NGS’ NG/LNG SNAPSHOT – JANUARY 2020, VOLUME 1

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City Gas Distribution & Auto LPG

The CNG power for Goan car owners

With the commissioning of the state’s first CNG fuelling station at West Coast petrol pump, old Goa, CNG powered vehicles running on non-polluting, clean fuel is finally a reality, reports Shoma Patnaik. There could be lesser vehicular pollution on Goan roads in 2020,  

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with the state’s first Compressed Natural Gas (CNG) fuelling station at West Coast petrol pump, Old Goa, up and running for a month now. After a long wait CNG fuel is at last an option for motorists paving the way for cleaner breathing air to road users. The response to the fuel is good as automobile owners are steadily lining up to purchase CNG, according to Shamsundar Kamat, owner, West Coast petrol pump, who says that, the retail price of CNG in the state is fixed at Rs 55.50 paise per kg and about 400-500 kg of the fuel is being sold daily. He says that, most of the vehicles are from other states, viz. drive-in tourists from Gujarat, Pune and Mumbai. “Tourist vehicle owners are pleased that the state has CNG re-filling infrastructure.  There are very few Goan vehicle owners who drive CNG-powered vehicles,” reveals s Kamat. He adds that, about 10-15 vehicles come in daily for refills albeit all with non- Goa registration plates. The CNG arrives in caskets presently from Madkai and is supplied by Goa Natural Gas (GNGPL), the joint venture company of GAIL and BPCL that is mandated with the task of distributing piped cooking gas and CNG to north Goa district  and currently in the process of laying pipelines. Recently the state government okayed the allocation of  land in Marcaim, Ponda, to GNGPL for construction of a city-gate station.  Post construction of the station, GNPL will construct a pipeline to transport CNG. “The pipeline will help us to add more CNG filling stations and expand the number of retail outlets,’ said Ajay Kumar Jindal, chief executive officer, GNGPL. Goa becomes one more state with access to CNG and be a part of the Indian CNG programme.

http://www.navhindtimes.in/the-cng-power-for-goan-car-owners/

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Pradhan unveils India’s first CNG bus which can run 1,000 Km in one fill

Mahindra & Mahindra along with Agility Fuel Solutions of USA have partnered with IGL for introducing the new concept of light weight Type IV composite cylinders in buses. Oil minister Dharmendra Pradhan today unveiled India’s first long distance

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Compressed Natural Gas (CNG) bus fitted with composite CNG cylinders, which can travel around 1,000 kilometre in a single fill. The project has been executed by Indraprastha Gas Limited (IGL) and has been achieved through design of Type IV Composite Cylinders in buses, replacing traditional very heavy Type-I Carbon Steel cylinders, the oil ministry said. Mahindra & Mahindra along with Agility Fuel Solutions of USA have partnered with IGL for introducing the new concept of light weight Type IV composite cylinders in buses. IGL has procured five Mahindra’s Type IV buses. The Buses would be given to Uttarakhand Transport Corporation (UTC) on lease basis after the launch. These will ply on Inter-city routes from Delhi to Dehradun and will be the first CNG Buses in Uttarakhand. These cylinders are 70 per cent lighter than the Type-I all steel cylinders which are used in India currently. Due to light weight, the number of cylinders can be increased in the vehicle, creating more storage capacity on-board. The buses which used to carry only 80-100 Kg of CNG with steel cylinders can carry 225-275 Kg of CNG with new composite cylinders, resulting in higher range. Buses fitted with Type IV Composite cylinders have a running range of 800- 1000 KM per fill of CNG. The government wants to begin door-to-door delivery of petrol, CNG and Liquefied Natural Gas (LNG).

https://energy.economictimes.indiatimes.com/news/oil-and-gas/pradhan-unveils-indias-first-cng-bus-which-can-run-1000-km-in-one-fill/72958476

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Chennai: Green nod for IOC’s gas supply pipeline project

In a step towards ensuring piped natural gas supply to residents and industries in and around Chennai, the Union government’s Expert Appraisal Committee (EAC) has approved Indian Oil Corporation’s Ennore-Kancheepuram underground pipeline project.

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The 120km pipeline will act as a feeder line for the upcoming city gas grid distribution (CGD) project, which aims at replacing LPG cylinders with piped natural gas (CNG) supply. Till GCD becomes a reality, bulk supply to industries, which depend on natural gas, will be the primary role of IOC pipelines. As more and more industries are shifting to natural gas from conventional sources like coal, demand for piped supply is witnessing a spike. Earlier this year, IOC started operations along Ennore-Manali pipeline project. Industries like Chennai Petroleum Corporation Limited, Madras Fertilizers Limited and Tamil Nadu Petroproducts Limited have started receiving gas through these pipes, said an IOC official. “The nod for Chennai-Kancheepuram project, costing Rs 849 crores, indicates that adequate supply will soon be ensured to similar industries surrounding Chennai,” he said.

https://timesofindia.indiatimes.com/city/chennai/green-nod-for-iocs-gas-supply-pipeline-project/articleshow/72961335.cms[Edited]

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Green shoots: City gas infrastructure will drive capex, credit demand

The last of a three-part series on credit pick-up looks at how the push for city gas is creating demand for development of overall gas infrastructure. City gas distribution (CGD), or the distribution of natural gas to consumers through a network of pipelines, is progressing by leaps and bounds.

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With the last two bidding rounds for CGD licences, nearly 70% of the country’s population has been covered. And this is translating into credit demand for the country’s banking system. Currently, state-run oil companies dominate India’s CGD segment, although conglomerates like the Adani Group are also stepping up their presence in it. According to industry experts, banks find it comfortable to lend to this sector owing to its strong borrower profile. Bharat Petroleum Corporation (BPCL), Hindustan Petroleum Corporation (HPCL), GAIL, Torrent Power, Indian Oil Corporation and Adani Gas were some of the companies who won licences in the 10th round.  “Given that most of the CGD projects are being executed by state-run oil companies or large corporate groups, banks are comfortable in funding these projects,” said Debasish Mishra, partner at Deloitte Touche Tohmatsu. The push for city gas is also creating a greater demand for the development of an overall gas infrastructure. According to one estimate, the country will see investments to the tune of around $60 billion for a natural gas infrastructure — including pipelines and import terminals — by 2024. “With the recent change in policy, there is a push for creating a gas infrastructure. After the two recent rounds, there is a huge demand for services in city gas, CNG and PNG-related equipment, pipeline and also LNG segment,” said BC Tripathi, former chairman of GAIL. He added that the government should consider banning pet-coke and furnace oil to boost the segment further. In terms of infrastructure, the two rounds are set to add 35,59,8324 km of piped natural gas connections and 7,205 compressed natural gas stations by March 31, 2029. What’s more, 156,178 inch-km of steel pipelines are likely to be part of this infrastructure. While the banking industry is hopeful that India’s gas infrastructure business will fuel credit growth, some analysts have raised concerns over the aggressive bids that firms placed for certain licences in the last two rounds. Others opine that the large size of the projects will help minimize risks. “These are infrastructure projects, where the investment is upfront, but cash flows are much superior. Given that by and large, there is a pass through for the cost of raw material, we do not see an issue,” said an analyst with a domestic brokerage firm, who did not wish to be identified. The thrust on the CGD business is also well-timed since this is the fag-end of investments in refinery upgrades. “Reliance Industries’ capital expenditure is now over. Similarly, investments to upgrade refineries for meeting BS-VI standards are also behind us. So CGD is now likely to drive capex in the oil and gas sector,” said the analyst quoted earlier. Tripathi hopes that there will be a retail gas revolution in the country. But though city gas and retailing is expected to drive demand from the oil and gas segment, the quantum of investments is expected to remain modest. “At best, these CGD projects would need Rs 10,000 to Rs 20,000 crore investments every year for the next five years,” said the analyst.

https://www.business-standard.com/article/economy-policy/green-shoots-city-gas-infrastructure-will-drive-capex-credit-demand-119121701733_1.html

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Patna to get 30 CNG buses by March next year

The Bihar State Road Transport Corporation (BSRTC) has decided to introduce 30 new compressed natural gas (CNG) buses in the city from March 2020 and convert the 100 existing diesel-driven buses into CNG by the end of next year.

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The BSRTC has initiated the bidding process for procuring 200 new AC and non-AC buses, including 30 CNG buses. “The initiative has been taken to curb pollution in the city. The state government has decided to ban all diesel-based autorickshaws after March 31, 2021,” said transport secretary Sanjay Kumar Agarwal, adding that CNG is not only an ecofriendly fuel, but cheap as well. While diesel and petrol are sold at Rs 71.45 and Rs 79.64 per litre respectively, the cost of one kilogram of CNG is just Rs 63.47 in Patna. “Maintenance cost of CNG vehicles running is also less when compared to diesel and petrol vehicles. The system in which CNG fuel is sealed doesn’t usually leak. Hence, it is safer too,” a transport department official said. There are, however, only three CNG fuelling stations in the city. The transport department official said the number of CNG stations in the city would be increases to 10 by March next year. “Talks in this regard are on with Gas Authority of India Limited (GAIL),” he added. GAIL deputy general manager Rajnish Kumar said the city will get two new CNG stations soon. “The city already has CNG stations at three places – Rukanpura, Zero Mile and Patna-Bakhtiyarpur NH-30 toll plaza. Another CNG station will come up at Saguna Mor by the end of this month. Work on developing a CNG station at Naubatpur will commence in the first week of January,” he added.

https://timesofindia.indiatimes.com/city/patna/city-to-get-30-cng-buses-by-march-next-year/articleshowprint/72891518.cms

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Exempt LPG & CNG autos from getting permits: Unions to govt

The unions feel that the exemption will not only lessen financial burden but also bring down pollution levels in the city. After the Centre’s move to exempt electric vehicles from the need for passenger transport permit, auto unions across

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the state are urging the government to implement the same for LPG and CNG autos. The Centre has provided several benefits to electric vehicles such as waiver of parking fee, toll charges, priority parking etc. The unions feel that the exemption will not only lessen financial burden but also bring down pollution levels in the city. “LPG and CNG autos should also be exempted from the permit rule since they do not cause pollution. The move will be of great help if the government provides us the same benefits which were provided to electric vehicles,” said Mohammad Umar Khan, working president of the Autorickshaw Drivers Union. Telangana Auto and Motor Welfare Union general secretary M Dayanand said, “The auto drivers spend Rs 3 lakh to purchase autos and another Rs 1 lakh for permit. Apart from exemption of permits, CNG and LPG autos should also be given other benefits such as parking fee waiver, toll fee waiver etc.”

https://energy.economictimes.indiatimes.com/news/oil-and-gas/exempt-lpg-cng-autos-from-getting-permits-unions-to-govt/72932038

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‘Fastest-growing’ MNGL faces hurdle in ensuring last mile connectivity

Lack of last mile connectivity is a major issue plaguing the Pune-based Maharashtra Natural Gas Limited (MNGL), which has earned the tag of the fastest growing city gas distribution company from the Federation of Indian Petroleum Industry.

