x500), all based on gas as feed stock for the ammonia plant.
8A 2X67.5 MW coal based captive power plant will also be set up along with all required utilities and offsite facilities.
8The company claims that plant location at Jaggayyapet in the Krishna District in Andhra Pradesh is an ideal location because of its close proximity to the Paleru and Krishna Rivers, natural gas pipelines, railway lines and national highway in the vicinity.
8The plant will market urea within its primary home state and also cater to the requirements in the neighbouring states of Karnataka, Tamilnadu, Kerala and Odhisa.
Click on Reports for more Details
The much touted LPG outreach programme for BPL families will only succeed if the government subsidizes the sale of LPG cylinders at a price lower than the current subsidized rate.
8A survey has shown that the purchasing power of a BPL family is so poor that to wean it away from freely available firewood, a gargantuan effort will have to be launched not just to give the family a connection but also to build its capacity to buy refill cylinders.
8The survey on LPG coverage in the country's most deprived states of Bihar, Jharkhand, Madhya Pradesh, Uttar Pradesh, Odisha and West Bengal goes on to show that a vast mass of people cannot afford an LPG connection or a replacement of a cylinder.
8The high upfront cost to secure an LPG connection is cited as the biggest hurdle (by 95 per cent of households) to adopting LPG.
8Furthermore, the high recurring monthly expenditure (88 per cent of households), and lack of distributors for the fuel in the local area (72 per cent) were also stated to be significant impediments to LPG adoption.
8The government is trying to tackle the distribution problem by unfolding a plan to appoint 10,000 dealers across rural India but that just won't be enough.
8The point is that even subsidized LPG is out of the reach of the rural poor and they will require a continuous infusion of money to be able to use LPG on a permanent basis until their income levels go up. Details
8A survey has shown that the purchasing power of a BPL family is so poor that to wean it away from freely available firewood, a gargantuan effort will have to be launched not just to give the family a connection but also to build its capacity to buy refill cylinders.
8The survey on LPG coverage in the country's most deprived states of Bihar, Jharkhand, Madhya Pradesh, Uttar Pradesh, Odisha and West Bengal goes on to show that a vast mass of people cannot afford an LPG connection or a replacement of a cylinder.
8The high upfront cost to secure an LPG connection is cited as the biggest hurdle (by 95 per cent of households) to adopting LPG.
8Furthermore, the high recurring monthly expenditure (88 per cent of households), and lack of distributors for the fuel in the local area (72 per cent) were also stated to be significant impediments to LPG adoption.
8The government is trying to tackle the distribution problem by unfolding a plan to appoint 10,000 dealers across rural India but that just won't be enough.
8The point is that even subsidized LPG is out of the reach of the rural poor and they will require a continuous infusion of money to be able to use LPG on a permanent basis until their income levels go up. Details
So how does the government make the grand plan of rolling out LPG to every doorstep a success?
8The first prerequisite is to ensure financial inclusion of all BPL families so that the direct transfer of funds can take place.
8The government is currently earmarking Rs 2000 crore, with each family to be given a subsidy of Rs 1,600. along with an EMI facility to meet the cost of the stove and the refill.
8But this amount will clearly not be enough.
8NEREGA funds will also have to the transferred into his bank account to provide adequate financial muscle power to the BPL family to be able to partially afford a refill.
8A realistic calculation has to be made of the income gap in a BPL family and that will have to be compensated by the government to stop him from turning away from a refill.
So, in effect, the government will have to be thinking of four different cooking gas rates in the country. They are:
8A price for commercial unsubsidized LPG for commercial establishments
8A subsidized LPG price for the general population
8A super subsidized price for BPL families
8A piped natural gas price that is independently set, depending upon the cost of gas
8There is a possibility of yet another price emerging, perhaps between the price of the commercial rate and the general subsidized rate for families over a certain income level. A cap on cylinders also translates in effect to another price for LPG
But will these multiple rates create leakages in the system?
8Not really, if the money is directly transferred to the beneficiary account. Details
8The first prerequisite is to ensure financial inclusion of all BPL families so that the direct transfer of funds can take place.
8The government is currently earmarking Rs 2000 crore, with each family to be given a subsidy of Rs 1,600. along with an EMI facility to meet the cost of the stove and the refill.
8But this amount will clearly not be enough.
8NEREGA funds will also have to the transferred into his bank account to provide adequate financial muscle power to the BPL family to be able to partially afford a refill.
8A realistic calculation has to be made of the income gap in a BPL family and that will have to be compensated by the government to stop him from turning away from a refill.
So, in effect, the government will have to be thinking of four different cooking gas rates in the country. They are:
8A price for commercial unsubsidized LPG for commercial establishments
8A subsidized LPG price for the general population
8A super subsidized price for BPL families
8A piped natural gas price that is independently set, depending upon the cost of gas
8There is a possibility of yet another price emerging, perhaps between the price of the commercial rate and the general subsidized rate for families over a certain income level. A cap on cylinders also translates in effect to another price for LPG
But will these multiple rates create leakages in the system?
8Not really, if the money is directly transferred to the beneficiary account. Details
In all there are 28 deepwater and ultra deepwater discoveries in India that will now be covered by the new gas pricing policy.
8And it is ONGC, more than the RIL-BP duo, that has a bigger slice of the oil & gas reserves that lie in store underwater.
8ONGC's reserves are pegged at 3.20 tcf from out of two blocks and 14 discoveries.
8BP-RIL's reserves are placed at 2.53 tcf from 8 discoveries from two blocks while GSFC's claim is only for 1.015 tcf of gas from 6 discoveries from just block.
8The point to note is that the GSPC led consortium had spent a disproportional Rs 9000 crore to find a little over 1 tcf of gas as of now.
8Overall, the government is hopeful that the new policy will unleash about 6.75 tcf of gas.
8Of the 28 discoveries, 23 have been notified and the other five are still be be notified.
Click on Reports for a government presentation. Details
8And it is ONGC, more than the RIL-BP duo, that has a bigger slice of the oil & gas reserves that lie in store underwater.
8ONGC's reserves are pegged at 3.20 tcf from out of two blocks and 14 discoveries.
8BP-RIL's reserves are placed at 2.53 tcf from 8 discoveries from two blocks while GSFC's claim is only for 1.015 tcf of gas from 6 discoveries from just block.
8The point to note is that the GSPC led consortium had spent a disproportional Rs 9000 crore to find a little over 1 tcf of gas as of now.
8Overall, the government is hopeful that the new policy will unleash about 6.75 tcf of gas.
8Of the 28 discoveries, 23 have been notified and the other five are still be be notified.
Click on Reports for a government presentation. Details
For reference, the website carries here a comparison of the Hydrocarbon Exploration Licensing Policy (HELP) with the earlier New Exploration Licensing Policy (NELP).The differences are highlighted in terms of:
8The kind of areas in which disputes will be eliminated
8Difference in royalty rates between the two regimes
8Fiscal Model
8Cost recovery
8Cost efficiency
8Exploration period
8Management Committee functions
8Revenue structure for the government
8Exploration in ML areas
Click on Reports for more Details
8The kind of areas in which disputes will be eliminated
8Difference in royalty rates between the two regimes
8Fiscal Model
8Cost recovery
8Cost efficiency
8Exploration period
8Management Committee functions
8Revenue structure for the government
8Exploration in ML areas
Click on Reports for more Details
The government now claims that it has done all it can to push through reforms in the oil and gas sector.
Among the measures it has taken over and above last week's initiatives are:
8Policy for early monetisation of hydrocarbon discoveries
8Discovered small field policy
8Survey of unappraised areas
8Resource reassessment
8Cess on ad-valorem basis
8National Gas Hydrate Project
8Permission to CIL to explore CBM from its Mining Lease areas
8Ethanol Blending Programme
8DBTL
8Diesel price deregulation
Click on Reports for more Details
Among the measures it has taken over and above last week's initiatives are:
8Policy for early monetisation of hydrocarbon discoveries
8Discovered small field policy
8Survey of unappraised areas
8Resource reassessment
8Cess on ad-valorem basis
8National Gas Hydrate Project
8Permission to CIL to explore CBM from its Mining Lease areas
8Ethanol Blending Programme
8DBTL
8Diesel price deregulation
Click on Reports for more Details
So what is the quantum of investment expected in the gas discoveries in the next few years?
