Energy News Monitor |Volume V, Issue 4

Indo-US Nuclear, a better Deal (Sridhar Kundu, Fellow, ORF)

he present UPA Govt. is at the brink of a disastrous fall just before the completion of its full term in office. The confidence motion of the Parliament is scheduled to be held on 21^st and 22^nd of July. The basic reason behind this motion is the Government’s go ahead of the signing of the Nuclear deal with the USA in the last week’s G-8 summit. The Left parties who used to be the ally of the UPA Govt. have emerged as the key player in putting the Govt. in trouble in obtaining its confidence in the Parliament.  At this moment while the Congress Party, the chief ally of the Govt. is cocksure about availing the magic figure of 272, the Left Parties have started the countrywide campaign in garnering support of the political parties against the Indo-USA nuclear deal. Debates and discussions on this Deal have been on fray for the last three years, though the justification of signing the deal is not clear to more than 90 percent of the population of the country even to some of the political leaders. Fracture has developed between the political parties even within the parties, different sections of people in the society regarding the Deal. But this is undoubtedly a better deal and can be established with the following facts.

Increasing Power Deficit

The total energy generation is rising at 5 percent while the requirement for energy use is increasing by 6 percent per annum. Again, the demand for power (at peak) is rising at 6 percent and the peak shortage is rising at an average rate of 12 percent per year. Total energy shortage of the country is rising at an average rate of 8.5 percent for the last five fiscal years. The growth of hydro power which is used to short out the deficit at peak load is a meager 4.5 percent. Generation of electricity from the renewables to bridge the deficit gap is not a cost effective factor and thus not a viable solution. Power generation from the nuclear fuel can be considered as an option to meet the increasing demand provided by removing its supply constraints.

Difference in cost of power generation

The cost of per unit generation of power in case of nuclear can be compared with the cost of per unit coal based thermal power generation, though in case of later there is abundance of raw material under the country’s disposal. For Nuclear power generation India has to depend on outside countries like USA, Canada, China and Australia. The cost of power generation at Kakrapara Plant is Rs.2.72, while in Tarapur Plant it is Rs.1.12. The average cost of power generation at Kaiga is Rs. 3.40 and in Narora Power Plant the cost per unit of generation is Rs.2.50. In case of thermal power plant, the National Thermal Power Corporation (NTPC) bears the cost of Rs. 2.50 per unit of generation, though the average cost of per unit generation of power is Rs.1.20 for the Neyveli Lignite Corporation.

Status of nuclear power in India

Share of nuclear power in total energy mix in India is quite negligible. At present, total Nuclear power generation capacity in India is 4120 MW which is 2.84 percent of the total installed power generating capacity of the country.  Targeted capacity addition during 11^th Plan is 3380 MW, out of which 220 MW capacity of Kaiga Plant has been added during 2007-08. Two units of light water reactors of (2*1000 MW) at Kudankulam, one unit at Kaiga whose capacity is 200 MW and two units at Rawanbhatt of capacity of 400 MW are under construction and likely to be operated by the end of  11^th Plan.  There are four future projects of capacity of 6800 MW out of which 2 Light Water Reactors of capacity 2000 MW are proposed to be set up at Kudankulam. In order to increase the share of nuclear power in total energy mix and in particular, to successfully operate the light water reactor (LWR) projects the Nuclear deal with USA is a feasible solution.

Efficiency and competitiveness

The central public sector enjoys the monopoly power over the nuclear power generation in India. Though private sector is allowed into the field of power generation since the adoption of macro economic policy of liberalization, the entry of private sector is restricted in the nuclear power generation because of lack of access of the private player into the nuclear fuel. Increasing nuclear fuel supply can help the entry of private sector in the filed of nuclear power generation which can build up efficiency and increase competitiveness in this sector. Exchange of technology and skilled manpower between the public and private sector will help the growth of power generation.  The expected players in the field of nuclear power generation are Reliance Energy, Tata Power Company, Torrent among others.

Necessarily and sufficiently the Deal is the best in the context of present power (electricity) scenario of the country. The Government should not mourn over in case of its defeat in the confidence motion because few in this world die for common cause.

 

Concluded

 

Beyond the Climate Crisis: A Critique of Climate Change Discourse (part – II)

Eileen Crist

 

Continued from Volume V, Issue No. 3…

 

Liabilities of the Dominant Frame

hile the dangers of climate change are real, I argue that there are even greater dangers in representing it as the most urgent problem we face. Framing climate change in such a manner deserves to be challenged for two reasons: it encourages the restriction of proposed solutions to the technical realm, by powerfully insinuating that the needed approaches are those that directly address the problem; and it detracts attention from the planet’s ecological predicament as a whole, by virtue of claiming the lime-light for the one issue that trumps all others.

Identifying climate change as the biggest threat to civilization, and ushering it into center stage as the highest priority problem, has bolstered the proliferation of technical proposals that address the specific challenge. The race is on for figuring out what technologies, or portfolio thereof, will solve “the problem.” Whether the call is for reviving nuclear power, boosting the installation of wind turbines, using a variety of renewable energy sources, increasing the efficiency of fossil-fuel use, developing carbon-sequestering technologies, or placing mirrors in space to deflect the sun’s rays, the narrow character of such proposals is evident: confront the problem of greenhouse gas emissions by technologically phasing them out, superseding them, capturing them, or mitigating their heating effects.

In his The Revenge of Gaia, for example, Lovelock briefly mentions the need to face climate change by “changing our whole style of living.”¹⁶

But the thrust of this work, what readers and policy-makers come away with, is his repeated and strident call for investing in nuclear energy as, in his words, “the one lifeline we can use immediately.”¹⁷ In the policy realm, the first step toward the technological fix for global warming is often identified with implementing the Kyoto protocol. Biologist Tim Flannery agitates for the treaty, comparing the need for its successful endorsement to that of the Montreal protocol that phased out the ozone-depleting CFCs. “The Montreal protocol,” he submits, “marks a signal moment in human societal development, representing the first ever victory by humanity over a global pollution problem.”¹⁸ He hopes for a similar victory for the global climate-change problem.

Yet the deepening realization of the threat of climate change, virtually in the wake of stratospheric ozone depletion, also suggests that dealing with global problems treaty-by-treaty is no solution to the planet’s predicament. Just as the risks of unanticipated ozone depletion have been followed by the dangers of a long underappreciated climate crisis, so it would be naïve not to anticipate another (perhaps even entirely unforeseeable) catastrophe arising after the (hoped-for) resolution of the above two.

Furthermore, if greenhouse gases were restricted successfully by means of technological shifts and innovations, the root cause of the ecological crisis as a whole would remain unaddressed. The destructive patterns of production, trade, extraction, land-use, waste proliferation, and consumption, coupled with population growth, would go unchallenged, continuing to run down the integrity, beauty, and biological richness of the Earth.

Industrial-consumer civilization has entrenched a form of life that admits virtually no limits to its expansiveness within, and perceived entitlement to, the entire planet.¹⁹ But questioning this civilization is by and large sidestepped in climate-change discourse, with its single-minded quest for a global-warming techno-fix.²⁰ Instead of confronting the forms of social organization that are causing the climate crisis—among numerous other catastrophes—climate-change literature often focuses on how global warming is endangering the culprit, and agonizes over what technological means can save it from impending tipping points.²¹

The dominant frame of climate change funnels cognitive and pragmatic work toward specifically addressing global warming, while muting a host of equally monumental issues. Climate change looms so huge on the environmental and political agenda today that it has contributed to downplaying other facets of the ecological crisis: mass extinction of species, the devastation of the oceans by industrial fishing, continued old-growth deforestation, topsoil losses and desertification, endocrine disruption, incessant development, and so on, are made to appear secondary and more forgiving by comparison with “dangerous anthropogenic interference” with the climate system.

In what follows, I will focus specifically on how climate-change discourse encourages the continued marginalization of the biodiversity crisis—a crisis that has been soberly described as a holocaust,²² and which despite decades of scientific and environmentalist pleas remains a virtual non-topic in society, the mass media, and humanistic and other academic literatures.

Several works on climate change (though by no means all) extensively examine the consequences of global warming for biodiver-sity,²³ but rarely is it mentioned that biodepletion predates dangerous greenhouse-gas buildup by decades, centuries, or longer, and will not be stopped by a technological resolution of global warming. Climate change is poised to exacerbate species and ecosystem losses—indeed, is doing so already. But while technologically preempting the worst of climate change may temporarily avert some of those losses, such a resolution of the climate quandary will not put an end to—will barely address—the ongoing destruction of life on Earth.

Notes:

16 Lovelock, The Revenge of Gaia, p. 11.

17 Ibid.

18 Flannery, The Weather Makers, p. 220.

19 I use the conceptual shorthand “industrial-consumer civilization” as the target of social critique throughout this paper. This term reflects the influence on my thinking of the Frankfurt School, especially critical theorists Theodor Adorno, Max Horkheimer, and Herbert Marcuse. These thinkers substantively elaborated and revised Marx’s analysis of capitalism as mode of production, by adding the dimension of capitalism as culture, as way of life. Capitalist production, alongside socio-cultural patterns and ideologies of consumerism, are complicit in the destruction of nature and the alienation of social relations. Production and consumption, in other words, constitute a single, literally totalitarian form of life, in which a social division of groups into “rulers” and “ruled,” “perpetrators” and “victims,” has become shaky if not vacuous. As Marcuse noted in his more timely than ever 1964 work, an entire socio-cultural-economic life—from (actual or aspired to) ways of eating and lodging, transportation, entertainment, or emoting and thinking—“binds the consumers more or less pleasantly to the producers and, through the latter, to the whole.” Herbert Marcuse, one-Dimensional Man: Studies in the Ideology of Advanced Industrial Society (Boston: Beacon, 1991), p. 12. Horkheimer and Adorno traced the origins of the collective’s participation in its own domination to the “historical” moment that magical control over nature (and over the deities of nature) was relinquished to a specific elite or clique in exchange for self and social preservation. Max Horkheimer and Theodor Adorno, Dialectic of Enlightenment, trans. John Cumming (New York: Continuum, 1972), pp. 21–22. After the decisive turn when the social body became implicated in its own domination, “what is done to all by the few, always occurs as the subjection of individuals by the many: social repression always exhibits the masks of repression by a collective” (ibid.). And elsewhere: “The misplaced love of the common people for the wrong which is done them is a greater force than the cunning of the authorities” (ibid., p. 134). In light of such astute observations offered by critical theorists, neo-Marxist and anarchist analyses that indict corporate and/or state power for the troubled natural and social worlds are, at best, only partially true.

20. More than thirty years ago, environmental philosopher Arne Naess articulated the influential distinction between “shallow” and “deep” ecology, characterized by the focus on symptoms of the environmental crisis, on the one hand, versus critical attention to underlying causes of problems, on the other. Notwithstanding its unfortunate elitist overtones—implying that some environmental thinkers are capable of reflecting deeply, while others flounder with superficialities—the shallow-deep distinction has been significant for two compelling reasons. One, it clarified how “symptomology” leads merely to technical piecemeal solutions; and two, it showed how underlying causes, left unaddressed, eventually generate more nasty symptoms. In other words, shallow ecological thinking is technical and narrow: when we think about climate change as “the problem”—as opposed to confronting the limitless expansionism of the capitalist enterprise as the problem—we arguably become shallow in our thinking. Arne Naess, “The Shallow and the Deep, Long-Range Ecology Movements,” in George Sessions, ed., Deep Ecology for the Twenty-First Century (1973; Boston: Shambhala, 1995), pp. 151–55.

21. As environmental writer Derrick Jensen notes about this kind of reasoning, it ends up “fighting over techniques to salvage civilization, not ways to save the planet.” Endgame, vol. 2, Resistance (New York: Seven Stories Press, 2006), p. 757.

