State-run power producer NTPC is likely to sign contracts next week to buy an additional 1.51 million cubic meters a day of gas from Reliance Industries at government-approved price of $4.2 per mmBtu.
The additional gas would be used at NTPC's Anta and Auriya plants in Rajasthan, Dadri unit in Uttar Pradesh and Faridabad plant in Haryana, official sources said.
Since these plants have already signed Gas Sales and Purchase Agreements (GSPA) for volumes totaling 1.81 mmcmd, only side-letters need to be signed for additional gas.
Sources said side-letters may be signed next week.
This follows Power Ministry's ultimatum to NTPC to sign contracts immediately. While the government had allocated 4.46 mmcmd of gas from RIL's eastern offshore KG-D6 field, NTPC has so far signed only for 1.81 mmcmd.
At a recent review of gas withdrawal from RIL's eastern offshore KG-D6 fields, it was informed that the government had allocated 31.1 mmcmd gas to power sector on firm basis and an additional 12 mmscd on fall back or temporary bais. Against this, only 30.11 mmcmd was been drawn by the power utilities.
It was stated at the meeting that if the power utilities continue to draw less quantity of gas than what has been allocated, there is a possibility that the unutilised gas is allocated to other sectors, they said.
Of the 4.46 mmcmd allocated to NTPC, 2.65 mmcmd was for its Kawas and Gandhar power plants in Gujarat. But the state- owned firm did not want to use KG-D6 gas at these plants since it was in litigation with the Mukesh Ambani firm over fuel supplies to expansion projects planned at these sites.
So, an Empowered Group of Ministers (EGoM) last year decided that the state gas utility GAIL India will swap KG-D6 gas with fuel from other fields. Under this scheme, gas from western offshore Panna/Mukta and Tapti (PMT) fields that was currently supplied to NTPC's northern India plants, was to be diverted to Kawas and Gandhar. The deficit at the northern India plants was then to be made up by KG-D6 gas.
But since PMT gas supplies to NTPC's northern plants was only 1.51 mmcmd, a swap of only that volume has been affected.
Sources said GAIL has decided that 1.51 mmcmd of PMT gas that is currently being supplied to NTPC's northern power plants would be diverted to Kawas and Gandhar. The northern plants will then be supplied KG-D6 gas.
NTPC currently buys 0.79 mmcmd of KG-D6 gas at its Anta, 0.54 mmcmd at Dadri, 0.26 mmcmd at Auriya and 0.22 mmcmd at its Faridabad unit.
With the swap, supplies would go up to 3.31 mmcmd.
RIL currently produces 63-64 mmcmd of gas against a potential of 80 mmcmd as government nominated customers like NTPC are yet to offtake their full allocated quantity.
Source:http://www.business-standard.com/india/news/ntpc-may-sign-for-additional-kg-d6-gas/92099/on
Friday, April 23, 2010
Thursday, April 22, 2010
Reliance profits to rise with higher output from KG
Energy major Reliance Industries should post a second straight increase in quarterly profit, lifted by higher gas output from fields off India's east coast and a nascent recovery in refining margins.
India's leading listed conglomerate, controlled by billionaire Mukesh Ambani, has been scouting for acquisitions overseas, and progress on that front will determine its outlook. Reliance, valued at $78 billion, recently said it would pay $1.7 billion to form a joint venture at one of the most promising natural gas deposit regions in the United States with Atlas Energy.
The deal followed two failed attempts to buy overseas firms as Reliance looks to expand its presence outside India, break into new markets and broaden its businesses, which include refining, oil and gas exploration and petrochemicals.
"The company has already invested in its own projects such as its gas fields in India and is going to generate a lot of cash flow," said Deepak Pareek, an oil and gas analyst at Mumbai-based Angel Broking.
"A lot of that cash has to be pumped into overseas growth opportunities and that's exactly what it's done with Atlas." Bankers say more overseas deals could be in the offing. The outcome of a long-running gas dispute with Reliance Natural, led by Mukesh's younger brother Anil, will also have a bearing on the company's outlook.
Reliance is unable to hit peak gas production of 80 million standard cubic metres a day (mmscmd) at its D6 block in the vast Krishna Godavari basin in the Bay of Bengal due to customers not buying allocated volumes, and a lack of pipelines. But analysts say current production of 63-64 mmscmd is still enough to boost results.
Reliance began pumping gas from the block in April last year. Analysts estimate gross refining margins (GRMs), a key measure of profitability, will have dropped about 16 per cent year-on-year in the March quarter to $8.30 a barrel, tracking a decline in Asia's benchmark Dubai crack margin.