8To begin with, ONGC is likely to place orders soon for the development of the discoveries in the KG-DWN-98/3 block.
8The price tag was Rs 53,000 crore for the block but ONGC is currently in the process of negotiating down the rates to the lowest possible denominator.
8Then again, the RIL-BP duo will have to firm up their investments. BP had at one point last year claimed that the it can produce 40-50 mmscmd of gas from around 5 to 7 TCF of discovered reserves in their deepwater blocks.
8The first of these projects, the D-34 cluster of discoveries, containing 1.2 TCF of gas can go on steam first
8The price tag then was $4 billion but now that the cost of equipment and services has fallen, the price tag will be down by 35-40% of this amount.
8GSPC however faces a tougher challenge in the block KG-OSN-2001/3. The HPHT block faces technological challenges that GSPC seems to be struggling to come to grips with. It is currently capable of producing around 1 msmcmd of gas and plans will be now be drawn up to ramp up production.
8It is not known however by how much output can be ramped up from the block. The GSPC led consortium has already spent around Rs 9000 crore in the bock and a major round of capex is not expected at this juncture.
8The government has made it own set of calculations on how new investments are going to pan out, now that gas prices have been freed. The reserves which are expected to get monetized are of the order of 6.75 tcf or 190 BCM or around 35 mmscmd considering a production profile of 15 years. Besides these, there are around 10 discoveries which have been notified and whose potential is yet to be established.
8The associated reserves are valued at 28.35 Billion USD (1,80,000 Crore) by the government
8The country’s present gas production is around 90 mmscmd.
click here to go to our report section for more information. Details
8To begin with, ONGC is likely to place orders soon for the development of the discoveries in the KG-DWN-98/3 block.
8The price tag was Rs 53,000 crore for the block but ONGC is currently in the process of negotiating down the rates to the lowest possible denominator.
8Then again, the RIL-BP duo will have to firm up their investments. BP had at one point last year claimed that the it can produce 40-50 mmscmd of gas from around 5 to 7 TCF of discovered reserves in their deepwater blocks.
8The first of these projects, the D-34 cluster of discoveries, containing 1.2 TCF of gas can go on steam first
8The price tag then was $4 billion but now that the cost of equipment and services has fallen, the price tag will be down by 35-40% of this amount.
8GSPC however faces a tougher challenge in the block KG-OSN-2001/3. The HPHT block faces technological challenges that GSPC seems to be struggling to come to grips with. It is currently capable of producing around 1 msmcmd of gas and plans will be now be drawn up to ramp up production.
8It is not known however by how much output can be ramped up from the block. The GSPC led consortium has already spent around Rs 9000 crore in the bock and a major round of capex is not expected at this juncture.
8The government has made it own set of calculations on how new investments are going to pan out, now that gas prices have been freed. The reserves which are expected to get monetized are of the order of 6.75 tcf or 190 BCM or around 35 mmscmd considering a production profile of 15 years. Besides these, there are around 10 discoveries which have been notified and whose potential is yet to be established.
8The associated reserves are valued at 28.35 Billion USD (1,80,000 Crore) by the government
8The country’s present gas production is around 90 mmscmd.
click here to go to our report section for more information. Details
The one price that domestic producers of gas will have to be on the lookout for is the price of spot gas in India.
8Given the glut in the LNG market, where supply outstripsdemand, the spot LNG price in India can dip really low as LNG suppliers struggle to stay afloat.
In this scenario, even if the official ceiling price is low, buyers may not be willing to pay a price to domestic producers that is higher than the spot LNG rate.
8This is what happened to RasGas whose long term cargoes were priced out of the market by competitive spot gas rates, eventually forcing the Qatari company to drastically cut its price.
Importantly however, none of the Indian deepwater discoveries are likely to be functional before 2019-2020. By then, it is estimated that the LNG demand-supply gap will be bridged and by the early 2020s, the price of LNG is going to firm up again.
8This implies that the price of both long term and spot LNG may get to be higher by the time domestic discoveries come on stream.
8But what happens, if there is a divergence between the price of gas and that of fuel oil, naphtha and coal and the ceiling price is set lower than the landed price of LNG?
8Then again, if the price of coal plunges further, as is likely, will it pull down the ceiling price with it? But this won't be so, if the carbon tax on coal, which is likely to go up over time, is added to the cost of coal while averaging the price of alternate fuels. Details
8Given the glut in the LNG market, where supply outstripsdemand, the spot LNG price in India can dip really low as LNG suppliers struggle to stay afloat.
In this scenario, even if the official ceiling price is low, buyers may not be willing to pay a price to domestic producers that is higher than the spot LNG rate.
8This is what happened to RasGas whose long term cargoes were priced out of the market by competitive spot gas rates, eventually forcing the Qatari company to drastically cut its price.
Importantly however, none of the Indian deepwater discoveries are likely to be functional before 2019-2020. By then, it is estimated that the LNG demand-supply gap will be bridged and by the early 2020s, the price of LNG is going to firm up again.
8This implies that the price of both long term and spot LNG may get to be higher by the time domestic discoveries come on stream.
8But what happens, if there is a divergence between the price of gas and that of fuel oil, naphtha and coal and the ceiling price is set lower than the landed price of LNG?
8Then again, if the price of coal plunges further, as is likely, will it pull down the ceiling price with it? But this won't be so, if the carbon tax on coal, which is likely to go up over time, is added to the cost of coal while averaging the price of alternate fuels. Details
There is no doubt this is the right time for the operators to put in money in the gas discoveries in offshore India.
The following reasons make the timing right for the likes of ONGC, RIL-BP and GSFC:
8Cost of equipment and services has fallen by between 15-40%. And there is the possibility of another 10 to 15% decline in the current year or the next as capex is going to continue to fall around the world on account of low prevailing crude and gas prices, thereby exerting a downward pressure on rig rates, sub-sea equipment, pipelines, processing platforms and services.
8Equipment and service prices are going to harden after they go down this year or perhaps the next.
8By the time the discoveries go on stream, LNG prices are likely to strengthen and the asking price of gas may well be higher than the $7/mmbtu today.
8If the capex is committed now and the IRR is good enough, assuming a gas price of $6-7/mmbtu going ahead, this will be as good a time as any to invest because LNG prices are going to firm up by the time the discoveries go on stream. Details
The following reasons make the timing right for the likes of ONGC, RIL-BP and GSFC:
8Cost of equipment and services has fallen by between 15-40%. And there is the possibility of another 10 to 15% decline in the current year or the next as capex is going to continue to fall around the world on account of low prevailing crude and gas prices, thereby exerting a downward pressure on rig rates, sub-sea equipment, pipelines, processing platforms and services.
8Equipment and service prices are going to harden after they go down this year or perhaps the next.
8By the time the discoveries go on stream, LNG prices are likely to strengthen and the asking price of gas may well be higher than the $7/mmbtu today.
8If the capex is committed now and the IRR is good enough, assuming a gas price of $6-7/mmbtu going ahead, this will be as good a time as any to invest because LNG prices are going to firm up by the time the discoveries go on stream. Details
The Cabinet decision today to free the price of gas for discoveries in deep water, ultra deep water and High Pressure-High Temperature (HPHT) blocks means that India will provide one of the most attractive prices currently available in the world to producers of gas.
8The Henry Hub price on March 1, 2016 was at $1.57/mmbtu whereas the new dispensation in India will provide a price of around $7/mmbtu as of today.
8What the government has done is free the price of gas for these discoveries but with an appropriate ceiling which will be either the landed price of Fuel Oil or the landed price of LNG or the average of the landed prices of fuel oil, coal and naphtha, whichever is lower. The weighted average imported landed price of substitute fuels will be defined as: 0.3 x price of coal + 0.4 x price of fuel oil + 0.3 x price of naphtha.
8In the ideal case, the government should have taken the landed price of LNG as the natural ceiling, for it will be impossible for domestic producers to price it higher as buyers will reject such a price in favour of LNG.
