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Modi on the go-I: All coal blocks to be allowed CBM rights

Sept 2: The Modi government is planning to allow all coal blocks to automatically mine for Cold Bed Methane (CBM) as well.
 
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This proposal is not new but the Congress led cabinet had restricted the automatic route to CBM mining only to blocks operated by Coal India Ltd.
 
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The new government now wants to extend this provision to all coal blocks, be in the public or the private sector. The proposal will require a ratification from the cabinet
 
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The only condition that has to be met is that in case of simultaneous mining of coal and CBM, the original production plan of coal and the timing for such production must be adhered to.
 
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In another big concession, the price of CBM gas will not be capped like is the case with conventional natural gas. Instead the CBM will be allowed to be sold in arms length transactions at market prices but with the caveat that the minimum price at which royalty and Production Level Payments are to be paid is at the level at which the price of conventional gas is fixed.
 
8An Empowered Committee under the petroleum minister will be given the rights to sort out contractual issues and grant concessions in current CBM-only blocks.
  Details

Modi on the go-II: CBM rights to be terminated in case overlapping problems cannot be resolved

Sept 2: The new policy gives the advantage to the coal mining license holder over the CBM operator in case of overlap of a coal mining area with that of CBM.
 
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Where CBM blocks have been allocated, the coal ministry must stay away from allocating an overlapping coal block wherever possible.
 
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In case of partial overlap, an attempt will be made to resolve the problem through meetings involving the ministry of coal and the petroleum ministry
 
8In cases where co-development is not possible for safety reasons, and a considerable amount of money has already been spent by the CBM operator, then the CBM license will be terminated. 8
In such an instance, the CBM operator should be compensated in accordance with valuations done by an independent third party and his assets should be taken over by the coal mining licencee.
 
8But the coal mining operator must ensure that he continues to produce coal in accordance with the targets and timelines set for the coal block.
 
  Details

Modi on the go-III: Cash penalites only for delay in CBM operations

Sept 2: A coal mine license holder will be allowed to get into CBM production on a set of given terms and conditions.
 
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Royalty has the be paid at the rate of 10% and Production Level Payments too, both on a monthly level.
 
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The PLP formula will be Z= X+{Y-X)x(b-0.5)/1.5}, where X is 2.5% of CBM production up to 0.5 mmscmd and Y is 10% of production at 2 mmscmd and above. But between 0.5 to 2 mmscmd , which is dubbed as 'b', the above formula will apply. CBM production is the average monthly rate of production.
 
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A one time commercial bonus at $0.3 million has to be paid
 
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Exemption from payment of customs duty on equipment imports will be provided.
 
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A field development plan has to be submitted within 24 months of grant of CBM mining lease but is extendable by 12 months on a case by case basis
 
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A delay beyond 36 months in submission of FDP will invite a penalty of Rs one lakh per month. For delay in production too beyond the date given in the FDP will attract a similar penalty
 
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The contractor will be allowed to hive off equity but only to companies with experience in CBM mining but majority stake will always remain with the original contractor
 
8CBM must be extracted before or simultaneously with coal mining operations
  Details

ONGC's exploratory efforts-I: Deepwater foray does not pay off, only KG basin holds out hope

Sept 2: Oil exploration, specially in deepwater areas, is a risky business. While some get lucky and strike it rich, others do not. ONGC, for example, has not been lucky.
8After exploring deepwater blocks across the Indian coastline, the public sector E&P< major has veered around the view that only its KG basin assets hold out promise of commercial exploitation.
A total number of 27 blocks -- situated in Western Offshore (Mumbai, Gujarat Saurashtra, Kerala-Konkan), Cauvery, KG, Mahanadi and Andaman basins -- have already been relinquished by ONGC.
8Eventually, the company`s focus shifted to the KG deepwater NELP block KG-DWN-98/2, adjacent to RIL`s D-6 block, where nine discoveries were made. Besides these, intensive efforts have led to discoveries such as G-1, G-2, G-4, Vashishta, S-1, G-4-6 in the KG nomination acreages.
8Though two more discoveries have been made in the deepwater blocks, AN-DWN-2002/1 and KG-DWN-2005/1, their potential commercial interest has not yet been established.
8In other words, despite adequate probing, ONGC`s success in deepwater areas has been confined to the KG Basin only.
Click on Details for more
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ONGC's exploratory efforts-II: The potential may lie in unconventional plays

Sept 2:  With its deepwater foray in trouble, ONGC sees hope in unconventional plays to extract oil and gas in commercial quantities.
 
