New Delhi: After city gas retailers in Mumbai and Delhi reduced CNG prices, Torrent Gas on Saturday announced a Rs 2.50 per kg reduction in compressed natural gas (CNG) prices across all its locations. “This makes CNG cheaper by up to 45 per cent vis a vis petrol and up to 37 per cent vis a vis diesel,” the company, which has a city gas license to sell CNG to automobiles and piped cooking gas to households in 34 districts, said in a statement.

“This reduction in prices of CNG has been done with an objective of promoting the usage of clean fuel and enhancing the ecosystem of natural gas.”

Mahanagar Gas Ltd, the city gas operator in Mumbai and its adjoining areas, on March 6, announced a Rs 2.5 per kg reduction in CNG price. Accordingly, the revised CNG price will be Rs 73.50 per kg.

“MGL‘s CNG price now offers attractive savings of 53 per cent compared to petrol and 22 per cent compared to diesel at current price levels in Mumbai while delivering unmatched convenience, safety, reliability and environmental friendliness to consumers,” the firm had said in a statement on March 5.

A day later, Indraprastha Gas Ltd announced a similar price reduction in Delhi and the adjoining cities. “The retail consumer price of CNG is being reduced by Rs 2.50 per kg across all geographical areas of IGL from 6 am on Thursday, 7th March 2024. The revised selling price of CNG in Delhi shall be Rs 74.09 per kg, while it shall be Rs 78.70 per kg in Noida, Greater Noida and Ghaziabad.”

The reductions follow a softening in input gas prices.

Torrent Gas said it has 428 CNG stations and more than 1 lakh piped cooking gas customers across its areas of operation.

“This reduction in CNG price, besides leading to greater savings for CNG vehicle owners, is also expected to give an impetus to the sale of new CNG vehicles across various segments, including passenger and commercial,” it said.

CNG, which is already known as clean and green fuel, owing to its environment-friendly nature will become even more attractive for vehicle owners with this downward price revision. It will offer increased savings, along with better mileage and lower maintenance to all CNG vehicle users, it said.

Speaking about the reduction in gas prices, Torrent Gas managing director Manoj Jain said, “Torrent Gas has always been at the forefront in promoting the use of environment-friendly CNG. This reduction in CNG prices is expected to increase the offtake of new CNG vehicles and increase the consumption of natural gas in the transport segment”.

“Torrent Gas has invested deeply into building CGD network infrastructure in its geographical areas and is continuously working towards creating awareness about CNG and piped gas and helping consumers adopt economical and environment-friendly natural gas as fuel.”

Torrent Gas hold city gas licenses for 34 districts across 7 states (Tamil Nadu, Telangana, Uttar Pradesh, Gujarat, Maharashtra, Rajasthan and Punjab) and one Union Territory (Puducherry). Torrent’s authorised areas, across the country have a population of approximately 9 crore, about 7 per cent of the total population of India.

https://energy.economictimes.indiatimes.com/news/oil-and-gas/after-mgl-and-igl-torrent-gas-cuts-cng-prices-by-rs-2-50-per-kg/108341586

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The price reduction aims to make CNG more accessible and affordable for consumers, thereby encouraging the widespread adoption of cleaner fuel options and promoting sustainable transportation practices.

The price of CNG at GAIL and GAIL Gas CNG outlets has been decreased by Rs. 2.50 per kg.  

The CNG Price at Varanasi, Patna, Ranchi, Jamshedpur (East Singhbhum), Bhubaneshwar (Kordha), and Cuttack,  stands revised as Rs 81.17, Rs 84.54, Rs 87.15, Rs 87.08, Rs 87.26 and Rs 87.60, per kg respectively.

CNG Prices at GAIL Gas authorised Geographical Areas (GAs) are: Meerut – Rs 79, Sonipat – Rs 80.4, Dewas & Firozabad – Vrindavan – Bharatpur – Rs 89.50, Bengaluru – Rs 81.50, Dehradun & Raisen – Sehore – Shajapur – Rs 88.50, Mirzapur – Chandauli – Sonbhadra – Rs 84.50 ; Puri – Ganjam – Nayagarh & Adityapur – Rs 84.50; Giridih – Dhanbad-  Rs 71.50; Sundergarh- Jharsuguda – Rs 67.50 and Dakshin Kannada – Rs 81.

The decision to lower CNG prices comes at a crucial time when the automotive industry is witnessing a surge in the production and adoption of CNG vehicles by leading manufacturers such as Suzuki Motors, Tata, Hyundai, Mahindra and others.