8The government is trying to be over cautious by referencing the ceiling price to fuel oil and an average of coal, naphtha and fuel prices. Linking the price of gas to fuel oil was adopted in India earlier but was abandoned when it was found that the gas price was turning out to be too high.
8It is indeed archaic to peg the price to such a basket in today's day and age when demand-supply forces determine the price of gas and not an artificial peg to a non-uniform basket.
Some questions will remain unanswered in the new policy format:
8Will the landed price of LNG be pegged to the long term LNG cargo price or will it also include spot LNG cargoes? If it is going to be a mix of the two, what will be the percentage mix?
8Should the cost of coal include the carbon tax which will go up inexorably over the years?
8The questions notwithstanding, the policy does provide enough leeway for ONGC, RIL-BP and GSPC to start investing money in getting their discoveries to the production point.
8It is unlikely in today's world that the operators could have wrangled a better deal than what the government doled out today. Details
8The Henry Hub price on March 1, 2016 was at $1.57/mmbtu whereas the new dispensation in India will provide a price of around $7/mmbtu as of today.
8What the government has done is free the price of gas for these discoveries but with an appropriate ceiling which will be either the landed price of Fuel Oil or the landed price of LNG or the average of the landed prices of fuel oil, coal and naphtha, whichever is lower. The weighted average imported landed price of substitute fuels will be defined as: 0.3 x price of coal + 0.4 x price of fuel oil + 0.3 x price of naphtha.
8In the ideal case, the government should have taken the landed price of LNG as the natural ceiling, for it will be impossible for domestic producers to price it higher as buyers will reject such a price in favour of LNG.
8The government is trying to be over cautious by referencing the ceiling price to fuel oil and an average of coal, naphtha and fuel prices. Linking the price of gas to fuel oil was adopted in India earlier but was abandoned when it was found that the gas price was turning out to be too high.
8It is indeed archaic to peg the price to such a basket in today's day and age when demand-supply forces determine the price of gas and not an artificial peg to a non-uniform basket.
Some questions will remain unanswered in the new policy format:
8Will the landed price of LNG be pegged to the long term LNG cargo price or will it also include spot LNG cargoes? If it is going to be a mix of the two, what will be the percentage mix?
8Should the cost of coal include the carbon tax which will go up inexorably over the years?
8The questions notwithstanding, the policy does provide enough leeway for ONGC, RIL-BP and GSPC to start investing money in getting their discoveries to the production point.
8It is unlikely in today's world that the operators could have wrangled a better deal than what the government doled out today. Details
The government has dropped the arbitrary cut off point of November, 2014, only after which offshore gas discoveries were meant to be entitled to the new gas price premium.
8The new cut off date is January 1, 2016. However, gas fields currently under production will continue to be governed by the modified Rangarajan pricing formula.
8In other words, all deepwater discoveries till date will now qualify for the new price.
8But the government has made it clear that if if there is any pending arbitration or litigation filed by the contractors directly pertaining to gas pricing covering such fields, this policy guideline will apply only on the conclusion or withdrawal of such litigation and the attendant legal proceedings.
8So the signal is clear to the RIL-BP combine: the new gas price will not be available to them unless they withdraw the arbitration proceedings over the right to market the gas freely as enshrined under the Production Sharing Programme (PSC).
8Early indications are that RIL-BP duo will be willing to withdraw the arbitration case without prejudice other ongoing arbitration cases.
8The government is silent on whether it will insist on a similar withdrawal of arbitration cases against the the capital recovery operation conducted on the D-6 block.
8Nor is there any mention on whether the new gas price will not be allowed to production from the D-6 block pending settlement of the charge made by ONGC of illegal extraction of gas from the adjacent KG-DWN-98/2 block. Details
8The new cut off date is January 1, 2016. However, gas fields currently under production will continue to be governed by the modified Rangarajan pricing formula.
8In other words, all deepwater discoveries till date will now qualify for the new price.
8But the government has made it clear that if if there is any pending arbitration or litigation filed by the contractors directly pertaining to gas pricing covering such fields, this policy guideline will apply only on the conclusion or withdrawal of such litigation and the attendant legal proceedings.
8So the signal is clear to the RIL-BP combine: the new gas price will not be available to them unless they withdraw the arbitration proceedings over the right to market the gas freely as enshrined under the Production Sharing Programme (PSC).
8Early indications are that RIL-BP duo will be willing to withdraw the arbitration case without prejudice other ongoing arbitration cases.
8The government is silent on whether it will insist on a similar withdrawal of arbitration cases against the the capital recovery operation conducted on the D-6 block.
8Nor is there any mention on whether the new gas price will not be allowed to production from the D-6 block pending settlement of the charge made by ONGC of illegal extraction of gas from the adjacent KG-DWN-98/2 block. Details
The Cabinet has approved a switch from Production Sharing Contract to a Revenue Sharing model.
8There will also be a uniform licensing system which will cover all hydrocarbons -- oil, gas, coal bed methane or shale oil or gas -- under a single license and policy framework.
8Contracts will be based on “biddable revenue sharing”. Bidders will be required to quote revenue share in their bids and this will be a key parameter for selecting the winning bid.
8Bidders will quote a different share at two levels of revenue called “lower revenue point” and “higher revenue point”. Revenue share for intermediate points will be calculated by linear interpolation.
8A concessional royalty regime will be implemented for deep water and ultra-deep water areas. These areas will not have any royalty for the first seven years, and thereafter shall have a concessional royalty of 5% (in deep water areas) and 2% (in ultra-deep water areas). In shallow water areas, the royalty rates shall be reduced from 10% to 7.5%.
8The bidder giving the highest net present value of revenue share to the government, as per transparent methodology, will get the maximum marks under this parameter.
8The revenue sharing model will go hand in hand with an Open Acreage Licensing Policy will be implemented, whereby a bidder may apply for exploration of a block not already covered by exploration.
8If the block is found suitable for award, the government will call for competitive bids.
8Pertinently, the bids will be called after obtaining necessary environmental and other clearances Details
8There will also be a uniform licensing system which will cover all hydrocarbons -- oil, gas, coal bed methane or shale oil or gas -- under a single license and policy framework.
8Contracts will be based on “biddable revenue sharing”. Bidders will be required to quote revenue share in their bids and this will be a key parameter for selecting the winning bid.
8Bidders will quote a different share at two levels of revenue called “lower revenue point” and “higher revenue point”. Revenue share for intermediate points will be calculated by linear interpolation.
8A concessional royalty regime will be implemented for deep water and ultra-deep water areas. These areas will not have any royalty for the first seven years, and thereafter shall have a concessional royalty of 5% (in deep water areas) and 2% (in ultra-deep water areas). In shallow water areas, the royalty rates shall be reduced from 10% to 7.5%.
8The bidder giving the highest net present value of revenue share to the government, as per transparent methodology, will get the maximum marks under this parameter.
8The revenue sharing model will go hand in hand with an Open Acreage Licensing Policy will be implemented, whereby a bidder may apply for exploration of a block not already covered by exploration.
8If the block is found suitable for award, the government will call for competitive bids.
8Pertinently, the bids will be called after obtaining necessary environmental and other clearances Details
While the government has introduced the revenue sharing model with a bang, the E&P industry is unhappy about it.
8The industry believes that the current Pre-Tax Investment Multiple model is a more pragmatic way of attracting E&P investments.
8"How would a company know by scanning sparse seismic data made available in a DGH data room on a deepwater block whether it will have enough oil or gas for it to come up with a revenue share number while bidding for the block?," an E&P operator told this website.
8A deepwater well can cost anywhere above $ 25 to 100 million and it is not possible for anyone to accurately project what kind of revenue it will generate at the very beginning, even before exploration work starts in the block.
8The revenue sharing model can work when there is some kind of certainty on the prospectivity of a block or exploration work has been completed and a Field Development Plan has been drawn up.
8There is also uncertainty over how the oil and gas sector will fare in the years ahead given changes on the ground brought about by global warming and disruptive technologies.
Click on Reports for more Details
8The industry believes that the current Pre-Tax Investment Multiple model is a more pragmatic way of attracting E&P investments.
8"How would a company know by scanning sparse seismic data made available in a DGH data room on a deepwater block whether it will have enough oil or gas for it to come up with a revenue share number while bidding for the block?," an E&P operator told this website.
