Buildup of Petrol at Delhi effective 24-05-12
The following Elements are considered: C&F (Cost & Freight) Price of Gasoline (Petrol) BS III equivalent, Average Rs/$ Exchange rate, Refinery Transfer Price (RTP) on landed cost basis for BS IV Petrol, Price Charged to Dealers (excluding Excise Duty and VAT), Specific Excise Duty, Dealer Commission, VAT and Retail Selling Price,
The competition in commercial/industrial LPG (liquefied petroleum gas) segments is set to intensify with Indian Oil Corporation (IOC) planning to appoint over 100 distributors to cater exclusively to such customers. Aimed at improving the oil company's market share and profitability, the move assumes significance for it is not only expected to give both public and private LPG marketers, but also existing Indane distributors, who deal in commercial cylinders, competition. Though both BPCL and HPCL have exclusive distributors for commercial cylinders, the numbers are small, sources in oil industry said. Unlike the subsidized domestic (14.2 kg) cylinders, commercial cylinders, in capacities of 5 kg, 19 kg and 47.5 kg, are free market product. Their pricing is linked to import parity price and revised on a monthly basis.
An IOC official said 114 locations for the NDNE (non-domestic non-exempt) distributorships have been identified based on market potential. Technically, there is no restriction on the area of operation for the existing distributors with regard to commercial cylinder sales. The exclusive NDNE distribution network would be helpful when subsidy on domestic LPG is reduced. “When the price gap narrows, households may opt for commercial LPG,” an IOC official said. The government is said to be considering imposing a cap on the number of subsidized cylinders per household in a year. Sources in IOC said the share of commercial cylinders in the total packed (cylinder) sales is about 7.2 per cent. For IOC, the share of the commercial cylinders in its total sale of packed LPG is around 5.7 per cent. The market size of packed LPG, of the public sector oil companies, is 10.68 lakh tonnes. IOC's share is 4.05 lakh tonnes or about 38 per cent. Six of the 114 NDNE distributors have been commissioned — three in Maharashtra, two in West Bengal and one in Gujarat. Letters of intent have been issued for 44.
The existing 5,000 Indane distributors, sources added, were engrossed in distribution of cylinders to domestic segment, which forms 90 per cent of their total business volume and as such not able to focus on the commercial cylinders to the extent required. The NDNE distributors could be individuals, partners of partnership firms and both public and private limited companies having relevant experience and meeting the selection criteria. The NDNE distributorships, which are expected to help curb/reduce illegal diversion of domestic LPG to commercial/industrial segments, would not be allowed to enroll domestic customers. The existing domestic LPG distributors, however, shall continue to sell domestic and commercial cylinders in the same market. Sources among Indane distributors said commercial cylinder sales were highly competitive and success depended on the ability of the agents to give discounts and credit to the consumers.
Credit :….N. Ravi Kumar ….from the pages of THE HINDU newspaper.
Rangarajan team to review oil firm-govt contracts
The government on Wednesday announced constitution of a committee under C Rangarajan, chairman, PM’s Economic Advisory Council, to review the existing production sharing contracts signed between the oil and gas companies and the government for developing exploration blocks. “The committee will review the existing PSCs, including in respect of the current profit-sharing mechanism... and recommend necessary modification for the future PSCs,” said an official statement.
Officials said the committee has been constituted after intervention of the Prime Minister’s Office (PMO), following increasing disputes between the developers of the oil and gas blocks and the government. The Committee has been asked to submit its report by August 31.The trigger for this review is clearly seen as the ongoing spat between Mukesh Ambani-led Reliance Industries Ltd (RIL) and the oil ministry over declining gas production and the cost recovery from the block.RIL has already dragged the government into arbitration for disallowing a recovery of $1 billion (R5,500 crore) from the producing KG-D6 gas field. Besides, RIL has also sought an increase in the price of gas that is being produced from the KG-D6 field from the existing government fixed price of $4.2 a unit.
The petroleum ministry has recently issued a R5,500 crore penalty notice to the company earlier this month for not fulfilling obligations and failing repeatedly to meet targets, factors, which it said caused considerable losses to the government. Besides, the Committee shall also be exploring various contract models with a view to minimise expenditure monitoring of the contractor without compromising, firstly, on the hydrocarbons output across time and secondly, on the government’s take. The Committe would be “a suitable mechanism for managing the contract implementation of PSCs,” the statement said.“Suitable governmental mechanisms to monitor and to audit Government of India (GOI) share of profit petroleum,” have been listed as another term for the Committee.