Speaking on the announcement, Shri Goutom Chakraborty, CEO GAIL Gas & Executive Director (CGD), GAIL, said, “At GAIL, we are committed to promoting the use of clean and affordable energy solutions to benefit both consumers and the environment. The reduction in CNG prices reflects our dedication to making sustainable transportation accessible to all, while also supporting the government’s initiatives towards cleaner air and reduced carbon footprint.”

The reduced prices of CNG will not only result in cost savings for consumers but also contribute to a healthier and more sustainable environment. GAIL encourages individuals, businesses, and transportation fleets to take advantage of this opportunity to switch to CNG and join the movement towards a cleaner and greener future.

https://www.sarkaritel.com/gail-and-gail-gas-announce-significant-reduction-in-cng-prices/#:~:text=The%20price%20of%20CNG%20at,Rs%2087.60%2C%20per%20kg%20respectively.

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Currently, I-Squared holds 100% stake in Think Gas Distribution and 73% in AG&P Pratham, the India arm of Singapore-based Atlantic Gulf & Pacific (AG&P) City Gas. About 21% is held by AG&P and 6% by Japan’s Osaka Gas-led consortium. Since both companies are in CGD business, promoters have decided to consolidate operations.

This is aimed at optimising resources and improving utilisation of manpower.

CGD refers to the transportation or distribution of natural gas to consumers in domestic, commercial, industrial and transport sectors through a network of pipelines.

The size of the combined entity will help it take on competitors like Mahanagar Gas, Gujarat Gas, Indraprastha Gas, Gail Gas, Adani Total Gas and Torrent Gas among others.

Osaka Gas and Sumitomo Corp will invest $200-250 million of primary capital in the company as growth capital, said one of the persons cited above.

After the merger, I-Squared Capital will hold over 60% stake in the combined entity. AG&P will hold up to 15% and the Osaka Gas and Sumitomo-led consortium will hold 25%.

In January, the companies had applied to the European Commission in Brussels for merger approval. That was granted in February, said the people cited above.

India, the fourth biggest buyer of liquefied natural gas, wants to increase the share of natural gas in the energy mix to 15% by 2030 from 6% now and the CGD network will play a key role in reaching this target. The use of natural gas will also help reduce the carbon footprint and address climate change challenges. The infrastructure to support this growth is also being put in place. By 2030, the country will have 17,500 compressed natural gas stations and 120 million piped natural gas connections, union minister for petroleum and natural gas Hardeep Singh Puri said on March 6.

Under the 12th and latest CGD bidding round, state-run Oil India, Bharat Petroleum and Hindustan Petroleum among others won licences to building gas infrastructure in the Northeast and Jammu & Kashmir. The round covered 103 districts. The government has decided to spend Rs 41,000 crore to build infrastructure in six northeast states and the two union territories of Jammu & Kashmir and Ladakh.

AG&P, Think Gas, I-Squared Capital, Osaka Gas and Sumitomo didn’t respond to queries.

Osaka Gas is Japan’s second-largest gas supplier and the first Japanese company to invest in the city gas sector in India through AG&P City Gas. Sumitomo is a global trading and investment company. AG&P Group has a presence in engineering, procurement, and construction, city gas distribution businesses, and LNG terminals.

In 2021, Osaka Gas, through affiliate Osaka Gas Singapore and Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development (JOIN), invested up to $120 million in Singapore-based AG&P City Gas.

“With the formation of a new entity, there will be a pan-India presence. The management will become one and the AG&P’s managing director will be the managing director of the combined entity,” said one of the persons cited, adding that the companies have agreed to the deal in principle and are awaiting regulatory approvals.

In May 2023, ET had reported that Sumitomo, Mubadala Investments and Tokyo Gas were in the race to acquire a 30% stake in Think Gas. The report had also included talk about a merger proposal.

Think Gas holds seven licences to operate in 13 districts in India across the states of Punjab, Madhya Pradesh, Bihar, Uttar Pradesh and Himachal Pradesh and supplies natural gas to the domestic, commercial, industrial and automotive sectors. The company was established in 2018.