Reliance GRMs nearly halved to $5.90 a barrel in the December quarter. The company's results will be helped by its acquisition last year of unit Reliance Petroleum. State-run explorer Oil and Natural Gas Corp is expected to post higher earnings on firmer oil prices, but subsidy payouts the group is required to make to state retailers will keep results muted.
A lack of clarity about the government's subsidy rules means analysts estimates for ONGC are often disparate. "What you'd want to bet on is a company's business or its management decisions," said Rakesh Rawal, head of private wealth management at Anand Rathi Financial Services. "But here you are betting on whether a government policy will change or not, which just can't be figured out." Energy major Reliance Industries should post a second straight increase in quarterly profit, lifted by higher gas output from fields off India's east coast and a nascent recovery in refining margins.
India's leading listed conglomerate, controlled by billionaire Mukesh Ambani, has been scouting for acquisitions overseas, and progress on that front will determine its outlook. Reliance, valued at $78 billion, recently said it would pay $1.7 billion to form a joint venture at one of the most promising natural gas deposit regions in the United States with Atlas Energy.
The deal followed two failed attempts to buy overseas firms as Reliance looks to expand its presence outside India, break into new markets and broaden its businesses, which include refining, oil and gas exploration and petrochemicals.
"The company has already invested in its own projects such as its gas fields in India and is going to generate a lot of cash flow," said Deepak Pareek, an oil and gas analyst at Mumbai-based Angel Broking.
"A lot of that cash has to be pumped into overseas growth opportunities and that's exactly what it's done with Atlas." Bankers say more overseas deals could be in the offing. The outcome of a long-running gas dispute with Reliance Natural, led by Mukesh's younger brother Anil, will also have a bearing on the company's outlook.
Reliance is unable to hit peak gas production of 80 million standard cubic metres a day (mmscmd) at its D6 block in the vast Krishna Godavari basin in the Bay of Bengal due to customers not buying allocated volumes, and a lack of pipelines. But analysts say current production of 63-64 mmscmd is still enough to boost results.
Reliance began pumping gas from the block in April last year. Analysts estimate gross refining margins (GRMs), a key measure of profitability, will have dropped about 16 per cent year-on-year in the March quarter to $8.30 a barrel, tracking a decline in Asia's benchmark Dubai crack margin.
Reliance GRMs nearly halved to $5.90 a barrel in the December quarter. The company's results will be helped by its acquisition last year of unit Reliance Petroleum. State-run explorer Oil and Natural Gas Corp is expected to post higher earnings on firmer oil prices, but subsidy payouts the group is required to make to state retailers will keep results muted.
A lack of clarity about the government's subsidy rules means analysts estimates for ONGC are often disparate. "What you'd want to bet on is a company's business or its management decisions," said Rakesh Rawal, head of private wealth management at Anand Rathi Financial Services. "But here you are betting on whether a government policy will change or not, which just can't be figured out."
Source:http://reliance-news.blogspot.com/2010/04/gas-sales-to-lift-reliance-results-m.html
India's leading listed conglomerate, controlled by billionaire Mukesh Ambani, has been scouting for acquisitions overseas, and progress on that front will determine its outlook. Reliance, valued at $78 billion, recently said it would pay $1.7 billion to form a joint venture at one of the most promising natural gas deposit regions in the United States with Atlas Energy.
The deal followed two failed attempts to buy overseas firms as Reliance looks to expand its presence outside India, break into new markets and broaden its businesses, which include refining, oil and gas exploration and petrochemicals.
"The company has already invested in its own projects such as its gas fields in India and is going to generate a lot of cash flow," said Deepak Pareek, an oil and gas analyst at Mumbai-based Angel Broking.
"A lot of that cash has to be pumped into overseas growth opportunities and that's exactly what it's done with Atlas." Bankers say more overseas deals could be in the offing. The outcome of a long-running gas dispute with Reliance Natural, led by Mukesh's younger brother Anil, will also have a bearing on the company's outlook.
Reliance is unable to hit peak gas production of 80 million standard cubic metres a day (mmscmd) at its D6 block in the vast Krishna Godavari basin in the Bay of Bengal due to customers not buying allocated volumes, and a lack of pipelines. But analysts say current production of 63-64 mmscmd is still enough to boost results.
Reliance began pumping gas from the block in April last year. Analysts estimate gross refining margins (GRMs), a key measure of profitability, will have dropped about 16 per cent year-on-year in the March quarter to $8.30 a barrel, tracking a decline in Asia's benchmark Dubai crack margin.
