NGS’ NG/LNG SNAPSHOT – March 16-31, 2022
City Gas Distribution & Auto LPG
Project of supplying piped cooking gas to houses launched in Maharashtra
The project of supplying cooking gas through pipeline has been launched in Latur city of Maharashtra’s Marathwada region by the local civic body. Maharashtra Medical Education Minister Sh. Amit Deshmukh, who is Latur’s guardian minister, on Saturday, March 19,
inaugurated the project, under which 101 houses in the city are being supplied piped cooking gas on a pilot basis. The project, which has been initiated by the Latur Municipal Corporation, is being rolled out by Ashoka Gas (Unison Enviro Pvt Ltd).
ETEnergyworld together with SAS is organising a roundtable discussion with a purpose to understand the significance of data and analytical tools in getting the optimized decisions for each of the individual business processes. A project of converting waste into energy will be started in the city, and this energy will be used for industrial purposes. Latur mayor Vikrant Gojamgunde, municipal commissioner Aman Mittal, CEO of Ashoka Gas Mukund Chandak were present at the inauguration ceremony.
700 CNG outlets likely in Nagpur district in 8 years, piped gas for industry, homes
Nagpur is likely to get 700 CNG pumps for vehicles within a span of eight years and supply of natural gas at doorsteps for industrial and domestic purposes in a year or more. Haryana City Gas (KCE) Private Ltd is all set to begin talks with consumers and commence works of laying piped gas networks across the district.
MSRDC vice-chairman and managing director Radheshyam Mopalwar had said that all districts of Vidarbha including Nagpur will get city gas distribution (CGD) networks after the completion of the pipeline. General Manager (commercial) of Haryana City Gas (KCE) Private Ltd Sh. Varun Chaturvedi said that PNGRB has issued licence to the company for CGB in the Nagpur district. Sh. Chaturvedi further stated that the plan is to develop 700 CNG pumps across the district.
The company will facilitate gas to all industries in the district. GAIL Limited has also planned to lay gas pipeline from Nagpur to Raipur to Jharsuguda in Odisha which will be an extension of the pipeline being laid from Mumbai to Nagpur.
98% of India’s population will be covered with piped cooking gas – MoPNG
More than 82% of India’s land area and 98% of the population will be covered with piped cooking gas after the latest round of expansion work, the government informed the Rajya Sabha on Monday, March 28. Bids for the expansion work will be opened on May 12 this year.
Replying to supplementary questions of members during Question Hour, Minister of Petroleum and Natural Gas Sh. Hardeep Singh Puri said once the award of bidding is done, it typically takes a certain number of years for the infrastructure to be laid.
Further, he stated that the only population that will be left will be some areas in the North East and Jammu and Kashmir because they are widely dispersed. Typically, cooking gas that comes through the pipe is cheaper and more consumer friendly than that supplied through cylinders.
Policy Matters/ Gas Pricing/ Others
Discounted LNG from Russia to cut costs of importers & users
The low Russian gas prices will allow Indian companies to ramp up inventories and cut losses caused by high spot prices over the last ten months or so. Higher spot LNG prices have led to a decline in India’s import of the commodity since January compared with
the year-ago period. However, with the war in Ukraine and economic sanctions on Russia, the price of Russian natural gas has dropped by over $10 per million metric British thermal unit (mmBtu) or about 29%, presenting a big opportunity for LNG importers and firms across sectors which use natural gas as feedstock or fuel. LNG prices are ruling at $39 per mmBtu in Asia. As against this, spot rate at Petronet LNG ‘s Dahej terminal is $35 per mmBtu in India. The cost at Dahej terminal for exchange gas is low because there are various suppliers at different prices, reducing the average price.
As against this, the Russian gas will now cost Indian buyers around $25 per mmBtu. The low Russian gas prices will allow Indian companies to ramp up inventories and cut losses caused by high spot prices over the last ten months or so. LNG terminals in Dahej and Hazira in Gujarat are underutilised after imports declined by 10.6% on year in January 2022, and over 3.2% per year in 10 months since April 2021.
GAIL India, which is the largest importer of natural gas in the country already has a long-term contract with Russia for 2.75 million metric tonnes per annum (mmtpa), which it plans to raise to 3 mmtpa soon. India received its first gas cargo from Russia’s Yamal project in October 2021.
