NGS’ NG/LNG SNAPSHOT – NOVEMBER 2020, VOLUME 1
National News Internatonal News
NATIONAL NEWS
City Gas Distribution & Auto LPG
PNGRB’s tariff determination proposal for open access in gas networks opposed
The recently proposed mechanism for tariff determination of city gas distribution (CGD) networks by the Petroleum and Natural Gas Regulatory Board (PNGRB) has met with
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a stiff opposition from market experts and CGD companies like Gujarat Gas Ltd (GGL), Adani Gas Ltd (AGL), Indraprasth Gas Ltd (IGL), Mahanagar Gas Ltd (MGL) and GAIL (India) Ltd among others. They have pressed the panic button saying that the new move can hit investments badly in the country’s sunrise sector Gujarat being the most developed market is likely to be hit the hardest in this case. The earnings of CGD companies can be impacted from 10-25%, according to the industry experts. The CGD stocks of CGD companies have performed well even in the last few months even amid Covid-19 crisis, but the share prices of companies like Gujarat, IGL and MGL have taken a hit in the range of 10-30% in the last two months. While the draft proposal PNGRB (Determination of transportation rate for CGD and CNG) Regulations, 2020 was made public by the natural gas regulator in the last week of September, the market seemed to have already factored in the negative impact of the decision a month ahead in anticipation, according to stock market experts. Experts and industry watchers feel it’s too early to bring in competition as India has only 6% of its geographical area covered under the CGD network. Of this, Gujarat contributes almost 80% of the infrastructure network. Morgan Stanley raised concerns about bringing the open-access regulation too early and that a similar regulation in case of transmission pipeline had dried up investments in the sector. The New York-headquartered financial services firm along with other CGD companies raised their issues at the open house held by the PNGRB on October 16 on the draft tariff regulation pertaining to CGD open access. “Any regulation imposed that can impact the cash flows and restrict further investment should always be avoided. Competition is good in any sector but the timing does not seem right especially when CGD entities are expected to invest about Rs 80,000 crore over the next few years,” said Harsh Vardhan Dole, IIFL Securities. Some CGD incumbents have highlighted in their submissions at the open house that certain matters related to the regulation are sub-judice. The government, through the PNGRB, has licensed out more than 136 new geographies during the past few years to cover half of the country’s population in an attempt, among others, to alleviate India’s astronomical pollution. It is imperative that CGD companies are offered a reasonable return, failing which nearly Rs 1 trillion of upcoming CGD infra investments would not materialize, according to a recent report by Edelweiss titled ‘Moving towards CGD deregulation’. Adani Gas Ltd has sought 14% return on capital investment instead of the 12% proposed in the draft policy. “In the CGD business, there are no long term contracts. There is extra effort required to take care of receivables. There is additional long term commitment made for connecting maximum domestic PNG customers and establishing network in all charge areas. Customer contracts may not have Minimum Guaranteed Offtake (MGO) provision and there is always the dynamics of competition from the emerging fuels as well as alternative fuels,” the company gave this rationale in its submission to the PNGRB. Mahanagar Gas Ltd has, in its submission, questioned the powers of the PNGRB to determine such a tariff in view of a past Supreme Court judgment.
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Kochi gas supply to be extended to entire district
The government has decided to implement the city gas supply scheme in all taluks of Ernakulam district. Currently, the natural gas pipeline is available from Karingachira via Kundannoor and
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Edappally up to Aluva. It has now been decided to extend the supply to Angamaly, Perumbavoor and Kolenchery as well. Groundwork for the same have started in all six municipalities. Local Self-Government Department principal secretary gave the directions regarding this to the local bodies during a video-conference meeting held on Saturday which was presided by District Development Officer Afzana Parveen. At present, 2,500 houses in Thrikkakara municipality have benefitted by the scheme. The plumbing work in 1,500 houses has also been completed. In addition to nine CNG stations, work is in progress at Wellingdon Island, Kalady, Perumbavoor and Poothottam. Municipalities that have not permitted to implement the project have been directed to decide within 21 days. Most of the municipalities opposed the digging up of roads for the project. The heads of the local bodies raised their apprehensions on re-tarring of the roads after digging for pipe-laying. They also complained that even the newly constructed roads were cut for pipe-laying and left without proper re-laying. In the meeting, the local bodies were assured that the Indian Oil-Adani Gas Pvt Ltd (IOAGPL), which is implementing the project, will carry out the reconstruction works. The municipalities demanded that once the pipes are laid, the roads should be temporarily filled within two days and the entire restoration works should be completed in another 30 days. The implementing agency has agreed to this demand, thereby reaching a consensus with the local bodies. With the implementation of the scheme, natural gas will be available in every household round the clock without interruption. In addition to domestic consumers, CNG vehicles, commercial and industrial consumers will also benefit from the scheme. It is also safer to use as the density of the gas is much lower than that of other cooking gases.
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GEECL restores CNG supply in Bengal’s Durgapur-Asansol belt after gherao withdrawn
Kolkata: Coal-bed methane producer Great Eastern Energy Corp (GEECL) on Tuesday (Oct 20) said it has normalised its gas supply in West Bengal‘s Durgapur-Asansol belt after more than
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60-hour-long gherao by agitators ended at its gas gathering station in the area. The CNG gas supply was suspended from Sunday for security and safety reasons after the agitation by some locals began at the unit on October 17. Around eight staffers were stuck inside the gas gathering station during the agitation, the company said. “The gherao had ended after more than 60 hours. The gas supply has been normalised and all safety measures are in place,” the company said. It was the third instance of gherao at the station in the last 43 days, it said. The trouble brewed at the unit after the termination of 29 third-party security men. “Twenty-nine third-party security men were terminated by the agency as per law due to severe and deliberate safety violations done by them,” the company said. “A group of miscreants have again done a gherao from the morning of October 17 and stopped the workers and staff from both entering and leaving the gas station,” GEECL had said on Monday. BSM BDC BDC
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Now, CNG-powered vehicles to collect dry waste in Bengaluru
In keeping with the Clean India campaign, the Gas Authority of India Limited (GAIL) handed over 18 CNG vehicles to the BBMP on Thursday (Oct 22) Murugesan, executive director, Gail India (South Zone), and
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chief general manager Vivek Wathodkar handed over the vehicles to BBMP administrator Gaurav Gupta and commissioner N Manjunatha Prasad. The 18 vehicles, whose total cost is estimated at Rs 1 crore, can be powered by either CNG or petrol. However, considering the eco-friendly and cost-eective aspect of CNG, the Palike would do homes twice a week. The vehicles will help about 7,500 people engaged in this profession. Till now, the BBMP did not have vehicles to collect dry waste. Each ward requires two to six vehicles, which takes the total to 613. The vehicles were hired and Rs 56,316 was spent on each of them. The induction of these 18 vehicles is seen as a beginning for change.
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IGL to facilitate conversion of diesel generators to natural gas gensets
Days after diesel generators were banned in Delhi and neighbouring cities, Indraprastha Gas Ltd on Friday said it will help housing societies as well as commercial establishments to
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replace diesel in generators to environment-friendly natural gas. IGL, which retails CNG and piped gas in the national capital and adjoining cities, in a statement said it will offer diesel-run genset users in residential complexes, commercial establishments and industrial units based in Delhi, Noida, Greater Noida, Ghaziabad and parts of Gurugram an appropriate solution to convert their electricity generating units to natural gas. A K Jana, Managing Director, IGL said, “In view of the ban on usage of diesel gensets due to enforcement of GRAP measures, a large number of users are considering converting their existing diesel gensets to gas. As an organisation committed to offering clean energy solutions to our stakeholders, we have put a system in place to capture the requirements and facilitating their communication with the technical team offering an eco-friendly solution for the same.” A link has been set up on IGL website where those interested in getting their gensets converted to gas can fill the details along with the capacity required. The interest in the conversion of genset to gas can also be conveyed on 24 hours helpline number of IGL. Highlighting the advantages of running genset on gas, Amit Garg, Director (Commercial), IGL said, “Apart from environmental benefits, the initiative of conversion of existing diesel genset to gas is expected to reduce the operational cost of running power back up gensets by up to half at the current level of prices if run on full capacity. The one time cost incurred on conversion can be recovered in over a year and a half depending on the usage.” The generators in most residential complexes can be connected to gas very easily as the complexes are already connected with gas pipeline network of IGL. Due to online supply, the users would not have to make any arrangement for procurement as well as storage of liquid fuels and the installation area shall remain clean. Apart from promoting the usage of natural gas in generators, a promotional campaign through various media platforms is already underway to push the usage of CNG in the automotive segment. “Latest figures indicate that around 8,000 vehicles are being added to the CNG fleet every month and the numbers are steadily growing due to cost advantage. CNG offers over 62 per cent savings towards the running cost when compared to petrol-driven vehicles at the current level of prices in Delhi. When compared to diesel driven vehicles, the economics in favour of CNG is around 40 per cent,” IGL said.
IGL sells CNG to over 12 lakh vehicles in NCR through a network of 560 CNG stations. It also supplies piped cooking gas to nearly 15 lakh households in these cities.
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Green gas to fuel kitchens, vehicles in Ayodhya soon
Poised to become a leading tourist destination of the world, Ayodhya will also get natural gas supply for cooking and transportation purposes.
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The temple town has been included in the ninth round of bidding undertaken by the Petroleum and Natural Gas Regulatory Board earlier this year. The responsibility has been given to service provider Green Gas Limited (GGL) which is already providing eco-friendly fuel to Lucknow and Agra. GGL is operating in four geographical areas, providing piped natural gas to over one lakh consumers and also running 61 CNG stations. Along with Ayodhya, PNGRB has allowed us to expand base in Sultanpur and Unnao,” said managing director of GGL Sanjeev Medhi. GGL is a joint venture of GAIL and IOCL which working to realize the government’s vision of increasing the share of natural gas in primary energy mix from 6.5% to 15% by 2030. Director, GGL, AK Tewari said, “The company has set an aggressive target for capital expenditure to increase supply of natural gas in Lucknow, Ayodhya, Agra and Unnao for 2020-21. “GGL plans to invest Rs 1,600 crore in the development of city gas distribution network in all its authorized geographical areas in next five years.” “Categorization of Ayodhya as Smart city has become important for GGL. We will act as enabler towards development of Ayodhya. Besides setting up CNG stations, GGL will provide natural gas to domestic, industrial/commercial entities which will not only lead employment generation but will also contribute in clean and green environment and development of the temple town,” he said. He said contracts had been placed and work was going on in full swing taking all Covid-19 precautions.
https://energy.economictimes.indiatimes.com/news/oil-and-gas/green-gas-to-fuel-kitchens-vehicles-in-ayodhya-soon/78883362
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AG&P Pratham opens the first CNG station in Jodhpur, Rajasthan
Jodhpur now has access to cleaner and lower cost fuel for the first time Jodhpur, Rajasthan, India – Business Wire India AG&P, the global downstream LNG and gas logistics company, today (Oct 25)
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announced the launch of its first Compressed Natural Gas (CNG) station in Jodhpur (Rajasthan), under its brand AG&P Pratham. In line with the Government’s vision of transforming India into a gas-based economy, the AG&P Pratham CNG station, co-located with the Indian Oil Corporation Limited (IOCL) at COCO Bhagat Ki Kothi, Main Basni Road, near Diesel Loco Shed, gives vehicle owners access to Compressed Natural Gas (CNG), an inexpensive, safe and clean alternative to the traditional costly and heavy polluting fuels such as diesel and petrol. Offering superior fuel-efficiency, significantly improved mileage and a reduction in maintenance costs to generate considerable saving, CNG has rapidly emerged as the fuel of choice for vehicle-owners. CNG can be used in almost any vehicle, including cars, auto-rickshaws and heavy-duty transit vehicles such as buses and trucks. CNG is also safer than traditional fuels, with the strongest safety record, because it is non-toxic and lighter than air, enabling it to evaporate into the atmosphere and reducing the risk of fire. Speaking at the inauguration of the CNG station, Manish Goswami, Chief Operations Officer, Rajasthan, Tamil Nadu & Andhra Pradesh and Head, Technical Services, AG&P said: “We are honored to launch AG&P Pratham’s first CNG station in Jodhpur, the first of the seven more to come within this year alone. We will be expanding our network of CNG stations by nine more stations in 2021, of which two stations will be wholly-owned by AG&P Pratham. We would like to sincerely thank our partners at IOCL and the local authorities for their support in helping us bring this important energy infrastructure for the people of Jodhpur. We expect to see an increasing and accelerated switch to CNG-fueled vehicles and create a healthier environment for our families.”
