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PPP in clean fuel business: Dharmendra Pradhan launches guidelines for DODO model CNG stations in India
In line with the vision of the government to make the country a Gas based economy, Shri Dharmendra Pradhan, Union Minister of Petroleum & Natural Gas; Skill Development & Entrepreneurship today launched the common general guidelines for setting up of Dealer Owned Dealer Operated (DODO) CNG stations in India. The guidelines were launched in the sidelines of Petrotech 2019, Greater Noida, in the presence of heads and senior officials of all major organisations in oil and gas sector including CGD companies through release of a booklet.
Most of the City Gas Distribution (CGD) entities run by central public sector undertakings will execute these guidelines for further setting up of CNG stations on DODO model in the country.
Speaking on the occasion, Hon’ble Minister Shri Pradhan reiterated the vision of Shri Narendra Modi, Hon’ble Prime Minister to make India a gas based economy and said that Petroleum & Natural Gas Regulatory Board (PNGRB) has redefined and has been providing an excellent regulatory support for the operators in the sector today. The journey of CGD started with less than 100 districts, now the CGD reach has come up to 400 Districts on the completion of 10th Round of PNGRB Bidding.
Shri Pradhan added that these guidelines will act as advisory for bringing uniform system in line with DODO policy which will further help in bringing hygiene and cleanliness in the environment. He also added, this is not a business venture but also a big civic endeavour.
In the history of gas industry, such a progress has never being made in a such a speed bad scale including policy reform and simplifying the process in sector. After the completion of ongoing tenth round of bidding by PNGRB, it is expected that 70% of the country’s population shall be covered by CGD network supplying CNG for transport sector and PNG to households as well as Industrial & Commercial sector. For successful and timely roll out of the CGD projects, it is important that there is easy availability of land with CGD entities for setting up CNG stations and the public is not denied the convenience of clean fuel due to non-availability of land.
DODO guidelines shall be an opportunity for those in possession of land to join hands with CGD entities in their endeavour to provide clean fuel for the transport sector. The booklet containing the guidelines will define the scope of activities of private land owners and the CGD entities while setting up CNG stations on DODO model. This will not only reduce the cost of setting up CNG filling stations for CGD entities but will also provide land owners and investors to become partners in this green drive.
The guidelines are being introduced in over 150 districts of the country spread across 87 Geographical Areas (GAs) defined by PNGRB, where entities promoted by state run companies are currently operating. As per the guidelines, the entire plot owned by a private owner shall be developed exclusively for setting up of CNG station and allied commercial activities at the discretion of CGD entity. The selection process will be as per individual guidelines developed by each entity. After selection of the site, the plot owner applicant desirous of setting up CNG station will have to enter into a long term agreement with CGD entity.
The CNG equipments (compressor/ cascade/ dispenser, etc.) shall be installed and commissioned by CGD entity while adhering to all the statutory rules/guidelines related to fire and safety.
On its part, the dealer will have to arrange all the permissions to setup CNG Station including change of land use, necessary clearance, license, etc. at own expense and cost. The day to day operation of the equipment as well as of CNG retail outlet including dispensing of gas and general maintenance shall be the responsibility of the appointed dealer. The dealer shall be paid commission by the concerned CGD entity as per the sales achieved based on the fixed dealer commission.
It is expected that these general guidelines shall add fillip to the CNG business in the country as easy availability of CNG across the country shall encourage more people to switch to eco-friendly and economical CNG.
Hydrocarbon demand here to stay, believe energy firms, policymakers
Even as growth in the renewables and electric vehicles (EVs) segment threatens the conventional energy land scape, oil marketing companies (OMCs), oil and gas producers, and policy makers remain confident that demand for hydrocarbons is here to stay.
The industry experts voiced their opinions at the chief executive officer (CEO) conclave on Sunday.
MM Kutty, secretary for petroleum & natural gas, expects hydrocarbon, motor spirit and gas will play an important role, even with the growth of the EV market.
Representatives from the oil producers’ community voiced similar views. “In percentage terms, the numbers look high, but absolute numbers would show a different picture. We should not be concerned about it. However, we do realise the situation is challenging,” said Shashi Shanker, chairman and managing director (CMD), Oil and Natural Gas Corporation (ONGC) with respect to the double-digit growth in the renewable energy space.
The industry is also facing challenges with the rise in energy efficiencies, according to oil refining companies.