AG&P, or Atlantic Gulf and Pacific Co., is headquartered in Singapore and develops LNG import and regasification facilities as well as CGD networks. In India, its city gas distribution arm AG&P Pratham holds 12 licences to exclusively develop CGD infrastructure in 37 districts covering 8% of India’s land mass and spread across five states — Tamil Nadu, Kerala, Andhra Pradesh, Karnataka and Rajasthan.

https://economictimes.indiatimes.com/industry/energy/oil-gas/agp-pratham-think-gas-set-for-1-1-billion-merger/articleshow/108373740.cms?from=mdr

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“As on the date, the infrastructure exclusivity period for the laying, building or expansion of the city gas distribution network has expired for” Mumbai & Greater Mumbai, which is operated by MGL, the Petroleum and Natural Gas Regulatory Board (PNGRB) has said on its website. The exclusivity period granted to MGL ended on April 11, 2021, it said. MGL was awarded the distribution license in January 2009.

The regulator also announced that the exclusivity period for Vadodara Gas Ltd (VGL) in Vadodara ended in March 2023. VGL had received the license in October 2016.

PNGRB also made it clear that no infrastructure exclusivity period was granted to Assam Gas Company for Upper Assam and Tripura Natural Gas Company for Agartala when they were awarded city gas distribution licenses in February 2015.

Previous regulatory attempts at ending distributors’ exclusivity have met with stiff resistance from companies, with several cases pending in the court today.

If MGL or VGL don’t legally challenge the PNGRB’s move on ending exclusivity, it could spur market competition and increase affordability for natural gas customers.

On Monday, oil minister Hardeep Singh Puri said the full benefits of gas sector reforms haven’t reached the end user. He also pointed towards the strong profits reported by city gas companies.

City gas companies get cheaper domestic gas and softer tax treatment for supply to households and vehicles. They, however, take advantage of their monopoly status and end up making big profit margins on CNG.

The government also wants them to take piped natural gas to more and more households, where progress has been much slower than the more profitable segment of CNG.

Ending exclusivity would allow competitors to set up marketing and distribution infrastructure in Mumbai and Vadodara, raising the quality of services and lowering the cost of supply for customers.

https://economictimes.indiatimes.com/industry/energy/oil-gas/mgls-monopoly-on-mumbais-city-gas-network-has-ended-pngrb/articleshow/108237105.cms?from=mdr

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Cheniere Energy Inc., a leading player in the liquefied natural gas (LNG) sector, is currently in talks to strike a significant supply agreement with Malaysian energy titan, Petronas. This development comes as Cheniere seeks to expand its footprint in the global LNG market by enhancing its production capabilities at its U.S. export terminals. Petronas, on the other hand, is exploring this deal to diversify its energy portfolio and bolster its trading operations.

Background and Strategic Implications

Cheniere Energy’s ambition to scale up its LNG production is evidenced by its recent application for a permit to construct the Stage 5 Expansion Project at its Sabine Pass LNG Terminal. This proposed expansion aims to add two additional natural gas liquefaction units, potentially increasing the terminal’s LNG production capacity by nearly 17 million metric tons per year. Such a move is not only significant for Cheniere but also for potential partners like Petronas, looking to secure long-term LNG supplies amidst a volatile global energy market.

Environmental Considerations and Industry Impact

While the expansion promises to bolster Cheniere’s position as a key LNG supplier, it also raises environmental concerns, with projected increases in greenhouse gas emissions surpassing those of an average coal-fired power plant. This aspect underscores the broader challenges faced by the LNG industry as it navigates the delicate balance between meeting global energy demands and adhering to environmental sustainability goals.

Market Dynamics and Future Prospects

The ongoing discussions between Cheniere and Petronas signify a potential shift in global LNG market dynamics, emphasizing the importance of strategic partnerships in securing energy supplies. For Petronas, this deal represents an opportunity to diversify its energy sources, a critical step in enhancing its global trading footprint. As negotiations progress, the outcomes of this potential collaboration will undoubtedly influence future trends in the LNG sector, particularly regarding supply chain resilience and sustainability practices.

The discussions between Cheniere Energy and Petronas mark a pivotal moment in the global LNG market, highlighting the strategic moves by key players to secure their positions amid changing energy landscapes. While the deal promises mutual benefits for both parties, it also presents challenges, especially in terms of environmental impact. As the situation unfolds, the energy sector will closely watch how this partnership develops and its implications for global LNG supply chains and environmental sustainability efforts.

https://bnnbreaking.com/breaking-news/energy/cheniere-energy-negotiates-lng-supply-deal-with-malaysias-petronas-amid-expansion-plans

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In 2023, the US maintained its position as the largest supplier of LNG to Europe (EU-27 and the UK), supplying nearly half of the total LNG imports, according to data from CEDIGAZ. This marks the third consecutive year that the US has led in LNG supply to Europe, accounting for 27% (2.4 bcfd) of total European LNG imports in 2021, 44% (6.5 bcfd) in 2022, and 48% (7.1 bcfd) in 2023.