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Electric Mobility & Bio- Methane
Delhi govt approves over 100 models for subsidy under new electric vehicles policy: Gahlot
The Delhi government has approved more than 100 models of vehicles, including 45 makes of e-rickshaw and 12 of four-wheelers, for subsidy under the new electric vehicles policy,
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Transport Minister Kailash Gahlot said on Friday (Oct 23). “Vehicles priced up to Rs 15 lakh will be eligible for the purchase incentive(subsidy), besides exemption of road tax and registration fee. Electric vehicles having a price over Rs 15 lakh will not get subsidy but will be eligible for road tax and registration fee exemptions,” he told a press conference. The minister launched a website having details of approved models, dealers, subsidy disbursal process as well as the network of 70 charging stations across the city. He also said 36 manufacturers have been registered with a network of 98 dealers across the city. Gahlot said that the whole process of subsidy payment will be online. Anyone purchasing an electric vehicle will require sales invoice of the vehicle, his aadhaar number and a cancelled cheque to claim the subsidy. The dealer will process the subsidy claim on his end through the website. The claims will be verified by the motor licensing officers concerned and forwarded to banks for subsidy payment. The minister said the subsidy will be applicable from August 7, 2020 when the policy was notified. Road tax and registration fee exemptions will be applicable from October 10 and October 15, when the respective notifications were issued, he said. At each stage of processing of subsidy claim, from the dealer to the bank, the buyers will receive updates through SMS, he said. Under its EV policy, the Delhi government will give incentive of up to Rs 30,000 for two-wheelers, autos, e-rickshaws and goods carriers while a subsidy of Rs 1.5 lakh will be provided for purchase of electric cars, officials said. The subsidy amount will be credited in the account of the buyer of e-vehicle within three days, they said.
Source: ET Auto
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MG Motor, Tata Power open first superfast EV charging station in Nagpur
MG Motor India and Tata Power Corporation Limited on Wednesday inaugurated the first superfast EV charging station in Nagpur. It is part of MG’s partnership with
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Tata Power for the deployment of 50 KW DC superfast charging stations across the country. According to a company release, the public EV charging station is available to all vehicles compatible with CCS/ CHAdeMO fast-charging standards. MG claims that its electric SUV ZS EV can be charged up to 80% in 50 minutes at such facilities. MG Motor India has 10 SuperFast 50 kW charging stations across its dealerships in New Delhi-NCR, Mumbai, Ahmedabad, Bengaluru, and Hyderabad. The company plans to expand further. Gaurav Gupta, chief commercial officer, MG Motor India, said, “Further strengthening the EV charging ecosystem in Nagpur, the partnership aims to provide customers with a robust charging ecosystem to promote the adoption of cleaner and greener mobility solutions. We feel confident that it will pave the way for superior EV adoption in the region.” Rajesh Naik, chief – new business services, Tata Power, said, “Our collaboration with MG Motor demonstrates our commitment to add impetus to the EV migration in India. Nagpur’s first-ever superfast EV charging station is just the beginning, and we look forward to adding more cities to this exciting transformation.”
Source: ET Auto
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Indian Oil Corporation to expand EV charging facilities at its petrol pumps
The Indian Oil Corporation has already installed EV charging points at 76 fuel stations, and battery swapping facilities at 11 outlets. The country’s leading oil marketing company,
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Indian Oil Corporation (IOC) is remodelling its business by increasing focus on petrochemicals to hedge certain unpredictability in the fuel business. Apart from conventional fuels, the company will offer EV charging points at its pumps and battery swapping points at the fuel stations that are in line with IOC’s aim to make itself future-ready. In a recent interview with PTI, IOC Chairman Shrikant Madhav Vaidya stated that the company aims to become a leading energy company in India without restricting itself to retail only petroleum products. IOC has already installed EV charging points at 76 fuel stations, and battery swapping facilities at 11 outlets. Additionally, IOC is also closely evaluating several advanced battery technologies which will help in setting-up of the metal-air battery-manufacturing facility for EVs. Shrikant Madhav Vaidya said, “Eventually we intend to become energy company of India and not just be restricted to selling petroleum products. The world is changing. We intend to set up EV charging points and battery swapping stations at our petrol pumps alongside offering auto-LPG and conventional fuels. So it will be a bouquet of offering.” IOC has also established itself as the second-largest player in natural gas in India with a licence to retail CNG and piped cooking gas in 40 geographical areas. “We are also aggressively promoting the use of compressed bio-gas, 2G ethanol, and biodiesel produced from used cooking oil, besides integrating our refinery processes with bio-fuels production,” he said. The fuel business is very much prone to volatilities which further reduces the margin of the company. Thus, IOC plans to add petrochemical plants at all nice of its oil refineries to de-risk the business. The percentage of crude oil converted into chemicals is low which is currently at 5-6 per cent. And, IOC intends to take it up to 10-12 per cent. He further said, “This would de-risk the fuel business. We realise that the volatility of the market can be easily controlled by having a good footprint in the petrochemical sector. Petroleum fuels continue to be my main business as far as turnover is concerned, but profitability I intend to get from petrochemicals.”
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Trial run: 50 buses using fuel greener than CNG rolled out
New Delhi: Delhi became the first city in the country to roll out hydrogen-enriched compressed natural gas (HCNG) buses for public transport on Tuesday (Oct 20),
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with the launch of a six-month trial run of 50 BS-IV compliant cluster scheme buses. Union minister of petroleum & natural gas and steel Dharmendra Pradhan and Delhi’s transport minister Kailash Gahlot inaugurated a four-tonne-a-day compact reformer plant at Rajghat Bus Depot-I of Delhi Transport Corporation (DTC). The cluster scheme buses have been slightly modified to enable a switch to HCNG. The HCNG production plant has been set up by Indian Oil Corporation Limited (IOCL) in collaboration with Delhi government’s transport department, which has provided Rs 15 crore for setting up of the plant and conducting the study. The ministry of road transport and highways has also notified HCNG as a fuel starting September, 2020. “Delhi, as the country’s capital is taking a lead in promoting environment conscious transport policies, like adopting cleaner fuels such as HCNG, electric vehicles, etc. The most important benefit of HCNG is that it emits 70% less carbon monoxide, which will reduce total hydrocarbons emissions by around 15%, along with 3-4% increased fuel efficiency,” Gahlot said. He said that during the trial, tailpipe emissions of the buses will be continuously monitored and analysed. “I am assured that once the trial is successfully completed, use of HCNG can be scaled up to other buses and private vehicles in Delhi,” Gahlot said. “I am happy to note that the scientists of Indian Oil R&D unit have risen to the occasion and developed an innovative compact reforming technology for production of hydrogen-mixed CNG. Hydrogen is the ultimate fuel, which, while giving energy, produces clean water in the emissions,” Pradhan said. He said that this pilot project will be unique and complimented Indraprastha Gas Limited for setting up a dispensing station to refuel HCNG.
https://timesofindia.indiatimes.com/city/delhi/trial-run-50-buses-using-fuel-greener-than-cng-rolled-out/articleshow/78776862.cms
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‘EVs distant dream, India needs cleaner fuels to combat pollution’
With a massive spike in air pollution in Delhi and its surrounding regions, experts believe that the country needs to to incentivise public transport,
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disincentivise personal vehicular transport and have a basket of cleaner fuels in a bid to mitigate the pollution emanating from the automobile sector. Road transport constitutes a major source of greenhouse gas emissions. In India, the transport sector is the third-most greenhouse gas emitting sector, with the major contribution coming from road transport. Speaking to IANS, Suyash Gupta, Director General of Indian Auto LPG Coalition, stressed on the need to invest in a wide range of alternative options to power the transport sector. “Much like DTC buses in Delhi shifted to cleaner CNG twenty years back, private vehicles need to shift to cleaner alternatives.” He said that the country must ensure that over the next decade, it manages to phase out a significant portion of petrol and diesel-powered vehicles, including two-wheelers, in favour of cleaner and cheaper gaseous fuels such as Auto LPG. The environmentally-friendly and economically-viable fuel can help in better mobility while minimising the impact of transport on human health and the environment. Unfortunately, despite significant price advantage over petrol and diesel and practical benefits, Auto LPG has achieved only marginal success in India, he said. According to Gupta, another way to reduce the pollution is to switch to electric vehicles but it has several ifs and buts. He maintained that a single technology cannot solve the air pollution challenge, especially if the technology is at least 10-15 years away from commercial viability. Gupta added that with almost 68 per cent of electricity being thermally produced, the so-called ‘clean’ electric vehicle may not really be as clean. “That is why it is important to invest in a wide range of alternative options to power the transport sector rather than putting all eggs in the electricity basket.” “Electric Vehicles are still a distant future and we cannot just wait for them to become widely usable and continue with the current levels of pollution. We desperately need immediate and near-term solutions to clean up the urban air,” he said. Rupa Nandy, Head of International Association of Public Transport (UITP), meanwhile, contended that a clean and green traffic jam would still be a traffic jam and hence, the overall focus of city and state authorities should be to strengthen and augment public transport and promote it as much as possible.
https://energy.economictimes.indiatimes.com/news/oil-and-gas/evs-distant-dream-india-needs-cleaner-fuels-to-combat-pollution/78692427
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From CNG to hydrogen, Delhi’s journey towards becoming city with clean air
On Tuesday, Delhi will become the first city in the country to roll out buses run on hydrogen-enriched CNG (HCNG), a fuel cleaner than CNG. However,
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HCNG is only an “interim” technology and the aim is to finally have hydrogen-run buses in the capital. A four-tonne-per-day compact reformer-based HCNG production plant will be inaugurated at the Rajghat-I bus depot of Delhi Transport Corporation (DTC) on Tuesday by Union minister for petroleum and natural gas Dharmendra Pradhan and Delhi transport minister Kailash Gahlot. From Tuesday itself, 50 buses running on HCNG will hit the capital’s roads. The buses will be run for six months as part of a pilot project. After the trial period, a detailed performance report will be compiled incorporating the fuel economy and the emissions data of the trial buses run with CNG and HCNG fuel mixtures. The report will be submitted to the Supreme Court and Environment Pollution (Prevention and Control) Authority. The apex court had earlier suggested that Delhi could “leapfrog” from the CNG-run to the Hydrogen-run buses instead of procuring electric buses as a solution for Delhi-NCR’s poor air quality. While the technology will take some time to appear in the capital, HCNG will be a step in that direction, even as Delhi government plans to gradually replace its fleet of CNG-run public transport buses with electric buses. The buses have been developed by Tata Motors and Indian Space Research Organisation, but are not easily available in the market yet. While a source in Delhi government said the possibilities were being explored, HCNG would help the city achieve reduction in emissions. Delhi government officials, however, said creating a fleet of purely hydrogen-run buses would take some time while it just needs to modify existing CNG-run buses for adopting HCNG. Delhi government is also looking at inducting 2,000 electric buses in Delhi’s public transport fleet by the end of 2021. Delhi government plans to induct 1,000 electric buses but their delivery schedule got hampered due the Covid19 outbreak. DTC also plans to induct 1,000 electric buses in its fleet and in a first-of-its-kind public-private partnership under the build-ownoperate-transfer (BOOT) model for the corporation, it is going to induct 300 electric buses by selecting an operator for procurement, operation and maintenance of these buses in an 11-year contract. The company will be paid operating cost per kilometre under the operating expenses (OPEX) model. Though DTC had received bids, the tender is yet to be awarded
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IGL to foray into battery swapping in tie-up with Mahindra Powerol
According to A K Jana, managing director, IGL, the company through this tie-up would be scaling up to 100 EV charging stations within a year. Indraprastha Gas Ltd (IGL),
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the country’s leading city gas distributor, is tying up with Mahindra Powerol to offer electric vehicle (EV) battery swapping facility at its retail outlets in the National Capital Region (NCR). Though the companies are still in discussions, with this foray, IGL would be branching out to the EV infrastructure business apart from its core business of retailing natural gas. According to A K Jana, managing director, IGL, the company through this tie-up would be scaling up to 100 EV charging stations within a year. Though IGL had plans to put up such stations across its network with every new IGL outlet having at least one EV charging point, the plan could not take off earlier. Mahindra Powerol, part of the Anand Mahindra Group, is into the business of providing power solutions, including diesel gensets, and offers operation and maintenance services. One of the major challenges that the battery swapping business is facing is lack of standardisation, said the executive quoted above, adding: “If the Bureau of Indian Standards comes up with specifications for batteries, swapping would pick up. One of the ways is to have modules in car batteries, which means whenever swapping is required, a discharged module can be exchanged for a fully charged one.” This would ensure that users do not waste time at charging stations for revving up their cars. Mahindra Powerol caters to industrial engine needs of construction, firefighting pumps, auxiliary power, and marine sectors. IGL’s 1,990 CNG stations could provide a good physical network for Mahindra. Mahindra along with Tata Motors in 2017 had won the first tender from Energy Efficiency Services to supply 10,000 EVs for senior government officials. However, a number of these vehicles could not be put to use because of low range. EESL has procured around 1,547 EVs of which 692 are from Tata Motors, 832 from Mahindra, 10 are Hyundai Kona, and 10 are MG Motor’s ZS 5.