…from the pages …Hindustan Times…New Delhi, May 30, 2012
After the hike petrol price in Mumbai Rs. 78.57
After the hike petrol price in Delhi Rs. 73.18
Fuel price hike draws closer
HT Correspondent, Hindustan Times…New Delhi, May 08, 2012
There seems to be no further escape for the consumers of auto and cooking fuels. An across-the-board hike in the prices of petrol, diesel and cooking gas seems to be just round the corner. The only good news is that to reduce the burden of this fuel price hike on the consumers - necessitated in the wake of high global oil prices and growing losses of state-owned oil companies - the Centre has asked state governments to pitch in and reduce taxes on fuel in the manner done in Goa recently.
Sending out a strong message to all political parties including United Progressive Alliance (UPA) allies and the opposition, finance minister Pranab Mukherjee made it clear on Tuesday that the Central government alone cannot address the burgeoning fuel subsidy.Replying to the debate on the Finance Bill, Mukherjee hinted that the time has come for all parties to bite the bullet and share the burden."Coalition consensus is necessary for reforms and all stake holders should come together for development," he said. States need to cut ad valorem taxes on fuels, the minister said. BJP-ruled Goa is the first state to have done so on its own. The companies reacted with scepticism. "We have been hearing this intention of the government for a long time," said a senior official at Indian Oil Corporation. "We are awaiting concrete action on states pitching in by reducing taxes."
Mukherjee hinted that oil imports will become difficult if crude touches $150 per barrel. The government controls the prices of diesel, domestic LPG and kerosene. Oil companies lose Rs. 14 a litre on diesel, Rs. 32.59 per litre on kerosene and Rs. 480 per cylinder of LPG.
The diesel pricing dilemma
(Courtesy: The Hindu Business Line , New Delhi, May 07, 2012)
Everyone knows it is heavily subsidised. Yet, any talk of a price increase in diesel raises the hackles of political parties. And amidst this chaos, expensive cars and SUVs are making the most of a hugely cheap fuel.
Oil companies are losing Rs 15/litre on diesel and are terribly concerned because it is already accounting for over 50 per cent of their projected losses of over Rs 2,00,000 crore this fiscal. Kerosene and cooking gas take up the balance but diesel continues to be the biggest area of concern because its use extends to a host of applications.
The transport sector is only a part of the actual problem. Thanks to the severe power crisis in many States, generator sets have become inevitable and need to be powered by diesel. Furnace oil, used in a variety of industrial applications, has given way to diesel which is a less expensive option.
NOC, IndianOil seal new fuel supply
(Courtesy: The Kathmandu Post, Nepal, April 30, 2012)
The Nepal Oil Corporation (NOC) and IndianOil on Friday signed a new petroleum supply agreement.
As per the new pact that will be effective until March 31, 2017, the IndianOil will be the sole exporter of refined petroleum products to Nepal for the next five years.
NOC acting Managing Director Suresh Kumar Agrawal and IndianOil General Manager (commercial) R Karandikar signed the bi-lateral pact.
According to NOC, the agreement has scrapped the existing price adjustment factor (PAF), under which IndianOil had been charging 5 percent on LPG, diesel and petrol and 2.5 percent on other petroleum products.
HPCL set to revive Vizag project, applies for land
(Courtesy: DNA, Mumbai, April 27, 2012)
Hindustan Petroleum Corporation Ltd (HPCL) is set to revive its plan to set up an integrated mega refinery near Visakhapatnam.
The company has approached the Andhra Pradesh government for allotment of about 1,500 acres at Achyutapuram near Vizag for this.
The land the state-owned company is keen on falls under a special economic zone and the state is yet to take a final decision on that.
According to state government sources, HPCL is keen on setting up a mega refinery, an aromatic plant and a naphtha unit in its proposed project with an estimated outlay of Rs 35,000 crore. The refiner had come up with a similar proposal in 2006 and was allotted the required land by the government. However, it had deferred its plan and the land was also taken back by the government.
IndianOil offers support to Sri Lanka refinery
(Courtesy: The Hindu, New Delhi, April 27, 2012)
The Lanka IndianOil has stepped in to offer support to Sri Lanka at a critical juncture: its only refinery, Sapugaskanda, can only process Iranian crude efficiently. With U.S. sanctions looming, the refinery needs to be urgently revamped to function with better efficiency.