Reliance GRMs nearly halved to $5.90 a barrel in the December quarter. The company's results will be helped by its acquisition last year of unit Reliance Petroleum. State-run explorer Oil and Natural Gas Corp is expected to post higher earnings on firmer oil prices, but subsidy payouts the group is required to make to state retailers will keep results muted.
A lack of clarity about the government's subsidy rules means analysts estimates for ONGC are often disparate. "What you'd want to bet on is a company's business or its management decisions," said Rakesh Rawal, head of private wealth management at Anand Rathi Financial Services. "But here you are betting on whether a government policy will change or not, which just can't be figured out." Energy major Reliance Industries should post a second straight increase in quarterly profit, lifted by higher gas output from fields off India's east coast and a nascent recovery in refining margins.
India's leading listed conglomerate, controlled by billionaire Mukesh Ambani, has been scouting for acquisitions overseas, and progress on that front will determine its outlook. Reliance, valued at $78 billion, recently said it would pay $1.7 billion to form a joint venture at one of the most promising natural gas deposit regions in the United States with Atlas Energy.
The deal followed two failed attempts to buy overseas firms as Reliance looks to expand its presence outside India, break into new markets and broaden its businesses, which include refining, oil and gas exploration and petrochemicals.
"The company has already invested in its own projects such as its gas fields in India and is going to generate a lot of cash flow," said Deepak Pareek, an oil and gas analyst at Mumbai-based Angel Broking.
"A lot of that cash has to be pumped into overseas growth opportunities and that's exactly what it's done with Atlas." Bankers say more overseas deals could be in the offing. The outcome of a long-running gas dispute with Reliance Natural, led by Mukesh's younger brother Anil, will also have a bearing on the company's outlook.
Reliance is unable to hit peak gas production of 80 million standard cubic metres a day (mmscmd) at its D6 block in the vast Krishna Godavari basin in the Bay of Bengal due to customers not buying allocated volumes, and a lack of pipelines. But analysts say current production of 63-64 mmscmd is still enough to boost results.
Reliance began pumping gas from the block in April last year. Analysts estimate gross refining margins (GRMs), a key measure of profitability, will have dropped about 16 per cent year-on-year in the March quarter to $8.30 a barrel, tracking a decline in Asia's benchmark Dubai crack margin.
Reliance GRMs nearly halved to $5.90 a barrel in the December quarter. The company's results will be helped by its acquisition last year of unit Reliance Petroleum. State-run explorer Oil and Natural Gas Corp is expected to post higher earnings on firmer oil prices, but subsidy payouts the group is required to make to state retailers will keep results muted.
A lack of clarity about the government's subsidy rules means analysts estimates for ONGC are often disparate. "What you'd want to bet on is a company's business or its management decisions," said Rakesh Rawal, head of private wealth management at Anand Rathi Financial Services. "But here you are betting on whether a government policy will change or not, which just can't be figured out."
Source:http://reliance-news.blogspot.com/2010/04/gas-sales-to-lift-reliance-results-m.html
Tuesday, April 20, 2010
Reliance’s transport tariff on KG approved
Oil regulator PNGRB today approved the tariff that Mukesh Ambani-owned East-West pipeline will charge for transporting gas from Reliance Industries' eastern offshore KG-D6 fields to users.
Against a levelised (or average) tariff of Rs 53.64 per million British thermal unit sought by Reliance Gas Transporation and Infrastructure Ltd, majority owned by RIL Chairman Mukesh Ambani, the Petroleum and Natural Gas Regulatory Board (PNGRB) today approved a provisional tariff of Rs 52.23 per mmBtu.
The Board, however, asked RGTIL to divide the Kakinada (in Andhra Pradesh) to Bharuch (in Gujarat) pipeline into three tariff zones as against two proposed by the company and apportion the levelized tariff.
RGTIL charged Rs 15 per MMBtu tariff for transporting gas in zone-1, i.e. Andhra Pradesh. For states between Andhra and Gujarat, it charged Rs 61.77 per mmBtu. The levelized or average of the two came to Rs 53.64 per mmBtu.
PNGRB's order asking RGTIL to have three zonal tariffs would mean that it will charge different transportation fee for ferrying gas to users in Andhra Pradesh, Maharasthra and Gujarat.
In effect, users in Maharasthra like the Dabhol Power Plant will have to pay less than those in Gujarat. Currently, users in both states pay the same tariff.
"The provisional initial unit natural gas pipeline tariff on levelized basis determined by the Board shall be Rs 52.23 per mmBtu with effect from the date of commissioning of the natural gas pipeline ie April 1, 2009," the PNGRB order said.