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The company said it was receiving a majority of the complaints pertaining to non-provision of connection despite requests and lack of last mile connectivity, among others. Even in terms of CNG stations, the utility is still catching up with the demand even as it added 20 new CNG stations last year and plans to add 24 more this year. MNGL officials said 3,096 connection requests were pending with the company. “There are challenges in terms of right of way, permissions and restoration charges. We have requested Pimpri Chinchwad Municipal Corporation (PCMC) to bring down the restoration charges in line with that of Pune Municipal Corporation (PMC). Also, an extended monsoon till mid-November has not helped us this year,” Supriyo Haldar, managing director, MNGL, said on Thursday (Dec26). He added that the company aimed at providing 90,000 new piped gas connections in one year. Even in defence areas, the utility is struggling to find a right of way. “If they (defence authorities) allow us, it will benefit all and we will also pay rent,” a senior MNGL official said. There are at least a dozen places in the city where the area has been gasified but awaits last mile connectivity due to want of one or several of permissions. In terms of households, the Pune-based company has a coverage of less than 20%. As for CNG stations, the company is also looking to add 24 new units in the city in addition to the existing 79. About 2.50 lakh vehicles in the city run on CNG, translating into one station for over 3,100 vehicles. Yet there are queues at many a stations because of the time taken for a CNG refill works out to be more.

https://timesofindia.indiatimes.com/business/india-business/fastest-growing-mngl-faces-hurdle-in-ensuring-last-mile-connectivity/articleshow/72986642.cms

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Gujarat gas Limited’s rating upgraded to ‘CRISIL AA+/Stable

RISIL has upgraded its rating on the long-term bank facilities of Gujarat Gas Limited (GGL) to ‘CRISIL AA+/Stable’ from ‘CRISIL AA / Positive’. The upgrade reflects CRISIL’s expectations of an improvement in GGL’s credit profile over the medium term.

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Sustainable improvement in cash accruals is expected to improve GGL’s financial risk profile notwithstanding the sizeable capital expenditure (capex) programme. GGL has reported a healthy growth in operating profit led by higher gas sales volumes and benign cost of re-gasified liquefied natural gas (R-LNG), in the first half of fiscal 2020. The volume growth was mainly driven by higher gas sales in the Morbi industrial area. In March 2019, the National Green Tribunal (NGT)’s order of banning the use of coal gasifiers in Morbi (Gujarat) region led to migration of industrial customers, mainly ceramic tile manufacturers, to piped natural gas from coal. Commercialization of new geographical areas (GAs) will further support the volume growth. GGL has annual capex plan of Rs 700-800 crore, to be largely funded through internal accruals. GGL has received the authorization to set up city gas distribution (CGD) network in 7 new GAs won under the Round 9 and Round 10 bid conducted by the Petroleum and Natural Gas Regulatory Board (PNGRB). Further, it plans to expand the network within existing GAs as well. The project risk on account of sizeable capex and newer geographies is partially mitigated by GGL’s long standing experience in CGD business. The rating continues to reflect the company’s sizeable scale of operations as the largest CGD entity in India, its healthy financial risk profile and stable profitability levels. These strengths are partially offset by its exposure to volatility in R-LNG and domestic natural gas prices and exposure to regulatory risks.

https://www.equitybulls.com/admin/news2006/news_det.asp?id=260384

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Electric Mobility

Electric 3-wheeler market hots up as cos look at alternate mobility

Chennai: The electric three-wheeler market is suddenly red hot right now as a host of technology startups and vehicle manufacturers look to enter alternative mobility. First, Chetan Maini co-founded Sun Mobility announced its tie-up with Piaggio to launch electric

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Ape three wheeler variants on their swappable battery architecture. Now Bengaluru-based Altigreen is all set to roll out cargo and passenger three-wheelers based on their own patented drivetrain platform through ‘multiple’ OEM partnerships. While Amitabh Saran, CEO, Altigreen Propulsion Labs is tightlipped, industry sources say tie-up talks are on with the likes of Bajaj Auto, Scooters India and Lohia Auto. Meanwhile OEMs like Lohia Auto say three-wheelers — including those on the Altigreen platform — will be their focus area for an electric mobility play. Altigreen, said Saran, is currently getting product type approvals from ARAI and the three wheelers, both cargo and passenger, should hit the market by February-March. “Commercial vehicle category becomes obvious choice for electrification because this segment is driven by rupee per kilometre. But the customer needs rugged variants for last mile connectivity which can match petrol, diesel, CNG versions in terms of price and performance,” he added. Mobility experts expect India’s roughly 8 lakh strong domestic three wheeler market to move to electric in the next decade. “Internal combustion version will continue to be manufactured for export market which is a good 40% of the total three wheeler sales in India,” said Ayush Lohia, CEO, Lohia Auto Industries.

https://auto.economictimes.indiatimes.com/news/commercial-vehicle/lcv/electric-3-wheeler-market-hots-up-as-cos-look-at-alternate-mobility/72988040

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This start-up can convert any fuel-powered scooter to an electric scooter

The recent air pollution crisis in the capital city caused an inevitable hullabaloo in the region leading to the announcement of a public health emergency by the government. The clamour to tackle air pollution in India and across the world largely center

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around getting more electric vehicles on our roads and limit the use of vehicles powered by internal combustion. However, a rapid transition to electric vehicles in a country of 1.3 billion people is not a feasible option. The move is likely to cause a huge dent in the automotive industry and will leave massive amounts of vehicle waste. Seeking an easier solution to accelerate adoption of electric vehicles with comparatively lower consequences, Rakesh Meladath Karunakaran along with his wife Winnie Gangadharan formed Meladath Auto Components in 2016, which can convert your regular petrol scooter into an electric hybrid scooter. We are in an era where most mobility solutions are driven by fossil fuel, be it petrol or diesel. With the world looking at alternative fuels, electric vehicles are often considered the panacea. “The problem is not in adapting the electric mobility solution. The issue would be what to do with the existing mobility solutions running on fossil fuels on the roads today,” Karunakaran told ET. The 39-year-old former Mahindra and Mahindra employee believes that migrating to e-mobility solutions will lead to the challenge of vehicle waste management. Despite a slowdown, according to a report by the Society of Indian Automobile Manufacturers (SIAM), the first nine months of FY 2019 showed a 5% growth year-on-year among premium scooter sales at 49,80,326 units. “Promoting EV sales with subsidies will also add to the other problem like increasing vehicle density on road without removing the existing vehicles. This will put tremendous pressure on the limited infrastructure and existing problem of traffic congestion,” he explained. Bengaluru-based Meladath’s e-kit is a retrofitable conversion kit for petrol scooters. The kit, once fitted in a petrol scooter, turns the vehicle into an electric hybrid scooter. As the name says ‘hybrid’, the scooter can be driven in both- electric and petrol mode selectively. Karunakaran explained that in electric mode, after one charge, the scooter can be driven upto 40 kms after which the rider can switch to the petrol mode. The kit is universal and can be suited for most scooters with 10-inch and 12-inch steel wheel. It includes a removable lithium battery which can be charged with domestic power socket or regular power plugs, therefore, preventing the need of a charging station or a charging port near vehicle parking. According to the entrepreneur, the idea will have a significant impact towards a healthier environment. The idea has the potential to help achieve 15% reduction in Greenhouse gases (GHG) emissions, which will further enable the target achievement of Indian Government by 2020. Karunkaran said that the firm is now looking to deploy a pure electric scooter, which will be a Made in India product, as it is being built with ingenious power-train components such as Brushless DC (BLDC) electric motor, BLDC Motor controller, lithium battery pack, lithium battery charger and throttle.

Source: ET Auto [Edited]

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DAO EVTech will invest USD 100 million in India

The company is already in advanced discussion with Andhra Pradesh government for setting up a manufacturing facility near Vishakhapatnam. It will initially be used to manufacture components for electric vehicles. The company also confirmed that the new facility will create over 2,000 direct jobs.

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In addition to it, it will also sell electric vehicles to retail consumers and commercial enterprises. At first, DAO EVTech will also initially start production of electric vehicles in collaboration with a third-party manufacturing unit near Miyapur in Hyderabad. This facility has the potential of producing up to 1 lakh units per annum.

DAO EVTech has been in the electric two-wheeler business for two and a half decades. The first product is the Dao GT, an electric scooter powered by a 1.5 kW motor and 72-volt lithium-ion battery with support for fast charging. The GT provides three riding modes, Economy at the top speed of 38 km/h, Sports at the top speed of 45 km/h and Turbo at the top speed of 49 km/h and offers a range of 120 km on a single charge. It takes 3 to 4 hours for a full charge. DAO EVTech is planning to launch the GT electric scooter in Hyderabad, India by February 2020 and later in remaining cities. The company not yet reveals the pricing details for the electric scooter.

Source: electricvehicles.in

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Bhagirathi Sustainability India to promote EVs

EESL has signed an MoU (Memorandum of Understanding) with Bhagirathi Sustainability India Pvt Ltd to explore the possibilities of encouraging electric vehicles in India. With this partnership, EESL sets out to deploy around 250 EVs and fast-track the adoption of e-mobility

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within private and government agencies across India. It will start with Telangana, Karnataka and Andhra Pradesh. Currently, Bhagirathi Sustainability India is operating a fleet of around 131 EVs in India. In 2016, in order to help in reducing greenhouse gas emissions transportation solutions company Bhagirathi Group ventured into electric cars. Under EESL’s EV program, a total of 1,510 electric cars have been deployed till date and another 500 cars are under registration. EESL has also signed agreements with various public sector undertakings, government departments, and state governments of Delhi, Haryana, Jharkhand, Madhya Pradesh, Uttar Pradesh, Andhra Pradesh, Maharashtra, Telangana, Andaman and Nicobar Islands, Gujarat, Orissa, Chhattisgarh, Kerala and others for deploying electric cars. EESL has also been working towards strengthening the charging infrastructure. Till now, 65 public charging stations (PCSs) abide by DC-001 (15kW) have been commissioned in Delhi. Besides these PCSs, EESL has also installed a total number of 470 captive chargers, out of which 170 are DC-001 fast chargers and 300 are AC-001 chargers.

With an aim to set up at least 10,000 charging stations in the next 2-3 years across India, EESL has signed the agreement with various urban local bodies and other organizations for setting up public charging infrastructure across India.

Source: electricvehicles.in

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First battery-electric San Diego MTS bus now serving passengers

The start of service also marks the start of a two-year electric bus pilot program announced earlier this fall.