8HP-HT and tight reservoirs
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ONGC has successfully established large volumes of in-place hydrocarbons in high-pressure and high-temperature (HP-HT) plays.
 --Several high potential fields have been discovered recently, namely Malleswaram, Bantumilli South, G-4-6, YS-5 in the KG basin and Periyakudi in the Cauvery Basin.
 --US-based Blade Energy has been engaged as consultant for the HP-HT fields in KG and Cauvery basins for their early monetization.
 
8Basement plays
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The prospectivity of unconventional Basement reservoirs in another area that ONGC is eying in several Indian basins, including Western Offshore, Assam Shelf and Cauvery Basins.
 --ONGC is currently focusing on unlocking these plays. The recent successes at Madanam and Pandanallur in the Cauvery basin have reinforced the confidence in the play.
 --The University of New South Wales (UNSW), Australia, which has been engaged as expert agency, has brought out areas of perceived prospectivity of Basement plays in the Heera field.
 --More work is being concentrated in this direction now.
 
8New oil and gas from Category-III and IV basins
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Out of the total of 26 sedimentary basins of India, 15 onland basins are in Category-III and IV basins which constitute frontier areas. Most of these basins, as they are located in logistically difficult terrain and environment with inherent geological complexities, have not been explored fully compared to Category-I and II basins.
 --As on April 1, 2014, ONGC has drilled a total of 54 exploratory wells in frontier basins, covering J&K, Himachal Pradesh, Haryana, Punjab, Madhya Pradesh, Chhatishgarh, Uttar Pradesh, Bihar and Uttarakhand. Besides, ONGC is also holding two NELP-VI blocks in the Vindhyan basin, covering the south-eastern part of Rajasthan.
 --Sustained and focused exploratory efforts by ONGC have led to recent discovery of gas in the Nohta-Damoh sector of Vindhyan Basin. Further exploratory drilling is in progress in the area to establish the extent of the gas bearing zones.
 --The possibility of wild card discoveries with a large upside is not ruled out from these areas.
 Click on Details for more
  Details

ONGC's exploratory efforts-III: New survey technology brings more oil and gas from new plays in producing assets

Sept 2:  Despite the shortcomings, ONGC has been successful in bringing more oil and gas from new plays in producing assets with the help of new survey technologies.
 
8Better surface surveys, coupled with subsurface quality seismic imaging solutions, has helped ONGC in the delineation and probing of the deeper, bypassed and complex reservoirs which were up till now considered untenable and unviable, both technically and economically.
 
8Some recent discoveries made include, Chandrika South, Alankari and Saveri in the block KG-GSN-2004/1, Madnam-3 in CY-ONN-2002/2, Pandanallur in CY-ONN-2004/2, Khubal in AA-ONN-2001/1, Hortoki in AA-ONN-2001/2, West Patan-3 in CB-ONN-2002/1, Karannagar in CB-ONN-2004/1, Vadatal in CB-ONN-2004/2, Aliabet in CB-OSN-2003/1, Uber in CB-ONN-2004/3, two gas discoveries in MB-OSN-2005/1 and one discovery in GS-OSN-2004/1.
 
8Though the field sizes of new discoveries in conventional plays are not significantly large, the efforts have resulted in new prospects and new pool discoveries. Since these discoveries and wells are located in the vicinity of producing fields, it would enable early monetization, thereby compensating decline from the aging fields.
 
8To bring more oil and gas, accelerated efforts are underway to tap the potential in established fields in the producing basins by targeting the deeper subtle plays. ONGC has also envisaged long offset seismic surveys to map the deeper horizons so that the subtle plays, which hold significant promise, are deciphered easily.
 
8This will then be supplemented by acquiring high-resolution carpet 3D data covering the entire acreages in all the basins available with ONGC, coupled with worldwide contemporary interpretation techniques for identifying new plays, concepts and models.
 Click on Details for more
  Details

ONGC's exploratory efforts-IV: 3,590 MMTOE of in-place reserves estimated in six high-potential plays

Sept 2: Keeping in mind the company's long-term plans, ONGC has identified six high-potential plays from which a total of 3,590 MMTOE of in-place reserves and 400 MMTOE of cumulative production is envisaged through domestic exploration (YTF) efforts by 2030. The six high-potential plays that have been identified are:
 
8CBM
 --The pace of CBM exploration has been severely affected due to land acquisition problems. Another major setback has been the overlapping of CBM exploration blocks with that of coal mining blocks. In order to push up CBM production, ONGC is on the look out for experienced partners who are willing to farm-in in four of its blocks.
 