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Gas/ Pipelines/ Company News
BP, Total remain bullish on India energy market
British energy major BP is looking at expanding its footprint in India’s fuel retail and mobility solutions market as the world bets on the third-largest economy in terms of purchasing power
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to lead the recovery in energy demand in the post-Covid scenario. According to BP CEO Bernard Looney, the company’s joint venture with Reliance Industries (RIL) will, over the next four to five years, add 5,500 fuel retail outlets that will also offer new-age mobility solutions such as charging facilities for electric vehicles. “India is an extraordinary country with an extraordinary history, an extraordinary group of people, and with extraordinary ambition,” Looney told India Energy Forum-CERA Week on October 26, pointing out the country has a growing population and an ambitious agenda to cut emissions that were “very, very compelling”. The expansion plan is not new as it was articulated at the time of announcing the JV with Reliance for selling motor and jet fuels in August 2019. But Looney’s reiteration of the plan signals the global oil industry is pinning its hopes on India to recover from the pandemic’s destructive impact on energy demand. In his concluding remarks on Wednesday, oil minister Dharmendra Pradhan pointed out that the fact that Prime Minister Narendra Modi inaugurated the forum shows his government’s emphasis on securing India’s energy architecture. “We are at such a point when we have to assess the impact of Covid-led disruptions to global energy sector supply chains and calibrate our approach towards strengthening of India’s energy sector.” Patrick Pouyanne, CEO of French major Total, joined Looney in describing India “as one of the world’s largest markets for energy” but pointed out that per capita consumption was just 30% of the global average, which offered “huge potential”. He said the French group is investing in setting up LNG import terminal, city gas networks and renewable energy projects in the country.
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USD 75 million investment so far in four OALP bid rounds, according to DGH
Having committed USD 2.3 billion investment, energy firms such as Cairn Oil & Gas spent USD 75 million (about Rs 550 crore) in oil and gas hunt in the first two years of India’s maiden open acreage licensing policy,
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according to the Directorate General of Hydrocarbons (DGH). In a bid to expedite oil and gas exploration and raise domestic production, the government had in 2018 launched the first bid round under the Open Acreage Licensing Policy (OALP) that allowed explorers to carve out desired areas for exploration and offered liberal terms. Five rounds have been concluded so far, with winners of the fifth bid round announced on Thursday. In the first four rounds, USD 2.317 billion investment was committed by firms such as Vedanta Group firm Cairn Oil & Gas, state-owned Oil and Natural Gas Corp (ONGC) and Oil India Ltd in 99 blocks awarded for exploration and production of oil and gas, according to the latest data put out by the DGH. Of this, USD 75 million has so far been invested till March 31, 2020, DGH, the upstream nodal authority of the Oil Ministry, said. The 1.38 lakh square kilometre of area offered for finding oil and gas in the first four rounds of OALP was double the acreage of the 254 blocks awarded in nine rounds of NELP between 1999 and 2010. The biggest chunk of USD 815 million was committed in the OALP-I round that saw Cairn Vedanta walking away with 41 out of the 55 oil and gas blocks on offer. Of this, only USD 46 million has been invested so far, DGH said. In 14 blocks of OALP-II, USD 452 million investment was committed, but only USD 2 million has been invested so far in exploration. The third round of OALP saw USD 709 million commitment in 23 blocks, of which USD 21 million has been invested. Only USD 6 million out of the USD 341 million committed in seven OALP-IV blocks have been invested so far. NELP attracted USD 29.15 billion investment since its launch in 1999 against the committed spending of USD 11.7 billion.
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Indian Oil board to consider issuing bonds and debentures for raising up to ₹20,000 crore
The borrowing would be carried out in one or more tranches, the company said in a regulatory filing on Thursday (Oct 22). The Board of India Oil Corporation (IOC) in its upcoming meeting
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on October 30 will consider the proposal to borrow up to Rs 20,000 crore during the ongoing financial year through private placement of bonds and debentures. The borrowing would be carried out in one or more tranches, the company said in a regulatory filing on Thursday (Oct 22). “The Board at its aforesaid meeting would consider the proposal for delegation of authority for borrowings including borrowings upto Rs 20,000 crore during a financial year through private placement of bonds/debentures in one or more tranches, from time to time, within the overall borrowing limit of Rs 1,65,000 crore approved by shareholders at the last Annual General Meeting,” it said. Shares of the oil marketing major traded on a positive noted on Thursday. Around 12.45 p.m. they were at Rs 76.70, higher by 0.85 per cent from their close.
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ONGC wins 7 oil blocks, OIL 4 in latest bid round
State-owned Oil and Natural Gas Corp (ONGC) has won seven out of the 11 oil and gas exploration blocks offered for bidding in the latest licensing round, upstream regulator
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Directorate General of Hydrocarbons (DGH) said Thursday. Oil India Ltd (OIL) won the remaining four blocks, it said. The government had offered 11 blocks for exploration and production of oil and gas in the fifth bid round under the Open Acreage Licensing Policy (OLAP). A total of 12 bids seven bids by Oil and Natural Gas Corp (ONGC) and four by Oil India Ltd (OIL) were received for the 11 blocks on offer at the close of bidding on June 30. Invenire Petrodyne Ltd was the only private bidder for one block. While ONGC was the sole bidder for six blocks, OIL was the lone bidder in all the four blocks it bid for. ONGC won all six blocks where it was the sole bidder and also the one block where Invenire Petrodyne had bid. The previous bid round, OALP-IV, too had seen just eight bids coming in for seven blocks on offer. ONGC had walked away with all the seven oil and gas blocks on offer. Prior to OALP-V, the government had awarded 94 blocks in four OALP bid rounds in the last two and a half years. These 94 blocks cover an exploratory area of about 1,36,800 square kilometers over 16 Indian sedimentary basins. In the latest bid round, about 19,800 sq km of the area was offered for bidding, according to DGH. OALP-IV was the first round on revamped terms approved in February 2019. Unlike previous rounds, where blocks were awarded to companies offering a maximum share of oil and gas to the government, blocks in little or unexplored Category-II and III basins are now awarded to companies offering to do maximum exploration programme. Of the 94 blocks awarded in the first four rounds of OALP, Vedanta has won the maximum at 51. Oil India Ltd has got 21 blocks and ONGC another 17. After OALP-V, ONGC’s tally has gone up to 24 and that of OIL to 25. Under OALP, companies are allowed to carve out areas they want to explore oil and gas in. Companies can put in an expression of interest (EoI) for any area throughout the year, but such interests are accumulated thrice in a year. The areas sought are then put on auction.
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Under construction gas pipeline catches fire in Moradabad district
Fire department teams were deputed in the area and the process of extinguishing the fire was carried out for a couple of hours. While no casualties were reported, equipment worth lakhs of rupees were damaged
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Bareilly: An under construction gas pipeline caught fire at Kalyanpur Road under Katghar police station limits in Moradabad on Wednesday (Oct 28). The fire reportedly broke out due to leakage in the pipeline. No injuries were reported so far. Fire department teams were deputed in the area and the process of extinguishing the fire was carried out for a couple of hours. While no casualties were reported, equipment worth lakhs of rupees were damaged. Around 20 fire extinguishers were needed to douse the fire. A local resident, Rajesh Kumar said that there was a massive fire and the situation was brought under control after several hours. Traffic in the area was suspended. Prima facie, the fire took place due to a leakage caused in the gas pipeline, however, the matter is being probed by the local area police, said officials at the fire department.
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Policy Matters/ Gas Pricing/Others
Why energy MNCs want natural gas to come under GST
Experts have argued that bringing natural gas under the GST would lead to a reduction in the cascading impact of taxes on industries such as power and steel, which used natural gas as an input.
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Global energy majors are bullish on the growth of natural gas usage in India and have called on the government to bring natural gas under the GST regime at the India energy Forum being held this week.
Experts have argued that bringing natural gas under the GST would lead to a reduction in the cascading impact of taxes on industries such as power and steel, which used natural gas as an input. The inclusion of natural gas under the GST regime would do away with the central excise duty and different value added taxes imposed by states. This would lead to an increase in the adoption of natural gas in line with the government’s stated goal to increase the share of natural gas in the country’s energy basket from 6.3% to 15%. Investing in renewable energy capacity was a key focus for CEO of Total, Patrick Pouyanné who noted that the company was aiming to expand its renewable energy portfolio in India to 6 GW. Pouyanne noted that he expected energy consumption in India to grow significantly. “The energy consumption per capita in India is just 30 per cent of the world average. So you have a huge potential with a very dynamic young population and that is a key priority of the Indian government…,” he said
https://indianexpress.com/article/explained/natural-gas-gst-tax-energy-companies-lpg-lng-6900697/
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Policy focus on e-mobility, clean fuels: PM Modi
India’s energy policy will focus on greater efforts to move towards a gas-based economy, cleaner fuels, electric mobility and renewable energy, Prime Minister Narendra Modi said on Monday (Oct.26).
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The policy will be industry friendly and growth oriented but energy should be affordable and reliable so it empowers people and improves their lives, Modi said. “India’s Energy Plan aims to ensure energy justice. That too while fully following our global commitments for sustainable growth,” he said at the India Energy Forum by CERAWeek, where petroleum minister Dharmendra Pradhan, US secretary of energy Dan Brouillette, and Saudi oil minister Prince Abdulaziz bin Salman also spoke. Modi supported the use of domestic, clean fuels, including biofuels and natural gas. “Increasing domestic gas production has been a key government priority. We plan to achieve ‘one nation, one gas grid’, and shift towards a gas-based economy,” Modi said. The Prime Minister called for better market mechanisms and stability in oil and gas. “For too long, the world has seen crude prices on a roller-coaster. We need to move towards responsible pricing. We have to work towards transparent and flexible markets for both oil and gas,” he said. He said India would be a major factor in the global demand for energy. Leading global bodies had projected a contraction in global demand for the next few years, but they also project India to be a leading energy consumer, he added.The government aims to increase its domestic refining capacity from 250 million to 400 MMTPA by 2025, he said. However, clean energy would be a focus area. “This means more energy to improve the lives of Indians, but with a smaller carbon footprint,” Modi added in context of international accords like the Paris Agreement. The Prime Minister said India remained committed to reduce emissions and combat climate change. “India has one of the lowest carbon emissions than the rest of the industrialised world, yet we will continue to make efforts to fight climate change,” he said. The Prime Minister stressed on the need to make energy an instrument of social transformation, but growth and investment would remain key pillars. “Our energy sector will be growth centric, industry friendly and environment conscious. That is why, India is among the most active nations in furthering renewable sources of energy.”
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Govt bans sale of gas, CBM to self
New Delhi: The government has banned natural gas and coal-bed methane (CBM) producers from buying their own produce in the newly notified gas marketing freedom guidelines.