22. E. O. Wilson, The Diversity of life (New York: Norton, 1999), p. 259.

23. I am referring here to general writings on climate change that include substantial sections about biodiversity, not works that focus specifically on biodiversity in connection to climate change. In The Weather Makers, Flannery examines the impact of global warming on life. In his prescient work, McKibben also devoted considerable attention to the fate of species and ecosystems in connection to global warming. See Bill McKibben, The End of Nature (New York: Random House, 1989). In his laboratory Earth: The Planetary Gamble We Can’t Afford to lose (New York: Basic Books, 1997), climatologist Stephen Schneider has a chapter on climate-change effects on biodiversity. Recently, Hansen and colleagues provided two criteria of “dangerous climate change”: rising sea levels and extermination of species. See James Hansen et al., “Global Temperature Change,” PNAS 103, no. 39 (September 26, 2006): 14288–93. For the most up-to-date volume dealing specifically with the impact of climate change on biodiversity, see Thomas Lovejoy and Lee Hannah, eds., Climate Change and Biodiversity (New Haven, CT: Yale UP, 2005).

 

 

to be continued…

 

 

The Future of Liquid Biofuels for APEC Economies (part – III)

 

Continued from Volume V, Issue No. 3…

 

Feedstock

iofuels in the APEC region are produced from a variety of first-generation feedstock using well-established conversion technologies. For ethanol production, these include: starches from grains (cereals, feed, and grains), tubers (cassava and sweet potatoes), sugars from crops (sugar beets, sugarcane, and sweet sorghum), and food-processing byproducts (molasses, cheese whey, and beverage waste).  First-generation biodiesel feedstocks used in the APEC economies include vegetable oil (such as soybean, rapeseed, and palm oil), used cooking oil, and animal fat (tallow and cat fish oil). Second-generation feedstocks for ethanol production include lignocellulosic material, such as crop and forest residues, urban residues (municipal solid waste - MSW), and dedicated energy crops (herbaceous and tree species). Economies with large-scale agriculture and forestry operations such as Canada; the United States; and China have set up demonstration projects using lignocellulosic biomass for ethanol production. An advanced biodiesel feedstock includes microalgae, and a few companies in the United States and New Zealand have started pilot projects to grow algae (Figures 5-6).

Figure 5 Ethanol Feedstock in APEC Economies

Figure 6 Biodiesel Feedstock in APEC Economies

Yield efficiency per land unit for biofuels is an important consideration when choosing appropriate feedstock and making decisions for production expansion. APEC economies in the tropical biome have the advantage of growing crops with significant solar energy and rainfall input, yielding the highest biofuels per land unit compared with those in the temperate biome and its seasonal limitations. Tropical crops sugarcane and oil palm for biodiesel are the most desirable feedstocks for ethanol and biodiesel, respectively, considering their high yield per hectare (Figure 7 and Figure 8). China; Mexico; Thailand; Australia; and Indonesia are well-established sugarcane producers and among the top 10 suppliers in the world. Indonesia; Malaysia; and Thailand are the world’s largest palm oil producers; the Philippines are the world’s largest coconut oil producer; and Russia is the world’s leader in sunflower oil production. Given the favorable climate conditions and significant labor availability, Southeast Asian economies have announced feedstock production expansion and large-scale biofuels programs.

Figure 7 Average Ethanol Production per Hectare of Farmland Yield by Crop

 

Source: Worldwatch Institute, 2007; USDA, GAIN Biofuels Report for China, 2007

Figure 8 Average Biodiesel Production per Hectare of Farmland Yield by Crop                  

Source: Worldwatch Institute, 2007 

Economics

The cost for biofuels production in the APEC region varies widely and depends heavily on the cost of feedstock. For ethanol production, feedstock is about 60-75% of total cost; and for biodiesel production, it is 80-90%. Figures 9-10 show ethanol and biodiesel production costs for a set of APEC economies, compiled from recent publications or provided by authorities in APEC economies. These are illustrative estimates because they vary in the years they were developed (2006-2007).

Figure 9 Illustrative Ethanol Production Costs

Note: The energy density of a liter of fuel ethanol is 70% that of gasoline. Mexico and Canada estimates are for 2006 and all others for 2007.⁶  

Figure 10 Illustrative Biodiesel Production Costs

Note: The energy density of a liter of biodiesel is 90% that of petro diesel. New Zealand estimates are for 2003, Mexico and Canada estimates are for 2006, and all others for 2007.⁷

 Figures 9-10 illustrate the cost of producing biofuels from traditional or first-generation feedstock. Regarding second-generation feedstock, it is expected that a successful implementation of the advanced technologies could lead to significant reductions in the cost of producing biofuels.

Notes:

6 Source: RIRDC/CSIRO, 2007; USDA, GAIN Russia Biofuels, 2007; DEDE, 2007; NDRC, 2007; Palmas e Industrias del Espino, 2008; ITRI, 2007; SENER-BID-GTZ, 2006; CRFA, 2006; UN ECLAC, 2007; Tatsuji Koizumi and Keiji Ohga, 2007; NREL, 2007.

7 Source: RIRDC/CSIRO, 2007; DEDE, 2007; NDRC, 2007; Palmas e Industrias del Espino, 2008; KEEI, 2007; ITRI, 2007; SENER-BID-GTZ, 2006; CCGA, 2006; APEC BTF, 2007; Tatsuji Koizumi and Keiji Ohga, 2007; EECA, 2003; NREL, 2007.

 

to be continued…

 

NEWS BRIEF

OIL & GAS

RIL, ONGC offshore operations may face shut down

July 15, 2008. Reliance Industries (RIL) and ONGC may face an imminent shut down of offshore oil and gas operations after the Shipping Ministry issued new norms for vessels operating in Indian waters. DG Shipping had in May banned operations of all vessels that are more than 25 years old. According to the ONGC, offshore oil and gas operations will collapse if these norms are implemented. ONGC has more than 100 vessels operating off the East and West coast providing supporting services to oil and gas production. According to Reliance Industries, the company faced a similar fate for its 40-plus vessels working on bringing the gas field in Krishna Godavari basin to production. As per the ONGC, world over safety certification is the criteria for operations of vessels, not vintage.

ONGC ready to rope in Petrobras, Statoil

July 15, 2008. Having set the stage to rope in Petrobras of Brazil and Statoil Hydro of Norway as strategic partners in its hydrocarbon rich KG-DWN-98/2 block in October 2007, Oil and Natural Gas Corp (ONGC) is still waiting for the Union Government to approve the deal. The delay may impact the Indian oil and gas major’s plan to develop the KG asset on a fast track basis. The foreign partners are expected to offer the much-needed technical and logistics support to ONGC in developing its first major discovery — that too in ultra-deepwater — in recent years and help explore the residual areas of the block. In April this year, the management committee under the Petroleum Ministry allowed ONGC to go ahead with a programme aimed at establishing commerciality and developing the approximately 2-tcf hydrocarbon potential in UD1 discovery and explore the possibility of enhancing the reserve by way of further ultra-deepwater and deepwater drilling.

Indian cos vying for oil assets in Australia

July 14, 2008. Indian companies are vying for oil assets in Australia. Reliance Industries (RIL), Essar Oil, Videocon Group, GSPC, BPCL, GAIL India, GVK oil and Gas are learnt to be interested in bidding for the five prized exploration blocks on offer. The Australian government is likely to close accepting bids by October this year. The Indian companies have started negotiations with Australian oil majors like Oilex, Santos, Arrow Energy, BHP Billiton among others. According to Videocon company, it would be bidding in Australia in the upcoming round. It is in talks with all its prospective partners, GSPC, BPCL, HPCL and GAIL, to jointly bid for oil blocks in Australia. So far, Videocon has two hydrocarbon blocks in Auatralia. The block EPP-27 in the South Otway Basin, Auatralia is co-owned with Oilex and GSPCL – the three companies own 60% – with the balance 40% being retained by the original license holder, Great Artesian Oil & Gas. It also has a stake in Block 103 Joint Petroleum Development Area, Timor Leste & Australia. The consortium comprising Videocon Industries (25%), GSPC (25%), BPCL (25%) and Oilex (25%) as the Operator has been awarded the Block 103 by the Timor Sea Designated Authority, which was created on April 2, 2003, pursuant to the Timor Sea Treaty between Governments of Timor-Leste and Australia.It is planning to bid in association with an Australian firm.

Reliance Industries (RIL) is also learnt to be interested in bidding for oil assets in Australia. Last year, RIL bagged an exploration permit for block WO6-05 in the Bonaparte Basin in Western Australia, its first exploration block in the region. RIL has also got licenses for uranium mining in Australia. GVK Oil and Gas, a subsidiary of GVK Power and Infrastructure, forayed into oil exploration by aggressively bidding with Australian oil major BHP Billition in the NELP VII. It is likely to participate in the Australian auction round also. State-owned GAIL India is learnt to be in talks with Arrow Energy of Australia for joint collaboration in upstream projects in India, Australia and overseas.

ONGC to form alliance with Imperial Energy

July 14, 2008. ONGC is planning to form joint venure with UK's Imperial Energy which could include the former buying an equity interest in the latter. The LSE-listed oil and gas exploration and production company currently produces 10,000 barrels per day of oil. If ONGC manages to strike a deal with Imperial Energy, it will strengthen the Indian explorer's overseas presence, reports stated.

Sakhalin-1 oil output 0.180-185 mn bbl per day  

July 11, 2008. Crude oil production from Russia's Sakhalin-1 has declined to an average of 180,000-185,000 barrels a day from a peak of about 250,000 barrels a day last year, lowering India's Oil & Natural Gas Corp.'s (500312.BY) share of its light sweet Sokol crude. ONGC will tender to sell only one 700,000 barrel cargo in September. State-run ONGC usually sells two 700,000 barrels cargoes a month. But last month, ONGC offered only one cargo for loading in August. ONGC, through its overseas unit ONGC Videsh Ltd holds a 20% stake in the project, which is operated by ExxonMobil (XOM). Sakhalin-1 has potential recoverable resources of 2.3 billion barrels of oil and 17.1 trillion cubic feet of gas. The fall in OVL's share of Sakhalin-1 production could spell wider concerns for parent ONGC, India's largest oil producer, which is struggling to maintain declining production at its oilfields at home. With the news of Sakhalin production is declining and domestic fields having negative to zero volume growth, the risk of ONGC reporting a consolidated production decline in the fiscal year that started April 1 is greater now.

ONGC rules out listing of overseas subsidiary

July 9, 2008. ONGC has ruled out listing of overseas subsidiary ONGC Videsh Ltd (OVL) in the near future. According to the parent company there is an independent board for OVL, with two government directors and two independent directors and thus the decisions of OVL are absolutely transparent. OVL in 2007-08 recorded highest ever oil and gas production from its overseas assets. Crude oil production was up 18% to 6.811 million tons (mt), while gas output was marginally lower at 1.962 billion cubic metres (bcm). It earned a net profit of Rs 2.397 bn. Currently, OVL has oil and gas production from six projects spread in Sudan, Russia, Vietnam, Syria and Colombia. At close of the financial year 2007-08, the proven reserves of OVL stood at 1.166 bn barrels, which next to ONGC, is the second largest holding of proven oil and gas reserves by any Indian company.