Referring to the lower fuel consumption resulting from the push in the automobile sector for higher-energy efficient engines, Sanjiv Singh, CMD, Indian Oil Corporation (IOC), added, “In India, the major shift that can happen is the energy efficiency and change in business models. We cannot ignore any change in the transportation sector, when they are driving most of our demand.”
Khalid bin Khalifa Al-Thani, CEO, Qatargas, referring to his firm’s capacity expansion plans said, “I do not think this is enough. More gas will be needed for the world demand.”
Qatargas is expected to take its current capacity of 77 million tonnes (mt) to more than 100 mt by 2024.
He also added, along with gas infrastructure development and policy push, India should look to bring the product under the goods and services tax preview.
Others such as B C Tripathi, CMD, GAIL, “expects the energy basket to go through a change, where the firm expects renewables and gas to dominate in the future.”
Petronet’s LNG terminal plan in Bangladesh put on the back burner
Bangladesh has instead asked India to bid in the ongoing round for an LNG regasification terminal at Matarbari, also Cox’s Bazar
Petronet LNG’s plan to build a liquefied natural gas (LNG) facility at Maheshkhali island in Cox’s Bazar district of Bangladesh through a government-to-government deal has been put on the back burner.
Bangladesh has instead asked India to bid in the ongoing round for an LNG regasification terminal at Matarbari, also Cox’s Bazar. An expression of interest (EoI) was floated in January.
This comes after Petronet LNG managing director Prabhat Singh last month said the company would not bid for the Matarbari project and instead wanted a bilateral deal on the Maheshkhali terminal.
Bir Bikram Tawfiq-e-Elahi Chowdhury, advisor (minister) to Prime Minister Sheikh Hasina for power, energy and mineral resources affairs, told Business Standard that though Petronet had submitted a feasibility report to set up a terminal at Maheshkhali, the country cannot afford it and has no appetite for so many terminals at one go. “We cannot have so many land-based terminals. We have made this clear to Indian Petroleum Minister Dharmendra Pradhan. We have sought the participation of Petronet in the land LNG terminal (at Matarbari) during our meeting,” said Chowdhury, who met Pradhan on the sidelines of the Petrotech-2019 in Greater Nodia on Monday.
Rupantarita Prakritik Gas Co, part of state-owned Petrobangla, late in January had invited an EoI for the design, engineering, procurement, construction and commissioning of a land-based terminal at Matarbari that can handle 7.5 MT of LNG.
Chowdhury also had some tough words for ONGC Videsh (OVL), a fully-owned subsidiary of state-run Oil and Natural Gas Corporation (ONGC), for the delay in the start of exploration work in its blocks. “They are late by around three years. We have given now them an extension of two years.”
OVL along with Oil India had got two shallow water exploration blocks SS-09 and SS-04 off Bangladesh in the Bay of Bengal during the 2012 hydrocarbon bidding rounds in that country. Bangladesh expects the first well to be spun by OVL by the month-end.
Chowdhury also expected the first phase of the joint coal-based power project with NTPC would be commissioned by 2020. NTPC and Bangladesh Power Development Board (BPDP) are jointly working on the project. “The reason for the delay of the project is not just environmental issues. There were other technical issues related to project implementation,” he said. The 1320-MW coal-fired power plant at Rampal in Bangladesh had faced the rough weather owing to its proximity of 14 km to the world’s largest mangrove forests, the Sunderbans.
Modi pitches for responsible oil pricing to balance interests of producers, consumers
There is a need to mitigate fluctuations in crude oil price and efforts must be directed towards responsible pricing, Prime Minister Narendra Modi said on Monday.
Speaking at the Petrotech – 2019, Modi said, “For too long, the world has seen crude prices on a roller-coaster. We need to move to responsible pricing, which balances the interests of both the producer and consumer. We also need to move towards transparent and flexible markets for both oil and gas. Only then can we serve the energy needs of humanity in an optimal manner.”
Modi said the global energy dynamics are changing and “There is a shift in energy consumption from West to East. The US has become the world’s largest oil and gas producer after the shale revolution.”
“As we gather here to discuss the present and future of global energy, winds of change are evident in the global energy arena. Energy supply, energy sources and energy consumption patterns are changing. Perhaps, this could be a historic transition,” he added.