India’s LNG imports had fallen in January due to higher international prices and a rise in domestic production. LNG imports fell 10.8% over a year ago to 2,408 million standard cubic meters in January, according to data released by the Petroleum Planning & Analysis Cell. Excluding the 1,640-mmscm imports in the pandemic-marred April 2020, it’s the lowest in 32 months.
Vedanta seeks minimum $19 for gas from the Gujarat block to cash in on surge in global energy prices
Billionaire Anil Agarwal’s Vedanta Ltd is seeking a minimum $19 price for natural gas produced from a field off Gujarat as it looks to cash in on the recent surge in global energy prices.
The firm has called for bids for the sale of 0.25 million standard cubic meters/day of gas produced from CB/OS-2 block located in Suvali, Surat district of Gujarat. Bids have been sought based on the average monthly price of Brent crude oil and Platts’ West India Marker (WIM) for liquefied natural gas (LNG) shipments.
The sale price will be lower than Platts LNG WIM + 1.0 or a premium over 16.67% average Brent crude oil price. At the current trading price of $117.68 per barrel for Brent crude oil, the floor price comes to $19.6 per million British thermal units. To this, buyers will have to bid a premium. Platts WIM closed at $32.275 per mmBtu on March 21 and if this benchmark is considered, the selling price will be $33.275.
The floor price will however be not lower than the government-administered price for gas, which currently is $2.9 per mmBtu. While Vedanta holds 40% interest in the CB-OS/2 block, ONGC has 40%. The balance of 10% is held by Tata Ptrodyne Ltd. Hindustan Oil Exploration Company (HOEC) sold 0.3 mmscmd of gas to Gujarat State Petroleum Corp (GSPC) at a price of around 22% of Brent.
PNG & CNG prices go up by Rs 1 per unit in Delhi-NCR; CNG too costs more
Indraprastha Gas Limited (IGL) has hiked the price of domestic Piped Natural Gas (PNG) in Delhi and the NCR by Rs 1 per standard cubic meter (SCM) to Rs 36.61 per unit. IGL also raised the price of Compressed Natural Gas (CNG) in Delhi by
Rs 1 per kg taking the new price to Rs 59.01/Kg. The latest hike in the new CNG & PNG price came into effect from Thursday (March 24, 2022).
Electric Mobility/ Hydrogen/ Bio- Methane
CNG retailer Indraprastha Gas launches EV battery-swapping station ‘Energy Cafe’
CNG retailer Indraprastha Gas (IGL) has partnered with Pune-based electric vehicle manufacturer Kinetic Green to launch a battery-swapping station, called Energy Cafe. The facility will replace discharged batteries of two-and three-wheeler EVs
with a fully charged one. Under the partnership, both these companies are looking to roll out a deep network of battery swapping stations, starting with the Delhi region.
Battery swapping as a concept is gaining popularity and momentum in India’s transition towards electric mobility. Under the partnership, both these companies are looking to roll out a deep network of battery swapping stations, starting with the Delhi region.
While IGL will provide the infrastructure for setting up of these swapping stations, Kinetic Green will play the role of the technology partner, provide EV Users can install Energy Cafe Mobile App on their phones to locate the nearest battery-swapping stations, book batteries from available charged batteries, pay through a digital payment gateway and swap it with a discharged battery at any of the IGL gas stations. They will have to pay for only the amount of charge they consume.
The technology addresses some of the critical concerns related to range anxiety and EV charging. Using this concept, the cost of the EVs can be almost halved and brought, not just at par, but below the price of internal combustion engine counterparts, the company noted. Further, range anxiety is eliminated as drivers can always swap their discharged battery for a charged one just like they fill fuel in their traditional ICE vehicles easily swapped manually.
Adani Total Gas enters the electric mobility infrastructure sector
Adani Total Gas Ltd, a joint venture of Adani Group and French energy giant TotalEnergies SE, has forayed into the electric mobility infrastructure sector by launching its first EV charging station in Ahmedabad.
The charging station is located at ATGL’s CNG station at Maninagar in Ahmedabad. ATGL is India’s largest private CNG and piped cooking gas distributor.