The difference between the tariff charged till now and that approved by the Board would be adjusted retrospectively with customers.
"The apportionment of the levelized tariff over all the tariff zone with detailed calculations will be submitted by the entity (RGTIL) for Board's approval within 10 days of the issue of this order," it said.
PNGRB said it will give the final tariff "once the audited cost and financial data" of the pipeline was available.
Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil--gas/Oil-regulator-okays-Mukesh-Ambani-firm-pipeline-tariff/articleshow/5832477.cms
Against a levelised (or average) tariff of Rs 53.64 per million British thermal unit sought by Reliance Gas Transporation and Infrastructure Ltd, majority owned by RIL Chairman Mukesh Ambani, the Petroleum and Natural Gas Regulatory Board (PNGRB) today approved a provisional tariff of Rs 52.23 per mmBtu.
The Board, however, asked RGTIL to divide the Kakinada (in Andhra Pradesh) to Bharuch (in Gujarat) pipeline into three tariff zones as against two proposed by the company and apportion the levelized tariff.
RGTIL charged Rs 15 per MMBtu tariff for transporting gas in zone-1, i.e. Andhra Pradesh. For states between Andhra and Gujarat, it charged Rs 61.77 per mmBtu. The levelized or average of the two came to Rs 53.64 per mmBtu.
PNGRB's order asking RGTIL to have three zonal tariffs would mean that it will charge different transportation fee for ferrying gas to users in Andhra Pradesh, Maharasthra and Gujarat.
In effect, users in Maharasthra like the Dabhol Power Plant will have to pay less than those in Gujarat. Currently, users in both states pay the same tariff.
"The provisional initial unit natural gas pipeline tariff on levelized basis determined by the Board shall be Rs 52.23 per mmBtu with effect from the date of commissioning of the natural gas pipeline ie April 1, 2009," the PNGRB order said.
The difference between the tariff charged till now and that approved by the Board would be adjusted retrospectively with customers.
"The apportionment of the levelized tariff over all the tariff zone with detailed calculations will be submitted by the entity (RGTIL) for Board's approval within 10 days of the issue of this order," it said.
PNGRB said it will give the final tariff "once the audited cost and financial data" of the pipeline was available.
Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil--gas/Oil-regulator-okays-Mukesh-Ambani-firm-pipeline-tariff/articleshow/5832477.cms
Tuesday, April 13, 2010
NTPC to buy 1.5 mmscmd more gas from RIL
State-owned power utility NTPC will buy an additional 1.5 million cubic meters a day of gas from Reliance Industries at government-approved price of $4.2 per mmBtu to feed its power plants in north India.
The government had allocated NTPC 4.46 mmscmd of gas from RIL's eastern offshore KG-D6 fields but it currently draws only 1.81 mmscmd due to resistance from state gas utility GAIL to transport additional volumes, official sources said.
Close to 60 per cent of the allocated volumes were for NTPC's Kawas and Gandhar power plants in Gujarat. But the state-owned firm did not want to use KG-D6 gas at these plants since it was in litigation with the Mukesh Ambani firm over fuel supplies to expansion projects planned at these sites.
So, an Empowered Group of Ministers (EGoM) last year decided that the state gas utility GAIL India will swap KG-D6 gas with fuel from other fields. Under this scheme, gas from western offshore Panna/Mukta and Tapti (PMT) fields that was currently supplied to NTPC's northern India plants, was to be diverted to Kawas and Gandhar. The deficit at the northern India plants was then to be made up by KG-D6 gas.
Sources said GAIL was however not willing to implement this. It feared that if PMT gas was supplied to Kawas and Gandhar, it would displace the costlier LNG that those plants currently bought. Kawas and Gandhar currently buy imported-LNG at about 50 per cent more price then the delivered cost of RIL gas.
The Petroleum Ministry, they said, a few days back convened a meeting to convey to GAIL in no uncertain terms that the EGoM decision has to be implemented at all cost.
It was decided that 1.5 mmscmd of PMT gas that is currently being supplied to NTPC's northern power plants would be diverted to Kawas and Gandhar. The northern plants will then be supplied KG-D6 gas.
GAIL markets gas from PMT fields which is priced at $5.65-5.73 per million British thermal unit.
Sources said the scheme would be implemented in couple of weeks. NTPC has contracted 0.79 mmscmd of KG-D6 gas for its Anta plant in Rajasthan, 0.54 mmscmd for Dadri unit in Uttar Pradesh, 0.26 mmscmd for its Auriya plant in Rajasthan and 0.22 mmscmd at its Faridabad unit in Haryana.