8A deepwater well can cost anywhere above $ 25 to 100 million and it is not possible for anyone to accurately project what kind of revenue it will generate at the very beginning, even before exploration work starts in the block.
8The revenue sharing model can work when there is some kind of certainty on the prospectivity of a block or exploration work has been completed and a Field Development Plan has been drawn up.
8There is also uncertainty over how the oil and gas sector will fare in the years ahead given changes on the ground brought about by global warming and disruptive technologies.
Click on Reports for more Details
The government has also announced guidelines for extension of PSCs for discovered fields but only under fresh terms.
The following are the details:
8The contractor should submit the application for extension of Contract at least 2 years in advance of the expiry date, but not more than 6 years in advance. The Director General Hydrocarbons (DGH) will make a recommendation within 6 months of submission of application by the contractor. The Government will take a decision on the request for extension within 3 months of receipt of the proposal from DGH.
8The government share of Profit Petroleum during the extended period of contract shall be 10% higher than the share as calculated using the normal PSC provisions in any year during the extended period. For example, if the current profit share, is 10 or 20%, it shall become 20 or 30% respectively.
8During the extended period of contract, the royalty and cess will be payable at prevailing rates and not at concessional rates stipulated in the contracts.
8The extension of these PSCs would be considered for 10 years both for oil and gas fields or economic life of the field, whichever is earlier. Details
The following are the details:
8The contractor should submit the application for extension of Contract at least 2 years in advance of the expiry date, but not more than 6 years in advance. The Director General Hydrocarbons (DGH) will make a recommendation within 6 months of submission of application by the contractor. The Government will take a decision on the request for extension within 3 months of receipt of the proposal from DGH.
8The government share of Profit Petroleum during the extended period of contract shall be 10% higher than the share as calculated using the normal PSC provisions in any year during the extended period. For example, if the current profit share, is 10 or 20%, it shall become 20 or 30% respectively.
8During the extended period of contract, the royalty and cess will be payable at prevailing rates and not at concessional rates stipulated in the contracts.
8The extension of these PSCs would be considered for 10 years both for oil and gas fields or economic life of the field, whichever is earlier. Details
Mar 11 : Government unleashes new oil and gas policies-IX: Why was Cairn's Rajasthan block left out?
The government has left out Cairn India's Rajasthan block RJ-ON-90/1 from the preview of the PSC extension guidelines.
8It is not known yet why the government did so.
8It could possibly be on account of the fact that the company sought the intervention of the Delhi High Court to issue directions to the government to extend the tenure of the block by 10 years after the present term expires in 2020.
8The reason for excluding the block could well be on account of the fact that the issue is subjudice and is under contention in court.
8There is also a possibility that ONGC had objected to Cairn's insistence that the block be extended under the same terms and conditions as before. ONGC wanted a change in the terms and conditions if the lease is to be extended.
8It is also likely that the government may be miffed over the managment's decision to haul it to court.
8This government does not take kindly to court directions on subjects that it believes should be handled only under its ambit..
8This website had said before that if the government decides to become intransigent as a consequence, the company might find it very difficult to carry on doing business with it.
8It now looks like the government will impose fresh terms on the extension.
8The moot point is given the special nature of the block, whether the same terms as enshrined in the extension policy will be applied or will there be a stricter set of norms?
Click on Details for more Details
8It is not known yet why the government did so.
8It could possibly be on account of the fact that the company sought the intervention of the Delhi High Court to issue directions to the government to extend the tenure of the block by 10 years after the present term expires in 2020.
8The reason for excluding the block could well be on account of the fact that the issue is subjudice and is under contention in court.
8There is also a possibility that ONGC had objected to Cairn's insistence that the block be extended under the same terms and conditions as before. ONGC wanted a change in the terms and conditions if the lease is to be extended.
8It is also likely that the government may be miffed over the managment's decision to haul it to court.
8This government does not take kindly to court directions on subjects that it believes should be handled only under its ambit..
8This website had said before that if the government decides to become intransigent as a consequence, the company might find it very difficult to carry on doing business with it.
8It now looks like the government will impose fresh terms on the extension.
8The moot point is given the special nature of the block, whether the same terms as enshrined in the extension policy will be applied or will there be a stricter set of norms?
Click on Details for more Details
The Modi government has ruled that a contract was never finalized for handing over the ONGC discovered Ratna Offshore Field to an Essar Oil Ltd consortium.
8The government's view is that the field was only tentatively awarded to Essar when a LOI was given in 1996. Even though 17 years have elapsed now, the Production Sharing Contract (PSC) for the field has not yet been signed.
8The official view now is that the contract was never finalized because of a number of administrative and legal uncertainties
8"As this field has remained without exploitation for over 20 years since its initial tendering, the government has now decided that it will be assigned to ONGC on nomination basis. This will enable this long pending and proven oil reserve to come into production, and create new employment," the government said in a press release
8The signing of the PSC was delayed over several issues including a dispute over whether Essar had the networth to develop the field and the amount of cess and royalty to be paid by the company once it took over. Details
8The government's view is that the field was only tentatively awarded to Essar when a LOI was given in 1996. Even though 17 years have elapsed now, the Production Sharing Contract (PSC) for the field has not yet been signed.
8The official view now is that the contract was never finalized because of a number of administrative and legal uncertainties
8"As this field has remained without exploitation for over 20 years since its initial tendering, the government has now decided that it will be assigned to ONGC on nomination basis. This will enable this long pending and proven oil reserve to come into production, and create new employment," the government said in a press release
8The signing of the PSC was delayed over several issues including a dispute over whether Essar had the networth to develop the field and the amount of cess and royalty to be paid by the company once it took over. Details
Will Essar take the Modi government to court over denial of the right to develop the Ratna field?
8Essar's official position has always been that a firm contracted existed for the field as an LOI was indeed issued by the government of India.
8The PSC was not signed for several reasons but that does prejudice the company's right to take over the field.
I8t had contested the government's right to change the royalty and cess rates without at the same time providing a new cost recovery margin.
8The company had time and again insisted that it was willing to pay the old cess and royalty rates if the old cost recovery norms were to hold or else if the cess and royalty rates were to be adjusted upwards, the cost recovery element must also take into account the rise in cost of equipment and services in the interim period.
8No government likes to be dragged to court and this may deter Essar from takeing it to the Delhi High Court.
8On the other hand, if the company feels its case is strong, it may take the legal battle forward. Details
8Essar's official position has always been that a firm contracted existed for the field as an LOI was indeed issued by the government of India.
8The PSC was not signed for several reasons but that does prejudice the company's right to take over the field.
I8t had contested the government's right to change the royalty and cess rates without at the same time providing a new cost recovery margin.
8The company had time and again insisted that it was willing to pay the old cess and royalty rates if the old cost recovery norms were to hold or else if the cess and royalty rates were to be adjusted upwards, the cost recovery element must also take into account the rise in cost of equipment and services in the interim period.
8No government likes to be dragged to court and this may deter Essar from takeing it to the Delhi High Court.
8On the other hand, if the company feels its case is strong, it may take the legal battle forward. Details
There is much confusion in the government over the basket of "alternative fuels" to be used for determination of a new gas price for new deepwater discoveries in India.
8There is a fear that in trying to determine the price of "alternate fuels", the government might dig itself into a corner from where it would be difficult to wriggle out in case the exercise backfires.
Click on Details to find out more on what troubles the government on the pricing of gas for new offshore discoveries. Details
8There is a fear that in trying to determine the price of "alternate fuels", the government might dig itself into a corner from where it would be difficult to wriggle out in case the exercise backfires.
Click on Details to find out more on what troubles the government on the pricing of gas for new offshore discoveries. Details
Clearly what the government is trying to do is to give a price hike to kick start the gas discoveries.
8Or else the discoveries are not going to be viable.
8But the new gas pricing mechanism may actually allow for a price that could be so high that gas producers would be forced to sell well below the official rate.
Click on Details for more on how that can happen. Details
8Or else the discoveries are not going to be viable.
8But the new gas pricing mechanism may actually allow for a price that could be so high that gas producers would be forced to sell well below the official rate.