8Shale gas
 --As per the recent shale gas policy announced by the government, ONGC has envisaged drilling of 20 wells during 2014-15, of which, 10 will be exclusive shale gas wells. In  the other 10 wells, both shale gas and oil specific studies would be carried out. In 2015-16, another ten exclusive shale gas wells have been planned.
 
8Deepwater areas in KG basin
 --Keeping in mind the fact that substantial exploratory inputs have been expended under NELP in all the basins without much success, the E&P major has decided to revisit its deepwater exploration programme with special focus on KG deepwater areas.
 
8Conventional plays in onland and shallow water areas
 --ONGC will further explore conventional plays in onland and shallow water areas with the help of new technology.
 
8HP-HT plays, especially in KG and Cauvery basins
 --ONGC has successfully established large volumes of in-place hydrocarbons (approximately 200 MMTOE) in high-pressure and high-temperature (HP-HT) plays mainly in KG and Cauvery basins. While the Mallewaram field has already been put on production in the KG basin, further exploration and appraisal is in progress in other fields.
 
8Basement plays, especially in Western Offshore
 --ONGC is currently focusing on unlocking the potential of Basement plays in Western Offshore, Assam Shelf and Cauvery basins.
 
Click on Details for more
  Details

ONGC's exploratory efforts-V: Details of new technology used

Sept 2: ONGC knows that technology will play a critical role if its wants to meet its target of unlocking 400 MMTOE of production from domestic exploration efforts. In the last three years, ONGC had inducted a total of 57 technologies to boost production. Some of the impact-making technologies inducted are:
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API of exploration data
 
--Installation of Differential Global Positioning Systems (DGPS), hiring of Q-Marine vessels, sea bed logging, acquisition of long-offset 2D data, acquisition of Seabed Node (SBN), Over-under DISCOver technology, carrying out of 3D-3C multi-component seismic and 4C-3D OBN surveys, interpretation of data through Kingdom Software, application of CGG Geo-cluster and WGC Omega software, 3D beam processing, Common Reflection Angle Migration (CRAM), application of Thrustline (GEOTOMO) software, Passive Seismic Tomography, setting up of 3D Virtual Reality Centers and digital multilevel Vertical Seismic Profiling (VSP).
8Surface prospecting techniques
 
--Carrying out of air borne electromagnetic surveys, use of Multi Transient Electro Magnetic (MTEM) and low-frequency passive seismic Direct Hydrocarbon Indication (DHI) technique, along with geovision technology.
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Petrophysical data
 
--Use of log data processing software, logging-while-drilling (LWD) and geo-steering with laterolog tool, use of dielectric scanners and basin modeling through "PetroMod" and "Move" software.
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Geochemical & Reservoir
 
--Microbial process for Enhanced Oil Recovery (MEOR) from heavy oil reservoirs, carrying out of helium surveys, uses of spectrophotometers (Lambada-35 and Thermo Fisher Nicolet iS5) and HPHT-Multi cycle DST tools
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Drilling
 
--Use of Stethoscope and Periscope technology, air hammer drilling, turbo drilling and use of cesium formate drilling fluid.
 Click on Details for more
  Details

ONGC's exploratory efforts-VI: Details of services hired from international experts

Sept 2: ONGC also utilized services of the following international experts for better understanding of its reservoirs and risk mitigation:
 
8Reservoir characterization in the western and KG offshore by Fugro Jason
 
8Structural modeling in the Himalayan fold thrust belt (Tripura-Cachar area) by Midland Valley
 
8Prospect de-risking analysis by Western Geco
 
8Advanced reservoir characterization by Pangea Inc.
 
8Seismic-guided drilling in Andaman deepwaters and KG offshore by Western Geco
 
8J.V.C.Howes, for evaluation of the KG-DWN-98/4 block
 
83D seismic data interpretation by Landmark Graphics (Malaysia)
 
8Special processing in KG Offshore by GXT Technology EAME Ltd.
 