With the swap, supplies would go up to 3.31 mmscmd. This would still leave 1.15 mmscmd of allocated quantities to be supplied.
RIL currently produces about 63-64 mmscmd of gas as against a potential of 80 mmscmd as government nominated customers like NTPC are yet to offtake their full allocated quantity.
KG-D6 gas has replaced costly imported LNG at Anta plant to save Rs 150 crore in power generation cost annually.
Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil--gas/NTPC-to-buy-15-mmscmd-more-gas-from-RIL/articleshow/5784912.cms
The government had allocated NTPC 4.46 mmscmd of gas from RIL's eastern offshore KG-D6 fields but it currently draws only 1.81 mmscmd due to resistance from state gas utility GAIL to transport additional volumes, official sources said.
Close to 60 per cent of the allocated volumes were for NTPC's Kawas and Gandhar power plants in Gujarat. But the state-owned firm did not want to use KG-D6 gas at these plants since it was in litigation with the Mukesh Ambani firm over fuel supplies to expansion projects planned at these sites.
So, an Empowered Group of Ministers (EGoM) last year decided that the state gas utility GAIL India will swap KG-D6 gas with fuel from other fields. Under this scheme, gas from western offshore Panna/Mukta and Tapti (PMT) fields that was currently supplied to NTPC's northern India plants, was to be diverted to Kawas and Gandhar. The deficit at the northern India plants was then to be made up by KG-D6 gas.
Sources said GAIL was however not willing to implement this. It feared that if PMT gas was supplied to Kawas and Gandhar, it would displace the costlier LNG that those plants currently bought. Kawas and Gandhar currently buy imported-LNG at about 50 per cent more price then the delivered cost of RIL gas.
The Petroleum Ministry, they said, a few days back convened a meeting to convey to GAIL in no uncertain terms that the EGoM decision has to be implemented at all cost.
It was decided that 1.5 mmscmd of PMT gas that is currently being supplied to NTPC's northern power plants would be diverted to Kawas and Gandhar. The northern plants will then be supplied KG-D6 gas.
GAIL markets gas from PMT fields which is priced at $5.65-5.73 per million British thermal unit.
Sources said the scheme would be implemented in couple of weeks. NTPC has contracted 0.79 mmscmd of KG-D6 gas for its Anta plant in Rajasthan, 0.54 mmscmd for Dadri unit in Uttar Pradesh, 0.26 mmscmd for its Auriya plant in Rajasthan and 0.22 mmscmd at its Faridabad unit in Haryana.
With the swap, supplies would go up to 3.31 mmscmd. This would still leave 1.15 mmscmd of allocated quantities to be supplied.
RIL currently produces about 63-64 mmscmd of gas as against a potential of 80 mmscmd as government nominated customers like NTPC are yet to offtake their full allocated quantity.
KG-D6 gas has replaced costly imported LNG at Anta plant to save Rs 150 crore in power generation cost annually.
Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil--gas/NTPC-to-buy-15-mmscmd-more-gas-from-RIL/articleshow/5784912.cms
RIL Jamnagar Refinery Highest Exporter
After hitting the slowdown bump when it commissioned its second refinery in December 2008, Reliance Industries Limited (RIL)’s special economic zone (SEZ) in Jamnagar has finished its first full operational year in March 2010 with a quantum leap forward.
Emerging as the single largest export zone in the country, the Jamnagar SEZ has seen its export nearly touch Rs 80,000 crore till March 2010.
“The physical exports from RIL’s Jamnagar SEZ stood at Rs 71,000 crore while Rs 8,000 crore has come from deemed exports. It is the largest SEZ in the country in terms of exports,” said Upendra Vasishth, Development Commissioner (Jamnagar SEZ).
With a capacity of 29 million tonne per annum, the Jamnagar Export Refinery Project (JERP), located in an SEZ, added nearly 20 per cent to the country’s refinery capacity.
Exports from the SEZ were primarily aimed at US and European markets, besides several other locations, including Asia and Africa.
In 2008-09, exports from all SEZs in India were at a modest Rs 99,689 crore. This year the country’s SEZ exports are expected to cross Rs 2 lakh crore, according to Central government sources. The overall figures are still being finalised, the official said.
Gujarat based SEZs have meanwhile contributed about 50 per cent of the country’s overall exports, sources said.
The exports from the 10 operational SEZs in the state have clocked Rs 1,12,600 crore, said government sources.
Topping the charts after Reliance, is Surat SEZ or SURSEZ with Rs 24,000 crore worth of exports in 2009-10. Nokia SEZ in Tamil Nadu ranks third with its exports expected to be in the range of Rs 15,000-18,000 crore, said sources privy to the development.