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MTS TWITTER

The San Diego Metropolitan Transit System (MTS) has announced the first of six battery-electric buses began serving passengers Dec. 16, setting in motion the two-year electric bus pilot program that was first announced earlier this fall. The first trip departed the 24th Street Transit Center in National City, serving passengers of Route 13 to Kaiser Hospital. The launch of passenger service follows several weeks of route validation and bus operator training on multiple routes around San Diego. “Our new electric buses represent a strong step forward to a greener, cleaner and better-connected transit system in San Diego,” said San Diego County Supervisor Nathan Fletcher, who is also chairman of MTS and serves on the California Air Resources Board. “I’m proud to be part of an organization that is taking new technologies that push us towards a greener future.” MTS’s existing fleet of 40- and 60-foot fixed route buses is fueled by compressed natural gas (CNG). State regulations require public transit agencies to gradually transition to all-ZEB fleets by 2040. MTS is preparing for that mandate by initiating this pilot program, which allows MTS staff to analyze vehicle performance under various conditions and train drivers on the most efficient driving habits. The electric buses have an average estimated range of 150 miles per charge. Range is dependent on many factors, including driving characteristics, weather, topography and more. Many MTS bus routes are 150 miles or less, making them appropriate for this pilot program. MTS is currently planning to begin pilot testing on Routes 1, 2, 4, 10, 13, 815, 905 and 936, though the test routes may change and expand during the pilot program. After 18 months of testing and modeling, MTS says it will have an accurate and holistic picture of the operational realities to present to the MTS Board as the agency develops a road map to transition to a full zero-emissions fleet. MTS already operates 128 zero-emissions trolleys serving the region’s riders every day. For its bus fleet, MTS was among the first transit agencies to convert to CNG fuel, deploy near-zero emission engines and purchase 100 percent renewable biogas. The board-approved budget for the pilot program is $12.5 million, including a combination of bus and infrastructure costs, and design/consulting/project management expenses. This pilot program is funded by the combination of a Caltrans grant, California Air Resources Board offsets, funding from the state’s Low Carbon Transit Operations Program and its Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project, as well as the MTS Capital Improvement Program.

https://www.masstransitmag.com/bus/vehicles/hybrid-hydrogen-electric-vehicles/press-release/21118665/mts-metropolitan-transit-system-san-diego-first-batteryelectric-san-diego-mts-bus-now-serving-passengers

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Gas/ Pipelines/ Company News

Bhatinda-Jammu-Srinagar gas pipeline project is nobody’s baby

Incredible it may sound but it is a fact that Bhatinda-Jammu-Srinagar gas pipeline project, which was announced with much fanfare over eight years back, is nobody’s baby with all the concerned officers fanning ignorance about the progress even after amendment to the Jammu and

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Kashmir Underground Public Utilities (Acquisition of Rights of User in Land) Act by the State Administrative Council (SAC). Official sources told EXCELSIOR that the Petroleum and Natural Gas Regulatory Board (PNGRB) on July 7, 2011 had authorized GSPL, a subsidiary of the Gujarat Government to lay Bhatinda-Jammu-Srinagar gas pipeline to ensure gas supply for industrial, commercial and domestic use in Jammu and Kashmir. Subsequently, PNGRB transferred the authorization in favour of GSPL India Gasnet Limited-a consortium comprising of GSPL, Indian Oil Corporation, Bharat Petroleum Corporation Limited and Hindustan Petroleum Corpo-ration Limited. The gas pipeline was to be laid through the districts of Kathua, Samba, Jammu, Udhampur, Ramban, Anantnag and Srinagar and the original completion date for laying 725 kilometre long pipeline was July 6, 2014. In order to facilitate acquisition of land for the project the then Governor of the erstwhile State of Jammu and Kashmir had even issued an Ordinance in June 2013. Though land acquisition process was started in Kathua and Samba districts but the same could not reach the logical conclusion and even after eight years of fanfare announcement the project, which could have pushed uninterrupted supply of gas to the consumers in landlocked Jammu and Kashmir, has seen no major headway mainly due to the official apathy, sources said. “There is no discernible progress despite the fact that on November 28, 2018 the State Administrative Council headed by the then Governor of the erstwhile State of Jammu and Kashmir Satya Pal Malik approved amendments to the Jammu and Kashmir Underground Public Utilities (Acquisition of Rights to User in Land) Act, 2014 to increase the time line for completing the gas project”, sources said.
A Law Officer of the Food, Civil Supplies and Consumer Affairs Department, who was dealing with the subject, when contacted, said, “all I know is that a Memorandum of Understanding was signed between GSPL and J&K Government and Jammu division administration might be aware of the developments on the ground”.  Divisional Commissioner Jammu, Sanjeev Verma, when contacted, too could not give details about the progress made on the project. Similarly, Samba and Kathua district administration too fanned ignorance about the execution of the project. All this clearly indicates that gas pipeline project is nobody’s priority and no serious efforts are being made by all the concerned authorities to regularly chase the same with GSPL and at other appropriate forums. Such a non-serious approach of all the concerned authorities is notwithstanding the fact that State Administrative Council had observed: “In today’s world, natural gas is the cleanest form of energy and is a non-pollutant. It is extremely useful both for heating and cooking purposes. However, Jammu and Kashmir is one of the few States (presently UT), which don’t have a gas pipeline as such is yet to be connected with National Gas Grid”. Even Jammu and Kashmir High Court is seized of the issue and has already passed directions seeking the reasons behind inordinate delay in completion of the project. In a recent hearing in a connecting matter in the Srinagar Wing of the High Court, the amicus curiae had submitted that Government of India has already sanctioned ten thousand crore rupees for laying of gas pipeline from Bathinda to Srinagar but it is only the failure of the Government that the funds are not utilized and project has remained incomplete.

https://www.dailyexcelsior.com/bhatinda-jammu-srinagar-gas-pipeline-project-is-nobodys-baby/

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Gail’s 444 km natural gas pipeline in the fast lane in Karnataka and Kerala

Pipeline up to Kozhikode to be commissioned in February; Mangaluru line in March 2020; work on remaining 2.5km stretch in progress across five rivers. While work on the Indian Oil Corporation Ltd’s LPG Import Terminal began on Monday after two years,

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another key project, Gas Authority of India Ltd’s (Gail)’s `3,263-crore Kochi-Koottanad-Bengaluru-Mangaluru natural gas pipeline project (KKBMPL), which faced protests in northern parts of the state, is quietly progressing at a fast clip. The first stretch of 96km from Kochi to Koottanad was commissioned in June this year. Koottanad is the point from where the pipeline bifurcates to Mangaluru (via Malappuram, Kozhikode, Kannur and  Kasaragod) and to Bengaluru (via Palakkad, Coimbatore, Erode, Salem Dharmapuri and Krishnagiri). Tony Mathew, general manager (construction), GAIL, said of the total length of 444km from Kochi to Mangaluru, pipe-laying on the 441.5km stretch has been completed and work on the remaining 2.5km is in progress across five rivers — Netravati (Mangaluru), Chandragiri (Kasaragod), Kuttiyadi, Chaliyar and Iruvanjippuzha in Kozhikode district. “We hope to commission the pipeline up to Kozhikode by February 2020 and commissioning up to Mangaluru by March 2020,” he told TNIE. The KKBMPL is an ambitious project initiated in 2007 by GAIL to connect the southern states of Kerala, Tamil Nadu and Karnataka to the national gas network. The deadline for the project was December 2018, but the flood last year and frequent protests in northern districts in the state held up the work. “(The work on) the 89km Koottanad-Walayar stretch is in progress and 75km welding is completed out of which 42km is lowered in soil. There are six stations including five SV stations and nine IP stations at Walayar) on this stretch,” said the GAIL official. “The commissioning of this stretch is expected by June 2020 which can facilitate gas supply to industries in Kanjikode and Coimbatore in addition to City Gas distribution at these places,” he added. Meanwhile, 48km of the pipeline is being laid from Bengaluru to Hosur (reverse direction of Kochi-Bengaluru) to provide gas supply to industries in Hosur as Bengaluru is already connected with the National Gas Grid. Mathew said the work in Tamil Nadu has not been started yet and discussion is in progress for final clearance from the Government of Tamil Nadu.

https://www.newindianexpress.com/states/kerala/2019/dec/18/gails-444km-natural-gas-pipeline-in-the-fast-lane-finally-2077660.html

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Reliance Industries ends IOC’s 10-year reign to become India’s largest company

Mukesh Ambani-led Reliance Industries has ended state-owned Indian Oil Corporation’s 10-year reign as India’s largest company to top Fortune India 500 list. RIL is the first privately-held company to become the largest corporation in India in 10 years, said Fortune India. RIL had a revenue of Rs 5.81 lakh crore in 2018-19.

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Fortune India said RIL posted a 41.5 per cent rise in its revenue in the financial year 2018-19, which was 8.4 per cent more than IOC, the second-largest company on the list. RIL’s 2018-19 revenue stood at Rs 5.81 lakh crore, while IOC posted a growth of 26.6 per cent in sales to Rs 5.36 lakh crore in the same year. RIL’s profit for 2018-19 was also more than double that of IOC at Rs 39,588 crore. “Over the past 10 years, the oil-to-retail conglomerate’s profit has been an average three times higher than that of IOC. The highest it touched compared to IOC was up to 4.8 times, in FY15 when RIL’s profit was Rs 23,566 crore and the public sector major’s stood at Rs 4,912 crore,” it said. The third spot went to state-owned Oil and Natural Gas Corporation (ONGC) that has retained its 2018 spot. It was followed by State Bank of India, Tata Motors and Bharat Petroleum Corporation. All these companies retained their previous rankings. On the 7th spot was Rajesh Exports that climbed one position from the year before. Tata Steel, Coal India, Tata Consultancy Services and Larsen & Toubro were ranked 8th, 9th, 10th and 11th respectively. They all climbed a spot from the previous rankings. ICICI Bank rose two positions to be placed on the 12th spot, followed by Hindalco Industries and HDFC Bank. Vedanta Ltd slipped three positions to be ranked 18th on the 2019 list. Overall, the revenue of the Fortune India 500 companies in the 2019 list grew 9.53 per cent, while profit rose 11.8 per cent. This year, the total loss posted by the 500 companies also came down, with 65 companies posting a cumulative loss of Rs 1.67 lakh crore, compared to last year’s Rs 2 lakh crore racked up by 79 companies, Fortune India said.

https://www.businesstoday.in/current/corporate/reliance-industries-ends-ioc-10-year-reign-become-india-largest-company/story/392168.html

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Gas output ceases, oil is down 75% in the North East                

Crude oil and gas production in Assam has been badly disrupted by the ongoing state-wide protests, affecting the supply of petrol, diesel and LPG in many districts. The two major PSU fuel producers, Oil India Ltd and Oil and Natural Gas Corporation, on

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Sunday said their gas output has almost stopped, while oil production is down by over 75 per cent, since protests erupted in the state. “Our gas production has almost ceased. In the crude oil segment, we were producing 9,000 tonnes per day, which has come down to just 1,000 tonnes,” a senior official from OIL told PTI. The company is operating only 50 out of its about 400 oil and gas producing wells. Filled LPG cylinders are lying stacked at oil terminals as vehicle transport has come to a halt. Tankers are stranded on highways. The other day, Oil India had issued an appeal to the people of the State to allow it to carry out day-to-day operations. The appeal issued in a leading English daily cautioned that the “total disruption of operational activities will adversely impact the economy of the State and the lives of the common people.

https://www.freepressjournal.in/business/gas-output-ceases-oil-is-down-75

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RIL dares government on Saudi Aramco

The govt sought to block Reliance selling a 20 per cent stake in its oil and chemical business to Saudi Aramco. Reliance Industries has mounted a strong counter to the government petition in Delhi High Court, seeking to block its $15-billion deal with

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Saudi Aramco, saying “the petition is an abuse of process as no arbitration award has fixed any final liability of dues on the company”. In a counter affidavit, Reliance said it was a “falsehood” to say that the arbitration tribunal had passed an award requiring the company and its partners to pay $3.5 billion to the government. It said “the petition is an abuse of process as “it portrays that a sum of money is due and payable under the final award and purports to compute the money payable on a basis neither found in the arbitration award nor disclosed in the petition”. The government, it said, has calculated on its own volition the revised figure of its share of profit from oil and gas production allegedly due by extrapolating the purported finds. The affidavit came in response to the government moving the Delhi high court, seeking to block Reliance selling a 20 per cent stake in its oil and chemical business to Saudi Aramco for $15 billion, in view of pending dues of $3.5 billion in the Panna-Mukta and Tapti oil and gas fields. An international arbitration tribunal issued a partial award in October 2016 in the dispute between the Government of India (GoI), BG Exploration & Production India Ltd (BG) and RIL regarding the Panna-Mukta and Tapti production sharing contracts. The tribunal in its 2016 award determined certain issues of principles. Pending determination of all issues before it, appropriately, it did not award any monetary sum. Quantification of amounts, if any, by the tribunal is to be done when all issues have been decided. Certain parts of the 2016 award were challenged by BG/RIL before an English court wherein it decided some parts of challenge in favour of BG/RIL and directed the arbitration tribunal to reconsider those parts of the 2016 award. The tribunal, having reconsidered, issued another partial award in December 2018 which was in favour of BG/RIL. While this challenge was pending in the English court, the Indian government unilaterally calculated certain amounts, based on its interpretation of the 2016 award, which the government alleges are payable by ONGC, BG and RIL. RIL said pursuant to the 2018 award, the GoI’s claim comes down very significantly, a fact which the government has not taken cognizance of and approached the Delhi HC prematurely for enforcement of its claim.