Gail may not share subsidy burden in ’08

July 15, 2008. According to the Gail India, it is unwilling to share the subsidy burden. As per the company, it is a mid-stream company and not an exploration and production (E&P) firm like ONGC or OIL. Gail, along with other upstream oil companies such as ONGC and OIL, have been asked to share subsidies worth Rs 45,000 crore ($10.4 bn) to bail out bleeding oil marketing companies (OMCs) in the wake of soaring crude prices. Their combined under-recoveries have been pegged at over Rs 2 lakh crore ($46.3 bn). Gail has been sharing the subsidy burden for the past three years. Its share in the subsidy burden was Rs 1,314 crore ($304.7 mn) last year, Rs 1,488 crore ($345 mn) in FY07 and Rs 1,064 crore ($246.7 mn) in FY06. Interestingly, Gail hardly earns any revenues from its upstream operations. It is not clear how much Gail’s share in the subsidy burden will be. But analysts said the company might have to share the burden as the Centre wants it to do so. They said the subsidy-share proposal was mooted when crude hovered around $123 a barrel and now with crude breaching $147 per barrel, these companies (Gail, ONGC and OIL) might have to share a bigger burden as the under recoveries of OMCs are expected to go beyond Rs 45,000 crore ($10.4 bn). It may be recalled that Reliance Industries had shared subsidy worth Rs 750 crore ($173.9 mn) in the form of discounts to OMCs in 2006. But the company was exempted when its petroleum retail business started making losses. So may be the case with Gail, say analysts. 

BP Plc to source 5 mt crude for Spice's Haldia unit

July 14, 2008. Spice Energy has tied up LNG imports from Indonesia for its proposed $400 million terminal in Haldia, while its unit Cals Refineries has signed a deal with oil major BP Plc to source 5 million tons crude oil a year for its $1.1 billion refinery in Haldia. Spice Energy has signed a framework agreement with Indonesia's Pertamina for sourcing liquefied natural gas for the Haldia import and regassification facility it plans to set up by 2011. Spice Energy is setting up a 2.5 million tons facility that will sell gas to fertilizer plants in West Bengal.

In the same port city, Cals Refineries, the BSE listed firm where Spice Energy promoters hold just under 15 per cent stake, is relocating a 5 million tons refinery from Germany by first quarter of 2010. It would get BP to commit 2.5 million tons a year of heavy crude and a similar quality of light crude. Spice Energy had also signed a deal with Indonesian miner PT Tambang Batubara Bukit Asam Tbk to buy 6 million tons of coal a year for 20 years from 2011 for its proposed 1,000 MW thermal power plant at Cuddalore in Tamil Nadu. The power plant would be set up in 32-36 months at a cost of $1.1 billion. BP would buy most of the petrol and produced by Spice Energy's Haldia refinery, for sale in Asia Pacific region. BP has agreed to take 65 per cent of the refinery throughput and the remaining, comprising mostly of LPG, aviation fuel, naphtha, proplene and pet coke, will be sold domestically. The refinery capacity will be doubled 2011. BP will supply 100 per cent of the refinery's crude requirement for 10 years from the date of commercial production. The project involves relocating a 90,000 barrels per day refinery of Bayenoil based in Ingolstald, Germany and adding new process units like delayed coker, offsites and utilities. The unit will shutdown this month-end after which it will be dismantled and shipped to Haldia for reconstruction. Spice Energy has bought two distillation units and a delayed coker plant of Petro Canadas Edmonton facility for $110 million to enhance its capacity of processing complex crude oil. The company plans to commission the refinery by Q1 2010. Cals has hired UK refinery engineers KBC to upgrade the plant, to be able to refine lower-quality crude oil. The refinery would be expanded to 200,000 bpd by Q1 2011 and possibly to 400,000 bpd by 2013. Spice Energy may induct a strategic partner in both refinery and LNG projects after their completion.

Kolkata to get piped natural gas in early ’09

July 14, 2008. The city of Kolkata could find its commercial transport, industries and perhaps even some of its homes using natural gas as fuel if a new plan, recently signed, to distribute viable methane gas takes off in early 2009. ONGC and Calcutta Compressions and Liquefaction Engineering Pvt. Ltd (CCL)—a private company—signed a memorandum of understanding for distribution of coal bed methane (CBM), in Kolkata and adjoining areas, starting January. It could help reduce pollution in Kolkata, where almost all commercial vehicles still run on diesel. Three-wheeled auto rickshaws run on petrol and liquefied petroleum gas (LPG), in Kolkata but, they too are a major pollutant because most of them end up using adulterated fuel. In major cities, such as Delhi and Mumbai, introduction of compressed natural gas, or CNG, has led to substantial reduction in pollution. CNG is not available in Kolkata. CBM, which has a high calorific value of around 8,000 kcal per cubic metre, can be used as an automotive fuel with the help of a converter. This converter, which CCL will get from a French firm and distribute in India, is going to cost around Rs 19,000 for auto rickshaws, Rs 30,000 for petrol cars and up to Rs 45,000 for diesel cars. Some diesel engines might, however, need minor modifications.

CCL is looking to tie up with Greater Calcutta Gas Supply Corp. Ltd (GCGSC), a West Bengal government-owned gas distribution firm, which owns an underground network of pipelines in Kolkata and adjoining areas. Though the two firms have not yet reached an agreement, the plan is to initially distribute 60-70% of the gas sourced from ONGC through GCGSC’s pipelines to industrial establishments in Kolkata and two neighbouring districts—Howrah and Hooghly. CCL will set up four dispensing stations over the next six months and sell 30-40% of the gas it sources to taxis and auto rickshaws to start with. CCL proposes to initially price the gas at Rs 35 per kg, or a shade over Rs 25 per litre. The fuel is significantly cheaper than diesel, but slightly more expensive than CNG in other cities such as Delhi and Mumbai. The company, which has hired a consultant for a feasibility study, estimates demand from private and commercial vehicles in Kolkata can touch 3 million cubic metres a day.

Under the agreement signed on 10 July, ONGC will supply 5,000 cubic metres of CBM a day, which will be transported to Kolkata by road in steel containers. The gas, containing 97% methane, will be recovered from two CBM blocks in Jharia in Jharkhand. ONGC will sell the gas to CCL at $5.1 per mbtu (or Million British Thermal Unit), which translates to around Rs 8.10 per cubic metre. Supply will be scaled up to 50,000 cubic metres a day in a year, and to 750,000 cubic metres by end of 2010. As production and demand go up, CCL plans to lay a pipeline from ONGC’s CBM blocks in eastern India to Kolkata, which is estimated to cost around Rs 325 crore ($75.9 mn).

Next  round  of  bidding  for  CBM  blocks  by December

July 15, 2008. The Government plans to put on offer more coal bed methane (CBM) blocks by December. Acocrding to the Director-General, Directorate-General of Hydrocarbons (DGH), Mr V K Sibal, about 10 CBM blocks may be put on offer. He said that the eighth round of New Exploration Licensing Policy (NELP) would be launched in the second half of 2009-10 and open acreage system that allows firms to carve out areas they want to drill may come simultaneously with NELP VIII. He is of the view that it is necessary to create a national data repository for open acreage that will have the data from all the blocks that have been drilled so far. He said that by end-December the Government would appoint a consultant for the data repository.

The DGH and Department of Industry & Resources of Western Australia has signed an memorandum of understanding (MoU) which aims at enhancing cooperation and understanding on oil and gas related issues and exchange information and pass on good practices in the development of policy on oil and gas exploration, production and field abandonment, and exchange of expertise. It also identifies broad areas of cooperation. These include aquifer depletion specific to the oil and gas sector, enhanced oil recovery, coal bed methane gas, education and training, joint research and development and any other areas that are mutually agreed upon by both parties. The two sides will seek to approve a programme of cooperation each year or such other jointly decided time period. The MoU is valid for 5 years and may be further extended with mutual consent. Both sides felt that there is a large potential for cooperation in various activities especially in exploration and production, coal bed methane, LNG, etc.

Govt bars new fuel pumps by oil PSUs for 2 years

July 14, 2008. Government has stopped oil PSUs from building new fuel stations for two years to cut costs at companies losing heavily from having to sell fuel at prices far below market rates. In June, the government raised petrol and diesel prices by about 10 percent, its biggest increase in 12 years, but the hike lagged far behind the recent rally in crude oil prices, which soared to a record above $147 a barrel. Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp are losing millions of dollars a day, as they sell fuels at low prices set by the government to help protect the poor and fight inflation. Upstream companies and the government partly subsidise their losses, adding to the strain on public finances.

Fuel gets cheaper in Mizoram

July 9, 2008. Petrol, diesel and LPG have become cheaper in Mizoram after the state government slashed rates of sales tax on the items. Petrol became cheaper by around Rs 4 a litre while diesel price also came down by Rs 1.80 per litre and a cylinder of LPG is cheaper by Rs 17.50. With the cut in sales tax on petrol and diesel, these items would be the cheapest in Mizoram among the north eastern states.

‘Taxing oil companies not under petroleum ministry’: Deora

July 9, 2008. Petroleum Minister Murli Deora said that his ministry cannot decide on imposing the so-called windfall profit tax on private oil producers and refineries. The Left parties and more recently the Samajwadi Party, that is now supporting the Manmohan Singh government after the Communist withdrew their support over the nuclear deal with US, have been demanding that companies like Reliance Industries, Essar and Cairn be taxed to tied over the crisis created by high oil prices. They have also demanded review of export oriented (EoU) status of the Jamnagar refinery of Reliance. Petroleum Ministry said no ministry unilaterally can levy windfall tax as it may require Parliamentary approval. Besides, the private firms cannot be singled out for the tax and if all standalone refineries or units with no fuel retailing are to be charged of such tax, units such as ONGC's subsidiary Mangalore Refinery, Chennai refinery of IOC and Numaligarh refinery would also come under the ambit of the new tax. Deora's aide said the decision to convert Reliance's Jamnagar refinery into export oriented unit was taken by the Commerce Ministry after several rounds of inter-ministerial consultations that did an in-depth study of demand-supply projections. While state-run firms are faced with huge revenue loss as they capped domestic retail prices despite two-fold jump in international crude oil prices, Reliance Industries' Jamnagar refinery has seen net profits jump 28 per cent to Rs 15,261 crore ($3.5 bn) in 2007-08. The refinery that has been turned into pure export oriented unit earned USD 15 a barrel margin, almost double of its public sector competition. The Left and the SP have questioned the UPA Government's move to give Jamnagar export oriented tag when the nation was short of critical cooking fuels like LPG and kerosene.

POWER

Bhel to generate power from demo plant

July 15, 2008. Bharat Heavy Electrical Ltd is planning to generate power from its demo plant, which has been installed at Trichy. With this India would be entering into a clean coal technology era. The 6.25 MW integrated gasification combined cycle plant (IGCCP), which is a demo plant, would be converted into a power generating unit. The initial investment is expected to be around Rs 125 crore ($28.9 mn). The plant is expected to start generating power by September 2011 and its annual consumption of coal would be 50,000 tonnes. The Andhra Pradesh Power Generation Corporation (APGenco) has also entered into an agreement with Bhel to set up a similar plant in Vijayawada. The 125 MW capacity plant will involve an investment of around Rs 950 crore ($220.3 mn). Of the total, Bhel is expected to invest Rs 420 crore ($97.4 mn). Similarly NTPC and Bhel are planning to establish a 250 MW power plant at Auriya in Uttar Pradesh, where NTPC was already running a gas-based thermal plant with a capacity of 640 MW.

NTPC explores investment in Oman: Report

July 15, 2008. According to a report NTPC is exploring an investment option in Oman and is in talks with Oman Power and Water Procurement Company (OPWPC), Omani Electricity and Water (PAEW). The report also points out that NTPC is also having discussions with two prominent Omani private industrial houses with diverse business interest. Oman government has decided to set up coal-based power plants in the upcoming industrial port city of Duqum and aims to have its first coal-based power plant commissioned by 2014, adds report.

Madhucon Projects bags contract for power plant

July 14, 2008. Madhucon Projects has bagged EPC Contract of Rs 9.89 bn for setting up of Thermal Power Plant in Krishnapatnam South, Nellore District of Andhra Pradesh. The project will be completed in 26 months. The 170 MW coastal based Thermal Power project is 1^st Phase of total envisaged 620 MW being set up by Simhapuri Energy Private Limited.