The Lanka IndianOil, a wholly owned subsidiary of IndianOil, which has a one-third market share in the retail trade in Sri Lanka, has offered to help in the US $ 2 billion upgrade of the refinery. Earlier attempts at modernisation of technological facilities with the help of other countries have not worked: the investments were huge, and only part of it was available as loan from those interested in refurbishing the refinery.
“We have offered them our expertise,” said Lanka IndianOil Managing Director, Suresh Kumar, when asked if IndianOil was interested in helping out Sri Lanka. A technical team from IndianOil had visited the facility and, this had made political parties such as the JVP, protest the idea that Indian help would be sought for the project.
Sri Lanka consumes about 5 million tonnes of petroleum products annually. Only about 2 million tonnes is refined in Sapugaskanda. The remaining is imported as petrol, and diesel, leading to a massive drain in foreign exchange.
In Germany, solar will be as cheap as conventional electricity by 2013
Solar probably won't really take off until it makes more economic sense to slap some photovoltaics on your roof than to continue paying your utility company for their dirty, probably mostly coal-fired power. That day has arrived in parts of sunny California and Hawaii, and it's coming to (not-so-sunny) Germany by 2013, reports Michael Coren at Fast Company.
Global PV solar installation grew from 0.26 GW to 16.1 GW between 2000 to 2010, while manufacturing costs fell 100 times.
Of course, "grid parity," as it's called, doesn't mean you can just painlessly switch from the old power source to a new one. There's still the up-front cost of installing solar panels, which is a lot to spend, even on something that is going to save you money in the long run. If you're paying for them on your own, you're essentially pre-paying your electricity bills for the next 20 to 30 years, which is something that only a tiny fraction of us can afford to do. (If you can afford it, it's probably as good or better an investment than basically anywhere else you can put your money, though.)
But with help from a solar installer/financier like SolarCity or SunRun, homeowners and businesspeople can get those solar panels for something approaching no money down, and still save money on their monthly bill.
So what grid parity really means is that as the price of solar continues to fall, conscientious consumers will be able to make the right choice. If it's a revolution, it's an incredibly slow-moving one, at least for now. But once it picks up steam, it could still upend how our civilization generates the electricity that is the lifeblood of a sustainable future.
New study brings down India’s shale gas potential drastically
(Courtesy: The Financial Express, New Delhi, April 19, 2012)
The initial hype over India’s shale gas potential seems to be making way for a more sober assessment of the unconventional energy that could actually be extracted from rock formations. From an initial assessment of 300 trillion cubic feet (TCF) to 2,100 TCF of producible and non-producible gas present in Indian basins (called in-place gas), the latest study has brought down the ‘technical recoverable’ gas to about 6.1 TCF.
The estimate of technical recoverable gas recently given to India by the US Geological Survey is a fraction of the in-place gas that could be recovered with existing technology without regard to cost. If commercial viability of extraction is also taken into consideration, the amount of recoverable gas would be lower. Earlier, the US Energy Information Administration had given an estimate of 293 TCF of in-place gas, whereas New York-listed Schlumberger had made an initial gas-in-place estimate of 300-2,100 TCF.
ONGC-Teri JV bags $1-billion Kuwait oil spill clean-up job
…..Vinay Umarji / Vadodara Apr 10, 2012, 00:37 IST…from the pages of BUSINESS STANDARD.
Oil and Natural Gas Corporation (ONGC) says its joint venture (JV) company has won a third of the estimated $3-billion global contract to clean the 60 million cubic metres of Kuwait contaminated by the huge oil spills that were a legacy of the retreating Iraqi armies in 1991.Sudhir Vasudeva, chairman and managing director of ONGC, told reporters here on Monday that ONGC-Teri Biotech Ltd (OTBL), the company’s JV with The Energy and Resources Institute (Teri), had got a $1-billion contract for doing part of the clean-up.
The contract was bagged recently, he said on the sidelines of a press conference. OTBL had been competing with 12 companies for Kuwait Oil Co’s mammoth contract. It is to use its ‘oil zapper’ technology to do the job. “Teri has been present in this segment and they were meeting the financial criteria for the contract. So, it is through them that OTBL has bagged the contract in Kuwait for $1 billion,” Vasudeva added.The oil zapper technology uses a bacteria they’ve developed to eat away the oil part of the contaminated soil. The bioremediation agent is used to clean both offshore and onshore spills and has been applied by ONGC on its own fields in India.