https://www.telegraphindia.com/business/reliance-industries-dares-government-on-saudi-aramco/cid/1729475

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Reliance, BP pay $36 million for exit of Niko in KG-D6 block

Reliance Industries and UK’s BP plc paid USD 36 million to get their defaulting Canadian partner Niko Resources to exit from the eastern offshore KG-D6 block. In a statement, Niko said it has exited from the KG-DWN-98/3 block and its 10% stake has been taken over by Reliance and

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BP. “An amendment to the production sharing contract for the D6 Block in India has been executed, reflecting the assignment of the 10% interest previously held by the company’s indirect subsidiary, Niko (NECO) Ltd to the remaining interest holders in the block, Reliance Industries Ltd and BP Exploration (Alpha) Ltd,” the statement said. Subsequent to this, Reliance’s stake in KG-D6 has gone up to 66.67% from the previous 60% and that of BP to 33.33% from 30%.
“Niko NECO had entered into a settlement agreement with Reliance and BPEAL under which it agreed to withdraw from D6 PSC and settle its arbitration case filed under the rules of the London Court of International Arbitration in December 2017 in exchange for a settlement amount of USD 36 million, subject to adjustment prior to closing,” it said. The settlement agreement is subject to certain conditions precedent including the execution of the amendment to the D6 PSC, it said adding the USD 36 million will go lenders to settle a part of the debt. Niko, which defaulted on payment of loans to its lenders, had been unsuccessful in seeking a possible buyer for its 10 per cent stake in Bay of Bengal block KG-D6 or securing financing for its share of the USD 5 billion R-Cluster, Satellite Cluster and MJ development projects in the block. This led to the company defaulting in making payments for its share of development cost. Reliance and BP are investing USD 5 billion to bring to production three sets of new discoveries in the KG-D6 block. R-Series will be the first to start output in mid-2020 with about 5 MMSCMD production. The peak from R-Series is expected at 12 MMSCMD. Satellite fields in the same block will go live a year later and are expected to contribute a peak output of 7 MMSCMD. MJ field will start production in second half of 2022 with peak production of about 12 MMSCMD. Reliance has so far made 19 gas discoveries in the Bay of Bengal block. Of these, Dhirubhai-1 and 3 (D1 & D3) — the largest among the lot — were brought to production from April 2009 and MA, the only oilfield in the block was put to production in September 2008. The output from D1 and D3 has dwindled to just 1.7 MMSCMD after touching a peak of 54 MMSCMD in 2010. MA ceased to produce last year.

Source: ET EnergyWorld

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Policy Matters/ Gas Pricing/Others

Growth as well as a low-carbon economy

There is welcome action in natural gas, the cleanest and most efficient fossil fuel. Oil minister Dharmendra Pradhan says significantly that gas projects of the order of $60 billion are under execution, including, notably, the 2,660-km Urja Ganga pipeline project,

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which would connect the eastern states of Bihar, Jharkhand, West Bengal and Odisha to the national gas grid. Natural gas is a vital fuel of the low-carbon economy that the world seeks and could even be part, technology permitting, of extensive use of hydrogen as a clean fuel. Also significant is the project underway at Talcher for efficient gasification of coal, initially to gainfully produce nitrogenous fertilizer. In the medium term and beyond, the intention is to leverage our large domestic coal reserves to step-up gas supply. Which would make perfect sense? India is urbanizing at a fast clip, and we would need, increasingly, peaking power that can be very efficiently provided by gas-fuelled thermal power plants. The setting up of a national gas grid and consequent revving up of gas usage, rather than burning coal, would stem carbon emissions and, so, reduce the emissions intensity of our economic output. The plain fact is that gas usage in our commercial energy mix is now down to barely 6%; the objective now is to raise the figure to a more respectable 15% in the foreseeable future. The gas projects now underway, pipelines, terminals and storage infrastructure would help shore up demand. The Urja Ganga pipeline would have a capacity of 16 MMSCMD. India’s overall gas consumption is about 166 MMSCMD. Meanwhile, domestic gas prices are around $3.50 per MMBtu. The way forward is to have a domestic gas pricing mechanism that is market-determined and efficient. A well-articulated pipeline network would allow such a market to function and determine the price. Our current gas pricing formula that takes into account gas prices at distant shores, Henry hub, Alberta, National Balancing Point and Russian prices surely needs a revamp.

https://economictimes.indiatimes.com/blogs/et-editorials/growth-as-well-as-a-low-carbon-economy/

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India plans bio-gas plants to tackle toxic pollution, but experts skeptical

India is planning to set up more than 100 bio-gas plants and provide thousands of farmers with machines to dispose of crop stubble in a bid to halt the choking crop-burning pollution that blights the country every winter .A major source of the smog

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that engulfs vast swathes of northern India, including the capital New Delhi, is the burning the straw and stubble of the previous rice crop to prepare for new planting in October and November. New Delhi is regularly judged to be one of the world’s most polluted major cities. Government-backed Indian Oil Corp Ltd will invite private companies to apply to set up 140 bio-gas plants that will use rice stubble as feed stock, two government officials, who didn’t wish to be identified in line with official policy, said. The plants would cost 35 billion rupees ($487.67 million) and each would require two tonnes of crop residue every hour for at least 300 days to produce “an optimum amount” of compressed natural gas (CNG), one of the sources said. The government would earmark funds for the project that would make it attractive for farmers to sell their waste rather than burn it, they said. The stubble pollution has become more acute in recent years because mechanized harvesters leave more residue than crops plucked by hand. Other than helping farmers sell their residue to the new bio gas plants, the government would provide 100,000 new machines every year to farmers to dispose of the farm waste in their fields, the sources said. “We’ll give farmers the choice to either get rid of crop residue or sell it to the bio CNG plants,” one of the sources said. “Given the amount of resources that the government has, what will decide the efficacy of this plan is consistent engagement with farmers,” said Nandikesh Sivalingam, a programme manager for Greenpeace. “But if you expect results next winter, it can’t happen.”

https://energy.economictimes.indiatimes.com/news/oil-and-gas/india-plans-bio-gas-plants-to-tackle-toxic-pollution-but-experts-sceptical/72878837

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LNG Development and Shipping

Dhamra LNG terminal: Why is IOC, GAIL hiring capacity from Adani?

It is a well-researched fact that oil is a curse. All over the world in every country where oil is found in abundance, scholars have shown that it has turned into a curse. India is no exception, despite not being an oil-rich country. So, any transaction involving a government agency

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and a private company in the petroleum sector will naturally come under suspicion. Given this reality, it is surprising that two leading public sector companies, Indian Oil Corporation (IOC) and Gas Authority of India Limited (GAIL) have entered into a contract involving a huge commitment, with questionable economics and doubtful strategic importance, with a private company. IOC and GAIL have signed a long-term ‘take or pay’ contract with an Adani Group company. It is to hire capacity in a 5 million-ton Liquefied Natural Gas (LNG) import terminal involving regasification facilities at Dhamra in Odisha. Recently, this deal was questioned by Trinamool Congress MP Mahua Moitra in Parliament. The MP’s main objection was that the contract, worth a huge Rs 46,500 crore, was signed without a tender. While she was justified in questioning the contract, she has failed to highlight the real issues. Since owning an import terminal is a monopoly business (in some European countries, such monopolies are regulated), tendering is not possible. Still, there are several troubling issues concerning this contract. According to Petroleum Minister Dharmendra Pradhan, India wants to increase the share of natural gas in meeting India’s energy needs to 15% by 2030. Currently, it is at 6.3%. According to Pradhan, gas consumption has to go from 60 BCM to 215 BCM in 2030 to reach this target. This can be met mostly by increasing gas imports in the form of LNG, and thus there will be a greater need to increase LNG import capacity from the current 41.5 MMT. It is this consideration that drove IOC and GAIL to have a non-binding agreement to take 50% interest in Adani’s project at Dhamra in 2016. However, the companies decided not to invest in the Rs 5,600 crore project, which would have entailed considerably less money than the commitment they have taken on by signing a ‘take or pay’ contract. The reason given for this was that they could not agree on the valuation. Then, how could Total, which is new to gas business in India, do so and invest in the project? This raises doubts over the real reason for their dropping out of the project. Minister Pradhan also agreed that the initial payment of Rs 60.18 per MMBtu to Adani is 5% higher than what they are paying for other terminals. He justified it by saying that these fees are inclusive of port charges, terminal charges, etc. In companion, the international prevailing charges for re-gasification are only $0.45 MMBtu (Rs 32 per MMBtu). This is 50% less than the contract fee of Rs 60.19. Why did IOC and GAIL agree to such a high fee?  Moreover, the current utilization rate of LNG terminals is only around 60%. Based on this, one may argue that there was no need to invest in additional capacity and it is better to hire capacity from a third party and avoid risking capital. We need to take a strategic view. Most current LNG terminals, with the exception of IOC’s Ennore terminal, are on the west coast. Also, the Kochi terminal was built even before the connecting gas network was built, which resulted in its poor utilization. However, where there are gas connecting networks, say near Dahej (owned by Petronet in which both IOC and GAIL have interest), utilization is around 109%. IOC needs to supply gas to three of its refineries in Paradip, Haldia and Barauni, while GAIL has to meet the gas needs of its customers in and around Odisha. There are several gas power plants on the east coast which have low plant load factor because of lack of gas supplies. When market conditions improve, IOC and GAIL can tap this market by supply LNG to them. If they had developed their own LNG import terminal near Dhamra after ensuring putting in place the network to take the gas supply, it would have been a far better strategic fit than signing a ‘take or pay’ contract with a private company for what looks like a high fee. GAIL and IOC have technical ability (far more than Adani Group) in LNG terminals. They also have the financial muscle needed. In addition, as discussed above, there is a strategic need to control LNG import terminal capacity when demand for LNG increases. Why did IOC and GAIL suddenly drop the project and decide to hire capacity from Adani, instead? Though the stated policy of the Narendra Modi government is that government has no business to be in business, it does not apply in a situation in which public sector companies need to compete with private companies. Also, the government has not announced any plans to privatise these companies (IOC, GAIL) any time soon. Thus putting direct or indirect pressure on them to sign a contract with a private company amounts to not giving a level playing field to public sector companies and harming their long-term interests. Imagine, if and when IOC and GAIL are privatized, if they were to control strategic assets like LNG terminals in key areas, the potential buyers would be prepared to pay more. In this context, it may be useful to recall the political decision the Modi government took to force the Oil and Natural Gas Company (ONGC) to buy the loss-making assets in the Krishna Godavari basin of the Gujarat State Petroleum Company (GSPC) to prevent its bankruptcy, after it had blown some Rs 20,000 crore, under Modi as Gujarat chief minister, on a false gas find. For all these reasons, is it possible that IOC and GAIL hiring capacity from the Adani Group, considered to be close to Modi, is more a political decision on the part of the companies than a prudent business decision?