Last year, SURSEZ was the largest exporter in the country followed by Nokia SEZ.
Exports from Kandla Port Trust’s SEZ and Adani’s Mundra SEZ have been Rs 2200 crore and Rs 1300 crore respectively in the last fiscal.
According to ministry of commerce and industry's official site, Andhra Pradesh leads with 72 notified SEZs, followed by Maharashtra which has 57 SEZs. Tamil Nadu has 55 SEZs and Haryana has 32 notified SEZs.
Andhra Pradesh leads with 21 operational SEZs against Tamil Nadu’s 19. Maharashtra and Karnataka rank third, with 15 SEZs operational SEZs each.
In all, there are 105 operational SEZs in the country with an overall export of Rs 1.5 lakh crore till December 31, 2009, according to official figures by the Ministry of Commerce and Industry.
Formal approvals have been accorded to 571 proposals, of which 348 SEZs have been notified. In Gujarat, so far 48 SEZs have formally been approved out of which 30 have been notified. Maharashtra has been approved 109 SEZs — the highest in the country — of which 57 have been notified.
Source:http://www.business-standard.com/india/news/ril-jamnagar-unit-sez-zlesrs-79k-cr-exports/391642/
Emerging as the single largest export zone in the country, the Jamnagar SEZ has seen its export nearly touch Rs 80,000 crore till March 2010.
“The physical exports from RIL’s Jamnagar SEZ stood at Rs 71,000 crore while Rs 8,000 crore has come from deemed exports. It is the largest SEZ in the country in terms of exports,” said Upendra Vasishth, Development Commissioner (Jamnagar SEZ).
With a capacity of 29 million tonne per annum, the Jamnagar Export Refinery Project (JERP), located in an SEZ, added nearly 20 per cent to the country’s refinery capacity.
Exports from the SEZ were primarily aimed at US and European markets, besides several other locations, including Asia and Africa.
In 2008-09, exports from all SEZs in India were at a modest Rs 99,689 crore. This year the country’s SEZ exports are expected to cross Rs 2 lakh crore, according to Central government sources. The overall figures are still being finalised, the official said.
Gujarat based SEZs have meanwhile contributed about 50 per cent of the country’s overall exports, sources said.
The exports from the 10 operational SEZs in the state have clocked Rs 1,12,600 crore, said government sources.
Topping the charts after Reliance, is Surat SEZ or SURSEZ with Rs 24,000 crore worth of exports in 2009-10. Nokia SEZ in Tamil Nadu ranks third with its exports expected to be in the range of Rs 15,000-18,000 crore, said sources privy to the development.
Last year, SURSEZ was the largest exporter in the country followed by Nokia SEZ.
Exports from Kandla Port Trust’s SEZ and Adani’s Mundra SEZ have been Rs 2200 crore and Rs 1300 crore respectively in the last fiscal.
According to ministry of commerce and industry's official site, Andhra Pradesh leads with 72 notified SEZs, followed by Maharashtra which has 57 SEZs. Tamil Nadu has 55 SEZs and Haryana has 32 notified SEZs.
Andhra Pradesh leads with 21 operational SEZs against Tamil Nadu’s 19. Maharashtra and Karnataka rank third, with 15 SEZs operational SEZs each.
In all, there are 105 operational SEZs in the country with an overall export of Rs 1.5 lakh crore till December 31, 2009, according to official figures by the Ministry of Commerce and Industry.
Formal approvals have been accorded to 571 proposals, of which 348 SEZs have been notified. In Gujarat, so far 48 SEZs have formally been approved out of which 30 have been notified. Maharashtra has been approved 109 SEZs — the highest in the country — of which 57 have been notified.
Source:http://www.business-standard.com/india/news/ril-jamnagar-unit-sez-zlesrs-79k-cr-exports/391642/
Monday, April 5, 2010
Reliance’s KG Gas provides relief to power and fertilizer firms
Natural gas from Reliance Industries’ prolific D6 field has generated savings worth thousands of crores of rupees for power and fertiliser companies, the main users of the gas.
Commercial production from the field in the Krishna Godavari (K-G) basin started on April 2 last year.
The gas-based power industry is estimated to have saved Rs 6,000 crore over the last year, while the government’s fertiliser subsidy bill is estimated to be lower by Rs 3,100 crore.
Users within the country could get gas from the D6 field, located off the Andhra cost, at a landed cost of $ 4.2 per million British thermal units (mBtu). This price was much lower than alternates like imported liquefied natural gas (LNG), the price of which touched over $20 per mbtu. It was, however, higher than the subsidised price at which the government sold gas to select customers.