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The government on October 15 notified the Natural Gas Marketing Reforms that give producers the freedom to discover the market price of gas through a standard e-bidding process. The notification, which follows the Cabinet Committee on Economic Affairs approving gas reforms, also gives them the liberty to market or sell the gas produced to anyone including affiliates. However, the producer or any member of its gas field consortium cannot bid and buy the fuel, the notified guidelines said. “Sale to affiliates will be allowed if affiliates participate in the open competitive process,” it said. “However, the contractor or its constituents shall not be eligible to participate in the bidding process.” “Seller and buyer will not be the same entity,” it added. This, the notification said, not just applies to conventional natural gas but also to CBM. In 2017, Reliance Industries had bid and bought all the gas it was producing from its Sohagpur East and Sohagpur West CBM blocks in Madhya Pradesh. The company used the gas at its petrochemical plants in Patalganga and Nagothane in Maharashtra, and Vadodara and Jamnagar in Gujarat. Reliance had outbid gas utility GAIL India Ltd for gas from Sohagpur till March 2021. State-owned GAIL had criticized the move saying Reliance had a 14 per cent tax advantage in the bid as stock transfer within the company is not subject to VAT.
The Oil Ministry had subsequently sought an explanation from Reliance which reasoned the sale to the CBM contract providing marketing freedom and the gas being sold through “an open and transparent bidding process through a reputed independent third party in compliance with provisions of the CBM contract and policy.” To put the ambiguity to rest, the October 15 notification said with the new change “the April 11, 2017 notification on Early Monetization of CBM, regarding the process of the sale, will stand amended.” The new guideline provides for the contractor selling the natural gas through e-bidding. “The contractor shall get the bids invited through an electronic bidding portal to discover market price by following a transparent and competitive bidding process notified by the government,” it said. The bidding will be conducted through an independent agency from a panel maintained by the Directorate General of Hydrocarbons (DGH). DGH is currently in the process of empanelling such agencies.
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LNG Development and Shipping
India to up share of short-term LNG deals in gas use: GAIL chairman
India’s biggest gas marketing firm GAIL expects the share of spot and short-term liquefied natural gas (LNG) contracts in the nation’s gas consumption to rise after a slump in
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spot prices has made long-term deals less attractive. “Presently one third of the market is (made up of) spot contracts and two thirds are long term. But we expect it to go more towards spot contracts,” GAIL Chairman Manoj Jain said at the India Energy Forum conference held by CERAWeek. To cut its carbon emissions India aims to raise the share of natural gas in its energy mix to 15 per cent by 2030 and companies are investing billions of dollars to build infrastructure including doubling pipeline capacity and setting up LNG import terminals. “Long-terms contracts are going to be lesser and short and medium term contracts are going to be the order of the day,” Jain said, adding GAIL was looking at destination swaps and to convert long-term contracts to small and medium-term contracts. Spot gas imports by the electricity generation sector, which account for over a fifth of India’s total consumption of the fuel, doubled in the June quarter to the highest in at least 14 quarters, while purchases under long-term contracts slumped by over a third to the lowest in the same period. India’s gas consumption needs to rise by at least three times to account for 15 per cent of the overall energy mix, Jain said, adding the country needed to further rationalise taxation and tariffs to boost gas consumption and local output. India’s gas consumption was 64.124 billion standard cubic metres in 2019/20. “Fifteen percent is a huge task but (because of) the policy environment and the push that the government has provided, I think yes, that is possible,” Jain said.
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India’s newest LNG terminal at Mundra nears 50% capacity utilization
At a time when some of the LNG re-gasification projects including the Dabhol (Maharashtra) and Kochi (Kerala) terminals are struggling for optimum capacity utilization despite being up and
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running for more than five years now, the brand new Mundra LNG terminal in Gujarat, is operating at about 45% capacity due to spurt in demand. The prices of gas in the international markets have been on a constant decline amid the Covid-19 crisis. The Gujarat government-backed GSPC LNG project at Mundra, which is co-promoted by the Adani Group, began commercial operations in February this year with 5 MMTPA installed capacity and built at a cost of about Rs 5,000 crore. “This is the fastest ramp up of an LNG terminal in the country since Dahej (phase-1) in 2004 which had the first mover advantage. Currently, the Mundra LNG terminal is operating at a throughput more than the throughput of the three LNG terminals (Kochi, Ennore and Dabhol) that came up in the last eight years,” said Sanjeev Kumar, managing director of GSPC. The Mundra terminal is facing pipeline capacity restraint that restricts it from further ramping up the capacity. The pipeline has a carrying capacity to cater to 5MMTPA of gas transportation from Mundra to Anjar. But, further down from Mehsana to Bhatinda, the pipeline can cater to only 7.5 MMSCMD or about 2MMTPA volume of gas. GSPC aims to set up a compressor near Ghana village in Kutch that will allow it to add throughput capacity of another 1.5 MMSCMD in the next few months, according to Kumar. By the end of this financial year, the Mundra LNG terminal will have achieved a throughput of 50% or about 2.5MMTPA of the total installed capacity, he added. The Mundra terminal was inaugurated by Prime Minister Narendra Modi in 2018 however it was only earlier this year that it received its commissioning cargo. India’s LNG import for September was 2,972 MMSCM which was 6.2% higher than the corresponding month of the previous year, according to a September report by Petroleum Planning and Analysis Cell, ministry of petroleum and natural gas. Mundra LNG terminal has already handled 20 cargoes, that too delivered by 19 different LNG ships including large sized Q flex carriers. The gas prices that were hovering around USD 5-6 per MMBTU last year fell to an all-time low of USD 2 in the April to July period this year. GSPC has booked 11 LNG spot cargos from April to October period in the range of USD 2.25 per million British thermal unit (MBTU) to USD 3.5 per MMBTU, said sources. The gas from Mundra terminal is supplied to the ceramic hub of Morbi and other parts of Saurashtra by Gujarat Gas, another state government-owned entity. Apart from households and industrial units, the gas from Mundra is supplied to GSPC Pipavav Power Company. The 700MW power plant produced only 62 million units in the April to July period last year which has increased to 1,610 million units in the same period this year, according to Central Electricity Authority data.
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Natural Gas / Transnational Pipelines/ Others
EU set to deny gas power plants a green investment label – draft
Power plants fuelled by natural gas will not be classed as a sustainable investment in Europe, unless they meet an emissions limit that none currently comply with, according to draft European Union regulations seen by Reuters.
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The landmark EU rules, due to be finalised this year, will force providers of financial products to disclose from the end of 2021 which investments meet climate criteria, and can therefore be marketed as “sustainable”. The aim is to steer billions of euros in much-needed private funding into low-carbon projects to help the EU hit ambitious climate goals, and limit so-called greenwashing by stopping the labelling of investments that do not meet the criteria as “green”. The draft rules say that to be classed as a sustainable investment – one that makes a “substantial” contribution to curbing climate change – gas power plants must not produce more than 100 grams of CO2 equivalent per kilowatt hour. Even Europe’s most efficient gas plants produce more than three times this limit, according to estimates by industry and independent climate think tank Ember. To comply, plants could use carbon capture and storage (CCS) technology – currently, no European gas plants do so, although companies such as Equinor and Shell are developing local CCS projects in industrial sectors. “The gas lobby has had its core request conclusively rejected,” said Rebecca Vaughan, an analyst tracking industry lobbying for InfluenceMap. Gas industry groups ramped up lobbying efforts after most gas plants and pipelines were excluded from a provisional list published in March. Companies including BP, Total and Equinor signed an open letter to EU leaders this month calling for the green finance rules to build on the existing gas market and network as the backbone of the bloc’s future energy system. The Commission declined to comment on the draft rules, which are subject to change before publication. The rules would not ban companies from investing in projects that don’t meet the EU’s “sustainable” criteria but industry groups have warned that excluding gas plants could mean they will struggle to raise finance – even for investments to reduce emissions. The EU rules use a tighter emissions limit than the 250g of CO2 per kwh threshold used by the European Investment Bank to screen investments. The EIB will stop financing unabated fossil fuel projects by end-2021. “Having a threshold that is not in line with the EIB suggests a lack of joined up rules between public and private lending, which is perverse,” Eurogas Secretary General James Watson told Reuters. The draft rules would label certain pipeline investments as sustainable – including refurbishments to enable gas pipelines to carry more low-carbon gases like hydrogen, or repairs to plug methane leaks. However, investments in new pipelines would only count as sustainable if they are dedicated to transporting low-carbon gas. Rules on nuclear power investments will be added following a Commission analysis.
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Neptune Energy makes small oil discovery off Norway
Oil firm Neptune Energy made a small oil discovery near the Fenja field in the Norwegian Sea, Norway‘s Petroleum Directorate said on Wednesday. (Oct 28).
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The discovery is estimated to hold between 0.5 and 3.2 million cubic metres (mcm) of recoverable oil equivalents, NPD said in a statement. The drilling, however, also led to a reduction in size of the nearby Arc discovery, which is now estimated to contain 0.2-1.6 mcm of recoverable oil equivalents, down from 1-4 mcm seen previously. Neptune’s partners in license 586, where the exploration well was drilled, are DNO, Suncor Energy and Eni subsidiary Vaar Energy.
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U.S. natgas jumps to 20-month high over $3 on rising LNG exports
U.S. natural gas futures climbed over 4% to a fresh 20-month high on Wednesday (Oct 21) as liquefied natural gas exports rise and output eases.
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Front-month gas futures rose 13.5 cents, or 4.6%, to $3.048 per MMBtu at 8:47 a.m. EDT (1247 GMT). That is the first time the contract rose over $3 since January 2019 and puts the contract up about 70% from a recent low of $1.795 on Sept. 21. Data provider Refinitiv said output in the Lower 48 U.S. states averaged 86.2 billion cubic feet per day (bcfd) so far in October, which would be its lowest month since September 2018. That compares with a four-month low of 87.2 bcfd in September and an all-time high of 95.4 bcfd in November 2019. Those production declines come as low prices earlier in the year due to coronavirus demand destruction caused energy firms to shut oil and gas wells and cut back on new drilling by so much that output from new wells no longer offsets existing well declines. As LNG exports rise and the weather turns colder, Refinitiv projected average demand would jump from 90.0 bcfd this week to 97.7 bcfd next week. The amount of gas flowing to LNG export plants has averaged 7.0 bcfd so far in October, up from 5.7 bcfd in September. That would be the most in a month since April and puts exports on track to rise for a third month in a row for the first time since February when feedgas hit a record 8.7 bcfd as rising global gasprices prompt buyers to reverse cargo cancellations. In the spot market, next-day gas rose to its highest since March 2019 at both the AECO hub NG-ASH-ALB-SNL and PG&E Gate NG-CG-PGE-SNL because of colder-than-normal weather in Alberta and hotter-than-normal weather in Northern California.Source: LNG Global/Reuters
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China warns of winter tightness in natural gas supplies
Beijing: China’s gas supply could get tight during the peak consumption period in December and January, state planner the National Development and Reform Commission (NDRC) cautioned on
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Tuesday (Oct 20). Factors of uncertainty, such as continuous cold weather in large areas, spell some pressures in guaranteeing gas supply, said the agency’s spokeswoman, Meng Wei. “The supply of natural gas resources is relatively sufficient, and the balance of supply and demand is generally better than in previous years,” Meng told a briefing. In the first nine months of the year, apparent consumption of natural gas stood at 230.9 billion cubic meters (bcm), or a year-on-year increase of 3.6%, she said. The National Energy Administration has forecast total 2020 consumption of 320 bcm. China is the only bright spot on the world gas market as it heads for its highest imports of liquefied natural gas ever, with industry recovering from the coronavirus pandemic. Since 2016, China has switched millions of homes and thousands of factories to natural gas from coal as a bridge fuel on its long journey to reach carbon neutrality by 2060.
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Greek asks EU to suspend customs union with Turkey: report
Athens: Greece’s Foreign Minister Nikos Dendias has written to the European Union asking it to consider suspending the EU’s customs union agreement with
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Turkey, the Greek state news agency ANA reported Tuesday (Oct 20). endias wrote to the European commissioner for neighbourhood and enlargement, Oliver Varhelyi, asking him to look at the measure in response to Turkey’s repeated violations of the agreement, the agency said. Under President Recip Tayyip Erdogan, Turkey has become an increasingly assertive regional power that is now engaged in a bitter dispute with Greece and Cyprus over oil and gas reserves in the eastern Mediterranean. In August Turkey sent a gas exploration vessel to waters Greece claims it owns south of the Greek island of Kastellorizo. The vessel spent nearly a month there before pulling out in early September. At the end of a summit last week, EU leaders on Friday condemned Turkey’s “unilateral actions and provocations” in the Mediterranean. The bloc warned Ankara that it would consider sanctions at its next summit in December if Turkey had not change its policy.