8Reinterpretation of entire KG-DWN-98/5 deepwater data by RPS Energy
 
8Advanced reservoir characterization through stimulation studies by Schlumberger Asia Services Ltd.
 
8Reservoir characterization in KG-DWN-98/2, Godavari and GS-29 PML areas by Pangea Inc
 
8Reservoir characterization in KG onland by Paradigm Geophysical India
 
8Evaluation of shale gas potential by Conoco-Philips and Exxon-Mobil
 
8Evaluation of deepwater areas by Statoil, Petrobras, Impex and British Gas
 
8Fold Belt imaging for stimulation of heavy oil production by EcoPetrol
 
8Acoustic impedance modeling of deepwater sand variations by Hampson-Russel
 
8Interpretation of deep water seismic data by Paradigm Geophysical India
 Click on Details for more
  Details

H-Energy's FRSU in East Coast-I: Company seeks customs duty exemption on R-LNG exports to Bangladesh and Nepal

Sept 2: In line with the duty exemption granted on re-gasified LNG (liquefied natural gas) for supply to Pakistan, Hiranandani Group's energy arm, H-Energy, which is planning to set up an LNG terminal at Digha on the east coast in West Bengal, has sought a similar exemption for R-LNG exports to Bangladesh and Nepal.
 8The request was made recently through a presentation made by H-Energy before the petroleum minister Dharmendra Pradhan
 8H-Enery plans to export gas to Bangladesh and Nepal from its proposed 4 MMTPA Floating Storage and Regasification Unit (FSRU) in the offshore Digha region of West Bengal. The FSRU will be set up by a subsidiary of H-Energy called H-Energy East Coast Pvt Ltd (HEECPL) and is expected to be operational by end of 2017.
 
8H-energy, through its Digha LNG plant, mainly intends to supply natural gas to the eastern states of West Bengal, Jharkhand and Bihar and some northern states through the proposed Jagdishpur-Haldia pipeline (JHPL) of GAIL.
 
8Noting that the LNG terminal is not very far from the Bangladesh border, H-Energy has contended that it would be feasible to extend the Haldia-Jagdishpur pipeline of GAIL upto Petrapol in Bangladesh. Petrapol is barely 46 kms away from the gas grid of Bangladesh passing through Jessore, thereby making it possible for Bangladesh to offtake gas from this entry point.
 
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Conceptually, this would enable Petrobangla -- the national oil company of Bangladesh -- to import LNG from a source of its choice at a competitive price and have it re-gasified in the facility planned by HEECPL in the Bay of Bengal. Thereafter, the delivery of the gas can be taken by Bangladesh at the Petrapol border.
 Click here to access the presentation
  Details

H-Energy's FRSU in East Coast-II: Puts forward a wish list

Sept 2:  Besides seeking duty exemption on R-LNG exports to Bangladesh and Nepal, H-Energy has also sought the petroleum ministry's support on the following:
 
8Putting in place a robust gas swapping regulation for better flexibility and market accessibility to gas consumers
 8Simplification of taxes pertaining to transit and swapping of natural gas
 8Implementation of latest PNGRB guidelines on tie-ins of pipelines
 8Encourage development of intra-state gas grids on the lines of Gujarat
 8Extension of gas grid to the North-East
 8Development of CGD networks in new cities
 8Granting of infrastructure status to LNG terminals and gas pipelines in India, at par with port projects to accelerate growth of gas markets
 8Firm off-take agreements, prior to commissioning of a project, should not be mandatory for project financing by banks
 8Declared goods status to natural gas
 8Exemptions under 80 IA to be extended to LNG infrastructure projects
 8Robust policy for LNG based peak power, coupled with penalty for load shedding
 8Minimum obligation on discoms to purchase gas-based power
 Click here to access the presentation
  Details

Talks to get foreign NOCs to fill up Vizag crude cavern yet to take off: ISPRL seeks 4948 crore from exchequer