Following the US, Qatar and Russia remained the second and third largest LNG suppliers to Europe in 2023. Qatar contributed 14% (2.0 bcfd), while Russia contributed 13% (1.8 bcfd). Combined, the US, Qatar, and Russia supplied three-quarters of Europe’s LNG imports in both 2022 and 2023.

Europe’s LNG import capacity (regasification capacity) is projected to expand to 29.3 bcfd in 2024, marking an increase of over one-third compared with 2021. This growth, reported by the International Group of Liquefied Natural Gas Importers (GIIGNL) and trade press, has been accelerated by the full-scale invasion of Ukraine by Russia in February 2022. The invasion prompted European countries to reduce imports of natural gas from Russia via pipeline, leading to the reactivation of previously dormant regasification projects and the initiation of new ones.

Germany is leading the expansion in LNG regasification capacity in Europe, with developers adding 1.8 bcfd in 2023 and plans to add 1.6 bcfd in 2024. Additionally, in 2022 and 2023, the Netherlands, Spain, Italy, Finland, and France collectively increased their regasification capacity by 3.2 bcfd. In 2024, Belgium, Greece, Poland, the Netherlands, and Cyprus are expected to add a combined 1.8 bcfd of new capacity.

Despite an estimated 4.2 bcfd increase in regasification capacity, Europe’s LNG imports averaged 14.7 bcfd in 2023, remaining relatively unchanged from 2022. This stability was influenced by mild winter weather in the Northern Hemisphere during 2022–23, which reduced heating demand and resulted in record-high natural gas storage levels in Europe.

From June 2022 to April 2023, Europe experienced peak LNG imports, reaching 18.1 bcfd. However, imports declined in subsequent months due to full storage inventories, high international LNG prices, and energy conservation measures that significantly reduced natural gas consumption.

In 2023, France, Spain, the Netherlands, and the UK combined accounted for almost two-thirds (9.3 bcfd) of Europe’s total LNG imports. Germany imported its first LNG in January 2023 and ended the year accounting for 4% (0.6 bcfd) of Europe’s total imports. The US supplied more than 80% of Germany’s LNG imports.

https://www.ogj.com/general-interest/economics-markets/article/14305969/us-remained-largest-lng-supplier-to-europe-in-2023

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TotalEnergies has entered into a long-term SPA with Sembcorp Fuels for the supply of LNG. 

The agreement, which will commence in 2027, involves the delivery of up to 0.8 million tonnes per annum of LNG to the subsidiary of Singapore-based Sembcorp Industries (Sembcorp) over a period of 16 years. 

TotalEnergies said the LNG will be sourced from its global portfolio.  

This SPA builds upon an existing LNG purchase agreement between the two companies that was signed in 2022, and will continue until 2029.  

Announcing the deal, Sembcorp said: “The SPA diversifies Sembcorp’s existing natural gas supply from piped and liquefied sources globally. As Singapore’s leading natural gas importer, Sembcorp is committed to supporting Singapore with a stable and resilient supply of energy in its transition towards a net-zero future.” 

TotalEnergies claims to have a market share of approximately 12% of the global LNG market, with an LNG portfolio of around 50 million tonnes per year.  

The French oil and gas major aims to expand its LNG production and long-term purchases by 50% by the year 2030.  

In line with this goal, in November 2023, the energy company signed an agreement to extend its partnership with Oman LNG, a joint venture (JV) in which TotalEnergies holds a 5.54% stake.  

At the time, TotalEnergies senior vice-president of Middle East and North Africa, exploration and production, Julien Pouget said: “We are pleased to extend our partnership with Oman LNG. This LNG contributes to our supply of Europe and Asian markets, and strengthens our integrated and flexible global portfolio, in line with TotalEnergies’ ambition to increase its LNG production and long-term purchases by 50% by 2030.” 

In the month prior, TotalEnergies secured LNG supply deals with government-backed QatarEnergy. 