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Turkish president announces more natural gas reserves in Black Sea
“Total amount of natural gas reserves in the Tuna-1 well in Sakarya Gas Field reached 405 billion cubic meters,” he said after his inspections at the ship. Istanbul:
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Turkish President Recep Tayyip Erdogan announced that Turkey found more gas reserves in the Black Sea. “As a result of testing, analysis, and detailed engineering work, another 85 billion cubic meters were added to the reserves we had discovered,” Erdogan said onboard the Fatih drillship in the Black Sea on Saturday, Xinhua news agency reported. “Total amount of natural gas reserves in the Tuna-1 well in Sakarya Gas Field reached 405 billion cubic meters,” he added after his inspections at the ship. In August, the drilling ship discovered 320 billion cubic meters of natural gas reserves. The Fatih vessel started its drilling activities in late July in an exploration zone known as Tuna-1 off the northern Zonguldak province in the Black Sea region.
https://energy.economictimes.indiatimes.com/news/oil-and-gas/turkish-president-announces-more-natural-gas-reserves-in-black-sea/78729264
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Gas cartel readies to gouge imports of our own gas – Australia
And, may we ask, why would Australian consumers of gas pay for the liquefaction? The only reason we are having to import gas is because the gas cartel overbuilt the liquefaction capacity in the first place.
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By doing so they cornered the domestic market for gas. Now, we’re expected to subsidise this monopolist gouge by helping them recoup their losses on the liquefaction plants? I think not. In its export net-back calculations for LNG, the ACCC makes no such provision for paying for exporter liquefaction costs. Indeed, it charges only a marginal efficiency ratio of about 50 cents to cover OPEX costs: Any gas delivered to southern states from QLD via ship should not have to pay more than the cash cost of liquefaction which is pennies on the $1.34Gj quoted by Energy Quest. Australians should not have pay for the amortised capital costs of the very cartel that is gouging them. The best way to ensure this is to import gas from elsewhere as cheaply as possible and to have as many import terminals as possible to promote competition. As said previously, Qatar for example is already selling gas at a 10% slope to Brent versus the 14% most large scale Aussie gas consumers pay.Even with transport costs it comes in cheaper:
https://www.macrobusiness.com.au/2020/10/gas-cartel-readies-gouge-of-imports-of-our-own-gas/
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Global LNG Development
Global LNG-Asian spot LNG prices jump 9% on robust demand
Asian spot prices for LNG jumped nearly 9% this week (Oct 24-30) from a weGlobal LNG-Asian spot LNG prices jump 9% n robust demandek ago, as demand continued to
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rebound in the region’s key importing countries ahead of winter. The average LNG price for December delivery into Northeast Asia LNG-AS was estimated at about $7.50 per MMBtu, up 60 cents from the previous week. Asian spot LNG prices have jumped by more than 40% since the start of the month due to firm demand and production issues. Oil major BP this week sold an LNG cargo for delivery into Northeast Asia in December to Vitol at $7.65 per MMBtu, S&P Global Platts data showed. China’s natural gas demand is likely to grow about 10% this winter, up from 0.3% last winter, as a strong economic recovery from the coronavirus crisis spurs residential and industrial demand, state-run oil majors said this week. Europe, China and Korea could experience a colder-than- normal winter by 2-3 degrees Celsius, which would be positive for LNG demand, analysts at Bernstein said. “With the prospect of a cold winter ahead, prices could go higher but further shutdowns due to COVID-19 appear to be a real risk.” Rising shipping rates, which have hit a one-year high, are also boosting the LNG market. On the buy side, Bangladesh’s state-owned Rupantarita Prakritik Gas Company is seeking two LNG cargoes for delivery in December, while China’s Guangzhou Gas is seeking a cargo for delivery in December, traders said. Japan’s JERA likely bought a cargo for late-December delivery at around $7.20 per MMBtu, while a sell tender by Papua New Guinea may have been awarded at $7.40 per MMBtu on a delivered basis, traders said. In Europe, Equinor’s Melkoeya LNG plant in Norway could remain closed until October 2021 as extensive repairs are carried out following a fire last month, the company said.
Source: LNG Global/Reuters
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Global LNG-Asian spot LNG prices jump to 20-month high on firm demand
Asian spot prices for liquefied natural gas (LNG) jumped to their highest in more than 20 months this week (Oct 17-23) on robust buying appetite ahead of a colder-than-expected winter,
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trade sources said. The average LNG price for December delivery into northeast Asia LNG-AS was estimated at about $6.90 per MMBtu, jumping $1.10 from the previous week. Prices were boosted by several requirements from buyers in Japan, China and South Korea. China’s Unipec sought 10 cargoes for delivery in winter, while Shenzhen Energy sought a cargo for December delivery, traders said. South Korea’s KOGAS may have awarded a tender to buy at least six cargoes for delivery over November to January at just below $7 per MMBtu, while Japan’s Tohoku Electric sought a cargo for delivery in late November to early December, they added. Taiwan’s CPC Corp may also have bought several cargoes for delivery in December at close to $7 per mmBtu, one of them said. Cheniere Energy may also have bought a cargo for delivery in December at about $7.10 per MMBtu, a second source said. Still, with no cancellations expected from U.S. LNG projects in December, a potential increase in cargo flows to Asia may cap price gains, traders added. Australia Pacific LNG (APLNG) offered a cargo for November-loading, while BHP offered a North-west Shelf cargo for late November to early December loading, traders said. Darwin LNG likely offered a cargo for loading over late November to early December, while Ichthys LNG likely sold a November cargo at $6.10 to $6.30 on a free-on-board (FOB) basis, they said. Russia’s Sakhalin Energy also offered a cargo for loading on Dec. 25, while Nigeria LNG offered a cargo for mid-November loading.
Gail (India) likely awarded a swap tender, selling a cargo for loading in January from the United States and buying a cargo for delivery into India, one source said.
Source: LNG Global/Reuters
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Global LNG-Asian spot prices rise on expected colder weather
Asian spot prices for liquefied natural gas (LNG) rose to their highest in more than 11 months this week (Oct 11-16), underpinned by expectations
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that an anticipated cold winter will stoke demand for the fuel used in heating. The average LNG price for December delivery into northeast Asia LNG-AS was estimated at $5.80 per MMBtu, up 10 cents from the previous week. The price for November delivery was at around $5.70 per MMBtu, up 20 cents from last week, trade sources said. Taiwan’s CPC Corp closed a tender earlier this week to buy 12 cargoes for next year, while South Korea’s Posco bought a cargo for delivery in the second half of November, traders said. Japan’s Kansai Electric and Japex were seeking a cargo each for mid-December delivery while China’s Guangzhou Gas was also seeking a cargo for delivery in late December, they said.
Kuwait Petroleum Corp bought a cargo for mid-November delivery at about $5.70 to $5.90 per mmBtu, one source said. In Pakistan, Gunvor Singapore s offered the lowest bid for the delivery of one cargo in November at 13.8699% slope of Brent, an official said on Thursday (Oct 15). Bangladesh is also expected to double its imports of LNG from December on rising demand, two energy officials said. On the sell side, Royal Dutch Shell said on Thursday its Prelude floating LNG project off Australia, offline since early February, is working on restarting operations but would not resume full production this year. Australia’s GLNG may have sold a cargo for late November loading at about $5.20 to $5.50 per MMBtu on a free-on-board basis while BHP Billiton likely sold a Nov. 21-23 cargo at about $5.40 to $5.60 per MMBtu, sources said. Angola LNG had a sell tender this week for a cargo to be delivered to as far as Indonesia, they added. Egypt’s Idku plant is expected to resume LNG production after a three-month hiatus, Kpler said.
Source: LNG Global/Reuters
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China’s winter gas demand to rise 10% on economic recovery – state oil firms
China’s natural gas demand is likely to grow about 10% this winter, up from 0.3% last winter, as a strong economic recovery from the coronavirus crisis spurs residential and industrial demand, state-run oil majors said on
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Thursday (Oct 29). With higher domestic production and record LNG imports, China will experience a relatively balanced market for the heating season from mid-October through mid-March when demand for the fuel typically peaks, executives from national oil companies told a gas seminar in Beijing. However, firms remain alert to possible disruptions from top piped gas supplier Turkmenistan and logistics hiccups in receiving LNG imports when heavy flows of shipments arrive. Turkmenistan could reduce daily supply by 5-15 million cubic metres (mcm) during the coldest month, as the country has been increasing gas exports to Russia since 2019, said Li Wei, vice general manager from PetroChina’s natural gas sales department. Gas demand will total 148 billion cubic meters (bcm) this winter, up 11.8 bcm year-on-year, Meng Yadong, an executive at Sinopec’s gas marketing company told a seminar hosted by Chongqing Petroleum and Natural Gas Exchange. Demand in the 2019/2020 winter only rose 0.3% year on year, as it was badly hit in the first few months of 2020 by the pandemic. Sinopec expects China’s total gas consumption to rise by 9 bcm, or 3% year-on-year, to 310 bcm in 2020, while CNOOC forecast 320-325 bcm. This is in line with a previous government forecast that pegged China’s 2020 gas demand growth at the slowest pace in five years as the pandemic hit economic activity.
Top oil and gas producer PetroChina said it expected to supply 98.6 bcm this winter, up 10 bcm from last winter. The firm also pumped 6% more gas into its underground storages that totalled 9.06 bcm by the end of September, said a company storage executive. Sinopec, which analysts said emerged as a leading global buyer of spot LNG this year on cheap Asian prices, said its winter gas supply would reach 26.3 bcm. CNOOC, which relies on LNG imports for 72% of its supplies, plans a total supply of 22.93 bcm this winter. Piped gas from Russia via the Power of Siberia project that started running a year ago will transport 14 mcm a day this winter, up from 8 mcm last winter, said PetroChina’s Li.
Source: LNG Global/Reuters
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Shell’s Australian Prelude LNG will not resume shipping LNG this year
Royal Dutch Shell said on Thursday (Oct 15) its Prelude floating liquefied natural gas (FLNG) project off Australia, off line since early February, is working on restarting operations but would not resume full production this year.
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The troubled Prelude FLNG platform was shut down following an electrical trip and Shell has faced a number of issues over the past few months in trying to restart full production and now does not expect to ship any LNG before next year. “Full production is not expected to resume before year end. Prelude is a multi-decade project, and our focus is on delivering sustained performance over the long term,” Shell said in a statement. The company hopes to resume shipping LNG from Prelude in the first quarter of 2021, a person familiar with the situation said. The $17 billion Prelude project, centred around the world’s biggest floating liquefaction vessel, has been plagued with problems. It shipped its first cargo only last year, more than two years behind schedule, and has yet to achieve steady output at its design capacity of 3.6 million tonnes a year of LNG. The project is jointly owned by Shell, Japan’s Inpex Corp 1605.T, Korea Gas Corp 036460.KS and a unit of Taiwan’s CPC Corp.
Source: LNG Global/Reuters
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Glencore to send 1st spot LNG cargo to China’s Zhoushan in key JV
Swiss-based global mining and commodities trader Glencore is set to send its first spot liquefied natural gas cargo to Zhoushan in eastern China in a trading joint venture with
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Zhejiang Energy Group, a top company trader said on Friday (Oct 16). Glencore’s joint venture with Zhejiang, which is backed by the provincial government, dates from 2018 making it one of the few Western traders with such tie-ups in China, the world’s top crude oil buyer and second-largest importer of LNG. Alex Sanna, Glencore’s global head of oil and gas, told an oil and gas seminar in Zhoushan that the shipment was set to arrive there “in two weeks”.The first spot cargo purchase came after the Zhejiang firm’s natural gas group injected funds in June into the joint venture, Sanna added. Zhoushan, which receives growing flows of super-chilled natural gas, is the site of a terminal run by private Chinese gas firm ENN Energy Holdings with annual capacity to receive 3 million tonnes. It is China’s largest privately controlled facility of the kind. In the year’s first half, the joint venture traded 5 million tonnes of oil and gas, an increase of more than 50% from a year earlier, Glencore’s Sanna added.