Sept 2: India's effort to rope in a foreign National Oil Company (NOC) to fill up the crude caverns being constructed by the Indian Strategic Petroleum Reserves Ltd (ISPRL) does not seem to have made much headway as is evident from the petroleum's ministry proposal for allocation of Rs.4948 crore for crude purchase for the Vizag facility from the exchequer in 2014-15. 
8ISPRL is building a storage capacity of 1.33 MMT at Visakhapatnam, 1.5 MMT at Mangalore and 2.5 MMT at Padur in Udupi. These storages are being creating India's largest underground cavities. involving approximately 30 kilometres of tunneling.
8ISPRL had gone on an international road show to explore the possibility of roping in foreign partners to invest in the facilities. Although, a few foreign companies, including Abu Dhabi National Oil Company (ADNOC), have shown interest, and talks are on, nothing concrete is expected to come up anytime soon.
8In this context, given the fact that the Vizag cavern is going to come on stream in the last quarter of 2014-15, the only way out to ensure that it doesn't stay empty is for the government to fund the initial tranche of crude.
8Since part of the filling can be done in the last quarter, funds are required preferably in the third quarter of 2014-15.
8Notably, the cavern has two compartments, withe one of the compartments of 0.3 MMT was approved for use by HPCL for storage of crude on proportional cost sharing basis.
8ISPRL is also exploring the option of crude oil procurement assistance from HPCL,as it has the experience of procuring crude regularly for its refinery.
8Meanwhile, the amounts required to fill up the remaining 1.03 MMT in ISPRL's compartment, in each quarter starting from Q4 2014-15, at crude price of $103.27/bbl and exchange rate of Rs.61.34/$ are estimated to be:
 --Q4 2014-15: Rs.1,291 crore for 0.2704 MMT
 --Q1 2015-16: Rs.2,582 crore for 0.543 MMT
 --Q2 2015-16: Rs.1,075 crore for 0.22 MMT
8Further, the maintenance cost of the crude and the cavern storage are estimated to be about Rs.47 crore per annum.
  Details

Crude procurement plans for 2014-15-I: 100 MMT to be imported, of which 81% will be term imports

Sept 2: In a recent presentation made to xxx, the petroleum ministry shared the latest crude procurement plans of oil PSUs for 2014-15, wherein the imports for the year are estimated to be 99.60 MMT, of which 80% will be through term imports.
8Total procurement for the year is estimated at 125.12 MMT, of which indigenous crude is estimated at 25.52 MMT, term imports at 80.51 MMT and spot imports at 19.09 MMT.
Details of procurement estimates, companywise, are as follows:
8Indigenous crude: IOCL 14.10 MMT, BPCL 5.29 MMT, HPCL 4.47 MMT, MRPL 1.66 MMT, Total 25.52 MMT
8Term imports: IOCL 44.40 MMT, BPCL 13.48 MMT, HPCL 10.90 MMT, MRPL 11.73 MMT, Total 80.51 MMT
8Spot imports: IOCL 10.30 MMT, BPCL 3.98 MMT, HPCL 3.00 MMT, MRPL 1.81 MMT, Total 19.09 MMT
8Total crude procurement: IOCL 68.80 MMT, BPCL 22.75 MMT, HPCL 18.37 MMT, MRPL 15.20 MMT, Total 125.12 MMT.
  Details

Crude procurement plans for 2014-15-II: Import details

Sept 2: The website carries here for reference purposes, details of how the 80.51 TMT term imports estimated to be made by various oil PSUs during 2014-15 are divided, under the following heads:
8Companywise (IOCL, BPCL, HPCL and MRPL) term imports from the middle east countries including Iraq, Saudi Arabia, Kuwait, UAE, Iran, Qatar, Dubai
8Companywise term imports from north and west Africa, including Nigeria and Angola
8Companywise term imports for 2014-15 for IOCL, BPCL, HPCL and MRPL from other oil producing countries like Malaysia, Azerbaijan, Brunei, Mexico and others
8Details include proposed term contracts with NOCs of Colombia, Venezuela, Brazil, Algeria as well as with MNCs for supply of Malaysian / Brunei crude, which are shown separately.
8Details also include some of the optional contracts for additional quantity from some of HPCL's suppliers, which are shown separately.
8Details also include ONGC's overseas equity crude like Azeri (Azerbaijan), Nile (Sudan), Sokol (Russia), subject to requirement and economic feasibility, which are shown separately.
  Details

IOTL gains from stringent safety norms for terminals-I: Captures most resitement projects