(The writer is former governing council member of Manipal Institute of Technology, and an international oil expert)

https://www.deccanherald.com/opinion/panorama/dhamra-lng-whyre-ioc-gail-hiring-capacity-from-adani-786113.html

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H-Energy gearing up for commissioning of FSRU at Jaigarh

H-Energy has announced the gearing up for commissioning of India’s first FSRU based LNG terminal and NG pipeline at Jaigarh by April 1, 2020. It has announced delivery of LNG by truck as well as regasified LNG ex their terminal.

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The Company has invited interests from potential RLNG/LNG customers and is offering a firm price ex-Jaigarh. The offers are as follows:

  1. $5.60/MMBtu for RLNG fixed price gas available from April 2020 to September 2020.
  2. $6.30/MMBtu for RLNG fixed price gas available from April 2020 to March 2021
  3. $6.20/MMBtu for RLNG fixed price gas available from April 2020 to December 2021.
  4. Spot and term LNG linked to other indices also available/flexible quantities.”

Source: Economic Times, New Delhi

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India’s Mundra LNG terminal to receive commissioning cargo in January 2020

India’s Mundra LNG terminal in Gujarat co-owned by Gujarat State Petroleum Corp (GSPC) and Adani Group is set to receive its commissioning cargo in the second half of January, a source familiar with the matter told S&P Global Platts Tuesday ( Dec 17).

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GSPC issued a tender Monday seeking a cargo to be delivered over H2 January to the Mundra LNG terminal. The tender closes Wednesday (Dec 18), with a one day validity. The terminal has been operationally ready since late last year but commissioning was delayed due to a commercial dispute between the developers, market sources said. The Mundra LNG terminal had been due to receive a cargo from the US in November last year, but the vessel had to be diverted to Hazira, trade sources said. The terminal has an import capacity of 5 million mt/year and two 160,000 cu m LNG storage tanks.

Source: SP Global/Indian Oil & Gas

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INTERNATIONAL NEWS

 

Natural Gas / Transnational Pipelines/ Others

Don’t bet on a natural gas rebound – USA

Natural gas prices are set to close out the year down by about 25 percent, and unlike crude oil, there is not a lot of confidence in a rebound. Record levels of production and mild temperatures have left the gas market in the U.S. well-supplied.

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After running down to exceptionally low levels a year ago, U.S. gas inventory levels have shot back up to the five-year average in 2019. That means that the U.S. enters the peak winter demand season with plenty of gas on hand. Major investors are pessimistic about the odds of a rebound in prices. Hedge funds and other money managers have amassed the largest net-short positions on gas futures since 2008, according to the Wall Street Journal. That means that investors and speculators are betting that prices will continue to fall. “We’re still in an oversupplied situation,” Kent Bayazitoglu, director of market analytics at Gelber & Associates, told the WSJ. “It’s made it very difficult to sustain prices—they just keep falling and falling.” A severe drop in temperatures across North America has not yet arrived, and the relatively mild weather forecasts have kept gas prices in the dumps. But the issue is broader than unexpectedly mild temperatures. The decade-long debt-fueled drilling frenzy may be coming to an end. In fact, the sharp drop in gas prices in 2019 threw the problems that have long been plaguing the shale gas industry into sharp relief. Investors have pulled their money out of sector and closed the door on new capital injections. The era of heavy spending and unprofitable drilling may be at an end. The malaise creeping over the gas industry is forcing spending cutbacks, which is already starting to translate into a production slowdown. The EIA forecasts a decline in gas production in Appalachia by 74 million cubic feet per day in January, month-on-month. Gas production declines are also expected in the Anadarko basin in Oklahoma and in the Eagle Ford in South Texas. Overall production for the country is still expected to rise, due to associated gas output still rising in the Permian, and due to the ongoing revival in the Haynesville shale. As a result, the industry finds itself in an odd predicament – total production is still at record levels, and may continue to climb, albeit at a slower and lower rate. At the same time there are widespread financial problems in the industry, particularly for gas-focused companies. One of the big questions regarding production is whether Texas oil drillers can keep gas output growing enough to offset the declines underway in. Meanwhile, the supply surplus is also a global problem. Chevron’s recent announcement that it would take an $11 billion write down revealed two things: its shale gas assets in Appalachia are not as valuable as once thought, and the write down of its LNG project in Canada also reflects the souring of the global market for gas. Asian spot prices for LNG are at their lowest on record for this time of year, falling as low as $5.65/MMBtu for January delivery. The glut is so bad that an LNG buyer in Singapore recently cancelled its order, but decided to pay for it anyway. It could take years for the supply overhang to get worked out. But the effects of the surplus in the U.S. – already visible in the steep drop in prices – could become even more pronounced at the end of the winter. It would take an “ice age winter” to prevent a further price slide, Sid Perkins, founder and managing partner at Ion Energy Group, told the WSJ in November. If that cold snap doesn’t occur, “we’re likely going to come out of winter with much more in storage than we had a year ago, with no significant new demand coming online.” If mild temperatures persist, U.S. natural gas prices could be flirting with sub-$2/MMBtu pretty soon.

https://oilprice.com/Energy/Energy-General/Dont-Bet-On-A-Natural-Gas-Rebound.html

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Natural gas is future fuel amid concerns over CO2: Qatari minister

Natural gas is the destination fuel, which will hold a prominent position in the current and future energy mix, said HE the Minister of State for Energy Affairs, Saad Sherida al-Kaabi, also the President and CEO of Qatar Petroleum. Stressing the importance of natural gas,

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during a panel discussion entitled ‘The future of LNG in meeting the world’s energy demand’ part of the Doha Forum 2019, the minister said, “The current energy transition is mostly driven by the need for cleaner and more economic and sustainable alternatives. Natural gas is the key in this transition because of its qualities as the cleanest of fossil fuels.” The panel saw the participation of Patrick Pouyanné, chairman and CEO, Total, and Claudio Descalzi, CEO, Eni. Al-Kaabi said, “Many countries are moving away from coal and building infrastructure for the use of gas. When we consider the efforts to combat climate change and the ongoing concerns over CO2 and other gas emissions, it is clear that gas is the future.” Al-Kaabi discussed various issues related to the global gas industry and stressed Qatar’s unique place as a well-established and reliable energy provider. “We do not see ourselves in competition with anybody. We focus on what we control, which is cost. We want to be safe, efficient and reliable,” he said. The minister highlighted Qatar’s strategy to serve the requirements of gas importers, and its plans on how to do that including the recent announcement to raise the country’s LNG production capacity to 126MMTPA by 2027. “We see exploration as the springboard of our international expansion. We are working with good partners and are willing to take the risks associated with this business. Our efforts have paid off in a number of our investments, and more is coming very soon. We are no longer a national oil company but rather an international one.” Addressing environmental concern, al-Kaabi called upon the oil and gas industry to take more responsibility towards carbon capture and storage, as well as in its overall attitude towards the environment. Noting a series of Qatari environmental initiatives, the minister drew attention to the largest CO2 recovery and sequestration facility currently in operation in the MENA region in Qatar saying, “We have recently announced 2.5mn tons of CO2 sequestration to reach 5mn tons by 2024, and hopefully to 7mn by 2027.” The Doha Forum, established in 2000, is a global platform for dialogue on critical challenges facing our world and bringing together leaders in policy to build innovative and action driven networks. Qatar Petroleum is an institutional partner of the Doha Forum.

https://www.gulf-times.com/story/650638/Natural-gas-is-future-fuel-amid-concerns-over-CO2-

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U.S. proved reserves of crude oil, natural gas hit record highs

The proved reserves of crude oil and natural gas in the United States set new records, the U.S. Energy Information Administration (EIA) reported. According to the EIA’s annual reserves report, the proved reserves of crude oil in the country increased 12%,

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from 39.2 billion barrels at year-end 2017 to 43.8 billion barrels at year-end 2018, setting another U.S. record for crude oil proved reserves. The previous record was set in 2017 at 39.2 billion barrels. The proved reserves of lease condensate in the United States increased 14 percent, from 2.8 billion barrels at year-end 2017 to 3.2 billion barrels at year-end 2018. U.S. crude oil and lease condensate production increased 17% from 2017 to 2018. Producers in the U.S. state of Texas added 2.3 billion barrels of crude oil and lease condensate proved reserves, the largest net increase of all states in 2018. The increase was a result of increased prices and development in the Permian Basin of West Texas. Meanwhile, the proved reserves of natural gas increased 9%, from 464.3 trillion cubic feet (about 13.15 trillion cubic meters) at year-end 2017 to 504.5 trillion cubic feet at year-end 2018, another U.S. record for total natural gas proved reserves. U.S. natural gas proved reserves from shale increased from 66% of total U.S. gas proved reserves in 2017 to 68 percent at year-end 2018.

Producers in Texas added 22.9 trillion cubic feet of natural gas proved reserves, the largest net increase of all states in 2018.

https://www.hellenicshippingnews.com/u-s-proved-reserves-of-crude-oil-natural-gas-hit-record-highs/

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Israeli gas exports to Egypt receive government approval

Energy Minister Yuval Steinitz gave the green light on Monday (Dec 11) to commence Israeli exports of natural gas to Egypt, ahead of an expected first flow between the countries on January 1, 2020. Approval was granted after completing

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necessary “professional procedures,” including the receipt of authorization from the Antitrust Authority and a recommendation from the Committee for the Reduction of Concentration. Gas exports will be carried out from the Tamar and Leviathan gas reservoirs, offshore Israel, and are destined for both domestic Egyptian use and re-exportation of liquefied natural gas by Egypt. Gas supply to Egypt’s Dolphinus Holdings will be carried out via the 90 km. subsea EMG Pipeline, connecting the southern Israel city of Ashkelon to the Egyptian network near El-Arish. “A short time ago, I signed an approval for the export of natural gas from Israel to Egypt,” said Steinitz. “In doing so, Israel becomes – for the first time in its history – an energy exporter and an important partner in the regional energy market. “The export of gas to Egypt, from the Leviathan and Tamar reservoirs, is the most significant economic cooperation between Israel and Egypt since the peace agreement was signed between the countries. This is a historic milestone for the State of Israel. The natural gas revolution makes us an energy superpower and will enable not only huge revenues for the country, but also a dramatic reduction in air pollution.” The Energy Ministry’s approval provides for the export of a total of 60 BCM of natural gas from Leviathan, which is expected to commence operations later this month, and 25 BCM from Tamar over the next 15 years. The existing deal is valued at $15 billion. “Obtaining regulatory approvals is a significant milestone toward exporting gas to Egypt, which will commence in approximately two weeks from now,” said Yossi Abu, CEO of Delek Drilling, one of the partners in the Leviathan reservoir. “Producing gas from Leviathan, which will start in the coming days, will strengthen Israel’s regional standing, will reduce electricity prices and finally enable the withdrawal from the use of polluting coal.” The deal to supply natural gas to Egypt follows a September 2016 agreement worth $10b. between Jordan’s National Electric Power Company Ltd. and the operators of the Leviathan gas field, to supply a gross quantity of 45 BCM of natural gas to Israel’s eastern neighbors, over a 15-year period. Exports to Jordan are also scheduled to commence on January 1.