Kuwait Oil Co had called for contract bids early last year. When Saddam Hussein’s invading army was forced to retreat by a US-led force in 1991 from Kuwait, it set fire to about 700 oil wells and also opened valves on diverse rigs and pipelines. The resulting spill is estimated at two to four million barrels (a barrel is 157.5 litres) , which contaminated not only soil but spread to a huge coastal area, including those of neighbouring countries.
The United Nations arranged an Iraqi compensation of $3 billion after Saddam was ousted but Kuwait had been slow in starting the process of rehabilitation. The idea was that a consortium of companies from across the world would toghether work to clean the contamination
Raise petrol price or face disruptions, firms tell govt
HT Correspondent, Hindustan Times…..New Delhi, April 03, 2012
Be ready to pay more for petrol or your car may go dry. The three state-owned oil companies, led by Indian Oil Corporation, warned on Monday that since they had been losing Rs 7.67 on every litre of petrol sold — the loss figure touching Rs 48 crore a day —there could be serious supply disruptions in future if prices are not hiked.
IOC chairman and managing director RS Butola said since prices of crude oil that accounted for 93% of petroleum goods production costs had been witnessing sharp rises in global markets, the desired price hike in the capital was Rs 9.20 a litre — adding the 20% sales tax per litre.
Butola said despite the petrol pricing mechanism having been decontrolled, the government had not allowed the companies to hike prices. “If we don’t earn revenues, we would not be able to buy crude. And if we are unable to buy crude, there will be supply disruptions.”“The central government earns Rs 14.78 (in excise duty) on every litre of petrol sold and states get between Rs 10 and 20 a litre. But the oil firms are not allowed to earn anything," he said.
Butola said although the government had been told that the only option left was to raise petrol prices, “we haven't so far heard from the government”.
LPG tax hike in Maharashtra rolled back by 2%
Press Trust Of India…Mumbai, March 30, 2012…First Published: 18:32 IST(29/3/2012) HINDUSTAN TIMES newspaper..
Under pressure from all quarters, including ruling coalition partner Congress and even from within his own NCP,
Maharashtra finance minister Ajit Pawar on Thursday announced a rollback by 2% of the 5% Value Added Tax (VAT)
he had proposed in Budget on LPG for domestic use."The tax would be now 3%, instead of 5%," Pawar informed
the state legislative council in Mumbai.
On Tuesday, Congress legislators led by state unit president
Manikrao Thakre had met chief minister Prithviraj Chavan and demanded withdrawal of the tax.Several NCP
legislators had also demanded a rollback saying the LPG hike will pinch the common man.The 5% tax would
have raised the cost of a domestic LPG cylinder by approximately Rs 20, and earned revenue to the tune of
Rs 200 to Rs 250 crore.Shiv Sena executive president Uddhav Thackeray, who met Chavan, had announced
that his party will hold a protest march if the tax hike is not done away with.
Can India afford fully free oil prices?
(Courtesy: The Economic Times, New Delhi, March 28, 2012)
Perhaps those recalcitrant allies of the Congress are right, but for the wrong reasons. The Trinamool Congress and the DMK, along with a few others, are fighting tooth and nail any move to deregulate diesel and LPG prices - all in the name of the aam aadmi. Which means the UPA is under tremendous political pressure from within not to decontrol oil prices, but much to its delight, an "economic justification" has just cropped up.
A study - which departs from the common-sense argument in favour of market-driven oil prices - suggests that the more decontrolled oil prices are, the lower will be growth, at least in the short run. A National Institute of Public Finance and Policy (NIPFP) paper, authored by NR Bhanumurthy, says, "Contrary to existing beliefs, passing on oil price hikes [to consumers] has an adverse impact on growth." Simply put, when we compare two scenarios- one of a 100% and other of a 50% decontrol of oil prices - when oil prices rise, GDP growth will be lower in the first case, at least in the short run.
The paper forecasts that even if overseas crude prices remain the same between 2012-13 and 2016-17 - a period when the Centre may gradually get rid of oil subsidies - average growth of the Indian economy may fall to 7.6% from 8.44% and average inflation accelerate by 0.7%. The study is based on the intuition that when the government decontrols oil prices, state expenditure on subsidies will fall and if there is no increase in any other component of expenditure, lower government demand will result in lower growth. Besides, higher inflation will contribute to lower real GDP growth.