Simhapuri Energy Private Limited has already been allotted land has achived financial closure, entered into power purchase agreement and also obtained Environmental clearance from Ministry of Environment and Forest. The company shall be the first power utility to start the construction and shall commence production in the Krishnapatnam by 2010.

BHEL bags $508 mn contract from TN

July 11, 2008. Bharat Heavy Electricals Limited (BHEL) has secured a Rs 21,750 mn ($508.17 mn), the EPC contract for setting up a 600 MW thermal power generating unit in Tamil Nadu, on EPC basis by Tamil Nadu Electricity Board TNEB. This is the second order secured by BHEL for the new rating unit of 600 MW designed to sub critical parameters.

TNEB has earlier placed a similar EPC contract on BHEL for setting up a 600 MW thermal power generating unit at the same power station. The contract is for the manufacturing of the Boiler and its auxiliaries, the Steam Turbine and Generator, the Pumps and Heat Exchangers, the art Controls and instrumentation system.

BHEL and TNEB have recently signed a MoU for the formation of a Joint Venture Company for setting up a 2x800 MW Supercritical Thermal Power Project Udangudi in Tiruchendur Taluk of Tuticorin District in Tamil Nadu, with principal equity stake from BHEL and TNEB. The project, with a total capital outlay of around Rs 85,000 mn, will be the first supercritical power project in the state of Tamil Nadu and will strengthen the power availability in the state.

NHPC, J&K to ink JV on 3 projects

July 10, 2008. The National Hydroelectric Power Corporation and Jammu & Kashmir (J&K) have signed an agreement on equity share in three major power projects over the river Chenab in Doda and Kishtwar districts of the Jammu region.  The equity share will be 49:51, with 49 per cent for the state and 51 per cent for the NHPC. The state cabinet has approved the draft MoU for the projects.

A decision was taken by the state government to float the Chenab Valley Corporation for the purpose with its chairman from Jammu and Kashmir. NHPC will give 12 per cent of the power generated gratis to the state. The projects are the 1,000 MW Pakal-Dul project in Kishtwar, and the 600 MW Keru project and the 520 MW Kawar project in Doda. The Power Finance Corporation will provide funds for the projects. The corporation has also provided an additional amount of Rs 200 crore ($46.5 mn) on the request of J&K government for the completion of Baglihar power project on the Chenab in Ramban district of Jammu.

Era Infra to build power plant in MP

July 10, 2008. Era Infra Engineering is expanding its horizon in the power sector. In pursuance of this objective, the company will establish a thermal power plant of 1200 MW in Madhya Pradesh. The company has initiated relevant steps and procedures for obtaining various clearances and permissions from concerned departments.

The company has also entered into an 'agreement to sell' for the purchase of land at Jatwar, Dist - Umaria, Madhya Pradesh on July 8. Other steps required for establishing the power project are being taken.Era Infra is primarily in the business of Construction / Development of Highways, Railways, Power Plants, Airports, Urban Infrastructure and Housing.

Siemens bags $47 mn order from CEB

July 14, 2008. Siemens Energy division has received an order of around Rs 200 crore ($46.7 mn) from the Ceylon Electricity Board (CEB), Sri Lanka's state power supply utility, for the modernisation and upgradation of the medium-voltage distribution network of Colombo. Colombo's power supply system is being modernised and expanded in order to meet the increasingly high standards required for the city's power supply.

Siemens would agument a 33/11 kv substation, supply, installation and commissioning of 390 air insulated medium voltage switchgear bays, 40 compact substations, 50 ring main units and 72 low voltage distribution switchgear from its facilities in India and Germany, apart from the supply and laying of over 200 kilometers of cables. Siemens is also delivering a Supervisory Control and Data Acquisition System (SCADA) for the load dispatch centre that will be equiped with Siemens Sinaut Spectrum control system. This system will gather data from 251 substations and connect them to a centralised distribution control center providing real time information at single point for effective monitoring and control of the power network.

Sterlite Tech wins orders worth $15.5 mn

July 14, 2008. Sterlite Technologies Ltd., a leading global provider of power transmission conductors, optical fibers and telecommunications cables, wins four contracts with leading infrastructure companies in Nigeria, Uganda, Algeria and Bangladesh. The contracts, which are for Sterlite's ACSR, AAAC and Almelec power conductors, are worth a total of $15.5 mn. The company was chosen as the sole manufacturer and supplier of power conductors for all these contracts. As per customer's requirements the power conductors would be supplied between July 2008 and November 2008. With these project wins, Sterlite has a fortified its market share to about 14% in Africa, with its Power Transmission Conductors products sold in 21 countries across the continent to reputed Turnkey, Utilities and Infrastructure companies such as SONELGAZ - Algeria, EEPCo - Ethiopia, KPLC - Kenya, PHCN - Nigeria and ESKOM - South Africa, to name a few.

The Company currently has a cumulative manufacturing capacity of 115,000 MT (Metric Tons), making it the largest manufacturer in India and amongst the Top 5 global manufacturers of Power Conductors. Sterlite is a significant contributor to the global power sector through indigenous manufacture of a complete range of power transmission conductors at Extra High Voltages (400kV - 800kV), High Voltages (66kV - 220kV) and power distribution conductors (11kV- 33kV).  The Company is a market leader in India and supplies about 27% of India's total demand for power transmission & distribution conductors.

C&O Group sign MoU with Griffin Coal

July 14, 2008. The Coal & Oil Group, a Rs 22 bn ‘Integrated Energy Company’, has entered into a Memorandum of Understanding (MoU) with Griffin Coal, a coal producer from the Western Australian region, enhancing current imports from 600,000 tons to 1.2 mn tons in the near future specifically targeted towards the sponge iron industry. The MoU will generate revenues of more than Rs 5 bn. India’s voracious demand for coal to power its industries, is throwing open opportunities for players across the world. Amongst them is Western Australia, a region with huge untapped reserves of coal and other minerals, which has slowly made inroads into the country. C&O were the pioneers in the import of steaming coal from Western Australia into India in February, 2007.  The coal would also be channeled for securing long term FSA’s (Fuel Supply Agreements) for the upcoming IPP’s (Independent Power Plants) in India. The two companies also plan to explore joint coal mining opportunities in India and Western Australia.

Haryana ties up for supply of 2,000 MW power

July 14, 2008. The Haryana government has tied up for supply of 2,000 MW of power to partly meet the the short fall of 4,000-5,000 MW likely to be faced by the state by 2012. The thermal plants being set up by Lanco, GMR (through PTC) and Adani would supply power to Haryana for a period of 25 years beginning from 2012 at a levelised tariff ranging from Rs 2.355 to Rs 2.940 per unit. Haryana Power Generation Corporation had invited bids on May 30, 2006, following central government's guidelines.

Private players corner over 50 pc of power trading biz

July 13, 2008. Private sector players are beginning to flex their muscles in the newly opened power trading business. Led by Lanco Electric Utility, Tata Power, JSW Power Trading and Adani Exports, private players are triggering a shake-up in the inter-State power trading market, cumulatively garnering over 50 per cent market share in the January-March quarter this year. This is against 44 per cent and 28 per cent during the preceding two quarters, according to latest Government estimates. Power trading pioneer and market leader, PTC India Ltd, and its State-owned counterpart, NTPC Vidyut Vyapar Nigam Ltd, have cumulatively seen a shrinkage in market share during the last three quarters. In fact, NTPC Vidyut Vyapar Nigam, the electricity trading arm of generation major NTPC Ltd, has also managed to increase trading volumes and is closing in on market leader PTC India Ltd, with both players trading nearly similar volumes of electricity during the January-March quarter this year. Lanco Electric Utility Ltd, Tata Power Trading Company, JSW Power Trading and Reliance Energy are among the private firms that have progressively increased their market share over the last three quarters. Karamchand Thapar & Bros Ltd, Visa Power Ltd, Kalyani Power Development and Patni Projects are the other private players in the fray for a chunk of the power trading pie.

Major Inter-state Electricity Players
(% of total traded volume)
Name of firm	Jan-March 2008	Oct-Dec 2007	July-Sept 2007
PTC India Ltd	23.33	39.76	56.87
NTPC Vidyut Vyapar Nigam Ltd	22.30	16.39	14.27
Lanco Electric Utility	16.52	12.78	9.76
Tata Power Trading Co	10.98	9.73	6.37
JSW Power Trading Co	9.46	7.73	4.25
Adani Exports Ltd	8.11	9.90	4.22
Reliance Energy Trading Ltd	7.68	3.13	2.78

The total traded volume during the January-March quarter this year was 3,803 million units (MU), down from 5,218 MU during October-December 2007 and 7,227 MU July-September 2007. Currently, inter-regional power transfer capacity of slightly over 6,000 MW is available in the country, which is expected to increase to about 9,500 MW in the coming years, according to Government estimates. Short-term power trading or trading on daily requirement accounts for about 15 per cent of the total power trading volumes on an average.

Metso to design CFBC boiler for Indian power sector

July 11, 2008. Finnish power and engineering major, Metso, formally signed a joint venture agreement with the Chennai-based EPT Engineering Services. The venture will provide engineering and design services for Metso group worldwide. Metso Power AB produces industrial and power boilers, mainly of the CFBC (circulating fluidised bed combustion) variety. These boilers are primarily used to burn fuels of less calorific value or those that contain pollutants—the technology makes way for contained combustion and removal of pollutants in solid form. But in India, CFBC boilers are used for burning coals of low calorific value and other fuels such as lignite. In fact, the demand for these boilers is still emerging. For instance, Neyveli Lignite Corporation is only now putting up it first CFBC. The joint venture of Metso and EPT, Metso Power India Pvt Ltd, will function out of a new facility in Guindy, Chennai.

‘Consider various green fuel options, including nuclear’: GAIL

July 15, 2008. With the country's oil and gas imports likely to rise by an additional 20 per cent, various green fuel options, including the nuclear energy, should be considered, said GAIL Chairman and Managing Director U D Choubey. The country's current oil and gas imports account for about 75 per cent of the energy needs. According to him, the $132 bn Indian oil and gas industry contributes around 15 per cent to the GDP and of the total energy needs, around 75 per cent is met with by imports. He projected that by 2020, the imports will rise to about 95 per cent of the Indian consumption.

There are about 400 reactors worldwide that produce 360 GW of power. About 50-60 per cent of the fuel purchased by India is from West Asia and of this 70 per cent is utilised for transportation. He also said that at 8 per cent sustained GDP, India will require 3-4 times of the current consumption of oil and gas. Similarly, the electricity demand will rise by 5-7 times in coming years.

AP Genco told to expedite pending projects

July 15, 2008. The Andhra Pradesh government directed AP Genco, which is adding about 8,860 MW in four years, to expedite the pending projects. The state was focusing on long-term strategies for power generation. The present gap between generation and supply of power was due to faulty policies of the previous government regime. The scanty rainfall this season has resulted in acute shortage of power in the State. Therefore, the Government’s focus is on long-term strategies in power sector. The daily demand for power has shot up to 198 million units a day as against 145 to 160 mu last year.

Govt's rural electrification scheme in dark

July 13, 2008. Delay in sanctioning money has taken its toll on the Rajiv Gandhi Grameen Vidyutikaran Yojna as the government has fallen short of target to electrify the villages by more than 50 per cent. Out of 1.25 lakh villages to be electrified only 45,000 villages have got electricity. Minister of State for Power, Jairam Ramesh, is of the view that in two years from now all villages would be electrified.