The company aims to expand its network by setting up 1,500 EV charging stations across the country and has kept an expansion plan ready to move beyond 1,500 EVCS, based on the demand generation and momentum building of the EV ecosystem in the country. It has the strategic fit to venture into electric mobility and capture a significant share of the rapidly growing EV market.
ATGL also draws its strength from the Adani Group’s inherent capacity to generate renewable power, and can further leverage group level synergies for sourcing green power. The firm has the authorisation to retail CNG to automobiles and piped natural gas to household kitchens in 19 geographical areas.
Japan’s Suzuki plans to invest $1.3 in India’s EV sector
Japanese multinational automobile company Suzuki has announced that it plans to invest an estimated 150 billion yen ($1.26 billion) to produce electric vehicles as well as batteries in India, Reuters reported.
This comes as part of a bigger plan to be announced by Japanese Prime Minister Fumio Kishida to inject a total of 5 trillion yen into India over the coming five years.
Natural Gas / Transnational Pipelines/ Others
UK: Energy giant ‘actively’ eyes plans to reopen Middlesbrough gas terminal
Energy trading giant Trafigura is actively looking at reopening a gas terminal in the north-east of England as the UK and Europe try to reduce their reliance on Russian energy. The Swiss company has had the option for years to reopen the Teesside site, but was waiting for the right market window.
After gas prices soared in recent months, the company confirmed to the PA news agency that the plans are being considered at the moment. The site started to bring gas into the UK in 2007, but its previous owner shut it down in 2015, saying it had got to the end of its commercially viable life.
Trafigura bought the rights to the site two years later. The plan could open another route for gas from the Middle East or the US into the UK, and onwards to Europe. At its height the site could bring as much as 600 million cubic feet of gas a day into the country.
This could help reduce the need for Russian natural gas, which currently heats homes and keeps heavy industry running across the continent.
The UK currently has three such sites, a significant proportion of the total across Europe. A fourth active site would help ship more gas into the UK, which could be used here or piped to mainland Europe. Spain has the highest number of LNG terminals in Europe but the country has limited pipeline connections with the rest of Europe, so it is difficult to get the gas that arrives there to Germany, which uses huge quantities of Russian gas.
Natural gas reserves in Africa, by main countries 2021
As of 2021, Nigeria concentrated most of the natural gas reserves in Africa. The country had more than 200 trillion cubic feet of natural gas reserves. Algeria and Mozambique followed, with 159 trillion cubic feet and 100 trillion cubic feet, respectively.
In the whole continent, the reserves amounted to over 625 trillion cubic feet.
Bangladesh: CNG filling stations to remain closed for 6 hours during Ramadan
CNG filling stations across the country will remain closed from 5pm to 11pm every day during the month of Ramadan, instead of 6 pm to 11 pm.
According to officials, the current gas crisis forced the authorities concerned to take the decision to keep the filling stations shut for six hours from the first day of Ramadan. The distribution companies will appoint vigilance teams to monitor whether the instruction is followed.
On September 16 last year, the government had directed the CNG filling station owners to keep their pumps shut for 4 hours from 6 pm to 10 pm every day until further order against the nagging gas crisis across the country. Later, the government issued instruction to the CNG filling stations to increase their non-operational time by one hour from March 1. In recent months, the country has been importing LNG at high prices after failing to keep gas supply in households and industries normal due to a huge gap between demand and supply.
Global LNG Development
Iran plans to propel LNG exports amid Russian-Ukraine war
Iran is planning to restore schemes to enter the LNG market and propel exports. This comes as Europe is trying to reduce dependency on Russia and could therefore potentially end sanctions on the Middle Eastern country.
Accordingly, government-owned natural oil and gas producer National Iranian Oil Co. has invited investors to submit proposals for building small LNG units.
Europe’s benchmark gas futures hit a record 345 euros a megawatt hour. The continent is on the search for alternative gas sources.
Iran has the second biggest gas reserves globally; however, entering the LNG market could be somewhat difficult as the country will need multi-billion-dollar facilities that can turn gas into a liquified form for shipment worldwide.
Eight previous Iranian LNG export schemes were hindered due to sanctions or capital constraints. The sanctions on the Islamic Republic are set to ease if the 2015 nuclear deal is restored.