IndianOil Posts Rs. 2,488 Crore Profit for Q3
(Gross Turnover up by 26.8% to Rs. 1,04,064 crore in Q3)
Indian Oil Corporation Ltd. (IndianOil) has registered a profit of Rs. 2,488 crore for the third quarter of the current financial year ended December 2011 as compared to a profit of Rs. 1,635 crore for the corresponding quarter of the previous year. The profit for the current quarter could be achieved mainly due to Government compensation of Rs. 8,237 crore for the previous quarters, approved and accounted for in this quarter.
The unaudited financial results of the Corporation were taken on record at the meeting of the Board of Directors here today. The Gross Turnover for the third quarter of the current financial year ended December 2011 rose by 26.8% to Rs. 1,04,064 crore from Rs. 82,097 crore during the same period last year.
Chairman addressing the mediapersons
For the nine-month period, IndianOil’s turnover went up by 26.8% to Rs. 2,97,690 crore. The loss for the period April-December 2011 was Rs. 8,716 crore as compared to the profit of Rs. 3,540 crore during the corresponding period of the previous financial year.
Mr. RS Butola, Chairman, IndianOil, said, "IndianOil sold 19.287 million tonnes of products, including exports, during the third quarter of 2011-12. Our quarterly refining throughput was 14.166 million tonnes and the throughput of the Corporation’s countrywide pipelines network was 18.160 million tonnes. The gross refining margins during the third quarter were US$ 4.31 per bbl."
In a significant step aimed at offering superior products to plastic processors, IndianOil has unveiled high performance Polypropylene grades for the Polymer processors in the injection moulding sector. The new Polypropylene grades - 1110MAS and 2120MC - were launched today by Mr. R.S.Butola, Chairman, IndianOil, in the presence of Mr. Sudhir Bhalla, Director (HR), Mr. A.M.K. Sinha, Director (Planning & Business Development), Mr. VS Okhde, Director (Pipelines), IndianOil, as well as major customers and business partners in the petrochemicals industry at a high profile event in the Capital today.
The new high performance grades have been developed using cutting edge technology at IndianOil's state-of-the-art Product Application & Development Centre (PADC) located at Panipat. The novel 1110MAS grade is designed to provide better attributes such as higher productivity, high stiffness, low warpage and superior gloss. The other new grade, 2120MC, provides superior aesthetics, excellent clarity, energy saving and higher productivity to polymer processors.
India is amongst the fastest growing petrochemicals markets in the world. IndianOil has identified Petrochemicals as a prime driver of future growth. The Corporation has established world scale mega petrochemicals plants - LAB, PX/PTA and Naphtha Cracker at its Refineries - as well as a world class Product Application & Development Centre. The PADC renders technical services in the areas of customer support, market development & new application development.
Today, IndianOil is a major supplier to the key players in the detergent industry, both national and international. Similarly, in PTA business, all major domestic customers are catered to by IndianOil. A robust logistics model has been the key to IndianOil's success story and facilities have been put in place for seamless product dispatches to customers by rail, road and sea. The technology and capacities of the Naphtha Cracker and Polymer units are world-class, with products ranging from commodity to niche grades. These initiatives are designed to catapult IndianOil among the top three petrochemicals players in Southeast Asia in the long term.
Mr. VS Okhde has taken over as the Director (Pipelines) of Indian Oil Corporation Ltd., the country's only Fortune 100 company. Prior to his elevation, he was Executive Director (Exploration & Production).
Mr. Okhde brings with him diverse experience of over three decades in various facets of hydrocarbon pipeline systems such as Operations, Maintenance, Engineering Services and Projects. Additionally, he has held senior management positions in the Business Development function. He will head IndianOil's cross-country network of crude oil, product and gas pipelines, spanning almost 11,000 km with a capacity of over 75 MMTPA, the largest in the country.
A Mechanical Engineer from Regional Engineering College, Bhopal, Mr. Okhde also holds a degree in Executive Management from Management Development Institute (MDI), Gurgaon.
Hike in petroleum product prices to wait till polls
With international crude oil prices hovering around $110 a barrel and the subsidy bill threatening to balloon, touching around Rs. 1,40,000 crore this fiscal, the oil marketing companies (OMCs) have been denied "political go-ahead" to raise the prices of petrol, diesel and domestic LPG due to Assembly polls in Punjab, Uttar Pradesh , Uttarakhand , Goa and Manipur.
The United Progressive Alliance-Il is wary of raising the prices of petroleum products as it feels that not only will this add to inflation, which has been cooling down for the last few weeks, but also upset the voters and work to the disadvantage of the Congress and its allies.