The agreements, spanning 27 years, will see LNG supplied from the JV between TotalEnergies and QatarEnergy, which have interests in the North Field East and North Field South projects in Qatar. 

https://www.offshore-technology.com/news/totalenergies-sembcorp-lng-supply-deal/?cf-view

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The new sales and purchase agreement adds to the companies’ current SPA which runs until 2029, with additional volumes set to help Semcorp fuel its multi-utilities centre on Jurong Island.

https://gastopowerjournal.com/markets/item/14285-sembcorp-signs-16-year-lng-spa-with-total-to-decarbonise-operations

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Japan’s biggest power generator Jera in February agreed to buy a 15.1 per cent stake in Woodside Energy’s Scarborough project in Australia. It was the latest in a string of deals as the fallout from Russia’s invasion of Ukraine threatens to disrupt access to gas from its northern neighbour, making it more imperative to find reliable long-term supply sources.

LNG accounts for about a third of Japan’s power generation and the country is the world’s second-largest importer behind China.

It remains a key part of Japan’s energy mix even though imports fell by 8 per cent in 2023 to the lowest since 2009 as the country has increased the use of renewable energy and restarted some nuclear reactors following a complete shutdown after the Fukushima disaster in 2011.

Since 2022, Japanese LNG buyers have struck equity deals in five projects in Australia and the United States, including an exploration block. They have secured 10- to 20-year offtake contracts from those countries for more than five million metric tonnes annually, or 8 per cent of Japan’s 2023 consumption, according to a Reuters calculation, eclipsing transactions elsewhere in the world.

Political issues, including new carbon emission rules Australia introduced in mid-2023 and President Joe Biden’s freeze in January on new US LNG export licence approvals, have not dented Japan’s appetite for long-term supplies from those countries.

Kyushu Electric Power, among the top five Japanese utility companies, has said it is considering buying a stake in Energy Transfer’s Lake Charles LNG project in the US, even though it is now subject to the US licence freeze.

This would be its second direct equity stake in gas production after Australia.

“North America and Australia still have supply stability compared with other projects,” Kyushu Electric executive officer Takashi Mitsuyoshi said.

“There are some concerns about North America due to the recent (LNG) move by Biden but it, along with Australia, is an ally and that means a lot.”

Japan and the US are members of the Group of Seven (G-7) alliance of developed nations and are partners with Australia in another regional security body, the Quadrilateral Security Dialogue, also known as the Quad.

Kyushu Electric has long-term supply contracts with Australia, Indonesia and Russia, some of which are due to expire between 2027 and 2032.

Mr Mitsuyoshi said Indonesia may have limited export capacity in the future due to strong domestic demand, thanks to a growing economy.

Qatar, another Japan supplier, is ramping up production but some buyers chafe at its contracts that limit flexibility to trade cargoes, with Japan’s industry minister in 2023 calling for the elimination of the destination clause.

Since 2022, Japanese LNG buyers have increased their involvement with Oman, but on a smaller scale compared with Australia and the US, while Japanese group Inpex acquired new exploration licences in Malaysia.

Replacing Russia

LNG flows to Japan have changed over the last decade, including large declines from Indonesia, Malaysia, Qatar and Russia, as well as the US and Papua New Guinea becoming major new suppliers, according to Japan customs data.

Throughout that period, Australia has been its top supplier, although other new sources are emerging.

Canada, a G-7 member, is preparing to start its first major export facility, from which Mitsubishi Corp, a shareholder, will receive more than two million tonnes of LNG annually.

LSEG senior analyst for Japan power research Yoko Nobuoka said the importance of cooperation with allies for Japan’s energy security, including LNG, had increased on the back of the energy crisis triggered by Russia’s invasion of Ukraine.

Russia was Japan’s third-biggest LNG supplier in 2023, after Australia and Malaysia, but imports fell 10.7 per cent from 2022.

Much of Japan’s Russian LNG comes from the Sakhalin-2 project, but many of its long-term contracts are set to lapse around 2030, giving added incentive to lock in deals elsewhere.

The vast new Arctic LNG 2 project, in which Mitsui & Co and state-owned Japan Organisation for Metals and Energy Security together own 10 per cent, underscores the perils of Tokyo’s reliance on Russian gas.

Washington in November imposed sanctions on the project, prompting its operator, Novatek, to declare force majeure and leading Mitsui to record an additional provision of 13.6 billion yen (S$123.3 million).

“But G-7 members can’t cut that reliance (on Russian LNG) overnight, so that’s why they need boosted LNG supplies from allies,” said Mr David Boling, a director at consulting firm Eurasia Group, who was deputy assistant US trade representative for Japan from 2015 to 2022. REUTERS

https://www.straitstimes.com/business/japan-boosts-reliance-on-allies-australia-us-for-long-term-lng-supplies

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