Click on Details for more on how that can happen. Details
Numaligarh Refinery is in the midst of preparing an Environment Impact Assessment Report for a massive bio-refinery -- the largest in India -- in Upper Assam to produce chemicals and ethanol by using bamboo as the feedstock.
8The bio-refinery will produce 48,900 MT of ethanol, 11,100 MT of acetic acid, 18,600 MT of furfural alcohol, 160,000 MT of biocoal (to combustion) and 30,000 MT of stillages.
8The complex will consume a massive 450,000 tonnes of green bamboo.
8The project is being set up at a cost of Rs 663 crore. The debt-equity ratio will be 70:30.
8Under various scenarios, the IRR for the project, as drawn up by PWC, varies between 14 to 16%.
Click on Reports for more Details
8The bio-refinery will produce 48,900 MT of ethanol, 11,100 MT of acetic acid, 18,600 MT of furfural alcohol, 160,000 MT of biocoal (to combustion) and 30,000 MT of stillages.
8The complex will consume a massive 450,000 tonnes of green bamboo.
8The project is being set up at a cost of Rs 663 crore. The debt-equity ratio will be 70:30.
8Under various scenarios, the IRR for the project, as drawn up by PWC, varies between 14 to 16%.
Click on Reports for more Details
The website believes that Numaligarh refinery should not go ahead with the bio-refinery in the North East of India.
8The procurement and transportation of 450,000 tonnes of bamboo will severely stress the fragile ecological balance in the North East as the bamboo will have to be sourced from all over the region, spread over different states.
8Already the bamboo sourcing process adopted by the public sector Ashok Paper Mills Ltd in Assam is a big mess, with unscrupulous forest contractors illegally denuding last tracks of virgin bamboo forests. Local villagers are exploited by the contractors and the harvest of bamboo is done in an unscientific and ecologically damaging manner.
8The demand for another 450,000 tonnes of bamboo by NRL will only escalate the scale of the ecological disaster
8What is more, the government has withdrawn excise duty and other tax relief given for new industrial units in the North East
8Given that prices of chemicals have fallen in recent months, the bio-refinery in the North East may be susceptible to market volatility of the kind that NRL may not be able to handle.
Click on Reports for more Details
8The procurement and transportation of 450,000 tonnes of bamboo will severely stress the fragile ecological balance in the North East as the bamboo will have to be sourced from all over the region, spread over different states.
8Already the bamboo sourcing process adopted by the public sector Ashok Paper Mills Ltd in Assam is a big mess, with unscrupulous forest contractors illegally denuding last tracks of virgin bamboo forests. Local villagers are exploited by the contractors and the harvest of bamboo is done in an unscientific and ecologically damaging manner.
8The demand for another 450,000 tonnes of bamboo by NRL will only escalate the scale of the ecological disaster
8What is more, the government has withdrawn excise duty and other tax relief given for new industrial units in the North East
8Given that prices of chemicals have fallen in recent months, the bio-refinery in the North East may be susceptible to market volatility of the kind that NRL may not be able to handle.
Click on Reports for more Details
In order to limit front end costs, Cairn India is planning to hire rather than purchase gas compressors for its gas pipeline from the Rajasthan block.
8The compressors are sought to be hired with accompanying O&M services.
8The compressors should be capable of compressing 10 to 20 mmscfd of gas with 35-45 barg under 30-40 degree centigrade temperature conditions.
8A compressor module will be an integrated package which will include all inter connecting piping, manual valves, scrubbers, air coolers, pessure control, relief valves, instruments, control system and electrical equipment to make the system operable.
8What Cairn is likely to provide in rentals for a guaranteed period of operations.
8Cairn believes this business model is more cost effective at this juncture than buying compressors even though the period of operations will be more than 15 to 20 years.
Click on Reports for more Details
8The compressors are sought to be hired with accompanying O&M services.
8The compressors should be capable of compressing 10 to 20 mmscfd of gas with 35-45 barg under 30-40 degree centigrade temperature conditions.
8A compressor module will be an integrated package which will include all inter connecting piping, manual valves, scrubbers, air coolers, pessure control, relief valves, instruments, control system and electrical equipment to make the system operable.
8What Cairn is likely to provide in rentals for a guaranteed period of operations.
8Cairn believes this business model is more cost effective at this juncture than buying compressors even though the period of operations will be more than 15 to 20 years.
Click on Reports for more Details
What is the real benefit of the Direct Transfer of Subsidy scheme for LPG?
8Quite a lot, the government claims.
8The public sector Oil Marketing Companies (OMCs) have reported that the growth in sale of domestic cylinders has slowed down to 5.7% in the April-January, 2016 against 11.31% for the same period in the previous year.
8The growth rate has come down because the direct transfer of cash scheme has plugged leakages in the system.
8Subsidized cylinders are no longer spirited off for use in the commercial sector.
8In contrast, the sale of commercial LPG cylinders has registered a growth rate of a whopping 42.21% for the same period as against an increase of a mere 2.11% during April 2014 to January 2015
8Clearly, commercial users scurrying for cover, buying their requirements from the open market instead of illegally dipping into the subsidized allocations.
Click on Reports for all the data Details
8Quite a lot, the government claims.
8The public sector Oil Marketing Companies (OMCs) have reported that the growth in sale of domestic cylinders has slowed down to 5.7% in the April-January, 2016 against 11.31% for the same period in the previous year.
8The growth rate has come down because the direct transfer of cash scheme has plugged leakages in the system.
8Subsidized cylinders are no longer spirited off for use in the commercial sector.
8In contrast, the sale of commercial LPG cylinders has registered a growth rate of a whopping 42.21% for the same period as against an increase of a mere 2.11% during April 2014 to January 2015
8Clearly, commercial users scurrying for cover, buying their requirements from the open market instead of illegally dipping into the subsidized allocations.
Click on Reports for all the data Details
For reference purposes, the website carries here details of:
--LNG imports in the last two years
--Domestic production of gas
--Countries from where LNG is imported
8According to latest data, India imported LNG from a total of 14 countries last year
Click on Reports for more Details
--LNG imports in the last two years
--Domestic production of gas
--Countries from where LNG is imported
8According to latest data, India imported LNG from a total of 14 countries last year
Click on Reports for more Details
Engineers India Ltd (EIL) is peeved with a tender brought out by ONGC for an agency that can handle the company's import handling and customs related work.
8The tender calls for a three-year contract.
8EIL's logistics, inspection and liaisoning division is eminently capable of doing this job.
8In the normal course, EIL had expected ONGC to work for the job on an automatic basis under the umbrella consultancy agreement with the engineering major, wherein the work done by EIL is billed to ONGC on the basis of an hourly manpower deployment rate.
8ONGC on the other hand believes that is mandated by law to tender for such services.
Click on Reports for more on this fracas. Details
8The tender calls for a three-year contract.
8EIL's logistics, inspection and liaisoning division is eminently capable of doing this job.
8In the normal course, EIL had expected ONGC to work for the job on an automatic basis under the umbrella consultancy agreement with the engineering major, wherein the work done by EIL is billed to ONGC on the basis of an hourly manpower deployment rate.
8ONGC on the other hand believes that is mandated by law to tender for such services.
Click on Reports for more on this fracas. Details
A Supreme Court order notwithstanding, GAIL seems to be making little progress in the laying of the Kochi-Bangalore-Mangalore pipeline in Tamil Nadu. A review petition by state has sought the reversal of a decision taken by the apex court to allow the pipeline to be laid. through agricultural land
8On the other hand the gas major has made progress in Kerela where the state government after initial opposition has intervened to allow the pipeline to be laid.
Click on Reports for more on both developments Details
8On the other hand the gas major has made progress in Kerela where the state government after initial opposition has intervened to allow the pipeline to be laid.
Click on Reports for more on both developments Details
The Department of Fertilizers will provide a one-time compensation to FACT Ltd to upgrade to LNG so as to push the company out of the red and away from the clutches of the Board for Industrial and Financial Reconsutrcition.
8This will mean that LNG suppliers can target FACT for purchase of gas.
8The DOF has said that a proposal for financial restructuring of FACT is under active consideration.