Courtesy: The Hindu, New Delhi, January 19, 2012
Hydrogen-powered three-wheeler ‘HyAlfa’ makes debut
The world’s first hydrogen-powered three-wheeler, ‘HyAlfa’, was showcased at the 11th Auto Expo here today. Part of a development project dubbed ‘DelHy 3w’, a fleet of 15 HyAlfa three-wheelers will run on an experimental basis at Pragati Maidan, where a hydrogen refuelling station has also been set up. The India Trade Organisation Promotion (ITPO) will use the vehicles on an experimental basis.
HyAlfa has been developed under a joint project by the United Nations Industrial Development Organisation (UNIDO) International Centre for Hydrogen Energy Technologies (ICHET), Mahindra & Mahindra and IIT-Delhi, with support from the Ministry of New and Renewable Energy.
“The aim of this project is to convert vehicles so that they can carry and use hydrogen — a carbon-free fuel — and thus remove all pollutants,” Mahindra & Mahindra President (Automotive and Farm Equipment Sectors), Mr Pawan Goenka, told reporters here. He said the vehicle is not yet ready for commercial production and further fine-tuning will be required before moving in that direction. “Moreover, we also have to look at the commercial viability of running a hydrogen-powered three-wheeler as the cost of hydrogen will be around Rs 250 per kg, which is not affordable at all,” he said.
Asked about the possible price of HyAlfa, he said: “When the product is on mass production, it will cost Rs 20,000 to Rs 25,000 more than a CNG three-wheeler.” On an average, a CNG three-wheeler costs close to Rs 2 lakh. Commenting on the development, UNIDO-ICHET Managing Director, Mr Mustafa Hatipoglu, said the DelHy 3W project aims to demonstrate hydrogen technologies developed by Indian partners for the Indian transport sector. Project coordinator, IIT-Delhi Professor L.M. Das, said HyAlfa marks a journey of 20 years from “laboratory to land’’. ITPO Chairperson-cum-Managing Director, Ms Rita Menon, said the hydrogen-powered three-wheeler could play a role in moving towards a newer, sustainable and eco-friendly mode of transportation. “We are happy to be a part of this project and are especially excited about the cargo version,” she said, adding that her organisation plans to submit a report within three months on the vehicle’s performance to the project organisers.
…from the pages of THE HINDU BUSINESS LINE newspaper.
Mahindra Solar commissions 5 MW unit
Mahindra Solar announced the commissioning of a 5-megawatt grid connected solar power plant using crystalline silicon modules in Jodhpur, Rajasthan. The cost per MW is in the range of Rs 9-10 crore.The plant has been set up under the Jawaharlal Nehru National Solar Mission (JNNSM) policy and had the distinction of generating the highest output per MW of any solar plant in India with cutting-edge tracker technology that maximises energy from the sun. The plant site is equipped to evacuate 55 MW and the company intends to scale up the capacity to match the evacuation capacity. Mr Anand Mahindra, Vice-Chairman and Managing Director, Mahindra & Mahindra, said, “We aim to be one of the top three companies in this industry.”
Essar Oil to hike Vadinar refinery capacity to 18 mtpa by March
Ahmedabad, Jan. 9::::::Essar Oil Ltd, a subsidiary of Essar Energy, on Monday announced the successful commissioning of the amine regeneration unit (ARU), a part of the Phase-I expansion at its Vadinar refinery in Gujarat, whose completion will increase the refinery's capacity from the existing 14 million tonnes per annum (300,000 barrels per day) to 18 mtpa (375,000 bpd).
The completion of expansion will also increase its complexity from 6.1 to 11.8. (The Refinery Complexity Index is a cost-based index. It provides insight into such things as refinery construction costs, replacement value, conversion capability and product slate.) The project is nearing completion and increased throughput of 18 mtpa will commence by March, the company said here.
An optimisation project is also under execution at the refinery to further increase the capacity to 20 mtpa (405,000 bpd) by September. The capacity expansion, complexity enhancement and subsequent optimisation will give the Vadinar Refinery the capability to process nearly 87 per cent ultra-heavy crudes, which are lower cost than light crudes.In terms of product yield, the expanded Vadinar Refinery will have the flexibility to produce higher value products, including pet coke, Mr Lalit Gupta, Managing Director and CEO, Essar Oil, said.
The ARU, with 8 mtpa design capacity, is one of the largest such units in the world. Essar Oil is the first refinery in India that will use in the ARU a specially-formulated amine UCARSOL, from Dow Chemicals, that helps achieve better efficiency in gas treating and reduces energy consumption in the ARU.