RGGVY, launched in 2005, is proposed to cover 1.25 lakh villages and provide free connections to 2.35 crore ($0.5 mn) people below poverty line (BPL) households. Under the scheme about 45,000 villages have already been electrified and 21 lakh free connections have been provided to poor households. In the 11th Plan, the Planning Commission has approved Rs 28,000 crore ($6.5 bn) for the implementation of RGGVY. Under the Plan, 316 new projects costing Rs 16,000 crore ($3.7 bn) have been approved, which are likely to commence operation within the next six months. RGGVY aims at creating rural electricity infrastructure and household electrification with 90 per cent grant from the central government and 10 per cent loan from the Rural Electrification Corp (REC).

'Hydel power is only way to resolve energy crisis': Khanduri

 July 13, 2008. Uttarakhand chief minister B C Khanduri has reiterated that the state would continue to pursue hydro-power projects, in order to fulfill its energy requirements. The state government had recently suspended two of its hydel power projects- at Bhaironghati as well as Pala-Maneri, after a environmentalist went on protest against the damming of upper reaches of the Ganga. However, Khanduri maintains that tapping the state's significant hydro power reserves is the only way to resolve the growing energy crisis in the state. According to the minister there is a potential of at least 40,000 MW of hydro-power in Uttarakhand.

India Inc eyes big gains from nuclear business

July 13, 2008. Over 400 companies in India may get a share of the total pie of nuke business, estimated at over $100 billion, over the next five years, if the country succeeds to clinch the civil nuclear deal with the US. Larsen and Toubro (L&T), Tata Power, Mahindra and Mahindra (M&M), Godrej and Boyce, Bharat Forge, Infosys, Wipro and TCS, which were already accorded Raksha Udyog Ratna (RUR) status by the ministry of defence, could be front-runners in engaging at various stages of building nuke power plants. Many of these companies may partner with foreign bigwigs such as Areva, Siemens and General Electric in the nuke business. India may build 10-15 nuclear plants if uranium supply is ensured. Australia and Russia could be the major beneficiaries of the nuclear deal as India is likely to source uranium from these two countries.

Andhra announces weekly electricity holiday for industry

July 12, 2008. In an attempt to maintain seven-hour free electricity supply to farmers, the Andhra Pradesh government imposed weekly one-day cut on the industry and two to six hours cut in towns and villages. The huge shortfall is despite the state purchasing 700 MW of electricity from other states. More electricity was not available from the southern grid as the other southern states were drawing their quota due to scanty rains. The hydro-electricity generation, which was 2,000 MW during July 1-12 last year, has come down to 600 MW during the corresponding period this year. The government was spending Rs 100 mn to Rs 110 mn every day on purchase of electricity.

Environment friendly coal yard at Port Pipavav

July 11, 2008. Port Pipavav, an APM Terminals run port, has commissioned an environmentally responsive coal handling facility capable of storing nearly 2, 50,000 MT of coal. The newly designed coal yard would ensure that coal could be handled and stored efficiently and safely, without adverse impact on any other cargo.

Port Pipavav handles substantial amounts of fertiliser and cotton and thus it is critical to ensure that these and other sensitive cargo types are not contaminated by coal dust at the port. The new coal facility includes an integrated system of two electric level luffing cranes and a mobile conveyor system leading to the coal yard. The most striking feature of the facility is a well planned and designed coal yard, which prevents and controls the coal dust from escaping the yard thus avoiding contamination to any other cargo type.

Tehri bats for run-of-river hydro projects

July 11, 2008. Tehri Hydro Development Corporation (THDC) has made a strong pitch for the development of Run-of-River (ROR) based hydro projects, as these projects, up to installed capacity of 250 mw, are exempted from taking prior environmental clearance. The time taken for environment clearance is a big hurdle in developing hydroelectric projects. The Environment Impact Assessment (EIA) study of hydro projects take at least 18 months time provided other things remain favourable.

THDC has argued that the ROR schemes being environment friendly and causing no pollution problem can be designed to harness hydro resources with least governmental restrictions. According to the existing policy (Environment Impact Assessment Notification, 2006) for granting environment clearance to hydroelectric projects, with respect to power generation capacity, THDC has brought to the notice of the Centre that there are various rules being followed for providing environment clearance.

For category (A) projects with generation capacity of more than 50 mw, prior environment clearance from the Ministry of Environment and Forests (MoEF) is necessary. For category (B) projects with less than 50 mw and /or more than 25 mw hydroelectric power generation, prior environmental clearance is required from State Environment Impact Assessment Authority at the state government level. THDC has requested for a proper legislative enactment to regulate the procedure and delegation to executive authority for granting permission for RoR projects.

IAEA safeguards to cover civilian nuclear facilities

July 10, 2008. The Congress-led United Progressive Alliance (UPA) Government made public the draft text of the Safeguards Agreement negotiated with the International Atomic Energy Agency (IAEA). The Agreement requires the Government to identify and separate the country’s military and civilian nuclear facilities, while placing the latter under the IAEA’s safeguards regime.

Once the Government “voluntarily” and “on the basis of its sole determination” notifies any nuclear facility and associated materials as civilian (i.e. intended for producing power), the IAEA would apply safeguards to ensure “that no such item is used for the manufacture of any nuclear weapon or to further any other military purpose and that such items are used exclusively for peaceful purposes and not for the manufacture of any nuclear explosive device”. The Agreement also has specific provisions to enable the country to obtain “reliable, uninterrupted and continuous access” to the international nuclear fuel market, currently restricted to just the 45-odd countries that are part of the Nuclear Suppliers Group (NSG). There is provision for India to take “corrective measures” and build a “strategic reserve” of nuclear fuel to ensure uninterrupted operation and guard against any disruption of supply over the lifetime of its civilian reactors.

In the event of India conducting a nuclear test or pursuing a foreign policy not in consonance to that of the major powers, fuel supplies would be terminated and lead to stranded reactor capacities. Significantly though, the provisions are contained only in the preamble of the Agreement and not in the operative part. Also, there is no definition given of “strategic reserve” or what precisely would “corrective measures” entail. Moreover, even the preamble does not explicitly “recognise” these issues and instead limits itself to “noting” them for the purposes of the Agreement. This, some experts believe, renders the provisions vague and not really legally binding.

Karnataka to ask the Centre to double power allocation

July 10, 2008. Slipping into severe power shortage following a weak monsoon, Karnataka Government has decided to ask the Centre to double the allocation from the southern power grid to 30 per cent. Tamil Nadu, Andhra Pradesh and Kerala have been allocated 30 per cent from the southern grid. With virtually no power project having come up in recent times, the State’s power demand had gone up. Besides initiating measures to increase power generation from thermal plants at Bellary and Raichur, the Cabinet decided to buy more power from private power producers. The private companies produce 80 MW power in the State. With a new generation plant set up for its captive steel plant by JSWS Steel Ltd, the State Government is hopeful of augmenting the supply from the private source to meet the shortfall in power.

Bureau of Energy Efficiency, PTC sign pact

July 10, 2008.  The Bureau of Energy Efficiency (BEE) and PTC India Ltd signed a memorandum of understanding which intends to leverage the financial and technical strength of PTC and also provide financial support to carry out contract audit. The MoU provides a framework for partnership between BEE and PTC for implementing programmes by providing technical expertise in the form of energy audits and finance by PTC, without any financial burden on BEE.

The MoU will also establish the Energy Efficiency Financing Platform (EEFP) that seeks to overcome barriers of financing by sharing risks and capacity upgradation of financial institutions among others. The MoU allows PTC to undertake energy efficiency projects on performance contracting model to demonstrate its effectiveness as a viable business model.

PTC will undertake these projects in various sectors such as Government buildings, commercial buildings, hospitals, municipalities and agriculture. The objective of EEFP is to create a mechanism to mainstream financing of energy efficiency projects. EEFP will provide the necessary instruments like aggregated energy efficiency projects, bankable DPRs and other risk mitigation measures to enhance the comfort for tenders. EEFP is being positioned as a platform to overcome barriers that have stunted financing to the energy efficiency projects.

OIL & GAS

Gazprom, Wintershall start Achimovskoe production in Russia

July 15, 2008. The joint venture of Gazprom and Wintershall Holding AG, ZAO Achimgaz, launched test production at section 1À of Achimovskoe formations at Urengoi gas and oil condensate field in Yamal-Nenets autonomous district. At present a complex gas treatment facility and three gas condensate wells are operating at the section providing daily gas production of 2.3 million cubic meters.

It is planned to produce by the end of 2008 531 million cubic meters of gas and 188.7 thousand tons of condensate. It was at the moment of Achimgaz creation that Gazprom for the first time applied the new principle of cooperation with foreign partners: the joint venture receives profit from the implementation of the project, while Gazprom holds the field license. The successful partnership established in gas trading with Gazprom was consequently extended to the production of natural gas in 2003.

In ZAO Achimgaz the know-how and expertise of the two partners complement each other perfectly for the difficult-to-recover Achimov formation in Western Siberia: Gazprom specializes in producing gas in the Extreme North, while Wintershall has many years of experience working in challenging geological conditions. In this ideal partnership risks and rewards are equally shared.

With the joint venture Achimgaz BASF/Wintershall and Gazprom extend their more than 17-year-old successful co-operation along the entire value chain, stretching from the gas wells in Siberia over pipelines and a gas distribution and trading joint venture to the customers in Europe.

Geopark discovery at Fell Block in Chile

July 15, 2008. Geopark Holdings Limited has discovered a new oil field on the Fell Block in Chile following the successful drilling and testing of the Aonikenk 1 exploration well. Geopark operates and has a 100% working interest in the Fell Block. Geopark drilled and completed the Aonikenk 1 well to a total depth of 2,377 meters.

A production test in July 2008 in the Springhill formation flowed without stimulation, at a rate of approximately 1,201 barrels per day (bpd) of oil, 1.2 million cubic feet per day (mmcfpd) of gas and 1,465 bpd of water through a choke of 12 millimeters (mm) and with a well head pressure of 896 pounds per square inch (psi).

Aonikenk 1 represents a new field discovery which was drilled on a geological structure defined following the interpretation of Geopark's 3D seismic program. Geological and geophysical interpretations suggest the opportunity for further development drilling in the Aonikenk field and a new drilling location has been selected to be drilled in Q42008.

Venture successfull at Barbossa, plans to Tie-Back

July 15, 2008. Venture Production plc has successfully sidetracked and tested well 47/9c-11x to appraise the Barbarossa gas field. Barbarossa is located in Block 47/9c in the southern North Sea on acreage operated and 90% owned by Venture. Rates of 40 million standard cubic feet per day gross were produced through a 96/64” choke with a tubing head pressure of over 1,000 psi.

The well will now be completed as the field production well with plans for the Barbarossa field to be developed as a subsea tie-back jointly with the nearby Channon discovery (Blocks 47/8c and 47/3h, Venture 54%, operator), which was tested at stabilized rates of up to 55 MMscfpd gross. Combined recoverable reserves from Channon and Barbarossa are 70 to 80 billion cubic feet net to Venture, with a combined well potential from both fields of circa 80 MMscfpd net to Venture. A field development plan is in preparation and, subject to conclusion of ongoing discussions with host platform operators, first gas from the combined development is planned for 2009. 

Sisi and Nubi gas fields inaugurated in Indonesia

July 14, 2008. Indonesian President Susilo Bambang Yudhoyono inaugurated the Sisi and Nubi gas and condensate fields. Both areas will produce 300-350 million cubic feet a day (MMSCFD) of gas in end 2008. The volume will add Total E&P Indonesia's production to 2.6 billion cubic feet a day to 2011. Total has spent $1.1 bn to develop the fields. Total E&P and Inpex expect to invest $6 bn over the next five years at the Mahakam block.