Source: LNG Global

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Pakistan faces gas shortage as temperature drops

It is ironic that the massive hike of up to 213.7% in gas prices comes at a time when Pakistan is facing gas outages as demand has exceeded supply following an abrupt drop in temperature in different parts of the country. The situation resulted in

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long queues outside tandoors due to low gas pressure at residences and prompted Karachi-based Sui Southern Gas Company (SSGC) to suddenly suspend supplies to CNG fuel stations in Sindh and Balochistan to keep supplies to households normal on Tuesday (Dec 17). SSGC supplies gas to consumers in two provinces – Sindh and Balochistan. SNGPL provides gas in Punjab and Khyber-Pakhtunkhwa (K-P). An SSGC spokesperson said that a sudden and massive surge in gas demand came from Quetta, the capital city of Balochistan, following a significant drop in temperature and strong cold breeze in the city and other parts of the country. Quetta recorded minimum temperature of seven-degree Celsius on Tuesday, according to the weather website timeanddate.com. “Gas remains a lifeline and a question for survival for the people in Quetta as they use the fuel to operate heaters and geysers,” he said. “Demand for gas from Quetta surged to around 150 million cubic feet per day (mmcfd) compared to around 50 mmcfd during summer,” he said. Similarly, demand for gas from the entire province of Balochistan surged to around 200-250 mmcfd compared to around 75-100 mmcfd during the summer season. In total, SSGC faced a shortfall of around 400 mmcfd as demand peaked at around 1,500 mmcfd compared to supplies of around 1,160 mmcfd in the system from gas fields in Sindh and Balochistan, the official said. “Supply of gas to industrial areas remained unaffected as SSGC managed to provide uninterrupted gas supply to industries and residential areas by suspending supplies to CNG fuel stations,” he said. An SNGPL official added that there were no total blackouts in Punjab and K-P, but “some of the areas, especially in the tail, complained of a drop in gas pressure. Our teams promptly addressed the complaints to restore supplies to normal.” The two provinces on the SNGPL network saw a drop in temperature, which slightly impacted supplies to some of the areas, he said. The system saw gas shortfall on the day when the Oil and Gas Regulatory Authority (Ogra) approved an increase in gas prices by up to 213% for the end-consumers including commercial and industrial consumers like cement and fertiliser plants. This is the second surge in gas prices during the ongoing fiscal year 2019-20 under the International Monetary Fund (IMF) programme.

https://tribune.com.pk/story/2120052/2-pakistan-faces-gas-shortage-temperature-drops/

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Proposed increase in gas price to trigger inflation- Pakistan

The business community rejects another gas price hike that is on the cards as it will make life difficult for the masses, a business leader said Wednesday (Dec18). The decision to increase the gas price up to 214 per cent will open floodgates for inflation,

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which will take a toll on people, and the economy, therefore, the Prime Minister Imran Khan should reject the decision, he added. Settling gas sector circular debt of Rs181 billion by burdening the masses is unjustified and it can be termed as a mini-budget, said Shahid Rasheed Butt former president ICCI. He said that gas tariff hike would trigger inflation and increase poverty in the country as it will also increase tariff of electricity, make production costly and hit exports. The business leader noted that gas is a very important part of Pakistan’s energy mix, therefore, a hike in the tariff will hit almost everyone. The gas prices for tandoor will go up by 245% while gas for the CNG sector is to get 31% more expensive, the fertiliser sector will see by 153% increase and IPPs, power stations and cement sector will face a 24% hike. He said that losses of the gas companies are running into billions of rupees due to mismanagement, incompetence and corruption that is shielded through frequent tariff hikes, which is not a sustainable solution.

https://www.thenews.com.pk/print/585576-proposed-increase-in-gas-price-to-trigger-inflation

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Turkey natural gas consumption seen down 10-11% in 2019 –association

Turkish natural gas consumption is expected to decline to 44-44.5 BCM in 2019 thanks in part to warmer weather, the chairman of the Natural Gas Distribution Companies Association of Turkey (GAZBIR) said on Monday (Dec 23).

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That level would mark a 10-11% decline from 2018, when the country consumed 49.3 BCM of gas, according to a Reuter’s calculation. “Other than the increase in the temperatures in the second half of the year, the biggest element here is the declining shares of natural gas use in electricity production,” Yasar Aslan, GAZBIR’s chair, said in an interview. He added that the natural gas used for electricity production, which makes up the largest portion of gas use, is expected to have declined 40% this year. Turkey is almost completely reliant on imports to meet its energy needs, which can lead to current-account imbalances. It purchases nearly all of its natural gas from Russia, Iran and Azerbaijan, and imports LNG from 13 countries. Electricity producers consumed 18.2 BCM of natural gas in 2018. But hikes to gas prices used in electric plants, as well as increased use of renewable sources and unchanged demand in overall electricity caused that amount to decline this year. Official data show that natural gas used for electricity production declined to a monthly average of 881 MMSCM in the first nine months of the year, marking a 42% decline. Residential use, the second-largest portion of natural gas consumption, is expected to remain unchanged in 2019.

https://www.hellenicshippingnews.com/turkey-nat-gas-consumption-seen-down-10-11-in-2019-association/

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Global LNG Development

Liquefied Gas Business: Lacking a strong foothold (for now)

Energy experts were in Budapest in the first week of December to discuss the liquefied natural gas market. Balázs Barabás went along to the conference for the Budapest Business Journal. One of the main studies released by the IEA,

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consulted by energy experts around the world, is the annual World Energy Outlook (WEO).  The gas sector has a separate chapter in the WEO, which states that natural gas had a “remarkable” year in 2018, with a 4.6% increase in consumption, accounting for nearly half of the increase in global energy demand. The WEO notes that “liquefied natural gas is the key to more broad-based growth in future; 2019 is already a record year for investment in new LNG supply, even as prices in key importing regions have fallen to record lows.” The WEO looks ahead using two projections, the Stated Policies and the Sustainable Development scenario. In the Stated Policies Scenario, LNG overtakes pipeline gas as the main way of trading gas between regions by the late 2020s. There is significant uncertainty, however, as to the scale and durability of demand for imported LNG. Over the long-term, the WEO explains, end-user prices generally seem set to rise. If not, LNG suppliers will be unable to recover their long-term investment costs or governments will have to continue to subsidize the cost of LNG imports. “The LNG industry therefore faces a struggle to gain a strong foothold in developing markets where affordability is a key consideration,” the study concludes. In short, LNG is expected to play a significant role in the future of the gas market, but when and how exactly this will happen, forecasts are not very clear. However, the perspectives for Hungary are promising.

Central and Eastern Europe has a strong potential for LNG in the power and transport sectors, as Croatia is not the only country with a terminal under construction, Yury Sentyurin, secretary general of the Gas Exporting Countries Forum in Qatar said. Belgium, France, Italy, Lithuania, the Netherlands, Portugal, Poland and Spain are also players on the LNG market, Sentyurin said. This may seem a lot, but currently the CEE region’s LNG imports are meager, accounting for 5% of Europe’s imports and only 1% of global LNG imports, Sentyurin noted. But this is part of a wider trend; although, on a global level, LNG trade has grown strongly since 2017, this expansion is expected to weaken in the short-term, as less LNG projects are commissioned, he added. The second most significant influence will be the LNG terminal in Croatia, which could connect medium-sized Central European companies to the global LNG market, Sztáray noted. He added that there is still a long way to go, but bilateral discussions are very promising. Russia may be an important player, but the United States is also making steps to expand its share of the gas market. Dan Milstein, director of the European Regional Office for the U.S. Department of Energy noted that the U.S. natural gas production has risen by more than 50% since 2000 and will have more than doubled by 2050. This is due mainly to the extraction of shale gas. American gas production has already exceeded internal consumption and the surplus will continue to grow over the next few decades, despite demand also growing, both from the industrial and the residential and commercial sectors. LNG exports are rapidly rising and the U.S. administration has adopted fast-track approval procedures for small scale exports, Milstein said.

https://bbj.hu/business/liquefied-gas-business-lacking-a-strong-foothold-for-now_175414

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European LNG imports are at record levels this year

The U.S. Energy Information Administration released the natural gas weekly update yesterday. In the update the EIA noted Europe’s imports of LNG have been steadily increasing since October 2018 and reached a new monthly

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record of 12.7 billion cubic feet per day (Bcf/d) in November 2019. The monthly record implies a 51% utilization of Europe-wide regasification capacity (including Turkey). From January through November 2019, LNG imports into Europe averaged 11 Bcf/d—the highest level for European LNG imports—surpassing the previous record of 8 Bcf/d (annual average) set in 2011 according to the EIA update. Lower spot LNG prices in Asia have narrowed the price differentials between delivering LNG to Asia or to Europe and have contributed to increased cargo shipments to Europe. EIA data showed this year three LNG suppliers to Europe—Qatar, the United States, and Russia—have increased their LNG exports to the region by a combined 3.7 Bcf/d in the first 11 months of 2019, compared with LNG exports to Europe by these suppliers in 2018 (annual average). The United States had the largest increase, with LNG exports growing from 0.4 Bcf/d in 2018 to 1.8 Bcf/d in the first 11 months of 2019, followed by Russia (1.3 Bcf/d increase), and Qatar (1.0 Bcf/d increase). Other suppliers to Europe, including Nigeria, Trinidad & Tobago, and Algeria, increased LNG exports by 0.3 Bcf/d each in 2019 (January–November) compared with the annual average for 2018.

Source: LNG Global

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Daewoo E&C gets state financing for $5.7 bn LNG plant project in Nigeria

South Korea’s Daewoo Engineering & Construction Co. was promised of state financing for the $5.7 billion liquefied natural gas (LNG) plant project in Nigeria, securing the financial support to operate in a country with potentially high business risks.

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The Ministry of Economy and Finance and related organizations on Monday agreed to back the project as part of the government’s new financing policy to encourage local builders to venture into high-risk countries. With the latest deal, Daewoo E&C became the first Korean builder to clinch an LNG plant contract overseeing the entire process from front-end engineering design to engineering, procurement and construction. “It’s hard for Korean companies to obtain financing in countries like Nigeria, which has a low credit rating due to violent riots and political instability,” said a finance ministry official. “The Export-Import Bank of Korea and the Korea Trade Insurance Corporation would be the primary backers, with the government providing additional support.” Vice Finance Minister Kim Yong-beom, who chaired the Monday (Dec 16) meeting, said the government would closely monitor this year’s pipeline of overseas projects and adjust plans to keep up with the fast-changing global infrastructure market. He also had a luncheon with major construction firms after the meeting to assess their current project status and hear out their grievances when doing business abroad.

https://www.hellenicshippingnews.com/daewoo-ec-gets-state-financing-for-5-7-bn-lng-plant-project-in-nigeria/

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Kinder Morgan sends out first export cargo from Elba Island LNG

Houston pipeline operator Kinder Morgan has sent out its first shipment from the company’s Elba Island LNG export terminal in Savannah, Georgia on Friday (Dec 13). Located on an island in the Savannah River, the facility has 10 small-scale liquefied

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natural gas production units known as trains that, once in operation, will be able to make 2.5 million metric tons of LNG per year. The Greek-flagged LNG tanker Maran Gas Lindos left the Savannah, Ga., LNG plant on Friday evening, data from the tanker tracking website Marine Traffic shows.

Maran Gas Lindos remains in the Atlantic Ocean awaiting orders for its destination. Both Kinder Morgan and its commercial partner, the European oil major Shell, declined to comment.

Source: LNG Global

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China-backed AIIB invests $500 million in Tianjin LNG project

The Beijing-backed Asian Infrastructure Investment Bank (AIIB) said on Tuesday (Dec 17) it was investing $500 million in a liquefied natural gas project in China to help support its efforts to transition to a lower-carbon energy future.