02 Jan 2012
GUWAHATI: Guwahati Refinery, India's first public sector refinery, celebrated its golden jubilee on Sunday. The day was marked by an inaugural function in the early hours of New Year's Day with a tribute at the Sahid Bedi (Martyr's column) of the Refinery Workers' Union office complex, which was attended by refinery employees, senior officials and the public.
With an initial capacity of 0.75 million metric tonne per year, the Guwahati refinery was inaugurated by the first Prime Minister of India, Jawaharlal Nehru on January 1, 1962 and was dedicated to the nation as a New Year's gift. The refining capacity was subsequently enhanced to 1.0 MMTPA and with INDMAX, the pilot plant for first in-house technology of Indian Oil, the ISOSIV and Hydrotreater the Refinery has been able produce eco-friendly fuels.
The Refinery produces various products and supplies them to the entire northeast and beyond. The Refinery has planned a month-long celebration including a mural on the history and growth of refinery, a herbal park, CSR initiatives in the health sector, skill development programmes for youth and women and release of an audio album.
On Sunday, a reunion of the pioneers and retired employees was organized. They were felicitated by the chief guest, Sudhir Bhalla, Director(HR), IndianOil for their efforts and dedication in transforming a dream into reality. Guwahati Refinery general manager said that the refinery came into existence because of the contribution of the pioneers. Courtesy: TOI
NZ Co LanzaTech to help IOC, JSPL set up bio jet fuel plant
MUMBAI: The New Zealand-based renewable energy company LanzaTech is in talks with its partners here - IndianOil and Jindal Steel & Power - to help them set up plant to produce commercial bio jet fuel from ethanol, a top company official has said. As a first step, LanzaTech will open an office in the country in the first half of 2012 as part of its plan to expand its operations here, LanzaTech vice-president for business development for Asia Pacific Prabhakar Nair said.
IndianOil and Jindal Steel & Power (JSPL) are already in discussions for collaborating to accelerate deployment of LanzaTech's technology to produce fuel ethanol from industrial off-gases , he said. "We have done our best to bring these partners (Jindal and IOC) together . While Jindal Steel & Power has the off-gases , IndianOil has facilities to make, store and supply aviation fuel. We expect them to take a decision in a year and a half to set up a demonstration scale plant," Nair said.
However, he said, the proposed plan only includes technology sharing and not any investment in the plant and machinery . Nair also noted that British airline Virgin Atlantic has already committed that it will begin trials using renewable bio jet fuel on its Shanghai- New Delhi-London Heathrow route within two to three years. It may be recalled that Virgin Atlantic had announced a partnership with LanzaTech to conduct such trials last October and its chairman Richard Branson had even visited the New Zealand facilities, where the technology was demonstrated to him.
Besides, the European Union will begin allocating carbon emission quotas to airlines operating flights to and from the Union from today and Virgin Atlantic believes this development will take it well beyond its pledge of a 30 percent carbon cut per passenger km by 2020. "Globally , the aviation industry's current daily demand is around 5 million barrels of aviation fuel. Even if 10% of this is substituted with LanzaTech's aviation bio jet fuel, it will be a big market for us," Nair said.
LanzaTech has the technology to convert carbon monoxide, syngas as well as steel mill off-gases into ethanol and is in talks with all major steel producers in India, including JSPL, Posco and SAIL, he said. "China's demo scale plant at Bao Steel Shanghai is scheduled for the first quarter of 2012, which will produce 1 lakh gallons of ethanol annually. We expect JSPL and most likely IOC to begin working on a similar plant here. We hope Virgin's commitment to use bio jet fuel for trials is likely to encourage our partners," he said.
As recently as last December 5, the US awarded $7.7 million in Federal Aviation Administration contracts to eight biofuel-related companies to develop 'dropin' jet fuels that can be used without changing engine systems or airport fueling infrastructure, out of which deals worth $3 million were bagged by Lanza-Tech alone. This amount is over-and-above the funds allotted last June by the US Defence Advanced Research Projects Agency for research on eco-friendly and low cost jet fuel from sources like rich carbon monoxide, Nair said.
Oil is still indispensable
Year 2011 was been a year of records for the oil business. It was a year when despite the sovereign debt tumult in Europe, the consumer “balance sheet”, recession in the US and the general economic slowdown in the BRIC countries, the price, demand, revenues and expenditures related to petroleum have all touched historic highs. The year has reaffirmed the indispensability of oil and the vulnerability of countries that, either for reasons of geology or policy, are stuck in the groove of import dependence. It has provided a touchstone for the Ministry of Petroleum to set its policy priorities for 2012.