Samsung, Lilama to build $1bn Vietnamese LNG-to-Power project
South Korea’s Samsung and Vietnamese contractor Lilama Corp have been awarded a $1bn engineering procurement and construction (EPC) contract for a 1,500-MW LNG-to-power project in Vietnam, Lilama said March 14.
Samsung and Lilama will build the Nhon Trach 3 and 4 gas-turbine units in the Dong Nai province, in southeast Vietnam. With each turbine due to offer 750 MW of installed capacity, the developers expect it should take 36 months to deliver the entire project.
General Electric is the main equipment supplier for Nhon Trach 3 and 4. The project is aimed at satisfying “large areas of high load power” to Ho Chi Minh City and other areas of Vietnam’s southern region. It will be Vietnam’s first regasified LNG-to-power plant once it launches, and will play a role in Hanoi’s 2050 net-zero carbon pledge to phase down coal and oil-based electricity.
Vietnam’s government said on October 8 that another 1,500 MW LNG-to-power facility is being built in Vietnam’s northern Quang Tri province. Due to launch in 2026-27, the project will receive imports via a 1.5mn metric tons/year LNG receiving and regasification terminal. Vietnamese industrial conglomerate T&T Group is putting up 40% of investment at Quang Tri, with the remainder sourced from Hanwha Energy Corp., Korea Southern Power Corp. and Korea Gas Corp.
HAM puts into operation new LNG station in northwestern Spain
HAM Group has opened an LNG service station in Salamanca, a few minutes from the N-620 and the A-62, also known as the Castilla highway, which runs from Burgos to Fuentes de Oñoro (Salamanca), on the border with Portugal, forming part of the European route E-80.
The HAM Salamanca station, designed, built and commissioned by HAM Criogénica, has a 60m3 tank, with a submerged pump for LNG and two innovative LNG refueling points for trucks and heavy vehicles. In addition, it will offer CNG refueling soon. Opening hours are 24/7 throughout the year, it is freely accessible and payments can be made easily from the payment terminal, which accepts all types of debit and credit cards and the HAM card for professionals.
The new facility is remotely monitored to guarantee its correct operation and offers the possibility of contacting the 24-hour Technical Assistance Service to resolve any incident. It also has an automatic extinguishing system and video surveillance. With this new opening, HAM’s natural gas refueling network continues to grow, with more than 90 stations, on the main routes in Spain and Europe.
Australia: ExxonMobil (XOM) to Invest $291M for Gippsland Gas Output Hike
Exxon Mobil Corporation’s XOM Australia-based subsidiary, Esso Australia Pty Ltd., reached a final investment decision to increase natural gas production from the Gippsland Basin Kipper field in southeastern Australia.
The move is part of ExxonMobil’s attempt to address the potential shortages in the supply of domestic natural gas. The Gippsland Basin Kipper field is operated by the Gippsland Basin Joint Venture (JV). Notably, Esso Australia operates the JV, with a 50% ownership interest.
The Gippsland Basin Kipper field is estimated to produce 30 petajoules (PJ) in 2023. ExxonMobil will invest $291 million to produce an additional 200 PJ of natural gas in the next five years. The company did not provide any details on the type of field development activities that will take place.
The Gippsland Basin has been a major supplier to Australia’s east coast domestic market. However, Australian regulators have cautioned that eastern Australia could see a natural gas shortage from 2026, as the maturing gas fields in the basin are drying up. This is driving the demand for liquefied natural gas (LNG) imports. Additional production from the Gippsland Basin will be developed ahead of five proposed LNG import terminals, looking to serve the same market. One of the terminals has started preliminary construction activities.
ExxonMobil’s investment to increase Gippsland gas production will ensure reliable and affordable gas supply to Australia homes and businesses. The company is proceeding with funding decisions to commence production from the Turrum field offshore Victoria. There is an adequate amount of gas remaining there and ExxonMobil is working to unlock its full value.
Indonesian Tycoon’s Firm to spend $500 Million on Canada LNG
An energy company backed by Indonesian tycoon Sukanto Tanoto plans to spend $500 million this year on a long-planned liquefied natural gas project in Canada, the clearest signal yet that it may move ahead with an LNG export facility on the country’s west coast.
Woodfibre LNG, backed by Tanoto’s Pacific Energy Corp., has yet to formally announce an investment decision. But Woodfibre President Christine Kennedy gave the spending details to local government officials in Squamish, British Columbia, on Tuesday. The $500 million figure is 31% of the expected $1.6 billion total cost of the project.