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AIIB financing will be used in the construction of LNG receiving, storage and regasification facilities at an LNG terminal in Binhai district in the northern port city of Tianjin, the multilateral development bank said in a statement. Upon completion, the project will cut coal consumption by about 11.9 MMT annually and help improve air quality by reducing coal combustion-related emissions in Beijing, Tianjin and Hebei province, an economic engine in north China. The project will be implemented by state-run Beijing Gas Group Co. AIIB began operations in January 2016 and has grown to 100 approved members worldwide, with China its biggest shareholder. The bank said in July that it aimed to finance from $10 billion to $12 billion worth of projects annually in coming years. (Reporting by Ryan Woo Editing by Robert Birsel)

Source: LNG Global

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Phoenix Petroleum inks deal with US-based firm

PHOENIX Petroleum Philippines, Inc. said on Monday (Dec 11) a subsidiary signed a memorandum of agreement with a US-based company to bring in power generation sets that run on different gases. The listed company told the stock exchange that

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Phoenix Pilipinas Gas and Power, Inc. signed the deal on Dec. 11 with Mesa Natural Gas Solutions, LLC., which is based in Casper, Wyoming. “Through this valuable project, we will be able to further support the Philippine government’s thrust to broaden our energy mix and move closer towards cleaner energy. Gas, being available in many parts of the world, will allow us to diversify and stabilize our energy sources as we help the country better secure its energy requirements,” said Henry Albert R. Fadullon, Phoenix Petroleum chief operating officer, in a statement. The generation sets run on raw wellhead gas, liquefied natural gas (LNG), compressed natural gas (CNG), and propane rich liquefied petroleum gas (LPG). “Considering the innovative properties of this technology, remote areas of the country that suffer from unreliable power supply and quality can greatly benefit from it, including businesses in the hospitality and manufacturing industries,” Mr. Fadullon said. He said the genset technology will allow the use of propane-rich LPG as a transition fuel while the availability of LNG is still being developed. Phoenix LPG Inc. will supply propane rich LPGas the feed-stock to the Mesa gensets. Phoenix Petroleum said the agreement will make the genset units available in the Philippines with the corresponding commissioning, training, and technical support from the US. Both companies expect the deal to promote the use of gas, and broaden the Philippines’ energy mix. It said the project also aims to contribute to the Department of Environment and Natural Resources’ initiatives on clean development mechanism, allowing its clients to earn carbon credits. The listed company described Mesa as having an estimated power generation fleet of 450 megawatts (MW). Last year, it installed at least 25 MW of power for microgrid clients.

https://www.bworldonline.com/phoenix-petroleum-inks-deal-with-us-based-firm/

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Top China buyer offering LNG on the cheap hints at severe glut

One of China’s top liquefied natural gas buyers offered to sell a cargo on the cheap — and in the throes of winter — a fresh sign of the massive oversupply that has weighed on the market. PetroChina Co. offered the lowest price in

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Pakistan LNG’s tender seeking a cargo for Feb. 16-17 delivery. This follows a move by China National Offshore Oil Corp., the largest buyer, to swap multiple December and January cargoes for later supply to help manage brimming inventories. Chinese companies stocked up on LNG for the heating season, but warmer temperatures have curbed demand at the same time supply is ramping up at new projects. Prices in North Asia are more than 40% lower than they were a year ago, and none of China’s major buyers are currently seeking prompt deliveries for the winter, according to traders surveyed by Bloomberg. PetroChina offered the February cargo at a 8.594% slope to Brent oil, beating out three other firms. Pakistan, which doesn’t always award its tenders, will notify PetroChina of its decision by Dec. 30. This is at least the second time PetroChina has offered the cheapest price in a Pakistan tender. The company, which has traditionally been a buyer but has trading ambitions, was the lowest bidder on a Nov. 30 delivery cargo, which Pakistan ultimately chose not to purchase.

Source: LNG Global/Bloomberg

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Nigeria LNG signs long-awaited Train 7 final investment decision

Nigeria LNG (NLNG) signed a long-awaited final investment decision on its Train 7 processing unit in Abuja on Friday, taking a step forward in increasing its liquefied natural gas production. NNPC and partners Eni, Total and Shell attended the signing ceremony for Train 7,

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which is expected to boost Nigeria’s LNG output by 35% to 30 MMTPA. The agreement is a bright spot for Nigeria, a nation rich in oil and gas that has been working for years, with limited success, to boost its output of both resources. It also marks a moment of amity with international oil majors, even as a tax dispute and a new law increasing the government’s take on deepwater oil production have rankled some companies. Nigeria’s declining LNG production last year pushed it down to the fifth largest producer, with the United States taking its place at number four. Shell, Chevron and ExxonMobil, are trying to pare back some Nigerian assets as they focus on projects elsewhere, including U.S. shale. NNPC Group Managing Director Mele Kyari said Nigeria’s President Muhammadu Buhari has directed NLNG to push forward to Train 12. “We are on course,” Kyari said.

https://www.hellenicshippingnews.com/nigeria-lng-signs-long-awaited-train-7-final-investment-decision/

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Global LNG-Asian LNG prices fall amid low liquidity

Asian spot prices for liquefied natural gas (LNG) slipped this week amid thin trading due to Christmas holidays.

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The average LNG price for February delivery into northeast Asia LNG-AS was estimated at around $5.10 per MMBtu, $0.35/mmbtu down from last week. “Technically (prices fall) because there is less demand and lots of people are on holidays,” one LNG trader said. Demand came only from a couple of buyers. India’s Gujarat State Petroleum Corp (GSPC) is in the market for a late January cargo. The tender will close on Dec. 30, one source said. Colombia’s Calamari LNG import project also issued a buy tender for a small cargo, the source added. The project is looking to buy 25,000 cubic metres of LNG for delivery between Jan. 6-15 in a tender that closed on Dec. 27. On the supply side, Cameron plant in the United States has started producing LNG at its Train 2 facility, Sempra LNG said this week, adding commercial operations on the train will start in the first quarter 2020. However, the availability of cargoes on the global market was seen limited for January and February supply over the past two weeks, several traders said, adding sellers likely preferred to agree deals for most cargoes earlier, expecting prices to keep falling. Asian prices also reacted to a drop in European gas prices that were pressured by a new deal between Russia and Ukraine ensuring that the transit of Russian gas to Europe will continue after the current deal expires on Dec. 31. The Dutch front-month contract, a benchmark for LNG arriving to Europe, has dropped by almost 50 cents in the past week to around $4.17/MMBtu on Friday (Dec27). Cargoes for delivery into northwest Europe in February have been priced at a more than a 40 cent discount to the Dutch gas price.

Source: LNG Global

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Natural Gas / LNG Utilization

U.S. Congress approves alternative fuel tax credit supporting NGV use

Clean Energy Fuels applauded the passage by the U.S. Congress of an alternative fuel tax credit which will continue to support the use of natural gas, a clean and affordable domestic transportation fuel option. Signed by President

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Trump, the credit is retroactive beginning January 2018 and extends through 2020 and applies to CNG and LNG. “This tax credit will support the continued expansion of natural gas fueling in the U.S., which will help to clean our air, address long-term climate issues and keep dollars here,” said Andrew J. Littlefair, president and CEO of Clean Energy. “We applaud Congress and the President for taking this action and encourage the implementation of permanent measures to encourage further use of this superior and cleaner fuel.” The legislation includes the Alternative Fuels Tax Credit, which extends the $0.50 per gallon fuel credit/payment for the use of natural gas as a transportation fuel, and the Alternative Fuel Vehicle Refueling Property Credit, which extends the 30 percent/$30,000 investment tax credit for alternative vehicle refueling property. The Alternative Fuels Tax Credit was last extended for the 2017 calendar year and applies to all classes of natural gas vehicles fueled by geologic and renewable CNG and LNG. More and more of the CNG and LNG vehicle fuel is being derived from renewable sources such a dairies and landfills, making it the cleanest fuel available today. The tax credit’s longer-term extension is important to provide investment certainty for fleets of all shapes and sizes working to reduce their environmental footprint and address clean air and climate change sustainability goals.

http://www.ngvjournal.com/s1-news/c1-markets/u-s-congress-approves-alternative-fuel-tax-credit-supporting-use-of-natural-gas/

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ew-cng-station-under-construction-in-california-with-pepsicos-help/

Converting 1.4m gasoline-powered vehicles to CNG hybrids in Iran

National Iranian Oil Products Distribution Company and Bank Mellat signed an agreement to contribute to a plan to convert gasoline-based vehicles to hybrid CNG engines. According to the MoU, $510 million required to convert 1.4 million gasoline-powered vehicles,

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including pick-up trucks, taxis and vans, to CNG hybrids will be paid by Bank Mellat, the Oil Ministry news agency Shana reported. According to the High Council of Economic Coordination, the government will provide grants to pick-up trucks, taxis and vans. The government raised gasoline prices by 50% to 200% on November 15. NIOPDC said on Nov. 14 midnight that subsidized gasoline would be sold for 13 cents a liter up to 60 liters for each car every month. Additional purchases will cost double. However, as CNG prices have not risen so far, its consumption increased by three million cubic meters a day during the three weeks after the plan (Nov. 15-Dec. 6). Each cubic meter of gas is sold for 3.5 cents, three times cheaper than gasoline. Before gasoline was rationed, average daily CNG consumption was 19.2 MMSCM (Oct. 23-Nov. 14). The figure reached 22.2 MMSCMD soon after. Of the 19 million vehicles in Iran, over 5 million have hybrid CNG engines. The share of CNG in fuel consumption is 20%. More than $2.4 billion has been invested to expand CNG use in the last decade and contribute to the global effort to reduce the CO2 footprint. Iran is 5th in global CNG consumption. There are over 2,500 CNG stations in the country. Boosting CNG share in the fuel mix can have multiple advantages, especially cutting gasoline demand and reducing air pollution.

https://financialtribune.com/articles/energy/101221/converting-14m-gasoline-powered-vehicles-to-cng-hybrids-in-iran

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Tristar adds LNG tanker to its fleet

Tristar Group is pleased to announce the recent delivery of the Liquefied Natural Gas (LNG) Tanker, Tristar Ruby to its shipping fleet. Formerly known as the British Ruby, the tanker will be the first LNG vessel to be added to the Tristar fleet of 30 ocean-going tankers.

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The Tristar Ruby will be on long-term time charter with BP Shipping. The vessel was built by Hyundai Heavy Industries in 2008 and has a cargo carriage capacity of 155,000 cubic metres. She has been chartered by BP Shipping since delivery and trades worldwide. She will be technically managed by Wilhelmsen Ship Management and commercially operated by Tristar.