Tag Oil successful at Cheal A7 step-out well

July 14, 2008. Tag Oil Ltd. announced the success of the Cheal A7 step-out well at the Cheal oil field, located in the onshore Taranaki Basin, New Zealand. The well has been drilled, logged and both of the Mt. Messenger sandstone reservoirs targeted are interpreted as oil saturated. The Cheal A7 well was drilled to a total measured depth of 1848 meters and intercepted approximately 7 meters of oil bearing sands within the Mt. Messenger formation. The Cheal Joint Venture (TAG 30.5%) is in the process of completing the well and preparing a temporary tie back into the Cheal Production Facility to production test the well in the near future.

OMV makes discovery at Jenein Sud block in Tunisia

July 14, 2008. OMV Aktiengesellschaft has discovered and successfully tested the condensate and gas in its Ahlem-1 exploration well in the Jenein Sud exploration permit in Southern Tunisia. This is the third successful discovery in the permit within the last two years and highlights the potential of this block, which is operated by OMV (Tunesien) Exploration GmbH.

The exploration well reached a total depth of 4,020 m and encountered a total of 36 m net gas and condensate pay in several layers at depths ranging from 3,700 m to 3,980 m. Further exploration and appraisal activities are planned in the area, including the acquisition of 3D seismic and drilling of additional wells. The cumulative flow rate of all layers tested by the Ahlem-1 well amounts to 3,500 bbl/d of condensate and 120 mn cf/d (20,000 boe/d) of gas. Drilling of the next exploration well in the block is expected to commence in July.

BG, partners make discovery at Jordbaer

July 10, 2008. Revus Energy ASA confirmed a gas/oil discovery on the Jordbaer prospect in the Norwegian North Sea. Operations are still ongoing and further data gathering with subsequent evaluation will continue. The Jordbaer prospect (Jordbaer is the danish word for strawberry) is located in PL 373S, which is operated by BG Norge. The PL 373S comprises parts of blocks 34/2, 34/3, 34/5 and 34/6, covering 330 square kilometers. The well was drilled by the semi submersible Bredford Dolphin, and partners are BG (operator and 45%), Idemitsu (25%), RWE Dea (10%) and Revus Energy (20%).

Star Consortium, Libya reach $2 bn refinery deal

July 15, 2008. The Star Consortium, comprising the Al Ghurair Investments' subsidiary TransAsia Gas International and ETA Ascon Star Group's Star Petro Energy, has concluded a $2 billion deal with the National Oil Company (NOC) of Libya to set up a joint venture company to own and upgrade its Ras Lanuf refinery. The companies had signed a Joint Venture framework agreement in February earlier this year confirming their intentions to form the Joint Venture Company. The proposed Joint Venture Company will be incorporated and registered in one of the free zones in Dubai. The consortium is considering the DMCC, among the free zones in UAE, to set up the JV. The company will be a 50:50 Joint Venture between the Star Consortium and NOC. Ras Lanuf refinery produces 10 Million tones of refined petroleum products per year which are sold locally as well as exported to America and Europe. The project which is estimated to cost $2 billion will take five years to complete and would start immediately. It will involve revamping and refurbishment of the existing plant to increase capacity and improve efficiency as well as upgrading and expansion of the refinery, using state-of-the-art technology to improve the quality of products to meet latest international standards.

Vietnam, Venezuela may build refinery

July 11, 2008. Venezuela and Vietnam are discussing energy and oil cooperation. The companies of the two countries will soon start explore oil and gas in the Oricono area of Venezuela, and build an oil refinery in Vietnam. The Ministry of Planning and Investment cited PetroVietnam saying the two countries are preparing to sign a contract in November to build an oil refinery in southern Vietnam. The Long Son refinery, which will be built in Ba Ria-Vung Tau province and located about 100 kilometers east of Ho Chi Minh city, will be supplied with crude oil from Venezuela.

PetroChina awards UOP contract for integrated complex

July 10, 2008. UOP LLC announced Thursday that PetroChina Sichuan Petrochemical Co., Ltd., a subsidiary of the PetroChina Company Limited, has selected UOP to supply technology, basic engineering services and equipment for a new integrated refining and petrochemicals complex to be installed at its facility near Chengdu, Sichuan Province. The new plant is a grassroots installation that will produce both fuels and petrochemicals, including 600 thousand metric tons per annum of para-xylene using the UOP Parex process. Para-xylene is a key ingredient in the production of PTA (purified terephthalic acid), which is used to make polyester for fabric and PET (polyethylene terephthalate) chips for carbonated soft drink and water bottles. The new plant will also produce more than 350 thousand metric tons per annum of benzene, also a building block in plastics production. This will be the fifth aromatics complex UOP has designed for PetroChina and the sixth Unicracking unit. With 2.69 million barrels per day of crude production and 4.6 billion cubic feet per day of natural gas production, China National Petroleum Corp. (CNPC) is China's largest producer and supplier of energy.

Dolphin evaluating bids for gas pipeline

July 15, 2008. Dolphin Energy Limited is in the process of finalizing the evaluation of tenders for the construction contract of its new $200 million Taweelah to Fujairah Gas Pipeline (TFP). The energy company received five bids from international construction companies of which three are within a competitive range. The bidders include Consolidated Contractors International (CCC), Greece; Stroytransgaz (STG) of Russia and Saipem/Snamprogetti of Italy. The award is expected to be finalized by August 1, 2008.

Neptune LNG pipeline getting early start

July 14, 2008. Representatives of the pipeline project explained that the construction company has found "a window" allowing them to begin the project this year, on or about July 16 -- instead of next year. The pipeline is designed to reduce local opposition to LNG port facilities by creating offshore access, allowing liquefied natural gas tankers to unload their cargo into the pipeline without ever coming near land. It's a technique pioneered in states bordering the Gulf of Mexico. The terminal for gas deliveries will be 10 miles out to sea. Then, the pipeline will connect with an existing line about three miles from Marblehead's shores, less than half a mile into Marblehead waters. The pipeline is intended to last for 30 years and will be inspected at five-year intervals. It will provide enough natural gas to serve 1.5 million homes.

Kazakhstan floats idea for new Black Sea pipeline

July 10, 2008. A state-run Kazakh energy firm said Astana has spoke with Azerbaijan and Georgia regarding a new oil pipeline in the Black Sea. KazEnergy Association, an association that includes all foreign and local energy companies, said it approached leaders from the two countries on the possibility of building a new oil pipeline from the Azeri capital, Baku, to Batumi in southwest Georgia. Azerbaijan and Georgia support the idea of a Baku-Batumi pipeline. Nearly 7 million barrels of Kazakh oil per year, along with additional supplies from the ChevronTexaco-operated Tangiz field, would run through the pipeline in its first stage.

CNPC, KazMunaiGaz start Sino-Kazak section of gas pipeline

July 10, 2008. China National Petroleum Corp (CNPC), parent of PetroChina Co Ltd, and KazMunaiGaz have started building the Sino-Kazak section of the Asian gas pipeline. The pipeline's new transit route is part of a larger project to build two parallel pipelines connecting China with Central Asia's vast natural gas reserves. The pipes will stretch more than 1,800 kilometers from Turkmenistan and cross Uzbekistan and Kazakhstan before entering China's northwestern Xinjiang region.

A first section, including a compressor station, is to be built by the end of 2009 and a second by the end of 2011. Work on the 530-kilometer Uzbek section of the pipeline has also already got underway. China hopes the pipelines will have the capacity to carry of around 30 bln cubic meters of gas a year within the next three decades. CNPC secured a 30 year gas-import deal with Turkmenistan last July.

Enhance Energy unveils CO2 pipeline plans

July 10, 2008.  Enhance Energy Inc., a private Alberta-based energy company specializing in enhanced oil recovery (EOR), plans to build a new CO(2) transmission system through the central part of Alberta. The Enhance CO(2) Pipeline System will be capable of gathering CO(2) from several sources in Alberta's Industrial Heartland and transporting the CO(2) to existing mature oil fields throughout South-Central Alberta. These oilfields will see significant increases in production as CO(2) is permanently stored in the reservoir.

The capture and permanent storage of CO(2) will result in significant reductions in emissions of greenhouse gases in Alberta. Environmentally, the completed project will be equivalent to taking 1,600,000 cars off the road. It's one of the largest projects in the world and it's not experimental, it's based on proven technology. The initial supply of CO(2) will by provided by North West Upgrading Inc. and Agrium Inc. This project shows how an eco industrial complex, where one industry relies on the waste products of another, can become a reality in Alberta. Because the CO(2) emissions that North West Upgrading and Agrium produce are permanently stored in the oil reservoir, they have the lowest CO(2) emissions profiles for projects of their type in the world.

Contracts for the design and project management of the new system have been awarded to Sunstone Projects Ltd. Other technical and support contracts have been awarded to Synergas Technologies Inc. for facilities engineering, Scott Land and Lease as land agent and Worley Parsons for environmental services. The system will have a design capacity of 25,000 tonnes per day with the initial throughput planned at 5,000 tonnes per day. Enhance anticipates regulatory applications for the proposed project to be completed by spring of 2009, and depending on the timing of regulatory approval, construction is expected by the end of 2009, with operational startup in 2011. Enhance Energy Inc. is a private Calgary-based company that specializes in EOR involving the permanent sequestration of CO(2). Enhance Energy uses CO (2) to recover oil that would otherwise remain in the reservoir.

Venezuela, Ecuador plan Pacific coast refinery complex

July 15, 2008. Venezuelan and Ecuador officially unveiled plans for a joint-venture refinery to be located on Ecuador's Pacific coast. The "Refinery of the Pacific" will include a petrochemical project. Work on the refinery complex is scheduled to start in 2010 and the aim is to have it in operation by 2013. The refinery, located in the Manabi province of Ecuador, will handle 300,000 barrels a day. The complex will require a $6 billion investment. PdVSA will hold a 49% stake in the Refineria del Pacifico-CEM, and Petroecuador will have 51%. The new refinery project is important for Ecuador, which has to import processed petroleum products such as gasoline because of a lack of refining capacity. Many of the new oil discoveries in Ecuador are heavy crude and cannot be processed at the country's three existing light-crude refineries. The new refinery is part of a strategy to integrate Latin American companies that began in February 2007 with an agreement to swap Ecuadorean oil for Venezuelan diesel and naphtha.

Russia registers heavy crude upgrading patent

July 14, 2008. Russia has become the first country to register a Mexican patent for a new technique to upgrade heavy grades of crude oil. The technology, developed by the Instituto Mexicano del Petroleo, or IMP, adds hydrogen to heavy grades of crude and removes contaminants such as sulfur and metal particles. The IMP has also asked Venezuela, Australia, the U.S., Canada, Brazil, Japan, Singapore, the European Union and Mexico to register the patent. The result of the petition in these countries is still pending. The IMP has named the technology Catalytic Hydrotreating of Heavy Petroleum Hydrocarbons, and is more efficient than competing technologies for upgrading heavy crudes.

According to the IMP, its technology can turn 100 barrels of extra-heavy 13 API crude into 104 barrels of lighter, upgraded crude. Meanwhile, a similar technology known as delayed coking turns 100 barrels of 13 gravity API crude into 80 barrels up upgraded oil. The gravity of crude oils is measured according to the American Petroleum Institute's formula, where lower numbers mean a heavier blend. Mexico is looking to install crude upgrading facilities in its domestic refining network, which can only process crudes with a gravity of 21 API or higher at present. Much of Mexico's new production from Ku-Maloob-Zaap, a group of offshore fields that produces around 25% of total Mexican production, has and API rating of 13 or lower.

Russia cuts oil supply to Czech Republic

July 11, 2008. Acording to Czech Industry and Trade Ministry, Russia recently reduced its oil supply to the Czech Republic. It was not immediately clear what caused the decline in the transit of Russian crude oil via the Druzhba, or Friendship, pipeline. Refineries informed the Repulic about a reduction in deliveries. The Czech Republic gets most of its oil from the Russian pipeline, while receiving the rest from another pipeline from Germany's Ingolstadt, or IKL. The pipeline from Germany has a capacity to secure the country's oil need.

