POLICY MATTERS/GAS PRICING/OTHERS:
- India should reduce dependency on fossil fuels: Economic Survey
- Budget 2017: Government plans merger of 13 state oil firms to create behemoth
- India to have two more strategic crude oil reserves
· Japan’s JERA to invest $200 million in India’s ReNew Power
India should reduce dependency on fossil fuels: Economic Survey
Government should take steps to bring down the country’s reliance on fossil fuels below the level of other countries and continue to be a good global citizen on climate change, the Economic Survey said today. India, which signed Paris agreement on climate change in December 2015, will now shift its focus to implementing the pacts, it said. On India’s fossil fuel use from long-term perspective, the Survey said that so far the country’s reliance on fossil fuels remains “well below” China and also below the US, the UK and Europe at comparable stages of development. “Going forward, of course, India needs to bend the curve to ensure that its reliance on fossil fuels declines and keeping it below the level of other countries so that its good global citizenship on climate change can continue,” it said. On pricing of carbon to tackle climate change, the Survey said since June 2014, when international oil prices started declining, India has increased its excise duties from Rs 15.5 per litre to Rs 22.7 per litre as of December 2016 for branded petrol and from Rs 5.8 per litre to Rs 19.7 per litre for branded diesel. When compared with other G-20 nations, the results are striking. The increase in petrol tax has been over 150 per cent in India, it said. In contrast, the governments of most advanced countries have simply passed on the benefits to consumers, setting back the cause of curbing climate change. “As a result, India now outperforms all the countries except those in Europe in terms of tax on petroleum and diesel,” the Survey noted.Having decisively moved from a regime of carbon subsidies, it is now de facto imposing a carbon tax on petroleum products at about USD 150 per tonne, which is about 6 times greater than the level recommended by the Stern Review on Climate Change, it added.
Source: Indian Express/Indian Oil & Gas
Budget 2017: Government plans merger of 13 state oil firms to create behemoth
To compete with global oil biggies like BP and Chevron, the government has said that it was planning to merge some 13 state oil firms to create an energy behemoth. In his fourth Budget speech yesterday, Finance Minister ArunJaitley proposed to ‘create an integrated public sector oil major which will be able to match the performance of international and domestic private sector oil and gas companies’.This comes more than 12 years after a proposal to merge oil PSUs was first mooted by the then Oil Minister Mani Shankar Aiyar.It the proposal is successfully executed, it will help the country to bag larger share of global energy to meet the needs. India is the world’s third largest oil consumer. An idea was mooted a few months back to merge them to create a behemoth that can’t just compete globally but also withstand oil price volatility by using profits the refining business make in low oil prices to make up for losses in upstream and vice versa. Top eight listed state-owned oil and gas companies have a combined market capitalisation of about USD 80 billion (over Rs 5.4 lakh crore), making it ninth largest globally. The combined entity will be larger than Rosneft of Russia and billionaire MukeshAmbani-led Reliance Industries. News agency PTI reported that the merge could top USD 100 billion (over Rs 6.7 lakh crore) in market value and compete with global oil biggies.In 2015-16, all state oil firms together reported a profit of Rs 45,500 crore on revenues of Rs 9,32,000 crore. They had planned a capital expenditure of Rs 87,600 crore in the current fiscal.The merged entity could rival the likes of Russia’s Rosneft (USD 60 billion in market cap) and UK’s BP Plc (USD 92 billion) in market value.