Eugene Mayne, Group CEO of Tristar, said: “As a group, we are extremely excited with this new opportunity to expand our presence into LNG shipping and look forward to strengthening and growing this new relationship with BP with a strong commitment to safety in operations and high standards of service and excellence.” Tristar is a global integrated energy logistics business, head-quartered in Dubai, which offers end to end fuel logistics solutions to blue-chip clients including international and national oil companies and international NGOs. Its integrated energy logistics platform spans road and maritime transportation, specialized warehousing, fuel farms, commercial aviation refueling and remote fuel supply operations.

https://www.hellenicshippingnews.com/tristar-adds-lng-tanker-to-its-fleet/

Syria wants to switch public transport to natural gas propulsion

The Syrian authorities plan to switch public transport and taxis from gasoline to CNG amid an oil deficit in the country, reported Al-Watan newspaper. According to sources in the state-run fuel distribution company, a plan to introduce control

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over the consumption of gas and fuel oil by public transport and taxis using GPS tracking is also reportedly in the works. The goals of these two projects include the reduction of imports and demand for foreign currency, tracking smugglers and counterfeit oil products, as well as the reduction of air pollution in cities. There are sufficient natural gas resources in central Syria, and the country expects to produce more on its Mediterranean shore in the future. To implement the project, building more CNG stations and installing equipment on cars is necessary. Trial projects were already being implemented in Syria before the war. Two gas fields producing a total of 1 million cubic meters of gas per day were put into operation east of the Syrian city of Homs and this should improve the situation with the country’s electricity supply, the Syrian Oil Ministry Suleiman al-Abbas said. The gasoline crisis in Syria erupted in early April. At peak times, queues at gasoline stations in Damascus reached about 300 cars, with similar situations seen in other cities. Subsequently, the authorities raised gasoline prices and imposed restrictions on the purchase of fuel.

http://www.ngvjournal.com/s1-news/c3-vehicles/syria-wants-to-switch-public-transport-to-natural-gas-propulsion/

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LNG as a Marine Fuel/Shipping

BHP closes in on deal for world’s first LNG-powered shipping fleet

Australian miner BHP is preparing to award a landmark contract as early as March for the world’s first fleet of bulk ships fuelled by liquefied natural gas after reviewing 17 bids from gas producers, shipbuilders and financial institutions.

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As the shipping industry braces for its biggest overhaul in decades with new rules slashing sulphur levels in maritime fuel from January 1, BHP, the largest charterer of bulk carriers in the world, has revealed it is close to deciding who will win a tender to design and supply LNG-powered ships to transport up to 27 million tonnes of its iron ore exports to Asia. BHP maritime vice-president Rashpal Bhatti said the introduction of bulk carriers running off LNG rather than diesel would eliminate NOx (nitrogen oxide) and SOx (sulphur oxide) emissions as well reduce carbon dioxide emissions by up to 25 per cent. “We sent requests for tender to 19 organizations – banks, entrepreneurs, vessel owners, shipyards – and 17 of them came back with very detailed offers two months ago,” Mr Bhatti told The Age and Sydney Morning Herald. “The great news is the interest is huge.” Mr Bhatti said BHP was evaluating the detailed submissions before progressing to a “clarification stage” with the companies in January and subsequent negotiations in February. “We are really excited about it,” he said, “and we expect to award in March-April.” As well as shipping companies, some of Australia’s major gas producers including Woodside, Shell and Pavilion were among the companies to have participated in the tender, according to Mr Bhatti. The incoming reforms have prompted major shippers to seek out cleaner alternatives to the heavy fuel oil known as bunker fuel that until now has been the shipping industry’s main source of fuel. Describing global warming as an indisputable crisis requiring a global “mobilization” effort, BHP’s outgoing chief executive, Andrew Mackenzie, embarked this year on a $500 million carbon-reduction drive to cut not only BHP’s own emissions but the emissions generated from beyond its mine gates – known as “scope 3” emissions – caused by shippers and the customers of its products such as Asian steel mills and power plants.
Source: Sydney Morning Herald

https://www.hellenicshippingnews.com/bhp-closes-in-on-deal-for-worlds-first-lng-powered-shipping-fleet/

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Factbox: IMO 2020 -a major shake-up for oil and shipping

Tougher rules on sulfur emissions from ships will come into effect next year in the biggest shake-up for the oil and shipping industries for decades. From January 2020, United Nations shipping agency the International Maritime Organization (IMO)

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will ban ships from using fuels with a sulfur content above 0.5%, compared with 3.5% now. The regulations are aimed at improving human health by reducing air pollution. Only ships fitted with sulfur-cleaning devices known as scrubbers will be allowed to continue burning high-sulfur fuel. Ship owners can also opt for other sources of cleaner fuel such as liquefied natural gas (LNG). Failure to comply with the global regulations will result in fines or vessels being detained and in some jurisdictions the risk of imprisonment, which could affect vital requirements such as insurance cover.

https://www.nytimes.com/reuters/2019/12/19/business/19reuters-shipping-imo-enforcement-rules-factbox.html

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Hyundai Heavy Industries bags $1.13 bn LNG carrier orders in Europe, Asia

South Korea’s Hyundai Heavy Industries Group on Thursday (Dec 19) has successfully bagged a combined $1.13 billion orders to build six units of liquefied natural gas (LNG) carriers in Europe and Asia. The orders will be carried out dockyards of

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Hyundai Samho Heavy Industries and Hyundai Heavy Industries. Four will be delivered to Europe and two to Asia starting mid-2022. The builders will apply a dual fuel engine for the vessels to improve the fuel efficiency and reduce the greenhouse gas emissions. Hyundai Heavy Industries Group clinched a combined $1.7 billion deals for 14 vessels in just four days of the week – two LNG carriers, two crude carriers and one product carrier in Japan and Greece on Monday and three shuttle tankers in Asia on Wednesday. “Global sea carriers are expanding ship orders that would meet the new environmental regulations set by the International Maritime Organization,” said a group official, adding that “it is now in talks with many other clients for additional deals including one for two LNG carriers set to be closed this week.” HHI Group this year has attracted a total of $11.3 billion orders for 125 ships, taking up 71 percent of its yearly target of $15.9 billion for 2019.

https://www.hellenicshippingnews.com/hyundai-heavy-industries-bags-1-13-bn-lng-carrier-orders-in-europe-asia/

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First LNG-fueled vessels for Brazil’s inland navigation under development

Hidrovias do Brasil and Robert Allan Ltd. announced an exclusive partnership for the development of a two-stage project, pioneer in South America’s inland navigation. The first phase of the project involves the development of river convoys for the transportation of LNG in the Amazon Basin,

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consisting of LNG-powered pushboats and cryogenic barges, which maintain liquids at temperatures below minus 160 degrees Celsius. The goal is to meet regional demand, which encompasses the domestic market, local thermoelectric plants and industrial complexes with combined demand potential of over 5 million cubic meters of natural gas per day. Currently, the most widely used fuels for waterway transportation are heavy fuel oil and marine diesel oil. The use of natural gas offers numerous benefits, so the Amazon region will benefit from LNG access through a massive transportation made with alternative energy, with lower environmental impact and cost reduction. The second phase includes the development of electric pushboats capable of maneuvering barges with approximately 2000 tons of cargo. Innovation, in addition to preventing the spread of pollutants in more environmentally sensitive areas, should reduce fuel and maintenance operating costs by up to 20%. The use of LNG and batteries will contribute to the future of waterway logistics, as well as promoting a more sustainable, cost-effective and more productive solution for the operation. Both the electric pushboat and the LNG convoy are expected to be operational by 2021. The project also comprises an LNG terminal owned by Hidrovias do Brasil in Barcarena, in advanced stage to receive Installation License from State Environmental Secretary (IL) – Preliminary License was issued in July 2019.  This terminal has construction time estimated in 18 months after IL issuance. Robert Allan Ltd. is Hidrovias do Brasil’s primary naval architecture and technical consulting partner, since the latter’s founding for the development of pushboats and barges.

http://www.ngvjournal.com/s1-news/c7-lng-h2-blends/lng-powered-vessels-under-development-for-brazilian-inland-navigation/

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Technological Development for Cleaner and Greener Environment Hydrogen & Bio-Methane

Inter-American Development Bank supports H2 project in Uruguay

Uruguayan state oil company Ancap has received support from the Inter-American Development Bank (IDB), with a non-reimbursable loan of $ 200,000, for technical collaboration in the execution of the Verne project, designed for the use of

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hydrogen as advanced energy in Uruguay. “The assistance can be renewed in 2020 because the multilateral entity values the initiative as very important,” said Ancap president Marta Jara. The Verne project was developed by Ancap, with the support of UTE and the Ministry of Industry, Energy and Mining. “The idea is to use that pool of clean energy to electrolyze water, produce hydrogen and use that technology for heavy transport,” Jara explained. While it is a pilot project and the business model is not yet closed, the investments could reach $ 10 million, the official said. Half would be used to produce hydrogen, an investment that would remain in the hands of Ancap, and the other half for the acquisition of hydrogen-powered vehicles, she added. “Verne is a project that has the institutional support of this Government, so we hope it will be considered by the authorities that will assume on March 1,” she commented. Jara highlighted the visit of Spanish experts Joan Ramón Morante and Marc Torrel, who represent the Catalan Institute for Energy Research, leaders in hydrogen projects in the European Union, as well as the presence of the IDB representative in Uruguay, Morgan Doyle.

http://www.ngvjournal.com/s1-news/c7-lng-h2-blends/inter-american-development-bank-supports-uruguayan-hydrogen-project/

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OMCs issue 500 LoIs for compressed biogas units, EoI extended till March

The minimum plant size has been fixed at 2 tonne per day and is expected to cost between Rs 2 crore to Rs 6 crore. The oil marketing companies under the Sustainable Alternative Towards Affordable Transportation (SATAT) scheme have issued over 500 letter of intents (LoIs),

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as of date, to private developers to set up compressed biogas (CBG) plants across the country, a senior ministry official said. The OMCs have also extended the last date for expression of interest (EoI) to March 2020 as it failed to generate satisfactory response from developers initially. Vijay Sharma, director, ministry of petroleum and natural gas (MoP&NG), said, at a road show on CBG in Mumbai, that, “CBG would help in effective waste management, reduction in carbon emissions, and creating additional source of revenue for farmers. The aim of the scheme is to replace the compressed natural gas (CNG) which is produced from fossil fuel in the long run.” “If total potential of CBG is exploited in the country, India can produce around 62 million metric tonne equivalent of CBG annually, which is sufficient to replace the entire gas demand of the nation and make the farmers from ‘Annadata’ to ‘Urjadata’ and contribute in making a brown revolution for energy.” In October, Union minister of petroleum and natural gas & steel Dharmendra Pradhan launched the SATAT Scheme under which oil & gas marketing companies including Bharat Petroleum Corporation, Indian Oil Corporation, Hindustan Petroleum Corporation, GAIL (India) Ltd and Indraprastha Gas Ltd have invited EoI from potential entrepreneurs to set up around 5,000 CBG plants, and produce over 15 million metric tonne of CBG annually by 2023. The developers will set up the plant in an year’s time from the date of LoI and OMCs will procure the gas at Rs 46/kg plus Rs 2.5 as GST. “The tariff of Rs 46/kg is an all inclusive cost. If the companies are not able to arrange for logistics to supply to the nearest retail outlets, OMCs will procure the supplies from developers minus the transportation cost from the tariff,” Sharma said. The minimum plant size has been fixed at 2 tonne per day and is expected to cost between Rs 2 crore to Rs 6 crore. Majority of the LoIs have been issued in Uttar Pradesh, Chandigarh, Maharashtra, Haryana and Punjab, the official said. CBG is purified and compressed biogas, which is produced through a process of anaerobic decomposition from various waste and biomass sources like agriculture residue, cattle dung, sugarcane press mud and spent wash of distilleries, sewage water, municipal solid waste (MSW), bio-degradable fractions of industrial waste. CBG has properties similar to CNG, thus it can be used as green fuel in automotive, industrial and commercial sectors along with CNG.

https://www.financialexpress.com/market/commodities/omcs-issue-500-lois-for-compressed-biogas-units-eoi-extended-till-march/1802498/

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