‘Refined product deficits could sharpen by ’15’: OPEC

July 10, 2008. The Organization of Petroleum Exporting countries said global refinery capacity could fall far short of demand by 2015 as rising costs force refiners to postpone or cancel new projects. In its annual World Oil Outlook, the group forecast 7.6 million barrels a day of new crude distillation capacity to be added to the global refining system by 2015, but warned that actual capacity growth could be much lower if expansion projects aren't given the green light.

If expansion projects go ahead, supply should exceed requirements between 2010 and 2013, helping to ease tight products markets and soften margins, OPEC said in what it describes as its "reference scenario" for the medium term. The reference scenario is its baseline expectation. But the group also outlined another "decisions deferred" scenario, which emphasized downside risk to refinery expansions, largely due to a 70% rise in construction costs since 2000. This could lead either to delays or the termination of projects, resulting in a 6.4 million barrel a day rise in global distillation capacity by 2015, nearly 16% lower than reference case. An unclear policy framework was also casting a shadow over refining projects worldwide. According to the OPEC, many investors, especially in the U.S. and Europe, are deferring final decisions on major projects as they are being confronted with mixed, even confusing, signals from policymakers concerning the future demand levels for refinery products. The growing supply of biofuels, initiatives to promote greater fuel efficiency and carbon trading could deter investment in the West.

 As per the OPEC, in China and India, uncertainties on the pricing policy for petroleum products and tax-breaks for new investments are also adding some risks to the economics of future investments. In the long term, the non-crude oil supplies - including biofuels, natural gas liquids, coal-to-liquids and gas-to-liquids - would become more widely used and cause a slowdown in refinery expansions between 2015 and 2030, OPEC said. The oil producers group was more skeptical about pace and volume of refinery capacity growth than its consumer counterparts at the International Energy Agency, the energy watchdog for the Organization for Economic Cooperation and Development.

Shell, Jordan to sign production sharing deal

July 10, 2008. Royal Dutch Shell PLC (RDSB) is in the final stages of striking a production sharing agreement with the Jordanian government to explore oil from the country's vast oil shale. The PSA needs the approval of the Jordanian government and parliament. Shell is expected to invest more than $20 billion in the project over a period of 20 years. The project would cover an area of 22,000 square kilometers. The area that Shell would explore stretches from northern Jordan and west Safawi to Azraq in the middle and Sirhan and al-Jafer in the south.

The project could produce thousands of barrels of oil from oil shale, and the kingdom holds some 40 billion metric tons of proven oil shale reserves, a figure which could be doubled. Under Jordanian production sharing terms, the contractor receives 60% of oil production or gas equivalent up to 10,000 barrels a day, with a sliding scale to a 35% share of production over 100,000 barrels a day oil equivalent. Oil shale refers to sedimentary rocks, mostly carbonates to chalk marl which when heated to above 500 degrees Celsius produces oil and gas. Oil produced from oil shale is mainly used for generating electricity.

The Jordanian Natural Resources Authority is also holding talks with an Estonian firm called EESTI Energy, specialized in oil shale, to finalize a production sharing agreement to explore oil shale at Attarat Um El-Ghurdan in southern Jordan. Jordan had signed four memorandum of understanding with four companies to carry out technical and feasibility studies on Jordan's oil shale. They are: The International Cooperation for Oil Shale, a Jordanian-Saudi joint venture company with $300 million capital, Oil Shale Energy of Jordan, a Jordanian company which submitted its bid in cooperation with local banks and EESTI.

The remaining two are U.K.-registered Jordan Energy and Mining Ltd., or JEML, and Petroleo Brasileiro S/A (PBR). Jordan imports around 95% of its energy needs and is striving to curb its high oil imports bill, which reaches some $1 billion a year. The Jordanian government decided to increase fuel prices by 4-9% as part of the government's plan to end fuel subsidies and face up soaring oil prices. Jordan is currently producing only 25 barrels of crude oil a day and some 22 million cubic feet of gas.

Two new refinery deals close in Iraq

July 10, 2008. Iraq's Oil Ministry is close to signing contracts to build two new oil refineries in southern Iraq. The ministry is expected to sign one contract for a 300,000 barrel-per-day refinery in Nasiriyah province by the end of July or early August. The ministry was studying proposals presented by international companies to build another 150,000-barrel-per-day refinery in Karbala.

The refineries would meet increasing need for oil products in central and southern Iraq and lead to a reduction in imports. Nasiriyah is about 320 kilometers (200 miles) south of Baghdad, while Karbala about 80 kilometers (50 miles) south of the capital. Iraq has the world's third-largest known crude oil reserves, with an estimated 115 billion barrels, but it suffers acute shortages in petroleum refined products as most infrastructure was damaged or destroyed after years of U.N. sanctions and war. Iraq's three main oil refineries are running at roughly half the 700,000 barrels daily capacity.

In 2006, the ministry built a refinery in Najaf, about 160 kilometers (100 miles) south of Baghdad. It has a refining capacity of about 20,000 barrels per day. Last March, the ministry declared a $85 million deal with the Colorado Industrial Construction Services Co. to help expand the refinery by 10,000 barrels per day. The shortfall has forced Iraq to turn to imports from neighboring Iran, Kuwait and Turkey. The country has been forced to import around 8,000 tons each day, or about 60,000 barrels.

Russia may build refinery

July 10, 2008. The Russian government is considering the possibility of building an oil refinery that will not depend on major oil companies. Russia and development institutions are considering the possibility of building a good oil refinery to process oil produced by independent companies.

The cost of building the oil refinery is about US$8 billion. For building the refinery a consortium might be created with a possible participation of suppliers and the state that will make 12 million tones of petrol products a year. The place for the refinery will be determined in accordance with the available reserves, transportation capabilities and market surveys.

POWER

Romania attracts euro 10 bn energy project investment

Jul 15, 2008. Romania's energy market is attracting more and more investors. From developers of wind power systems to giant energy companies, investments unveiled over the past year exceed 10 bn euros ($15.86 bn U.S. dollars) in value and thousands of new megawatts in output. Investors come to Romania because of the increasing energy consumption in Romania's reindustrialization and rising purchasing power. Energy companies and big energy users have over the past year unveiled plans to build heat and wind power stations.

Belgian Electrabel giant energy company is mulling building an electrical station to generate 1,600 MW in Constanta, in an investment estimated at between 2 and 2.4 bn euros ($3.17 and $3.81 bn). Italy's Edison is contemplating generating some 1,000 MW more in Romania using heat power. Sinus Holding, a Hungarian company intends to set up wind power turbines in Romania to generate 700 MW, in an investment that might reach 1 bn euro ($1.59 bn).

Britain to build more nuclear power plants

July 14, 2008. British Prime Minister Gordon Brown says his government will place no limit on the number of nuclear power plants that can be built by private companies. The country plans to fast track the construction of at least eight nuclear power stations to cut Britain's dependence on foreign oil following its dramatic rise in price. The prime minister said he fears Britain could face an energy supply crisis in the future if it fails to step up its nuclear program along with increasing renewable energy sources. Brown outlined his vision of a post-oil economy, calling for a renaissance of nuclear power and massive expansion of renewable energy. Currently Britain's 10 nuclear power stations provide about 20 percent of the nation's electricity. Most of the new power stations are expected to be built near existing sites.

Electricity price rises in New Zealand

Jul 13, 2008. Figures showing the cost of New Zealand’s electricity have gone up five percent faster than inflation. The Government's energy data file shows residential users have had to fork out for an average 4.8% price increase, every year since 2000. That's well ahead of the 1.4% increase for commercial users each year, and 2.8% for industrial users. The cost of power is crimping household spending, along with petrol and food price increases.

Electricity prices to rise by 17.5 pc from August

July 11, 2008. The energy regulator has approved a 17.5% increase in ESB prices in Ireland from August 1^st this year due to the rising international cost of oil, gas and coal. The Commission for Energy Regulation also says it will review market conditions later this year before deciding if any further increase should come into force next January. ESB was providing a €300m contribution to offset the effects of rising fuel prices. Without this contribution, the company says the price increases facing customers could have been up to 10 percentage points higher.

Plans for new coal port in Australia

July 15, 2008. Australia's first new coal port in 25 years could be built in central Queensland, to boost the state's coal exports by 40 per cent. Ttrifecta of proposals was announced for the Bowen, Galilee and Surat coal basins, during a Budget estimates committee hearing. The Government was considering a $5.3 billion proposal by Waratah Coal, including a new mine near Alpha. The Galilee Coal project would produce 25 million tonnes of thermal coal a year for export. A new coal port would be built near Shoalwater Bay, between Rockhampton and Mackay, with a 100 million tonne a year capacity. A 500km rail line from the Galilee Basin to the new port would open the region to coal exports for the first time. The second proposal, the Bowen Basin Growth project, comprises two new mines at Daunia and Caval Ridge, and the expansion of the existing Gooyella Riverside Mine, north of Moranbah.

The BHP Billiton-Mitsubishi Alliance proposal would boost exports by about 20 million tonnes. Both projects had been declared significant projects and would undergo an environmental assessment process. The third proposal was a 30 million tonne a year open-cut mine near Wandoan by an Xstrata Coal consortium, which was declared a significant project in December last year.

The draft terms of reference for the environmental impact statements are expected to be released by late September. According to a recent climate change inventory, Queensland produced 170 million tonnes of greenhouse gas emissions in 2006, 30 per cent of the national figure. Queensland is set to export around 170 million tonnes of coal this year, rising to 200 million tonnes by the end of 2009 with projects currently under construction.

China steps up coal shipments

July 14 2008. Chinese authorities will step up coal deliveries to power plants in Beijing and neighbouring cities to ensure they can meet demand for electricity during next month's Olympics. Authorities have made cleaning up Beijing's air one of their top priorities for the Games and are telling hundreds of steel plants and other factories in the capital and nearby provinces to shut down or reduce production starting from July 20.

But the country's reliance on power generated by burning coal, which accounts for about four-fifths of its power, means that it will likely have to burn more coal to meet the additional demand needed for the Olympics, at a time when the country is facing its worst summer power shortage since 2004.

According to the Ministry of Railways, authorities would increase transport of coal to Beijing, Tianjin and Tangshan, in northern Hebei province, giving priority to shipments to 24 thermal power plants in the region.

HPCL ties up with Chhattisgarh for Jatropha plantation

July 14, 2008. Hindustan Petroleum Corporation Ltd signed a memorandum of understanding with Chhattisgarh Government and Chhattisgarh Renewable Energy Development Agency (CREDA) for the formation of joint venture company to undertake jatropha plantation on 15,000 plus hectares in the State. CREDA is a State Government body under the Department of Energy constituted for the development of renewable energy sources in Chhattisgarh. According to the MoU, HPCL will hold 74 per cent equity and the rest would be held by CREDA.

The responsibility of obtaining wasteland for plantation of Jatropha from the Chhattisgarh Government would rest with CREDA. The entire produce of jatropha seeds from the cultivated land would be sold exclusively to HPCL. The bio-diesel would be sold through HPCL retail outlets in Chhattisgarh.

TNEB to buy solar power at Rs 3.15 per unit

July 13, 2008.  The Tamil Nadu Electricity Regulatory Commission (TNERC) has fixed an interim tariff of Rs 3.15 a kWh (unit) for grid connected solar photovoltaic and solar thermal power generation plants. This will be the purchase rate at which the distribution licensee, the Tamil Nadu Electricity Board, will buy power from the solar power producers.

This paves the way for the proposed grid connected solar power projects to get additional benefits offered by the Ministry of New and Renewable Energy to promote solar power. The Ministry will offer priority to those projects in the States where the State Electricity Regulatory Commission has approved or notified a tariff for solar power.