The package includes:
8Waiver of Government of India loans and interest
8Granting onetime compensation for use of liquefied Natural gas (LNG)
8Issuance of sovereign guarantee so as to come out of Board for Industrial and Financial Reconstruction
8The proposal also includes In principle approval for sale or leveraging of land for raising resources to repay the loans raised against sovereign guarantee and to raise funds for implementation of shor, medium and long term
projects.
8However, to avert immediate crisis, budgetary provision of Rs. 1000 Crore for providing Plan loan to FACT has been made.
Click on Reports for more Details
8This will mean that LNG suppliers can target FACT for purchase of gas.
8The DOF has said that a proposal for financial restructuring of FACT is under active consideration.
The package includes:
8Waiver of Government of India loans and interest
8Granting onetime compensation for use of liquefied Natural gas (LNG)
8Issuance of sovereign guarantee so as to come out of Board for Industrial and Financial Reconstruction
8The proposal also includes In principle approval for sale or leveraging of land for raising resources to repay the loans raised against sovereign guarantee and to raise funds for implementation of shor, medium and long term
projects.
8However, to avert immediate crisis, budgetary provision of Rs. 1000 Crore for providing Plan loan to FACT has been made.
Click on Reports for more Details
Is the coal-based Talcher fertilizer plant ever take off?
8The protagonists think it still can.
8A JV company involving all the stake holders -- RCF, CIL, GAIL and FCIL -- was incorporated in November, 2015 under the style of Rashtriya Coal Gas Fertilizer Ltd.
8SBI Caps has submitted a report on the techno-economic feasibility study that was submitted by PDIL.
8An asset evaluation of the unit is now being carried out.
8Consensus building is now being sought among stakeholders based on the EIL report on how to take the project forward.
Also click on Reports for more details on revival plans for other fertilizer plants Details
8The protagonists think it still can.
8A JV company involving all the stake holders -- RCF, CIL, GAIL and FCIL -- was incorporated in November, 2015 under the style of Rashtriya Coal Gas Fertilizer Ltd.
8SBI Caps has submitted a report on the techno-economic feasibility study that was submitted by PDIL.
8An asset evaluation of the unit is now being carried out.
8Consensus building is now being sought among stakeholders based on the EIL report on how to take the project forward.
Also click on Reports for more details on revival plans for other fertilizer plants Details
ONGC is going ahead with the development of the Bokaro CBM block.
8The company will drill a total of 90 wells in two "patches".
8Patch A will witness the drilling of 52 wells and one GCS/ GCP while Patch-B will have 38 wells and two identical EPSs.
8Facilities of gas and produced water separation will be be created for all 90 well heads
8A series of associated pipelines will be built and this will be a huge network given the fact that a total of 90 wells will be strung together in two patches.
8The pipeline contract and the drilling contact will be two independent contracts
Click on Reports for more Details
8The company will drill a total of 90 wells in two "patches".
8Patch A will witness the drilling of 52 wells and one GCS/ GCP while Patch-B will have 38 wells and two identical EPSs.
8Facilities of gas and produced water separation will be be created for all 90 well heads
8A series of associated pipelines will be built and this will be a huge network given the fact that a total of 90 wells will be strung together in two patches.
8The pipeline contract and the drilling contact will be two independent contracts
Click on Reports for more Details
The Bokaro CBM block encompasses an area of 75 km2 and falls in the Bokaro and Ramgarh districts of Jharkhand.
8The block falls in the Bokaro coal field and comprises three geographically disconnected patches in the East and West Bokaro coalfields.
8The main central part (Patch-A) lies on the eastern and western flanks of the Lugu Hill.
8Additionally, two small patches lie in the southwestern part of West Bokaro coalfield (Patch-B).
8The East and West Bokaro coalfields are important sources of medium coking and coking coal respectively in India.
8The entire development project involves construction of the following facilities:
8A new 10 LSCMD Gas Collecting Station cum Gas Compressor Plant and a 7.5 LSCMD compression facility at the Bokaro Patch-A Field
8Two Quick Production Systems (EPS) of 0.5 LSCMD each capacity with Water Treatment at the Bokaro Patch-B Field.
890 wellhead separation facilities including supply and laying of CS and HDPE pipelines coming to individual wellheads from main feeder lines.
Click on Reports for more Details
8The block falls in the Bokaro coal field and comprises three geographically disconnected patches in the East and West Bokaro coalfields.
8The main central part (Patch-A) lies on the eastern and western flanks of the Lugu Hill.
8Additionally, two small patches lie in the southwestern part of West Bokaro coalfield (Patch-B).
8The East and West Bokaro coalfields are important sources of medium coking and coking coal respectively in India.
8The entire development project involves construction of the following facilities:
8A new 10 LSCMD Gas Collecting Station cum Gas Compressor Plant and a 7.5 LSCMD compression facility at the Bokaro Patch-A Field
8Two Quick Production Systems (EPS) of 0.5 LSCMD each capacity with Water Treatment at the Bokaro Patch-B Field.
890 wellhead separation facilities including supply and laying of CS and HDPE pipelines coming to individual wellheads from main feeder lines.
Click on Reports for more Details
The drop in oil prices since June 2014 has aided the expansion in oil demand in India.
8The increased affordability of oil to a very large section of the population is reflected, for instance, in massive additions of two-wheelers to the total vehicle fleet over 2015
8A research paper now shows that recent policy initiatives are likely to further lift oil demand.
8Specifically, this paper estimates a significant uplift in the consumption of diesel and naphtha as the government pushes for raising manufacturing’s share within GDP from 15 per cent at present to 25 per cent by 2022.
8Such an increase could add at least a third to India’s current oil demand levels, based on a broad and conservative linear estimates.
8A concomitant programme of road infrastructure creation targeting the addition of 30 km a day will add to this, although growing environmental and air pollution concerns could constrain growth in oil demand in the transportation sector.
8In terms of the bigger picture: while China’s oil demand growth has slowed, India's is picking up.
8This rise in demand also has implications for India’s recently acquired status as a net exporter of oil products, which this paper shows could well be reversed.
8Finally, the question of whether India will manage to soar to a higher plane of development and consumption is contingent to a great extent upon its ability to carry out and sustain structural reforms to support economic growth.
Click on Reports for more Details
8The increased affordability of oil to a very large section of the population is reflected, for instance, in massive additions of two-wheelers to the total vehicle fleet over 2015
8A research paper now shows that recent policy initiatives are likely to further lift oil demand.
8Specifically, this paper estimates a significant uplift in the consumption of diesel and naphtha as the government pushes for raising manufacturing’s share within GDP from 15 per cent at present to 25 per cent by 2022.
8Such an increase could add at least a third to India’s current oil demand levels, based on a broad and conservative linear estimates.
8A concomitant programme of road infrastructure creation targeting the addition of 30 km a day will add to this, although growing environmental and air pollution concerns could constrain growth in oil demand in the transportation sector.
8In terms of the bigger picture: while China’s oil demand growth has slowed, India's is picking up.
8This rise in demand also has implications for India’s recently acquired status as a net exporter of oil products, which this paper shows could well be reversed.
8Finally, the question of whether India will manage to soar to a higher plane of development and consumption is contingent to a great extent upon its ability to carry out and sustain structural reforms to support economic growth.
Click on Reports for more Details
India’s oil demand has soared over the last year, reaching an average year-on-year demand growth of 0.30 mb/d in 2015, compared with 0.1–0.15 mb/d over the previous decade.
8This jump in demand reflects a number of underlying dynamics at play, indicating that India’s oil demand may be on the verge of ‘taking off’'.
8The magnitude of this ‘take-off’' can be gauged by the fact that Indian oil demand is demonstrating trends that were visible in China around a decade ago.
8For instance, the level of growth in oil product demand in India, particularly gasoline, is rapidly approaching levels seen in China prior to its ‘boom’.
8Furthermore, an analysis of motorization, widely regarded as an acceptable metric in gauging oil consumption patterns and economic ‘take-off’, shows that car ownership trends in India (per thousand population) are at around the levels which China reached a decade ago.
8India’s per capita income on a purchasing power parity basis is also estimated to have breached the threshold beyond which motorization rapidly ensues.
Click on Reports for more Details
8This jump in demand reflects a number of underlying dynamics at play, indicating that India’s oil demand may be on the verge of ‘taking off’'.