NTPC, the country's largest power producer, could reduce its pricey LNG imports as domestic gas became available. The power sector, the biggest consumer of K-G gas, was sold about 18 mscmd of gas, used across 4,745 Mw of power capacity.
According to industry experts, the cost of generating power from naphtha, assuming a naphtha price of $10 per mBtu, would be Rs 3.97 per unit, while the cost of generation from KG-D6 gas assuming a delivered price of $6 per mBtu would be Rs 2.50 a unit. “Depending on the current price of naptha (which is an alternative feedstock), the power sector is estimated to have saved about Rs 6,000 crore while using gas as feedstock,” said Rakesh Jain general manager (energy division) at Feedback Ventures.
These savings have gone to the pocket of the consumer, according to Jain, since most producers have agreements with the state power utilities to simply pass on the cost of fuel to the consumers.
The average saving to a household in Andhra Pradesh, a state which houses some of the plants to which the D6 gas has been allocated, would be as much as Rs 300 per month, according to industry experts.
This is assuming an annual power consumption of 2,448 kilowatt hour.
The fertiliser sector also benefitted, as it switched to gas.
“It has been a very good experience. The supplies have been stable, leading to smooth operations, and we did not use any naphtha (as fuel) in the past one year. The subsidy saving to government from our plant alone is around Rs 100 crore,” said Kapil Mehan, executive director, Tata Chemicals.
The company is using 0.88 million standard cubic metres a day (mscmd) of K-G gas at its fertiliser plant in Babrala (Uttar Pradesh). The total gas supply to fertiliser sector during 2009-10 was 12.24 mscmd, which translated to a production of 6.10 million tonne of urea.
The D6 field is currently producing 60 mscmd of gas.
The government, through its gas utilisation policy, has made allocations to various priority sectors like power, fertiliser, steel, city gas, refineries, petrochemicals, LPG and captive power.
The power sector has been allocated 31.165 mscmd of gas on a firm basis and another 12 mscmd of gas on fallback basis. The fertiliser sector has been given firm allocation of 15.508 mscmd, refineries have been given 5 mscmd of firm allocation and 6 mscmd of fallback allocation and the steel sector has been given 4.19 mscmd firm allocations.
A fallback allocation implies that the sector will get gas if the firm allocation of other sectors is not fully consumed due to some reason.
Source:http://www.business-standard.com/india/news/power-fertiliser-firms-reap-gains/390496/
Commercial production from the field in the Krishna Godavari (K-G) basin started on April 2 last year.
The gas-based power industry is estimated to have saved Rs 6,000 crore over the last year, while the government’s fertiliser subsidy bill is estimated to be lower by Rs 3,100 crore.
Users within the country could get gas from the D6 field, located off the Andhra cost, at a landed cost of $ 4.2 per million British thermal units (mBtu). This price was much lower than alternates like imported liquefied natural gas (LNG), the price of which touched over $20 per mbtu. It was, however, higher than the subsidised price at which the government sold gas to select customers.
NTPC, the country's largest power producer, could reduce its pricey LNG imports as domestic gas became available. The power sector, the biggest consumer of K-G gas, was sold about 18 mscmd of gas, used across 4,745 Mw of power capacity.
According to industry experts, the cost of generating power from naphtha, assuming a naphtha price of $10 per mBtu, would be Rs 3.97 per unit, while the cost of generation from KG-D6 gas assuming a delivered price of $6 per mBtu would be Rs 2.50 a unit. “Depending on the current price of naptha (which is an alternative feedstock), the power sector is estimated to have saved about Rs 6,000 crore while using gas as feedstock,” said Rakesh Jain general manager (energy division) at Feedback Ventures.
These savings have gone to the pocket of the consumer, according to Jain, since most producers have agreements with the state power utilities to simply pass on the cost of fuel to the consumers.
The average saving to a household in Andhra Pradesh, a state which houses some of the plants to which the D6 gas has been allocated, would be as much as Rs 300 per month, according to industry experts.
This is assuming an annual power consumption of 2,448 kilowatt hour.
The fertiliser sector also benefitted, as it switched to gas.
“It has been a very good experience. The supplies have been stable, leading to smooth operations, and we did not use any naphtha (as fuel) in the past one year. The subsidy saving to government from our plant alone is around Rs 100 crore,” said Kapil Mehan, executive director, Tata Chemicals.