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China’s Guangzhou Gas says LNG import terminal to begin operations by H2 2022
China’s Guangzhou Gas Group said the liquefied natural gas (LNG) storage tank and jetty it’s building on the southern coast in Guangzhou is expected to begin
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commercial operation by second-half 2022, with initial annual throughput of 1 million tonnes. In slides presented at a gas conference in Shanghai, the company said it would begin issuing tenders to buy over 1 MMTPA of LNG for the medium and long term in 2021. Local government-backed Guangzhou Gas, one of China’s fast-growing players in the LNG sector outside the national state giants, had earlier planned to build a 2 MMTPA LNG terminal by 2020. Phase 1 of the terminal project on the southern coast includes building two 160,000 cubic metre LNG storage tanks, while Phase 2 includes building two 200,000 cubic metre LNG storage tanks, according to the presentation. The jetty will be able to berth a 80,000 tonne LNG tanker.
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LNG imports in Latin America fall as pandemic takes toll
Imports of liquefied natural gas (LNG) to Latin America fell by 4.2 MMT, or 32%, during January-September versus the same period in 2019 as the coronavirus ravaged the region’s economies,
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according to new analysis by data intelligence firm Kpler. Latin America has seen a particularly sharp decline this year compared to other LNG-importing regions in the world, said Kpler’s Homayoun Falakshahi, senior commodity analyst, during a webcast last week. Europe, for example, saw an 11% year/year increase in LNG imports over the same span, while Asia recorded a 2% increase. In both cases, however, the increases were because of high imports during the first quarter, before the pandemic made its impact felt around the world. Falakshahi also noted that Latin America’s LNG import volumes were on the decline before the pandemic. The last quarter in which the region posted a year/year increase was in 1Q2019, Kpler data show. In Brazil, “LNG and thermal coal imports have pretty clearly weakened a lot through Q2 and Q3” of this year, said Kpler’s Reid I’Anson, senior commodity analyst. He noted that the reason for this is two-fold. In the second quarter, Brazil’s LNG import weakness was mainly because of an overall drop in power demand amid the pandemic, while in Q3 it primarily was the result of a bump in hydroelectric output. Normally in Brazil, “if you have a strong hydropower output, thermal power output tends to weaken on a year/year basis and vice versa,” I’Anson said. “This was not true through Q2, and this is very rare.” Both hydropower and thermal generation were either flat or lower on a year/year basis throughout the second quarter in Brazil, reflecting overall economic weakness. “But this has since reversed into Q3,” I’Anson said, “and we’ve moved back into a more normal situation” of an inverse relationship between the two power sources. Latin America’s largest LNG exporter, Trinidad and Tobago, has seen its export volumes to the Americas steadily decline over recent years, although they have stabilized at an average of about 450,000 tons/month over the last year, Kpler data show. Exports from Trinidad to Europe did tick up slightly to 240,000 tons/month in September, however. The country’s exports to Asia and the Americas have remained relatively stable over the same span, Falakshahi said. He also noted that Kpler has recently seen a few cargoes coming out of Trinidad’s Atlantic LNG terminal sitting idle in floating storage for a few weeks before finding a buyer. Mexico, meanwhile, is seeking to join the ranks of LNG exporters in the Americas by liquefying natural gas produced in the United States and exporting it to Asia. Sempra Energy and Mexico Pacific Limited LLC each are nearing a final investment decision on liquefaction terminals planned for the country’s Pacific Coast. The government has announced a third project for the port city of Salina Cruz, although experts have questioned the project’s viability.Mexico has seen its own LNG imports largely displaced in recent months by new pipeline infrastructure, including the 2.6 Bcf/d Sur de Texas-Tuxpan offshore pipeline and the Waha-to-Guadalajara, aka Wahalajara system.
https://www.naturalgasintel.com/lng-imports-in-latin-america-fall-as-pandemic-takes-toll/
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China’s CNOOC issues first LNG tender on Shanghai gas exchange – sources
China National Offshore Oil Corp (CNOOC) issued the first tender to buy liquefied natural gas on the Shanghai Petroleum and Natural Gas Exchange when the bourse launched
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LNG trading on Friday (Oct 30), two sources familiar with the matter said. According to an online notice by the exchange, CNOOC issued a buy tender for LNG to be delivered in March 2021. The two industry sources said that was the first acquisition of an LNG cargo via the exchange. One of the sources said foreign companies would be allowed to participate in the bidding for the tender. “It should be quite exciting,” the source said. The Shanghai exchange said bidding will begin on Oct. 30 and close on Nov. 2, and that the tender would be awarded on Nov. 2. It did not indicate the cargo size. CNOOC Gas & Power Group, a wholly owned subsidiary of CNOOC, will carry out the bidding on the exchange’s electronic trading platform, which began international LNG trading on Friday, the exchange said. The LNG trading launch would “further meet the sales and purchase needs of domestic and foreign LNG market participants,” added the exchange. China is the world’s second largest importer of LNG after Japan, and its appetite for natural gas has swelled in recent years amid a government-led push for a coal-to-gas switch in power generation. The country’s gas demand is expected to grow by 10% this winter, compared with 0.3% last year, its state oil-majors said this week.
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Natural Gas / LNG Utilization
Gazprom puts into operation Europe’s biggest CNG station
A ceremonial event celebrating the commissioning of two new natural gas stations has taken place in Moscow via a video link at the meeting of the Gazprom Board of Directors.
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Now that these two new filling stations have been brought onstream, the total number of Gazprom’s natural gas refueling facilities in Moscow and the adjacent territory has increased to seven. Situated at the intersection of Zenitchikov and Dubravnaya Streets, CNG station No. 2 with the annual design capacity of 29.8 million cubic meters is the largest in Europe (along with the CNG station opened on the Levoberezhnaya Street in 2017). The station has 12 gas pumps ensuring a daily throughput of 1,600 vehicles. CNG filling station No. 5, located on Podolskikh Kursantov Street, has the annual design capacity of 8.9 million cubic meters of natural gas and is equipped with six pumps allowing to refill 480 vehicles a day. These new facilities were built using domestic equipment and materials. Mosgortans (Moscow City Transport Authority, passenger transportation) and Ecotechprom (disposal of household waste) will be the main consumers of natural gas. The use of this eco-friendly vehicle fuel will help establishing a more comfortable urban environment in Moscow.
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New Volkswagen Golf with natural gas drive is now available to order
The new VW Golf is now also available with an environmentally-friendly natural gas drive: the Golf TGI is equipped with a powerful 1.5-liter four-cylinder engine with 96 kW / 130 PS and three CNG tanks.
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The tanks are integrated into the underbody and permit a range of around 400 kilometers (WLTP) in pure natural gas mode. The engine of the quasi-monovalent drive system is powered primarily with CNG, but can also run on petrol. Drivers of natural-gas-powered vehicles benefit from comparatively low fuel prices in many countries. The total CNG tank capacity is currently 115 liters or 17.3 kg and permits a driving radius of a good 400 kilometers in the WLTP cycle. The Golf TGI is also equipped with a petrol tank with a useful capacity of 9 liters – this is essentially a reserve tank in case the natural gas should run empty, but ensures additional range too. For driving dynamics and efficiency, the Golf TGI comes with a 1.5-liter four-cylinder petrol engine. This powerful engine is both efficient and environmentally friendly, as also demonstrated by its WLTP fuel consumption of just 4.3–4.1 kg of natural gas per 100 kilometers in combination with CO2 emissions of only 117–111 g/km. The new 1.5 l TGI engine in the Golf operates according to the innovative Miller cycle principle, a combustion process that achieves low carbon emissions thanks to its high efficiency and a compression ratio of 12.5:1. At the same time, a turbocharger with variable turbine geometry increases the charge pressure and supplies more air to the cylinders. This allows the Golf TGI to accelerate powerfully from low engine speeds at any time.
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HAM will develop the first LNG fueling station in Chile
HAM Chile, a subsidiary of HAM Group, has been chosen by Lipigas Companies for the design, construction and commissioning of Chile’s first LNG station. This will be located at the facilities of Transportes San Gabriel, Linares,
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Maule Region, very close to the Ruta Cinco Sur (Pan-American Highway in Chile), which is part of the country’s main land communication artery. The new service station will allow the continuous supply of LNG to a fleet of 30 trucks from Cervecera AB InBev Chile, which will be added to Transportes San Gabriel’s fleet. The project has been possible thanks to Lipigas’ commitment to natural gas for vehicles, with the aim of contributing to sustainable development through the design of efficient energy solutions that help its customers in the challenge of reducing their environmental impact. Lipigas is a relevant player in the energy market in Latin America, with a presence in Chile, Colombia and Peru, and delivers comprehensive energy solutions to its customers through its different products. HAM Chile has been operating for several years in South America, with its own facilities and staff in the Santiago metropolitan region. This has allowed HAM Group to continue its expansion and have greater proximity with its customers, making available a wide variety of products and services: design, construction, maintenance and supply of CNG-LNG service stations; regasification plants (PSR); bunkering; manufacture of cryogenic tanks for LNG and air gases, among others.
https://www.ngvjournal.com/s1-news/c4-stations/ham-will-build-chiles-first-lng-fueling-station/
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BBVA USA offers loan discounts on alternative fuel commercial vehicles
BBVA USA, a financial services provider, has unveiled its second product geared towards environmental sustainability, announcing a rate discount on secured term loans for fuel-efficient commercial vehicles.
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The loan provides a .75 percent rate discount for hybrid, electric, natural gas or hydrogen fuel cell vehicles. The announcement comes on the heels of a BBVA USA commercial real estate product launch that focuses on sustainability, a key pillar of the bank’s 5-year strategic plan. Commercial clients are eligible for the secured term loan rate discount when financing commercial vehicles through BBVA USA from a licensed auto dealer. Potential benefits also include competitive low fixed rates, and terms up to five years. Healthcare providers can receive an additional .15 percent rate discount. Commercial clients must apply by December 31, 2020. “We want to make environmental sustainability, and the steps toward that goal, convenient for our commercial clients and their overall operations,” said BBVA USA Small Business Credit Products & Processes Manager Stan Demarest. “When we develop these products, we take into account not only environmental sustainability, but how we can make it easy for these businesses to save money in a time where every dollar counts. On BBVA’s side, we want these products to continue to advance the bank’s overall strategy and hit measurable business and sustainability targets for our overall bottom line.” These recent products reflect BBVA USA’s second of six pillars that guide the bank’s strategic plan, focused on environmental and economic sustainability, among other issues.
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Solaris will supply an extra 100 NGVs to Estonian biggest bus operator
In 2019 in Tallinn, Solaris won a tender for the delivery of 60 Urbino 12 and 40 Urbino 18 articulated buses, all fueled by CNG. In accordance with the agreement, the
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Tallinn operator Linnatranspordi AS (TLT) have been receiving the vehicles in batches. 80 of them have been delivered so far, and the remaining 20 buses will be delivered by the end of this year. Before the end of the deliveries TLT triggered an option provided for in the main contract and extended the order by another 100 vehicles. This time, the order will encompass 50 Solaris Urbino 12 CNG buses and 50 Solaris Urbino articulated CNG buses. The order is worth 28 million euros. These vehicles will be delivered in 2021. Compared to the first batch of the contract, the 100 newly commissioned buses will be kitted out differently: this time the client has opted for closed driver’s cabins with a separate entrance. This is just one of the many solutions offered by the bus maker as part of “anti-coronavirus” package. The closed cabin limits the driver’s contact with passengers, thus minimizing their risk of infection. Both in the 12-meter and the 18-meter versions, the heart of the vehicles will be a 239 kW engine adapted to use CNG. It will boast a cold start function that facilitates starting of the engine at very low outside temperatures. The driveline will be supplemented by an automatic transmission, ensuring optimal travel comfort for drivers and passengers. The buses will feature, among others, efficient air conditioning for the whole vehicle and dual USB ports installed between the seats in each row. It will also be equipped with a passenger information system with external and internal voice announcement systems, as well as CCTV comprising interior cameras, a road-facing and a rear-view camera.