New energy sources
Modi said the newer sources of energy can lead to a time of energy abundance. He said, “We are entering an era of greater energy availability…Solar energy and other renewable sources of energy have become more competitive. They are emerging as sustainable substitutes for traditional energy forms. Natural gas is fast becoming one of the largest fuels in the global energy mix. There are signs of convergence, between cheaper renewable energy, technologies, and digital applications. This may expedite the achievement of many sustainable development goals,” he said.
Clean cooking fuel
Despite energy abundance, there are many across the globe that do not have access to it. Modi said, “More than a billion people across the globe still do not have access to electricity. Many more do not have access to clean cooking fuel. India has taken a lead in addressing these issues of energy access. In our success, I see hope for the world that problems of energy availability can be suitably addressed. People must have universal access to clean, affordable, sustainable and equitable supply of energy. India’s contribution in the onset of an era based on energy justice is significant.”
https://www.thehindubusinessline.com/todays-paper/tp-news/article26244201.ece
UAE keen to invest in refining, petrochemical projects, store oil in India
Betting big on rising oil demand in the world’s third largest energy consumer, oil-rich UAE Monday said it is looking at investing more in refining and petrochemical projects as well as stocking more crude in India.
UAE’s Abu Dhabi National Oil Co (ADNOC) and its partner Saudi Aramco have jointly taken a 50 per cent stake in the planned USD 44 billion refinery-cum-petrochemical complex at Ratnagiri in Maharashtra.
It has hired space at the underground strategic oil storages built at Mangalore and Padur in Karnataka.
We are looking at expanding investment portfolio in the downstream sectors (particularly) oil refining and petrochemicals,” said Sultan Ahmed Al Jaber, Minister of State in the United Arab Emirates and CEO of the ADNOC.
UAE, he said, is looking to go beyond merely selling crude oil to India and wants to develop a strategic partnership.
“We are only looking at strategic partnership given that we can also bring our own crude,” he said. “India is not only an important market for us. India is a very strategic partner.”
UAE, he said, is looking to expand its cooperation with India and it will look at enhancing avenues of cooperation.
The minister was talking to reporters after receiving Lifetime achievement award at the Petrotech Conference from Prime Minister Narendra Modi.
Like other major producers, Aramco and ADNOC are looking to lock in customers in the world’s third-largest oil consumer through investments. Kuwait too is looking to invest in projects in return for getting an assured offtake of their crude oil.
UAE supplies a small quantity of oil to India but is ramping up investments.
Asked if ADNOC has finalised the exact quantum of stake it will pick up in the 60 million tonnes a year Ratanagiri refinery, he said, “We are still at an early stage. We are still in the process of defining the scope and scale of the project. We are working very closely with our partner Saudi Aramco as well as our counterparts in India.
Aramco and ADNOC will together own 50 per cent of the planned project but a division between them has not yet been announced.
The remaining 50 per cent stake is held by state-owned Indian Oil Corp (IOC), Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL).
He said UAE is also looking at storing more crude oil in Indian storages.
“India is very high on our strategic agenda and expanding our strategic reserve in india will be an item on the agenda to be discussed with our friends and counterparts in India,” he said.
In November last year, India had signed an initial pact to lease out a part of its underground strategic oil storage at Padur in Karnataka to ADNOC for storing crude oil.
India has built 5.33 million tonne (MT) of emergency storage -enough to meet its oil needs for 9.5 days, in underground rock caverns in Mangalore and Padur in Karnataka and Visakhapatnam in Andhra Pradesh. It has allowed foreign oil companies to store oil in the storages on condition that the stockpile can be used by New Delhi in case of an emergency.
ADNOC had in February 2018 signed a pact to fill half of the 1.5 MT strategic oil storage at Mangalore. In November 2018, it signed a similar pact for Padur.
Strategic Petroleum Reserve entity of India (ISPRL) has constructed and commissioned underground rock caverns for storage of total 5.33 million tonnes (around 39 million barrels) of crude oil at three locations — Vishakhapatnam (1.33 MT), Mangalore (1.5 MT) and Padur (2.5 MT).
While a third of the Visakhapatnam facility has been hired by Hindustan Petroleum Corp Ltd (HPCL), ADNOC and the Government of India filled the storage at Mangalore. The 2.5 million tonnes Padur facility remained empty.
Aramco is also keen on venturing into fuel retailing in India.