Sept 2: Infrastructure and Energy Services Limited (IOTL), a 50:50 JV of IOC and Oil Tanking Germany, seems to be a beneficiary of the stringent safety norms for terminals enforced by the likes of OISD, wherein companies like HPCL, BPCL and IOCL have failed comply with such norms in existing terminals, forcing them to recite their facilities elsewhere.
8IOTL seems to be capturing most of the resitement projects that are in the pipeline using innovative business models.
8The reason IOTL has been capturing most resitement projects is that no one has the kind of experience it has in India. What is more public sector companies don't have to go through a competitive process to award contracts and IOTL has been able to win most of them on a nomination basis.
In the process, IOTL has picked up a lot of experience.
8IOTL is known to be the only company with integrated experience from conceptualization, design, engineering, construction, commissioning and operation of POL terminal in India
8IOTL has already developed 14 Lakh KI of tankage on BOOT basis at a cost of Rs.2976 crores at Paradeep for IOC.
8The company has also developed a tank farm and storage facilities for IOC Vadodara,as also for Oil India Assam, Bangalore International Airport and CPCL.
8Further, the company is successfully operating 5 terminals of HPCL on the Mundra-Delhi product pipeline as well as operating independent terminals on  its own at Navghar and Goa.
8Also, IOC and BPC have engaged IOTL for developing a new terminal at Raipur and HPCL and BPCL have engaged the company to acquire land at Tatanagar for POL facilities.
  Details

IOTL gains from stringent environment norms for terminals-II: IOC & HPCL to set up joint terminal at Borkhedi

Sept 2: IOTL has been selected by both IOCL and HPCL to set up a common terminal at Borkhedi after safety norms dictated the closure of HPCL's terminal at Khapri.
8IOC already had a terminal at Borkhedi but with some spare land and agreed to a new terminal to be jointly promoted with HPCL in the same area.
8The point to note here is that IOTL will also help acquire the extra land that will be required to put up the terminal.
8IOTL in turn will enter into a BOT or BOOT agreement with both IOCL and HPCL for building and operating the terimnal.
8This is the standard model that IOTL seems top be following these days in league with public sector oil marketing companies. 
The following business model is to be followed:
Capex recovery
8The model will be either BOOT or BOO, which is to be jointly discussed and agreed with IOC & IOTL.
8Capex recovery to be based on agreed post tax rate of return as recommended by financial consultants.
8Term for the investment recovery will be 25 years from the date of starting commercial operations.
8Residual value after 25 Years will be considered as 15% of the Capex.
8The share out of Capex will be in proportion to the respective companies projected thruput in 2020-21.
The following methodology will be utilized to detemine the capex:
8IOC & HPC jointly advise facility requirement to IOTL
8Basic Engineering will be carried out by IOT
8Detailed BOQs (Bill of Quantities) & rates will be prepared by IOTL along with following overhead expenditure:
--Detailed Engineering charges
--Project & Construction Management charges
--Site Management charges
-Commissioning charges
8Both IOCL and HPCL to joint negotiate the capex with IOTL
8This Capex recovery charges to be paid monthly for 25 years irrespective of thruput.
  Details

IOTL gains from stringent environment norms for terminals-III: Details of charges

Sept 2: IOTL's BOOT or BOT model for Borkhedi have the following opex and variable charges:
Operating Expenditure (OPEX):
These charges will be structured under following heads:
Fixed charges: This component is towards the recovery of operational expenses of terminal facilities & is payable as a Lumpsum amount.
8Operations: This will broadly cover cost towards fixed manpower, Fixed energy / utility cost such as water air etc., statutory compliance cost, Health, Safety, Environment & Security.
Manpower will be provided in line with similar thruput terminals being operated by IOC/HPC. However the variable cost for handling receipt & despatch is not covered under this head.
8Repair & Maintenance charges (RMC): A detailed working to be carried by IOT equipment wise R&M charges for 25 years. This offer will be reviewed by HPC/ IOC for finalising the R&M charges. However the indicative cost payable progressively as per the age of equipment as a percentage of Capex as below:
--1-3 years in the order of 0.3 %,
--4-10 years in the order of 0.8 %
--11 to 25 years in the order of 1.6%.
Variable charges:
8TT/ TW Operations: Tank truck loading / unloading charges and Tank wagon unloading charges will be worked out basis the Contract labour cost and electricity charges incurred for handling per KL of product. These charges will be comparable to similar thruput terminals of the industry
8Extended working hour charges for TT loading operations: The tank truck operation beyond two shifts on working days and working on Sundays/ National Holidays, will be paid extra basis the additional manpower cost incurred by IOT. However the tank wagon unloading operation is considered to be round the clock operations (24X7) on all days and no extra charges are payable for TW unloading operations.
All the above said OPEX charges are subject to annual escalation / de-escalation linked to applicable Consumer Price Index(CPI) declared by RBI. The applicable CPI will be advised by the Financial Consultant. In case of Raipur, CPI (Urban) has been agreed upon between IOC/BPC with IOT.
8OPEX reimbursement formula will be finalized in consultation with established Financial Institution like SBI Capital Markets etc. However these charges will be jointly negotiated and mutually agreed by HPC / IOC.
  Details