The company is using 0.88 million standard cubic metres a day (mscmd) of K-G gas at its fertiliser plant in Babrala (Uttar Pradesh). The total gas supply to fertiliser sector during 2009-10 was 12.24 mscmd, which translated to a production of 6.10 million tonne of urea.
The D6 field is currently producing 60 mscmd of gas.
The government, through its gas utilisation policy, has made allocations to various priority sectors like power, fertiliser, steel, city gas, refineries, petrochemicals, LPG and captive power.
The power sector has been allocated 31.165 mscmd of gas on a firm basis and another 12 mscmd of gas on fallback basis. The fertiliser sector has been given firm allocation of 15.508 mscmd, refineries have been given 5 mscmd of firm allocation and 6 mscmd of fallback allocation and the steel sector has been given 4.19 mscmd firm allocations.
A fallback allocation implies that the sector will get gas if the firm allocation of other sectors is not fully consumed due to some reason.
Source:http://www.business-standard.com/india/news/power-fertiliser-firms-reap-gains/390496/
Thursday, April 1, 2010
OilMin wants RIL to join hands with ONGC for Venezuela project
State-owned Oil and Natural Gas Corp (ONGC) may have won a large oil block in Venezuela but the Petroleum Ministry wants Reliance Industries to join the project to give stability to the venture.
ONGC Videsh Ltd, the overseas investment arm of the state-run explorer, and Reliance had in 2008 teamed up to bid for the Venezuela's Carabobo field auction but last year the Mukesh Ambani-run firm walked out sighting delays in the bid round. OVL subsequently roped in Spain's Repsol YPF and Malaysian state Petronas to win Carabobo-1 heavy oilfield.
But since the project involves investments that may over the life of the project run into USD 40 billion, the Oil Ministry wants Reliance back into the project, sources in know of the development said.
Sources said fillers at very high level were sent to Reliance but it has so far remained non-committal on taking the state.
Reliance has, however, agreed to bail the state-run firms out agreeing to buy over one-fifth of the 400,000-480,000 barrels per day of oil production envisaged from the project.
OVL, Repsol and Petronas all have an 11 per cent stake each in the project, while Indian Oil Corp (IOC) and Oil India Ltd (OIL) have 3.5 per cent each. The remaining 60 per cent is held by Venezuela's state Petroleos de Venezuela (PdV).
As per the bid conditions, the foreign firms, who were offered a maximum of 40 per cent stake in the project, had to commit to offtake the entire production.
Sources said of the planned output, Repsol had indicated it can take 165,000 barrels per day while Petronas said it could take 100,000 bpd. The remaining 220,000 bpd was split equally between OVL and OIL.
OVL's share of 110,000 bpd would go to ONGC's subsidiary Mangalore Refinery and Petrochemicals Ltd (MRPL), while Reliance agreed to take OIL's share for at least 10 years from the start-up in 2016-17.
Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil-gas/OilMin-wants-RIL-to-join-hands-with-ONGC-for-Venezuela-project/articleshow/5749798.cms
ONGC Videsh Ltd, the overseas investment arm of the state-run explorer, and Reliance had in 2008 teamed up to bid for the Venezuela's Carabobo field auction but last year the Mukesh Ambani-run firm walked out sighting delays in the bid round. OVL subsequently roped in Spain's Repsol YPF and Malaysian state Petronas to win Carabobo-1 heavy oilfield.
But since the project involves investments that may over the life of the project run into USD 40 billion, the Oil Ministry wants Reliance back into the project, sources in know of the development said.
Sources said fillers at very high level were sent to Reliance but it has so far remained non-committal on taking the state.
Reliance has, however, agreed to bail the state-run firms out agreeing to buy over one-fifth of the 400,000-480,000 barrels per day of oil production envisaged from the project.
OVL, Repsol and Petronas all have an 11 per cent stake each in the project, while Indian Oil Corp (IOC) and Oil India Ltd (OIL) have 3.5 per cent each. The remaining 60 per cent is held by Venezuela's state Petroleos de Venezuela (PdV).
As per the bid conditions, the foreign firms, who were offered a maximum of 40 per cent stake in the project, had to commit to offtake the entire production.
Sources said of the planned output, Repsol had indicated it can take 165,000 barrels per day while Petronas said it could take 100,000 bpd. The remaining 220,000 bpd was split equally between OVL and OIL.
OVL's share of 110,000 bpd would go to ONGC's subsidiary Mangalore Refinery and Petrochemicals Ltd (MRPL), while Reliance agreed to take OIL's share for at least 10 years from the start-up in 2016-17.
Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil-gas/OilMin-wants-RIL-to-join-hands-with-ONGC-for-Venezuela-project/articleshow/5749798.cms
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