8The magnitude of this ‘take-off’' can be gauged by the fact that Indian oil demand is demonstrating trends that were visible in China around a decade ago.
8For instance, the level of growth in oil product demand in India, particularly gasoline, is rapidly approaching levels seen in China prior to its ‘boom’.
8Furthermore, an analysis of motorization, widely regarded as an acceptable metric in gauging oil consumption patterns and economic ‘take-off’, shows that car ownership trends in India (per thousand population) are at around the levels which China reached a decade ago.
8India’s per capita income on a purchasing power parity basis is also estimated to have breached the threshold beyond which motorization rapidly ensues.
Click on Reports for more Details
EIL is also pushing its expertise as a shipping and logistics company to clients.
The company's services include:
8Scope development for shipping and logistic bid documents, evaluation and award.
8Coordination with the client and Customs House for registering various concessional duty schemes applicable for Import shipments.
8Arrange shipping space by liaisoning with Transchart (Ministry of Shipping) for all import consignments through sea by optimizing the freight economics.
8Air freighting to meet project exigencies.
8Customs clearance activities and expediting of critical shipments.
8Conducting route surveys for ODC movement and deciding on the best mode (road or multimodal) based on geographic location of each project.
8Arranging suitable agency for Site Material Handling services.
8Rendering assistance in obtaining suitable marine Insurance coverage.
Click on Reports for more Details
The company's services include:
8Scope development for shipping and logistic bid documents, evaluation and award.
8Coordination with the client and Customs House for registering various concessional duty schemes applicable for Import shipments.
8Arrange shipping space by liaisoning with Transchart (Ministry of Shipping) for all import consignments through sea by optimizing the freight economics.
8Air freighting to meet project exigencies.
8Customs clearance activities and expediting of critical shipments.
8Conducting route surveys for ODC movement and deciding on the best mode (road or multimodal) based on geographic location of each project.
8Arranging suitable agency for Site Material Handling services.
8Rendering assistance in obtaining suitable marine Insurance coverage.
Click on Reports for more Details
EIL is also aggressively pushing its inspection services to clients.
8It says its Inspection Department provides specialized inspection services through its Regional Procurement Offices (RPOs) across India and through Inspection offices in London, Milan and Shanghai.
8EIL’s inspection services aim at ensuring specified quality and specification adherence by vendors.
8A multidisciplinary team of engineers bring in experience, professional judgment and compliance to codes and specifications.
8Inspection engineers are qualified in the fields of NDT, ASNT Level III in UT and RT, and Level II in RT/UT/MPT/ LPT/VT including TOFD & PAUT.
8Inspection engineers are proficient with national and international codes and standards like ASME / NACE/ BIS (Bureau of Indian Standards) / API & GIS etc with specialization in the field of Non-Destructive Testing (NDT) level-II/level-III.
8Inspection experience covers all types of equipment and materials and EIL says it has experience of over seven million man hours over a period of 50 years across India and the globe.
8Standard Inspection & Test Plans (ITPs) covering all type of equipment have been developed in house and this forms an intrinsic part of all contracts/PO’s for ensuring quality.
Click on Reports for more Details
8It says its Inspection Department provides specialized inspection services through its Regional Procurement Offices (RPOs) across India and through Inspection offices in London, Milan and Shanghai.
8EIL’s inspection services aim at ensuring specified quality and specification adherence by vendors.
8A multidisciplinary team of engineers bring in experience, professional judgment and compliance to codes and specifications.
8Inspection engineers are qualified in the fields of NDT, ASNT Level III in UT and RT, and Level II in RT/UT/MPT/ LPT/VT including TOFD & PAUT.
8Inspection engineers are proficient with national and international codes and standards like ASME / NACE/ BIS (Bureau of Indian Standards) / API & GIS etc with specialization in the field of Non-Destructive Testing (NDT) level-II/level-III.
8Inspection experience covers all types of equipment and materials and EIL says it has experience of over seven million man hours over a period of 50 years across India and the globe.
8Standard Inspection & Test Plans (ITPs) covering all type of equipment have been developed in house and this forms an intrinsic part of all contracts/PO’s for ensuring quality.
Click on Reports for more Details
EIL also claims to provide bespoke supply chain management solutions.
8It says it can provide competitive advantage for projects of all scale and size through a proficient team of category specialists aimed to help organizations, optimize their spend base and achieve sustainable results, that improve bottom lines.
8All purchasing and contracting to be facilitated through e-procurement.
8Reverse auctions whereever warranted.
8All enquires or RFPs for goods, services, works and contracts hoisted on e-platform for open access.
8Performance monitoring and real time assessment.
Click on Reports for more Details
8It says it can provide competitive advantage for projects of all scale and size through a proficient team of category specialists aimed to help organizations, optimize their spend base and achieve sustainable results, that improve bottom lines.
8All purchasing and contracting to be facilitated through e-procurement.
8Reverse auctions whereever warranted.
8All enquires or RFPs for goods, services, works and contracts hoisted on e-platform for open access.
8Performance monitoring and real time assessment.
Click on Reports for more Details
EIL says it can provide unbeatable supply chain management services to its clients.
The following are the highlights of EIL's offer:
8Global vendor enlistment, evaluation and upgradation
8Continuous interaction with licensors, EPC contractors and vendors.
8A dynamic list of vendors that is continuously updated.
8The company has 1800 suppliers enlisted for supply of 700 items in different categories
8225 contractors have been short listed in different disciplines
8Over 1000 suppliers in India itself and 800 abroad
8Status report on supplies to be provided on a daily, weekly and monthly basis.
8Shop visits for first hand evaluation of vendor capability
8Continuous performance review of contactors and suppliers
8Assessment of quality control systems and procedures at vendor establishments.
824x7 online applications for suppliers and contractors
Click on Reports for more Details
The following are the highlights of EIL's offer:
8Global vendor enlistment, evaluation and upgradation
8Continuous interaction with licensors, EPC contractors and vendors.
8A dynamic list of vendors that is continuously updated.
8The company has 1800 suppliers enlisted for supply of 700 items in different categories
8225 contractors have been short listed in different disciplines
8Over 1000 suppliers in India itself and 800 abroad
8Status report on supplies to be provided on a daily, weekly and monthly basis.
8Shop visits for first hand evaluation of vendor capability
8Continuous performance review of contactors and suppliers
8Assessment of quality control systems and procedures at vendor establishments.
824x7 online applications for suppliers and contractors
Click on Reports for more Details
Engineers India Ltd is pushing an end to end integrated supply chain management concept to its clients.
8The company will undertake contracts and purchases on behalf of the client, provide inspection as well as monitoring services along with logistics, invoicing, reconciliation and payments.
The services will include:
8Vendor enlistment and development through rigorous evaluation and selection.
824x7 monitoring of vendor performance
8Contracting & Purchasing on a global platform.
8Inspection and expediting not just through pan India offices but through its global offices in London, Milan & Shanghai.
8Shipping & Logistics for material dispatch and transportation to site, along with warehousing receipt and control.
Click on Reports for more Details
8The company will undertake contracts and purchases on behalf of the client, provide inspection as well as monitoring services along with logistics, invoicing, reconciliation and payments.
The services will include:
8Vendor enlistment and development through rigorous evaluation and selection.
824x7 monitoring of vendor performance
8Contracting & Purchasing on a global platform.
8Inspection and expediting not just through pan India offices but through its global offices in London, Milan & Shanghai.
8Shipping & Logistics for material dispatch and transportation to site, along with warehousing receipt and control.
Click on Reports for more Details
Following a slow down in E&P business in India and worldwide, Engineers India Ltd is trying push some of its non-core businesses to cilents.
8Among the businesses it is advocating are underground storage technology, end to end supply chain management services, logistical services and inspection services.
8As its order acquisition volumes slow down, EIL is trying to reinvent itself.
8There is no denying that EIL still is a formidable company.
8Over the past five decades, it has executed more than 5000 projects including over 400 major projects worth USD 200 billion in "total cost".
8The company for example has already been a project management consultant for construction of 5.33 MMT of strategic crude reserves in Vizag, Mangalore and Padur.