Price of Jet/Kero and Naphtha for August (up to August 25, 2014): Details

Sept 2: From the price data available for the month of August, 2014, until August 25, 2014  jet / kero as well as naphtha have all gone down as compared to the average price for the previous month (July, 2014).
The details are:
8Jet/Kero: The average price of jet/kero in the Arab Gulf market for August (up to August 25, 2014) declined to $113.96 per barrel, which was lower than the average prices registered in the previous month (July, 2014) at $116.37 per barrel. The average price of jet/kero in the Singapore market for August, 2014 also went down marginally to $116.80 per barrel, which was lower than the average prices registered in the previous month at $118.79 per barrel.
8Naphtha: The average naphtha prices in the Arab Gulf and Singapore markets for August, 2014 (up to August 25, 2014) fell steeply to $96.29/bbl and $98.95/bbl respectively, which were much lower than the average prices witnessed in the previous month (July, 2014) at $103.28 per barrel for Arab Gulf and $106.34 per barrel for Singapore market.
The website carries here detailed information on the price variations of Dubai, Oman, Brent (dated) and WTI grades of crude for August, 2014, until August 25, 2014, as well as the corresponding figures from earlier periods for perusal of our readers. Similar data is also carried for products like naphtha, jet/kero, gas oil, HSFO 180 CST and MS unleaded (92 RON).
  Details

Tender Briefs

Sept 2:  8ONGC floats tender for sale of gas: ONGC has floated a tender for sale of gas from its east Rangapuram field in the Rajahmundry asset.
 --The approximate quantity that has been offered for sale is 20,000 SCMD.
 --Tender documents can be purchased before September 22, 2014 (upto 11:55 hrs).
 --A pre-bid meeting will be held on October 7, 2014 (at 11:00 hrs).
 --The tender closing date is November 4, 2014 (upto 14:00 hrs).
 --Click here for more information
 
8More tenders: Some more tenders floated by oil and gas companies are:
 --Hiring of coring services, Mumbai [ONGC] Details
 --Supply of drill collars and lifting plugs, Duliajan [OIL] Details
 --Supply of complete heat exchanger, Pata [GAIL] Details
 --Procurement of storage tanks for storing crude and HSD, Rajahmundry [ONGC] Details
  Details

Modi at work-I: Sets the ball rolling in the petroleum sector

Sept 1:  Narendra Modi clearly has his own unique style of functioning like no other Prime Minister in the past.
 
8It is clearly a one-man show, as he alone seems to to be taking the decisions in conjunction with the secretary of the relevant ministry, with the cabinet secretariat and the PMO working as monitoring and coordinating authorities. 
 8Modi is the CEO, the administrative minister, the departmental head, and the secretary is the points man.
 
8Decisions are translated into real targets as was evident from the excel sheet that came out recently from one of Modi`s meetings on the infrastructure sector.
 
8On the petroleum sector, Modi, perhaps goaded by petroleum minister Dharmendra Pradhan, was the one who ordered the revival of the long defunct Jagdishpur-Haldia Pipeline (JHPL).
 8The Prime Minister`s orders were simple: the fertilizer projects at Gorakhpur, Barauni, Sindri and Haldia have to be revived. 
 8If required, Modi has expressed his willingness to provide a viability gap funding (VGF) of upto 20% to facilitate the completion of the pipeline.
 
8Then again, the government has also decided to consider gas pooling for resolving the problem of gas shortage for power plants.
The Prime Minister is keen that stranded gas based capacity should somehow be restarted so that more power can flow into the grid.
Comment: It looks like the Prime Minister will single handedly move the agenda in the petroleum sector. The first set of goals have already been fixed. More action is likely in subsequent meetings.
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