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OnTurtle opens five natural gas refueling stations in the Netherlands
OnTurtle is expanding its network of international service stations with the addition of five new natural gas stations in the Netherlands. The leading company in fleet management services,
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with more than 1,600 stations distributed throughout Europe, is now entering the Dutch market with DC BERKEL as a supplier to offer LNG supply. The new stations are located in Beneluxhaven (Rotterdam), Roosendal, Harnaschpolder, Servenum and Borne, strategic points adapted to the usual routes of international transport, to facilitate access to refueling for professionals from the main roads and highways or near the border with Germany. The facilities are adapted for Volvo trucks. In addition to the arrival in the Netherlands, OnTurtle announced three new service stations that began operating in parallel in France, in the towns of Fretin, Gonfreville-L’Orcher and La Rochelle. In total, the company has 62 natural gas refueling stations in five European countries: Spain, France, Belgium, Italy and the Netherlands. Since 2018, OnTurtle has been supporting LNG and CNG as an alternative to traditional fuels and confirms its strong commitment to professional transport that is more respectful of the environment.
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LNG as a Marine Fuel/Shipping
South East Asia’s first LNG bunker vessel ready to operate in Malaysia
Keppel Offshore & Marine (Keppel O&M) has successfully delivered its first newbuild LNG carrier, the Avenir Advantage, to Avenir LNG Limited. The ship also functions as an LNG bunkering vessel,
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making it the first in South East Asia to do so. In addition, it is the first of two such vessels that Keppel O&M is building for Avenir LNG, expanding its suite of solutions across the gas value chain. This reinforces Keppel’s Vision 2030, which includes seizing opportunities in LNG solutions and renewables. The 7,500m3 vessel was built at Keppel Nantong Shipyard in China, and is equipped with engines that can run on both diesel and LNG. Keppel O&M’s technology arm, Offshore Technology Development (OTD), also installed and commissioned the vessel’s Ballast Water Treatment System. “We are pleased to deliver South East Asia’s first LNG bunkering vessel, which strengthens our capabilities and extends our track record in providing solutions across the gas value chain,” said Tan Leong Peng, Managing Director (New Builds), Keppel O&M. “This is the fourth dual-fuel vessel we have delivered, and one of four LNG bunkering vessels we are building. It is a testament to our versatility and ability to provide environmentally-friendly solutions for more sustainable vessel operations.” The Avenir Advantage has been chartered by Petronas LNG to provide ship-to-ship LNG bunkering to vessels across Malaysia, and transport services as an LNG carrier for small-scale terminals in the region. Avenir LNG’s CEO, Milorad Doljanin commented, “The flexible design of our vessels means they can support the development of the LNG bunker fuel market in the shorter term whilst underpinning our strategic objective: to enable LNG supply to energy users who were previously unable to enjoy the environmental and cost benefits which LNG affords.”
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US firm Pilot LNG signs deal to supply LNG bunker from proposed Galveston port
Texas-based firm Pilot LNG has signed a non-binding deal for the supply of liquefied natural gas (LNG) marine fuel from its proposed Galveston LNG Bunker port,
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the region’s first dedicated LNG bunker terminal, the company said late on Tuesday (Oct 20). It signed a preliminary deal, known as the heads of agreement (HOA), with bunkering firm GAC Bunker Fuels for the supply of LNG marine fuel on a delivered ex-ship (DES) basis. The super-chilled fuel is to supply GAC’s customers in the Galveston Bay Port complex, including the ports of Houston, Galveston and Texas City, as well as the Galveston Offshore Lightering Area, on a long-term basis, Pilot LNG said. “This agreement with Pilot will allow us to grow our portfolio of alternative fuels, with LNG as the cleanest and most cost-effective way for shippers to meet compliance,” said GAC Bunker Fuels’ global director Nicholas Browne. The shipping industry has been under pressure to reduce carbon emissions, and earlier this year introduced new rules to cut the sulphur content in marine fuels, also known as bunker fuels. This in turn is prompting demand from tanker operators and cruise liners for LNG as a bunker fuel. Pilot LNG added it has filed regulatory applications with the U.S. Army Corps of Engineers (USACE) and other relevant regulatory agencies, ahead of a final investment decision expected next year. The Galveston LNG Bunker Port on Pelican Island, located off Galveston Bay, is expected to start operations in late 2024 and is expected to fuel ships entering or leaving the busy Houston Ship Channel.
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Lower prices drive Asia’s demand for LNG as ship fuel
The use of LNG fuel ships is gaining traction in Asia amid a global push to use cleaner fuels in the sector and as abundant supplies are making the super-chilled fuel more affordable than oil.
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The move could draw billions of dollars in investments from suppliers and buyers in gas storage, LNG-fuelled vessels and barges that will enable ships to meet stringent emission standards set by the International Maritime Organization, analysts and industry officials say. These measures are expected to boost Asia’s share of the global LNG marine fuel market to between a quarter and a third by 2030, up from a “tiny fraction”, Andrew Buckland, analyst at consultancy Wood Mackenzie, said. Globally, LNG is expected to account for 10 per cent of overall marine fuel mix by 2030, up from less than 0.1 per cent last year, he added. Rashpal Bhatti, vice president for maritime and supply chain excellence at BHP Group, said: “Today, the industry is a homogenous fuel, which is fuel oil. “Going forward, some percentage will use fuel oil, some percentage will use LNG, some will use ammonia, some hydrogen and other sources of fuel as well.” BHP is in talks with three companies to supply LNG to fuel five ships it plans to use to transport iron ore between Western Australia and China. The company analyzed supply and demand of gas and fuel oil and estimates that LNG is now cost competitive as shipping fuel. LNG spot prices have averaged about $131 per tonne less than those for very low sulphur fuel oil so far in 2020, data from Refinitiv Eikon showed. While the gap has narrowed recently due to an uptick in LNG prices, they are expected to widen again when more supply hits the market over the next few years, analysts said. To tap this potential growth, Singapore’s Pavilion Energy is working with potential partners to develop a global bunker supply network. It signed a memorandum of understanding with Finnish state-owned gas company Gasum earlier this month and is currently in “advanced stage of negotiations” with parties in China, said Alan Heng, managing director of its Asia office. Singapore’s FueLNG, a joint venture between Keppel Offshore & Marine and Shell Eastern Petroleum, will operate a LNG bunkering vessel while more such vessels are on order from countries like Singapore, Malaysia, Japan, South Korea and China. As more facilities are built, Asia’s LNG bunkering will grow faster to nearly 10 million tonnes by 2025, or about 4 per cent of global marine fuels market, IHS Markit’s director of southeast Asia gas and LNG division Chong Zhi Xin said. “Once these LNG bunkering vessels are introduced, it will allow more contracts to be signed and vessel owners will be more comfortable making the switch to LNG,” he said.
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LNG and hydrogen fuel option to help shipping meet IMO targets
Liquefied natural gas (LNG) and hydrogen have been named as frontrunner fuels that could help the shipping industry meet IMO decarbonisation ambitions, a new survey by ABS suggests.
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In the ABS Future Fuels LinkedIn Survey, 47% of the respondents mentioned LNG as the solution to the 2050 emissions target while 40% selected hydrogen. Only 8% of the stakeholders opted for ammonia as the future fuel and 5% mentioned methanol. For the 2030 industry targets, LNG was chosen by 64% of the respondents as the dominant fuel option. Approximately 22% of the respondents said they believe hydrogen could be the option while 7% each considered ammonia and methanol. The results demonstrate the challenges faced by the shipowners in developing fleets that meet and exceed IMO targets, ABS noted. ABS chairman, president and CEO Christopher Wiernicki said: “Owners of internationally trading ships are facing increasingly complex investment decisions as they try to navigate the most efficient course to the low-carbon future, which is why ABS has moved to simplify the landscape by identifying three fuel pathways potentially open to shipping.” The first pathway identified by ABS is called ‘Light Gas’. It uses generally light, small molecule fuels with high energy content but more demanding, mainly cryogenic fuel supply systems and storage. The group includes a relatively mature methane solution, leading towards bio-derived or synthetic methane, and ultimately, to hydrogen as fuel. LNG can reduce greenhouse gas (GHG) emissions by approximately 20%. Bio-methane can be carbon neutral while hydrogen is a zero-carbon fuel. While Hydrogen is viewed as an optimal solution, it requires major technical advances to put it into practice. Wiernicki said it may even take a decade or more. The second pathway is defined as ‘Heavy Gas’. It includes the use of generally heavier, more complex molecules but with less demanding fuel supply and storage requirements than the light gas pathway. The group includes liquefied petroleum gas (LPG), methanol and ethanol, leading to bio-derived or synthetic LPG / methanol, and ultimately, to ammonia. The third pathway uses bio / synthetic fuels that are derived from renewable sources and can produce liquid fuels. The fuels have similar properties to diesel oil and can be used with minimal changes to current ship designs. Wiernicki said: “In the future, the third generation of biofuels such as lignocellulosic or algae-based fuels could potentially provide the industry with almost 500 million tonnes of fuels annually, more than the current annual bunker demand. “This group includes electro / synthetic gas-to-liquid (GTL) fuels produced through either carbon capture and electrolysis, or from converting biomass to syngas and then to liquid fuels such as methanol or diesel.” He also noted that shipowners may choose the pathway depending on the operation profile and trade of the vessel. He added: “Although we are fuel and technology agnostic, ABS focuses on working across the board to help owners not only reach their decarbonisation and sustainability targets but hit them successfully while maintaining a laser focus on safety.”
https://www.ship-technology.com/news/lng-hydrogen-fuel-shipping-imo-targets/
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JERA launches LNG bunkering business
JERA Co., Inc. has started an LNG bunkering business in the Chubu region of Japan through its Central LNG joint venture with Kawasaki Kisen Kaisha, Ltd., Toyota Tsusho Corporation, and
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Nippon Yusen Kabushiki Kaisha (NYK). On 20 October, the Central LNG-owned LNG bunkering vessel Kaguya supplied LNG to Sakura Leader, an LNG-fuelled PCTC (pure car and truck carrier) operated by NYK that is under construction at Shin Kurushima Toyohashi Shipbuilding Co., Ltd. This is the first time LNG fuel has been supplied through ship-to-ship LNG bunkering in Japan. The International Maritime Organization (IMO) has established the goal of reducing greenhouse gas (GHG) emissions from shipping by at least 50% by 2050 compared to 2008, and many LNG-fuelled ships are expected to be produced going forward. JERA, together with its business partners, established Central LNG in May 2018 in preparation for the launch of its LNG bunkering business. Construction of Japan’s first LNG bunkering vessel, Kaguya, began at Sakaide Works (Kawasaki Heavy Industries, Ltd.) in July 2018 and was turned over to Central LNG this September. The LNG fuel supplied by Kaguya was loaded between 16 and 17 October this year at JERA’s Kawagoe Thermal Power Station. Existing facilities at Kawagoe Thermal Power Station were modified beginning in July 2018 to coincide with the start of the LNG bunkering business. Going forward, Kaguya will be based at Kawagoe Thermal Power Station as Central LNG further develops the LNG bunkering business in the Chubu region. JERA will continue to provide a stable supply of LNG fuel to Central LNG, while driving the conversion of ships to LNG fuel by promoting the LNG bunkering business through this joint venture, thereby helping to reduce the impact on the environment.
https://www.lngindustry.com/liquid-natural-gas/22102020/jera-launches-lng-bunkering-business/
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LNG tanker rates soar ahead of expected cold Asian winter
Shipping rates for liquefied natural gas (LNG) tankers have soared to their highest in a year ahead as demand for cargoes rose on expectations of a colder than expected winter in North Asia,
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shipping and trade sources said on Monday (Oct 26). The daily charter rate for shipping LNG on a 160,000 cubic metres tanker in Pacific and Atlantic basins are currently estimated to be about $85,000 to $105,000 a day, four shipbrokers told Reuters. Rates rose by $23,750 a day on Friday (Oct 23), the biggest daily rise since last October, said Tim Mendelssohn, managing director at Spark Commodities. Mendlessohn listed several reasons for what would have been an increase of around 29 %. “Strengthening cargo prices, an increasing arbitrage, no planned U.S. Gulf Coast cargo cancellations and a more bullish winter sentiment are driving charterers to secure LNG tonnage across both basins,” he said. “This is translating into significant increases in spot and front month freight rates in both the Atlantic and Pacific.” Asian spot LNG cargo prices rose to their highest since January on Friday on the back of firm demand from North Asian buyers ahead of a colder than expected winter, traders said. Monthly LNG shipments into North Asia are set to rise to their highest since January, primarily driven by a jump in demand from South Korea, shiptracking data from Refinitiv Eikon showed. There are also expected to be no cargo cancellations from the United States, after dozens of cancellations earlier this year, shipbrokers said. “Everyone’s holding on to their ships and are not sub-letting,” one of them said. LNG shipping rates are expected to improve further next year as demand recovers in the region once recovery from the coronavirus pandemic takes hold, said analysts from Jefferies Shipping Weekly. “We believe the LNG shipping market will improve in 2021 relative to a weak 2020 as global demand for LNG recovers post-COVID, especially in Northeast Asian markets,” they said in a note on Monday.