Woodfibre’s plan follows Shell Plc’s decision to build the much-larger C$40 billion ($31.8 billion) LNG Canada project in Kitimat, British Columbia, which is 60% complete and scheduled to start operating by the middle of the decade. Woodfibre is licensed to export about 2.1 million metric tons a year of gas chilled to a liquid so it can be shipped to faraway destinations on special tankers.
The decision to boost spending comes as European countries scramble to find alternatives to Russian gas and cut the continent’s dependence on the energy-producing giant following Vladimir Putin’s invasion of Ukraine.
Estonia considering helping to build an LNG terminal
Feeling the need to ensure Estonian energy independence, the Estonian government has stated to look into the options of building or investing in the construction of a liquefied natural gas (LNG) terminal, Estonian public broadcaster ERR reports.
At the Estonian electricity and gas grid operator Elering, its CEO Taavi Veskimägi, has said that an LNG terminal can only be built once Estonia has decided to stop importing Russian natural gas, which has not happened.
Recently, the EU decided to set a deadline of 2027 for achieving independence from Russian energy sources. Estonian Minister of Economic Affairs and Infrastructure Taavi Aas has cautioned that Russia may respond by ending the sale of natural gas to Europe. Aas has also submitted a proposal to the Estonian government in mid-March suggesting building a temporary LNG terminal in the northern port town of Paldiski. «This area is already essentially terminal-ready as such,» Aas highlighted, noting that fuel retail chain Alexela had already completed a significant amount of preliminary work in that regard. The firm has announced that it has offered the Estonian government a specific way of fully divesting from Russian gas for the 2022-2023 heating season and additionally allowing Finland to join the boycott, ERR reports.
Technological Development for Cleaner and Greener Environment Hydrogen & Bio-Methane
Duque unveils the first car fuelled by green hydrogen produced in Colombia, SA
Six months after the announcement of the Hydrogen Roadmap, Colombia launched the first electrolyzer in the country, located in Ecopetrol’s Cartagena Refinery, and which strengthens the energy transition developed by
the national government. There, President Iván Duque refuel with this ecological energy and drove a Mirai vehicle, supplied by Toyota. The refueling station was provided by Linde. The country’s first project that injects hydrogen into the natural gas network was also put into operation by Promigas.
Today the first car with green hydrogen produced by Ecopetrol is rolling in the most modern refinery in Latin America. The most convincing fact is that the country ratifies that “on March 18, Ecopetrol has just installed this first electrolyzer.
The president also affirmed that Colombia will be a power in the production and export of green hydrogen. In addition, he commented that the difficult situation in Europe and the world due to Russia’s invasion of Ukraine also motivates the adoption of alternatives. “Europe will not be able to continue to glimpse its future depending on gas from Russia. And they know that they have to diversify and look for reliable, safe sources, but above all green, clean in terms of emissions; and that also allow them to generate the transition,” he concluded.
Brazil launches measures to produce biomethane to power heavy vehicles
President Jair Bolsonaro attended the launch ceremony of the incentive measures aimed at the production and sustainable use of biomethane. The renewable fuel is obtained by purifying biogas, and may replace natural gas, diesel, and
gasoline. After an interview in the garden of the Alvorada presidential residence, Bolsonaro drove a New Holland biomethane-powered tractor to the Planato Palace, reported Agencia Brasil.
Brazil’s Environment Minister Joaquim Leite signed a decree creating the National Program for the Reduction of Methane Emissions, also known as Metano Zero (Zero Methane), which should help make progress in the generation and use of biomethane derived from urban and rural waste. Minister of Mines and Energy Bento Albuquerque signed a decree including investments in biomethane under the country’s Special Regime of Incentives for Infrastructure Development (REIDI), and exempting new projects from PIS/Cofins taxes for the acquisition of machinery, construction materials, and equipment.
According to the federal government, the inclusion of biomethane should enable the construction of new plants producing the fuel, increasing supply and the installation of green corridors for heavy vehicles, impacting the reduction of greenhouse gas emissions. The total investment planned is upwards of BRL 7 billion, generating at least 6,500 jobs in the construction and operation of the new units. The goal is to build 25 new plants across six states.