The Ministry, through the Indian Renewable Energy Development Agency, will provide a generation-based incentive of Rs 12 a kWh for solar photovoltaic projects and Rs 10 a kWh for solar thermal power generation projects eligible for such incentives.

Only units that are commissioned before December 31, 2009 are fully eligible for this support. Under this programme the Ministry plans to support installation of up to 50 MW of solar power projects.

Projects with an aggregate capacity of up to 10 MW in a State would be considered for the incentive. Developers can set up a maximum aggregate capacity of 5 MW through a single project or multiple projects of at least 1 MW each. The incentive offered is to develop and demonstrate the technical performance of grid interactive solar power generation and reduce cost of the grid connected solar power generation.

Underwriters plans solar PV testing lab

July 12, 2008. Underwriters Laboratories Inc, a US-based product testing and certification organisation, would be investing about $5 million in setting up a lab in South India for testing solar photovoltaics. The organisation develops standards and test procedures for products, materials, components, assemblies, tools and equipment, chiefly dealing with product safety.

According to the Underwriters Laboratories India, there is a huge potential for testing facilities for photovoltaics modules given the large scale investment the sector is attracting from companies such as Moser Baer and Reliance Industries. The lab will serve as regional testing centre for South-Asia and for local companies which want to export their products. It will test the modules for the US and European market compliance standards.

STC plans to plant Jatropha in Surinam, Indonesia

July 9, 2008. To tap the potential of jatropha bio-fuel for expanding product portfolio, STC plans to acquire vast tracts of land in Surinam and Indonesia to grow the plant and market the oil to end users. The trading house is keen to take the local governments as partners in the proposed venture.

The company is looking at 50,000 hectares of land in Surinam and had successfully conducted a research on a small parcel of land in Surinam to achieve the fruition of jatropha seeds in less than a year, against the normal four years the plant takes.

Oil extracted from Jatropha can be used as bio-fuel, varnish, and medicine for skin care. STC was looking at the opportunity for bio-fuel from the plant. STC was looking for funding from a UK organisation for its research to standardise the variety it had developed. STC hoped to raise $2.5 million for the purpose from a UK private equity.

Nava Bharat bagasse unit in CDM programme

July 12, 2008. Nava Bharat Ventures’ bagasse based co-generation unit at its Samalkot sugar facility has been registered under the CDM (clean development mechanism) programme. The company also hinted at expanding the facility from 9 MW to 29 MW by the end of this year.

The project has been recognised based on its ability to reduce the environmental impact of carbon emissions. Co-generation has long been established as an alternative source of creating value out of sugarcane as saleable power.

It is produced through the combustion of bagasse being sugarcane waste. With this registration, the project becomes eligible to receive tradable CER (Certified Emission Reductions) for the power it produces and exports to the grid. This is likely to translate into an additional source of earnings. Initial estimates suggest a reduction in emission to the extent of about 16,000 tonnes of carbon dioxide per year. This sugar facility has also received the distinction of being adjudged an Excellent Energy Efficient Unit amongst a wide spectrum of industrial concerns by CII.

UN's India solar programme wins award for effectiveness

July 12, 2008. A United Nations programme which has helped bring solar powered electricity to some 100,000 people across 18,000 rural Indian households has won the prestigious UN-21 award for efficiency and effectiveness. The initiative, which was launched by the United Nations Environment Programme (UNEP) in 2003 in collaboration with Indian banks, was aimed at providing loans to rural households for setting up solar energy systems.

Speed up energy projects: Minister

July 11, 2008. Punjab Science and Technology Ministry asked the Punjab Energy Development Agency (PEDA) to expedite various renewable energy projects for achieving 10 per cent renewable energy share of the total installed power capacity in the State.

According to the ministry, in present time of power shortage being faced by the State, it becomes imperative for PEDA to expedite its projects to contribute maximum power in the State’s kitty.

The Ministry reviewed the progress of biomass power projects, cogeneration and hydel projects that have been allotted to various developers. The ministry directed PEDA to extend all assistance to private developers for completing these projects in a time bound manner.

According to the PEDA, five projects of capacity 3.9 MW on Sidhwan branch canal are at an advance stage of completion and will be commissioned by March 2009. The development agency also mentioned that the work will commence at mini hydel project Khanpur, Sadhar, Akhara, Channowal and Gholian on Abohar branch canal during this month and these projects of total 5.5 MW capacity would be completed by December 2009.

5,400 small hydro power sites identified

July 10, 2008. The ministry of new and renewable energy identified small hydro power sites need to be exploited at the earliest to generate more power using renewable, natural and pollution-free sources. The government has so far identified more than 5,400 small hydro power sites in the country with combined capacity of potentially generating 15,000 MW of power. Small hydro power plants usually have a capacity to generate up to 25 MW of electricity.

Unlike the large hydropower projects, such plants do not require any construction of dam, resettlement of people and large falling of trees. Small hydro power plants make it a viable option for generating power feeding electricity grid, as well as meeting the requirement of power for domestic, small scale and commercial sector in rural and remote areas.

According to the ministry, the progress in installing small hydro power projects is not up to the desired level despite many sites already been allotted to the developers. The developers, however, said that sudden change of policies at the Centre as well as state levels, different rules with different state governments, difficulty in acquisition of land at many levels, escalating prices of steel and cement, bank facilities and other problems present hurdles to such projects.

BR targets power plant construction

July 15, 2008. According to Buchanan Renewable (BR) company, it would construct a 35 MW integrated biomass electricity generation power plant in Paynesville to supply electricity to Monrovia in Liberia. The power plant would use rubber wood chips to produce electricity. The power plant would run for 25 years minimum.

The plant would begin operation by December 2010 and more than $100 million would be used to construct it. However, a 7 MW power plant which the company would also construct would be operational by December next year. The 0.5 MW biomass electricity generation plants on a non-integrated basis would also be constructed in other parts of Liberia to supply electricity to rural dwellers.

The company was presently discussing with the government regarding the construction of power plants in Liberia. As soon as the company and the government reach an agreement, construction of the plant would begin. The company would buy redundant rubber trees from plantation owners to be processed into woodchips, offer planting and replanting services of rubber, planting food crops alongside replanted rubber, rehabilitation of plantation infrastructure and reestablish a critical core industry in Liberia.

DOE award Verenium grant for La. ethanol plant

July 15, 2008. Verenium Corp., a pioneer in the development of next-generation cellulosic ethanol and high-performance specialty enzymes has been awarded a grant from the U.S. Department of Energy (DOE) under a $40 million program to support the development of small-scale cellulosic ethanol biorefinery plants.

The Company will now begin discussions with the DOE to determine the amount of the award. Demonstration-scale facilities are a critical development step to scaling and validating cellulosic technology as the industry advances toward the commercialization of next-generation ethanol. Verenium is one of two companies that were selected for this round of DOE grants and will utilize the funds to support ongoing activities at its 1.4 million gallon per year demonstration-scale facility in Jennings, La.

Cellulosic ethanol is a renewable fuel source produced from natural, plant waste products such as rice straw, sugarcane waste (bagasse), switchgrass and wood chips. Cellulose, a long-chain polysaccharide found in nearly all plant life, is the most abundant molecule on earth. Next-generation cellulosic ethanol uses advanced enzyme science to reduce the cost of ethanol production and enable the use of a wide variety of biomass.

Unlike traditional ethanol manufactured using natural gas or coal, cellulosic ethanol from biomass can be broken down into fermentable sugars using acid or enzymatic hydrolysis.

The biomass is heated at high pressure to form synthesis gas that is then turned into ethanol. Industrial enzymes also can be used to break the cellulose down into sugars that are then fermented into ethanol using microbes. Cellulosic ethanol can achieve the high yields vital to commercial success, has high octane and other desirable fuel properties, and is environmentally friendly.

The Energy Independence and Security Act of 2007 mandates that advanced biofuel production consist of 21 billion gallons by 2022, of which 16 billion gallons come from cellulosic ethanol. Further, it calls for a modified standard, starting at 9 billion gallons of renewable fuel in 2008 and rising to 36 billion gallons by 2022.

MU experts help town become 1^st in nation to run on wind energy

July 15, 2008. Rock Port, a small Missouri town of 1,300 residents, has become the first town in the nation to operate solely on wind power. Northwest Missouri has the state's highest concentration of wind resources and contains a number of locations potentially suitable for utility-scale wind development.

MU Extension specialists said the wind farms will bring in more than $1.1 million annually in county real estate taxes, to be paid by Wind Capital Group, a wind energy developer based in St. Louis. The alternative energy source also benefits landowners, who can make anywhere from $3,000 to $5,000 leasing part of their property for wind turbines.

Florida PSC approves FPL solar plants

July 15, 2008. Florida Power & Light Company received approval from the Florida Public Service Commission (PSC) to begin construction of three solar energy centers that will make Florida the second largest supplier of utility-generated solar power in the nation. At a time of record-setting fossil fuel prices and concern over global climate change, solar power helps to meet the goals of protecting the environment and enhancing Florida's energy security.

FPL, a subsidiary of clean energy leader FPL Group, Inc., last month announced plans to construct three solar energy centers that includes the world's largest photovoltaic solar array and the first "hybrid" energy center that will couple solar thermal technology with an existing natural gas combined-cycle generation unit. The projects include the DeSoto Next Generation Solar Energy Center. Planned for construction on FPL-owned property in DeSoto County, Fla., the DeSoto project will provide 25 MW of photovoltaic solar capacity, making it the world's largest photovoltaic solar facility. DeSoto is expected to be in service by December 2009.

Planned for construction at FPL's existing Martin Plant site, the Martin Next Generation Solar Energy Center will provide up to 75 MW of solar thermal capacity in an innovative "hybrid" design that will connect to an existing combined-cycle power plant. It is the world's first project to integrate solar thermal steam generation into a combined-cycle steam turbine. When the power of the sun is being harnessed to produce electricity from steam, less natural gas is required.

The Martin facility is expected to be on-line at the end of 2009 and completed by 2010. The third project is the Space Coast Next Generation Solar Energy Center. Planned for construction at the Kennedy Space Center, the Space Coast project will provide 10 MW of photovoltaic solar capacity in an innovative public-private partnership. Space Coast Solar will be operating by the first quarter of 2010.

Solar-power rebates to generate 59 MW

July 15, 2008. California has added enough solar power to its electrical grid this year to light a small town. Those rebates, which go to businesses and homeowners who put solar panels on their roofs, have funded enough new installations this year to generate 59.4 MW of electricity, enough to juice up about 44,550 homes. The rebates are the heart of the Go Solar California campaign, which is part of California's larger fight against global warming. Over the campaign's 10-year span, the state will pump $3.3 billion into financial incentives for Californians who go solar, with the money drawn from utility bills. By the end of that time, the program should fund roughly 3,000 megawatts of new solar generation.

The Go Solar rebates were first offered in January 2007. Since then, the utilities commission has received 11,653 active applications, for projects capable of generating 251.5 MW. If approved, those projects will receive $635 million of incentives. The PUC handles rebates for existing buildings that add solar power, while a different government agency, the California Energy Commission, handles incentives for new construction.

Gulf Ethanol opens R&D facility

July 14, 2008. Gulf Ethanol Corporation's new R&D facility, which officially opened, will focus on quantifying the design of their new cellulosic preprocessing system. Gulf is looking to provide increases in net ethanol yield from cellulose and will be concentrating initially on testing the machine with sorghum and corn. Recently, TX A&M agreed to provide sorghum to Gulf Ethanol.

The opening of the new facility will enable Gulf to determine the energy required to preprocess biomass into a fine powder that can be more efficiently treated to extract the simple sugars for fermentation into ethanol. Gulf Ethanol is an alternative energy company focused on the development of the cellulosic ethanol industry with a particular emphasis on Texas and the Gulf Coast.

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