EIL says it has the domain advantage in the following areas involving strategic storage:
8Feasibility studies and detailed project reports
8Exploratory investigation campaigns
8Geology, hydrogeology and rock engineering work
8Above ground process facilities
8Cavern integrity testing and commissioning
8Construction management
8The point is whether EIL will be now allowed to be a project management consultant on a nomination basis for other strategic storage facilities that will automatically allow the company to generate a vast amount of business, or will Modi government come out with a tender for them.
Click on Reports for more Details
8Among the businesses it is advocating are underground storage technology, end to end supply chain management services, logistical services and inspection services.
8As its order acquisition volumes slow down, EIL is trying to reinvent itself.
8There is no denying that EIL still is a formidable company.
8Over the past five decades, it has executed more than 5000 projects including over 400 major projects worth USD 200 billion in "total cost".
8The company for example has already been a project management consultant for construction of 5.33 MMT of strategic crude reserves in Vizag, Mangalore and Padur.
EIL says it has the domain advantage in the following areas involving strategic storage:
8Feasibility studies and detailed project reports
8Exploratory investigation campaigns
8Geology, hydrogeology and rock engineering work
8Above ground process facilities
8Cavern integrity testing and commissioning
8Construction management
8The point is whether EIL will be now allowed to be a project management consultant on a nomination basis for other strategic storage facilities that will automatically allow the company to generate a vast amount of business, or will Modi government come out with a tender for them.
Click on Reports for more Details
Rajasthan is working on a natural gas infrastructure development plan that envisages clean energy solution to the "smart" cities of Jaipur, Ajmer, Kota and Udaipur by creating CNG highways between cities.
8The big attempt is to eventually convert the Delhi-Mumbai higway into a CNG corridor.
Gas "highways" are planned between the cities of Rajasthan, including:
8Kota-Jaipur
8Kota-Baran-Indore-Mumbai
8Jaipur-Ajmer
8Jaipur-Sikar
8Bhilwara-Chittorgarh-Udaipur.
8The commissioning of a "mega CNG station" at Neemrana and another at Jaipur will ensure that the crucial National Highway 08 becomes operational for CNG vehicles within the state.
8Rajasthan is looking at the development of Industrial clusters under the banner of “Make In Rajasthan” drive and availability of gas will power this move.
8Gas supply is already provided to industrial zones at Behror, Sotanala, Keshawana and Kukas.
8Meanwhile, additional compression facility at Neemrana and construction of a dedicated pipeline will bring gas to the industrial base at Ghilot
8By the last quarter of 2017, the CNG highway will be extended between Kota-Jaipur and along the Kota-Baran-Indore-Mumbai highway.
8The ambitious plan involves using different modes of energy usage in some of the cities. In Kota for example, the idea is to ensure speedy execution of pipeline so as to connect demand centers for rapid industrialization. In Ajmer, the approach is to to convert municipal waste into biogas while also making nautural gas available through the Neemrana-Jaipur-Ajmer pipeline.
Click on Reports for more Details
8The big attempt is to eventually convert the Delhi-Mumbai higway into a CNG corridor.
Gas "highways" are planned between the cities of Rajasthan, including:
8Kota-Jaipur
8Kota-Baran-Indore-Mumbai
8Jaipur-Ajmer
8Jaipur-Sikar
8Bhilwara-Chittorgarh-Udaipur.
8The commissioning of a "mega CNG station" at Neemrana and another at Jaipur will ensure that the crucial National Highway 08 becomes operational for CNG vehicles within the state.
8Rajasthan is looking at the development of Industrial clusters under the banner of “Make In Rajasthan” drive and availability of gas will power this move.
8Gas supply is already provided to industrial zones at Behror, Sotanala, Keshawana and Kukas.
8Meanwhile, additional compression facility at Neemrana and construction of a dedicated pipeline will bring gas to the industrial base at Ghilot
8By the last quarter of 2017, the CNG highway will be extended between Kota-Jaipur and along the Kota-Baran-Indore-Mumbai highway.
8The ambitious plan involves using different modes of energy usage in some of the cities. In Kota for example, the idea is to ensure speedy execution of pipeline so as to connect demand centers for rapid industrialization. In Ajmer, the approach is to to convert municipal waste into biogas while also making nautural gas available through the Neemrana-Jaipur-Ajmer pipeline.
Click on Reports for more Details
HPCL has completed financial closure for the Rs 5411 crore LNG terminal at Chhara Port.
8A 50:50 joint venture with Shapoorji Pallonji Port Pvt. will build the terminal.
8Financial closure means that the company will now go ahead with RFQs for contractors for a detailed feasibility report.
8Further RFQs are likely going ahead.
8The completion date for the project in 2019.
Click on Reports for more Details
8A 50:50 joint venture with Shapoorji Pallonji Port Pvt. will build the terminal.
8Financial closure means that the company will now go ahead with RFQs for contractors for a detailed feasibility report.
8Further RFQs are likely going ahead.
8The completion date for the project in 2019.
Click on Reports for more Details
The following timelines have been set for implementation of BPCL's Gasoline Hydrotreatment Unit:
8Award of PMC or EPCM contract: May 2016
8Prepare +/- 10% cost estimate: February 2017
8Order long lead items: November 2016
8Mechanical completion December 2019
Environment clearance
8Award EIA contract: May 2016
8Complete EIA/RRA studies: August 2016
8Environment clearance: September 2016
Basic Engineering Package
8Licensor selection and approval: July 2016
8BEDP: January 2017
Click on Reports for more Details
8Award of PMC or EPCM contract: May 2016
8Prepare +/- 10% cost estimate: February 2017
8Order long lead items: November 2016
8Mechanical completion December 2019
Environment clearance
8Award EIA contract: May 2016
8Complete EIA/RRA studies: August 2016
8Environment clearance: September 2016
Basic Engineering Package
8Licensor selection and approval: July 2016
8BEDP: January 2017
Click on Reports for more Details
BPCL plans to set up a 0.9 MMTPA gasoline hydro treatment unit (GTU) at its Mumbai refinery.
8The Mumbai refinery has an installed crude processing capacity of 12 MMTPA and the new GTU will hydrotreat cracked gasoline ex CCU/FCCU and the resultant gasoline will conform to BS-IV specifications.
8This proposal is a mandatory product quality improvement project which will ensure product security for MS while sustaining crude throughput at 13 MMTPA.
8Concomitantly, the company will also revamp the amine regeneration unit to treat additional rich amine from the GTU as well as revamp the existing sour water stripper units to treat additional sour water generated from the GTU.
8The cost is pegged at Rs 544 crore.
Click on Reports for more Details
8The Mumbai refinery has an installed crude processing capacity of 12 MMTPA and the new GTU will hydrotreat cracked gasoline ex CCU/FCCU and the resultant gasoline will conform to BS-IV specifications.
8This proposal is a mandatory product quality improvement project which will ensure product security for MS while sustaining crude throughput at 13 MMTPA.
8Concomitantly, the company will also revamp the amine regeneration unit to treat additional rich amine from the GTU as well as revamp the existing sour water stripper units to treat additional sour water generated from the GTU.
8The cost is pegged at Rs 544 crore.
Click on Reports for more Details
The following preliminary cost configuration has been arrived at: for the HPCL unit:
8GTU: Rs 300 crore
8SWS and ARU modifications: Rs 26 crore
8Catalysts, chemicals, utilities, offsites, buildings, owner's construction period expenses, start up and commission: Rs 81 crore
8License, basic engineering and EPCM: Rs 69 crore
8Total: Rs 476 crore
8Contingency: Rs 48 crore
8IDC: Rs 20 crore
8Capex: Rs 544 crore
8Associated capex: Rs 10 crore
8Total project cost: Rs 554 crore
Click on Reports for more Details
8GTU: Rs 300 crore
8SWS and ARU modifications: Rs 26 crore
8Catalysts, chemicals, utilities, offsites, buildings, owner's construction period expenses, start up and commission: Rs 81 crore
8License, basic engineering and EPCM: Rs 69 crore
8Total: Rs 476 crore
8Contingency: Rs 48 crore
8IDC: Rs 20 crore
8Capex: Rs 544 crore
8Associated capex: Rs 10 crore
8Total project cost: Rs 554 crore
Click on Reports for more Details