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Technological Development for Cleaner and Greener Environment Hydrogen & Bio-Methane
Freight company uses only biogas to make deliveries in Greater Helsinki
Savon Kuljetus Oy, a transport and infrastructure business, has ordered ten new natural gas delivery vehicles, and has committed to using only biomethane to fuel them.
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The new fleet will deliver parceled goods mostly in the Greater Helsinki Area but will also operate in Kotka, Lahti and Hämeenlinna. “We want to be a leader in the transition taking place in the logistics sector. We are ready now and in future both to invest in and commit to new low-emission motive power in line with the wishes of our customers,” said Kimmo Pekonen, Business Director at Savon Kuljetus. The company decided to invest in theese vehicles to serve its customers in the best possible way and to help them to reach their responsibility goals. Recent years have seen clear growth in the popularity of natural gas as a fuel in logistics and heavy-duty transport. For example, Valio and Lidl Finland nowadays use biomethane in part of their transports. Gasum is responding to demand growth by continuously developing their refueling station network. Use of biogas can reduce greenhouse gas emissions over the lifecycle of the fuel by up to 90% and is a cost-efficient way for a company to reduce its carbon footprint. “We’re happy to see how switching to biogas offers our customers new business opportunities. Savon Kuljetus is a good indication of how biogas is not just an investment in a vehicle but can also provide a company with an opportunity to grow. Each cleaner vehicle on the roads is a step towards reducing emissions and clean transport,” commented Juha-Matti Koskinen, Sales Manager, Traffic, Gasum.
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Toyota delivers a hydrogen-fueled popemobile to Pope Francis
Pope Francis has received as a gift from the Catholic Bishops’ Conference of Japan (CBCJ) a hydrogen-powered Toyota Mirai adapted for his mobility needs. The car is one of two
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Toyota Mirai vehicles specially made by Toyota and donated to the CBCJ on the papal visit to Japan in November last year. Present at the delivery ceremony near the Pope’s residence in the Vatican City, were Rev. Father Domenico Makoto Wada (representing the Catholic Bishops’ Conference of Japan) and His Excellency Seiji Okada (Ambassador of Japan to the Holy See). Representing Toyota was a delegation of six people led by Miguel Fonseca (Senior Vice President of Toyota Motor Europe) and Mauro Caruccio (CEO of Toyota Motor Italia).
The popemobile has a length of 5.1 meters and a height (including the roof) of 2.7 meters, allowing the Pope to stand and be visible to people. The Mirai (named after a word that in Japanese means ‘future’) is the ultimate zero-emissions car powered by a hydrogen fuel cell system, enabling a range of around 500km (approximately 300 miles) while emitting only water. Launched in 2014, it was also the first mass-produced hydrogen powered saloon. Pope Francis has a deep interest in global environmental matters, which he shared in his encyclical Laudato si’ in 2015. This is his appeal to safeguard the earth and all that surrounds us, changing our lifestyle to preserve our ‘common home’. The Toyota Mirai is well suited to his vision.
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UK trials first hydrogen-fueled train & announces unique transport hub
The first-ever hydrogen-powered train is running on the UK mainline in a big step forward towards the UK’s net-zero targets, Transport Secretary Grant Shapps announced when visiting the start of trials in Warwickshire.
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These trials of the train, known as HydroFLEX, which have been supported with a £750,000 grant from the Department for Transport (DfT), follow almost two years’ development work and more than £1 million of investment by both Porterbrook and the University of Birmingham. The ground-breaking technology behind the trains will also be available by 2023 to retrofit current in-service trains to hydrogen, helping decarbonize the rail network and make rail journeys greener and more efficient. The next stages of HydroFLEX are already well underway, with the University of Birmingham developing a hydrogen and battery-powered module that can be fitted underneath the train, which will allow more space for passengers in the train’s carriage. The Transport Secretary also announced the ambition for Tees Valley to become a trailblazing Hydrogen Transport Hub. Bringing together representatives from academia, industry and government to drive forward the UK’s plans to embrace the use of hydrogen as an alternative fuel could create hundreds of jobs and boost the local economy in the process, while seeing the region become a global leader in the green hydrogen sector. To kick-start this development in Tees Valley, the DfT have commissioned a masterplan to understand the feasibility of the hub and how it can accelerate the UK’s ambitions in hydrogen. The masterplan, expected to be published in January, will pave the way for exploring how hydrogen could power buses, heavy goods vehicles, rail, maritime and aviation transport across the UK. The aim would then be for the region to become a global leader in industrial research on the subject of hydrogen as a fuel, as well as research and development (R&D) hub for hydrogen transport more generally. Through a £23 million Hydrogen for Transport Program, the plans announced also include £6.3 million of funding for a green hydrogen refueling station and 19 hydrogen refuse vehicles in Glasgow, a world-first for the size of the fleet. This will give a post-COVID boost to local economies through the creation of green jobs while also decarbonizing the transport network. “As we continue on our road to a green recovery, we know that to really harness the power of transport to improve our country – and to set a global gold standard – we must truly embed change,” said Shapps. “That’s why I’m delighted that, through our plans to build back better, we’re embracing the power of hydrogen and the more sustainable, greener forms of transport it will bring.” The department is developing even more ways to slash emissions across transport, as work to create the transport decarbonization plan continues. The plan will develop a first-of-a-kind approach to decarbonize every mode of transport and is due to be published before the end of this year.
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New dairy biomethane project will power transport sector in Wisconsin
U.S. Gain announced the anaerobic digester at Deer Run Dairy is complete, transforming animal waste to clean, low carbon fuel for the transportation market. Renewable natural gas production offers
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Deer Run Dairy the opportunity to improve manure management practices from its herd of 1,700 milking cows. In 2021, U.S. Gain will expand the system’s capacity by installing a mixing tank that will enable other local farms to bring animal waste to Deer Run Dairy. “We’ve developed a great relationship with Deer Run Dairy over the years and are pleased to work with them on this opportunity, especially given the benefits their farm will receive,” said U.S. Gain Renewable Natural Gas Director of Business Development, Hardy Sawall. “This includes animal bedding and nutrient-rich fertilizer that can be either used by the farm as a cost savings measure or profitably sold.” “As caretakers of the land, we feel a strong obligation to continue looking at all aspects of our operations to determine what’s best, not only for our farm, but also for our community,” explained Deer Run Dairy owner Dale Bogart. “We couldn’t be more pleased in partnering with U.S. Gain, a like-minded company that sees the value in ensuring a brighter future for us all. When the capacity is increased next year, we encourage our neighbors to consider this waste management option.” Biomethane produced at Deer Run Dairy will be transported to a new decanting facility U.S. Gain constructed at Holsum Dairy located in Hilbert, Wisconsin, where it will be injected into the natural gas pipeline. Nacelle Solutions, a leading technology and service company specializing in gas conditioning and advancement of the energy and biogas industries, was a key partner to U.S. Gain in bringing this project online.
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Hyundai delivered first seven units of its XCIENT hydrogen heavy truck
Hyundai Motor has delivered the world’s first mass-produced hydrogen fuel cell heavy-duty truck to customers in Switzerland, with a total of 50 hitting the roads there this year.
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The delivery of XCIENT Fuel Cell marks the official entry of Hyundai’s commercial vehicles in the European market, a touchstone for the company’s expansion into the North American and Chinese commercial markets. Production capacity of the XCIENT Fuel Cell will reach 2,000 units per year by 2021 to support its expansion into Europe, the U.S. and China as demand for clean mobility grows. The increase in capacity will be backed by a USD 1.3 billion investment in addition to a previously announced USD 6.4 billion stake in establishing a hydrogen ecosystem to support creation of a hydrogen society. In the U.S., Hyundai is collaborating with logistics leaders to supply mass-produced fuel cell heavy-duty trucks. Hyundai revealed the fuel cell-powered HDC-6 NEPTUNE Concept Class 8 heavy-duty truck at the North American Commercial Vehicle (NACV) Show in October 2019, hinting at what the future holds and Hyundai’s plans for it. To back this plan, Hyundai is partnering with companies to build a complete hydrogen value chain covering everything from hydrogen production and charging stations to service and maintenance. The North American market will also get a 6×4 tractor model. By 2030, Hyundai expects more than 12,000 fuel cell trucks to hit the U.S. roads.
Hyundai also is working with various parties in China, which aims to get 1 million hydrogen vehicles on its roads by 2030 as the country’s hydrogen industry is on a sharp growth trend, creating massive potential. Three fuel cell trucks are scheduled for launch in China: a medium-duty truck in 2022, a heavy-duty truck in in a couple of years, and another heavy-duty truck strategically designed for the China market. With these models, Hyundai’s goal is to achieve aggregate sales volume of 27,000 units by 2030.
A key to Hyundai’s global expansion of fuel cell trucks will be the successful launch of XCIENT Fuel Cell in Europe. The seven customers who received the first batch of XCIENT Fuel Cell trucks will haul payloads of consumer goods around Switzerland, emitting nothing but clean water. The operations will be backed by a robust green hydrogen ecosystem. Hyundai will take the success in Switzerland to broader European markets as Hyundai establishes solutions and partner networks in Germany, Norway, the Netherlands and Austria. As part of its production expansion plan, Hyundai expects to supply 1,600 commercial fuel cell trucks by 2025. Currently, Coop, Migros, Traveco, Galliker Logistics, Camion Transport AG, F. Murpf AG and G. Leclerc Transport AG along with others have placed orders for XCIENT Fuel Cell. They will be utilizing the trucks to haul everything from food to cars around Europe.
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Major Parisian transit operator will pilot Solaris hydrogen-powered bus
For the next few weeks, the most innovative of the Solaris buses, the Urbino 12 hydrogen, will be tested on the streets of the south of Paris. Tests carried out together with Solaris will allow RATP Group
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(Régie Autonome des Transports Parisiens) to trial the technology and operational capabilities in regular passenger traffic. The vehicle will be stationed at a depot in the Thiais district, and will be refueled at the Jouy en Josas station in the south-west suburbs of the French capital. The Urbino 12 hydrogen bus is an extremely technologically advanced vehicle that uses a set of fuel cells with a power of 70 kW to generate energy. The hydrogen supplied to the fuel cells is converted into electricity, which, in turn, is feeding directly the bus driveline which consists of an axle with electric engines. The vehicle is also fitted with a Solaris High Power battery acting as an additional electric power storage facility. The hydrogen is stored on the roof in five tanks of the latest generation available on the market. The sole products of the chemical reaction occurring in the fuel cell are heat and steam. The bus does not generate any noxious substances whatsoever. The latest product of Solaris has met with huge interest among customers. Since its première in June last year Solaris has been awarded orders from the Netherlands, Germany and Italy for 57 buses in total. The first vehicles will make it to Bolzano, Cologne and Wuppertal by the end of this year.
RATP Group is the largest French city carrier serving millions of passengers daily in Paris and the entire Île-de-France region. Importantly, the operator has decided to completely transform its fleet of 4,700 buses to low-emission vehicles by 2025. So far, the company’s fleet includes 19 Solaris Urbino 18 CNG buses as well as three Solaris Urbino 8.9 LE electric buses.
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