Over the past 12 months, the price of the benchmark light Brent crude oil has averaged $110/barrel. This is the highest average price in real and nominal terms since Colonel Drake first struck oil in 1859 in the small timber town of Titusville in North Pennsylvania. Global demand has, during this period, hovered just below 90 million barrels. Here too, the figure has touched a historic high. OPEC has, in consequence, earned over a trillion dollars. Only once before in 2008 has their revenue crossed this mark. On the flip side, oil importing countries and in particular, China and India, have seen a record outflow of foreign exchange on their crude oil account. The general consumer too has spent a record proportion of his income on energy for lighting, heating and transportation. Caught between the pincer of squeezed earnings and high prices, thousands have been pushed into “fuel poverty”, especially in countries that do not subsidise energy.
These records throw into sharp relief the pivotal and enduring significance of petroleum. Sure, the price of oil may slip back into double digits in 2012. For demand is declining and production from countries like Libya and Iraq, which had been convulsed by geopolitics, is now re-entering the market. But such a slip, if it did occur, must not be grounds for complacency — at least not in economies like India that are moving into their next, more energy-intensive, phase of development and where their emergent, urbanising middle class is looking to trade up from a cycle to a two-wheeler to a Nano equivalent. For there are few, if any, immediately available commercial alternatives to oil, especially as a transport fuel. CNG (compressed natural gas) for example which has been mandated by the Supreme Court as the fuel for our buses, taxis and 2-wheelers in major cities has a low energy density and cannot therefore be a substitute for the diesel used by the heavy duty long haul transporters. LNG (liquefied natural gas) on the other hand, which has a higher energy density and could, therefore, be the substitute, cannot be used without the development of expensive infrastructure and the redesign and retrofitting of existing engines. The fundamentals of demand and supply do not in short provide a solid base for assuming a prolonged downward shift in prices.
It is with this backdrop of 2011 that the petroleum ministry should review its policy towards exploration and production (EP) of hydrocarbons. It should do so also because of the worsening imbalance between demand and supply. Today India imports more than 80 per cent of its crude oil requirements. EP has long been a policy priority for the ministry. To reiterate that it should occupy pole position in its agenda is not therefore an original thought. But in recent months the signals emanating from the ministry have suggested that there is a gap between rhetoric and practice.
The rhetoric encourages the involvement of private capital. It accepts that EP is an inherently risky and uncertain activity involving not just the challenge of locating hydrocarbons but also, once located, the challenge of developing and producing the hydrocarbons on a commercially sustainable basis. It also accepts that to harness its hydrocarbon potential, India must bring to bear the optimum combination of capital, technology and operational expertise into EP and create a policy framework that attracts the broadest spectrum of petroleum companies from both the public and private sector.
Unfortunately, in practice, things are different. The industry is concerned at the reinterpretation of the contractual clauses related to tax, marketing and prices. They are questioning the rationale behind the continual debate over operating practices. Their foreheads are creased with worry about what they regard as rigidity and lassitude in decision making. Whether warranted or not, this perception has cast a somewhat ambivalent pallor on the EP environment. It is a situation that the country can ill afford. For with the end of the “era of easy oil” and the reality that new discoveries will most likely be found in harsh terrain and geologically complex structures, the private sector is a necessary factor for EP success. This is not to dilute the role of the public sector. In fact, some of the major EP breakthroughs in recent years have been spearheaded by state-owned companies. The unlocking of billions of barrels by PetroBras — the Brazilian PSU — in the presalt reservoirs of the Santos basin in Brazil is a case in point. It is merely to emphasise that private companies must not be deterred. Their contribution to the production of hydrocarbons in India is already material. In 2010-11, for instance, they produced 10.67 mt and 25.5 bcm of oil and gas respectively up from 5.07 mt and 7.72 bcm in 2006-07.
Those of us who have followed the corruption scandals that have bedevilled governance can appreciate the pressures imposed on officials by the sword of Damocles wielded by the CBI, CVC and CAG. We can understand why, under such circumstances, “acts of omission” are deemed safer than “acts of commission”. But this cannot justify ignoring the underlying message of 2011. EP policy must be reinvigorated and if not done the country will pay a huge and enduring price in terms of energy security and economic growth. The writer is chairman of the Shell Group in India.
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