maharatna

RINL’s navratna status extended by one year

November 27th, 2012

The Union Government extended ‘navaratna’ status to Rashtriya Ispat Nigam Ltd (Visakhapatnam Steel Plant) till November 2013. The government took into account the company’s performance, investment of huge amounts in expansion and plant modernisation and completion of all formalities for an IPO.

ONGC Videsh has recently acquired a share in Azeri, Chirag
and Guneshli (ACG) oil and gas fields. The ACG oil and gas fields are located in

Azerbaijan ACG, which is located in the South Caspian Sea about 95 km off the
coast of Azerbaijan, is the largest oil and gas field complex in Azerbaijan and is one
of the largest producing oil fields in the world.






ONGC inks MoU with US Oil Major ConocoPhillips for Shale resources
State-owned ONGC (Oil and Natural Gas Corporation) inked an MoU with the US oil major ConocoPhillips.
Objective: To conduct a joint study of shale gas potential in all domestic basins, as well as some global
ones owned by ConocoPhillips. The companies intend to initiate the cooperation
in shale gas exploration through joint studies of opportunities in India, North
America, and elsewhere.In addition, both companies also aim to explore possible
cooperation in deepwater areas in eastern offshore fields of India.
ConocoPhillips: A major player in shale gas as well as deep-water exploration. 3rd largest US integrated energy
company, based on market capitalization, as well as proven reserves and production of oil and natural gas, and the
largest refiner in the US. 7th largest holder of proven reserves and the 4th largest refiner worldwide, among private
companies.
What it means for INDIA?
Current Affairs Published on www.gktoday.in from January 1, 2012 to
September 10, 2012
 The MoU will increase the co-operation b/w the two companies in the areas of gas exploration in India, USA and
at other places in the world.
 The cooperation b/w the two majors is expected to accelerate the learnings in shale gas for India.
 It will assist towards India in achieving energy security for sustaining its booming economy.
 The US firm ConocoPhillips rich experience in the field of shale gas exploration and holds large acreage position,
while ONGC’s endeavour in shale gas is at a nascent stage.







GAIL, ONGC ink Swap agreement and Gas Co-operation agreement
GAIL and ONGC inked Swap Agreement and Gas Co-operation Agreement.
As per the Gas Co-operation Agreement:
 ONGC can sale and purchase the gas from GAIL for 3 years
 Both the companies can supply or sale LNG by GAIL to ONGC for the reduction of C2+ Extraction at Dahej.
 C2+ components will be supplied to ONGC Petro additions Limited (OPAL) for producing the petrochemicals
at Dahej Special Economic Zone.
As per the Swap Agreement:
 ONGC would supply gas to customers through GAIL’s infrastructure so as to boost the availability and the
efficient exploitation of resources.

CIL approved the Switching Over to Gross Caloric Value-based Pricing Mechanism

State-owned Coal India (CIL) announced on 2 January 2012 that its board approved in a meeting held on 30 December 2011 the switching over to internationally-accepted Gross Caloric Value-based pricing mechanism. The new system is based on the recommendations of the Integrated Energy Policy Committee and the Expert Committee on Road Map for coal sector reforms.

The board approved switching over of non-coking coal pricing from Useful Heat Value based grading system to Gross Caloric Value (GCV) based classification with effect from 1 January 2012. GCV measures the amount of heat released by carbon and hydrogen in coal when it is heated and is an internationally accepted pricing mechanism. the UHV mechanism was followed in India Howeverbecause of the high-ash content in Indian coal. The UHV took into account  the heat trapped in ash. In Indian coal, GCV is 25% higher than UHV.

The Coal Ministry mentioned that the pricing of coal on GCV-based mechanism was not likely to lead to any significant change in pricing.

The new system will incentivise improvement in quality, resulting in better quality of coal to consumers and commensurate revenue realisation for coal firms.

Impact
The revision of coal prices as per international norms is believed to raise input costs of power utilities for which consumers may have to pay more once the new price is passed on power tariff. state power utilities will be the worse affected. The state poer utilities will have to step down generation leading to blackouts.

Against the seven varieties of UHV coal that was available till 31 December 2011, from 1 January 2012 coal will be sold in 17 price brands ranging from the variety that produces 2200 kilo calorie to one that produces 7000 k cal. In between, there are 15 price bands, each at an incremental rise of 300 k cal.

Coal of B, G and F grades will not be affected as new prices will be either same or lower, those using However, power utilities that use different quantity of coal from across the grade spectrum, will be hit by the steep hike in A, D and E category coal.

Power utilities is to be be doubly affected as the monopoly has decided to levy 6% extra on coal from Eastern Coalfields Ltd (ECL) since it's a sick subsidiary listed with the Board for Industrial & Financial Restructuring (BIFR). ECL supplies coal to both CESC and WBPDCL.

Coal India however opined that coal priceeven after revision of prices would be still be 77% lower than the international prices for power, fertilizer and defence and 25% for others.